City seeks to outsource minority certification process

The city's troubled process of determining which businesses are eligible to compete for contracts steered to minority -owned businesses should be outsourced,  Mayor Richard M. Daley said today.

Daley said he believes the process would be faster and more efficient in other hands.

The measure was among a handful of proposals offered by the 21st Century Commission, a group assembled by the mayor last fall to find ways to reduce spending and better manage government services.

Daley did not specify how the outsourcing of minority-owned business certification would save money, but described the city's process as "cumbersome."

"We should not be in this business, it's as simple as that," Daley said. Daley, however, said even outsourcing would not be fool-proof.

"Will there be fronts?" he said. "Yes. There'll always be some way somebody can get around the system."

The Minority and Women-Owned Business Procurement Program (M/WBE), which is managed by the city's procurement department, will begin relying on other organizations, such as the National Minority Supplier Development Council and the U.S. Small Business Administration.

Eventually, Daley says, he would like the city to rely on a more universal process of determining whether a business meets the criteria of at least 51 percent control by a minority or woman.

The city's minority certification process has been plagued by instances of white-owned businesses winning city contracts using minority fronts. 

More recently, aldermen have criticized the slow pace of certification for minority businesses.

Last October, aldermen proposed privatizing the certification process after it was revealed that only 8 percent of city-awarded contracts went to African Americans in 2007.

The city's new procurement chief, Montel Gayles, was charged with streamlining the process when he was appointed by Daley in January.

Ald. Isaac (Ike) Carothers (D-29), who's been critical of the city's minority hiring record, says he has some concerns about the change.

"I know that initially the city was hailing this program because of alleged fraud and front companies," says Carothers. "Now we're saying we're going to take the certification to other people. But what if these companies aren't legitimate? Who's going to be monitoring that? Who has the ultimate liability here?"

The mayor also announced today that the city would move toward allowing some building owners to self-certify in a bid to make its building inspections process less expensive and more efficient.

The program would enable building owners who have already passed a complete city inspection to conduct their own subsequent inspections using licensed architects and engineers and submit their documents for the city's review.

This will free city building inspectors to investigate specific complaints and to focus on older and higher-risk buildings, Daley says.

Other moves intended to cut costs and improve services include merging the plan to end homelessness, the office of domestic violence, veterans' assistance and prisoner re-entry programs into the Department of Human Services.

Other recommendations included posting key performance indicator for city services online and the development of programs to reward city employees for innovative thinking.

Jay Stewart, executive director of the Better Government Association, a watchdog group that monitors corruption and waste in city government, says he sees little substance in the commission's recommendations.

"It seems to me that the city's losing sight of the forest for the trees here," says Stewart. "The mayor doesn't seem to be grasping the enormity of the pernicious influence of corruption going on at all levels of government, including the highest."

The root cause of inefficiency in Chicago government is the politics involved in hiring and contracts, says Stewart.

"Get rid of the hired-truck type program; root out that type of corruption," says Stewart. "Get rid of the hiring of hacks ...then you've got the money to hire city building inspectors to do the job they need to do."