By Albert Samaha
By Steve Weinstein
By Devon Maloney
By Tessa Stuart
By Alison Flowers
By Albert Samaha
By Jesse Jarnow
By Eric Tsetsi
The new law gives SBS numerous enforcement powers to compel other agencies to increase minority contracting, but SBS hasn't taken advantage of them. However, the agency doesn't blame the lack of a disparity study for that reluctance. If it needed to, SBS says, it could defend a crackdown on the basis of the council's disparity findings. But those are the same findings that Walsh, the head of SBS, has publicly criticized— and any company that's denied a city contract in favor of a minority contractor will no doubt zero in on that contradiction in litigation. So whom is SBS trying to kid?
Sanders, who negotiated the bill with several offices of Bloomberg's administration, insists that Walsh "had trouble" with the new law "before he even saw it" and "was pushed into this by the administration." He contends that the failure of SBS "to enforce the rule of law and economic justice as far as MWBEs are concerned is at best a dereliction of duty, and at worst a failure of character." James is kinder to Walsh, saying only that "there was a period where SBS had to ramp up, and I don't know if they are there yet completely, and we've given them some leeway to come into compliance with this law." Both are dismayed by the administration's handling of the new disparity study, with James noting that it was "the administration that decided it was necessary," adding that the failure to produce a "timely" second one "is a concern."
But the Bloomberg administration hasn't only failed at the tough question of enforcement; even its simple promotional efforts have flopped. James has been doing a five-borough tour with SBS to try to get minority contractors and procurement officers from city agencies together for the last six months, but she says that seven or eight of the biggest contracting agencies have never attended, forcing her to complain to City Hall. The program has had two directors since 2005—the first was allowed to run it from Westchester while on partial leave for seven months, and the second has no background in minority contracting.
Research Assistants: Samuel Breidbart, Sarah Lavery, Shaunna Murphy, Shea O'Rourke, and John Wilwol
In fact, Walsh has been so disinterested in the program that when Public Advocate Betsy Gotbaum produced a damaging 26-page report on "Problems with the City's MWBE Program" last July, he didn't even bother to respond. The report concluded that SBS was "not effective in certifying MWBEs or helping them gain more opportunities to compete for city contracts," noting that it was "nowhere close" to the goals set forth in the council's law. Walsh did refer to the report in his August 9, 2007, memo to the mayor, branding it "distorted" and claiming that he'd "drafted a point by point rebuttal." But he didn't send a response for nine months. When the Voice began inquiring about it and Gotbaum personally wrote a follow-up letter, Walsh finally answered her, citing several agency actions that, as Susie Han, the author of the Public Advocate's study, put it, "were already done" before the study was released. Reminded that he'd told the mayor that he'd drafted a "point by point rebuttal" of the study months earlier, Walsh sheepishly conceded, "Apparently I did," referring to the memo to the mayor, and "I guess I did not," on the question of whether he ever did send that rebuttal.
Though Walsh has struck out on these minority-contracting initiatives, he loves to pitch SBS's business-service programs—even if they appear to fly in the face of Bloomberg's repeated boasts that he has "essentially ended corporate welfare as we know it." Having branded the tax incentives long offered to city businesses as "bribes," Bloomberg claimed twice in his campaign accountability report for the 2001 mayoral race that, as mayor, he'd instituted policies to put the squeeze on corporate giveaways.
Yet SBS has awarded nearly $5 million in "Business Solutions Training Funds" since 2005—giving, for example, Tiffany's $9,350 to educate 10 retail clerks in English as a second language. Walsh concedes that the agency doesn't consider profit margins or labor conditions when it makes these grants. As a result, highly profitable companies that service the rich—and that can presumably afford to train their own workers—have collected subsidies far grander than Tiffany's.
Georgina Bloomberg, the mayor's 25-year-old daughter—described as "one of the most successful equestrians currently competing on the Grand Prix circuit"—buys her riding boots at Der-Dau Custom-Made Boots & Shoes, a Brooklyn company that received a $105,635 SBS grant. Der-Dau president Joseph Der recalls fitting Georgina at horse shows in which she competed, and tells the Voice that she has some of the company's boots in her riding wardrobe. Also a sponsor of major equestrian events, Der says he's met the mayor at some of Georgina's competitions, but both he and the mayor's office agree that Bloomberg did not refer them to SBS. (Bloomberg doesn't remember meeting Der.) Der and SBS both said that a consultant working for the company suggested that it apply for the grant, but neither could identify the consultant. SBS admitted that Der-Dau's per-trainee cost—$10,564 for each of the 10 trainees—was at the "high end" of the applications it had approved, and that only seven of 121 recent applicants got grants. (In addition to its equestrian specialty, Der-Dau sells "Platinum Hip Hop" boots for $5,000, and offers shoes in French calf, ostrich, alligator, sharkskin, and iguana.)