Mayor Martin O'Malley told city agencies yesterday that he wants to award 35 percent of all contracts to minority and women-owned businesses, hoping to resuscitate earlier goals nullified by a federal judge in December.
O'Malley set the new minority participation goal in an executive order.
Although that order is nonbinding, the mayor said he intends to use the powers granted him under the City Charter to push the minority participation goal when contracts come before the Board of Estimates.
While minority groups lauded O'Malley's initiative yesterday, business groups that have successfully challenged such set-aside laws across the nation denounced the order as "unconstitutional."
O'Malley dismissed the criticism, saying that a city with a 65 percent African-American population would not be deterred by federal court rulings that have struck down 22 such laws across the nation, including Baltimore's.
"Some people might have thought that, because Baltimore has a new, white mayor and because a judge struck down our minority and women business enterprise law, that we would be retreating from our goals," O'Malley said. "They should think again."
O'Malley's order ended a week of activity to shore up Baltimore's minority contracting goals, which were invalidated last year, when U.S. District Judge Andre M. Davis ordered the city to stop enforcing its minority contracting law. That law required that 20 percent of each city contract be awarded to African-American businesses and 3 percent to women-owned businesses.
The Associated Utility Contractors of Maryland Inc. successfully challenged the city law, arguing that its members were being denied contracts.
Lawyer's clients opposed
Robert E. Gough, a Rockville attorney representing the group, said yesterday that, although he had not seen O'Malley's order, his clients oppose it.
"We don't think the city's use of race, gender and ethnicity in contracting is constitutional or supportable," Gough said.
Baltimore-area minority business owners praised O'Malley's effort, but expressed concern that the goal includes both minorities and women, citing their experience with the state's contracting law.
State law at 14%
The state law calls for 14 percent of contracts to be awarded to minority and women-owned businesses.
Lisa M. Harris, a Baltimore attorney representing black and Hispanic businesses, said her group would rather see the women-owned business percentage separated in the city order.
At City Council hearings earlier this week, black civic activists called for Baltimore to strive for minority contracting percentages to reflect the city's population, which is about 65 percent black.
"We wanted to establish a goal we can realistically achieve," O'Malley said of the overall 35 percent goal.
By issuing the goals in an executive order, Baltimore joins other cities with large black populations, such as Detroit, Chicago and Philadelphia, that have faced similar challenges to their minority contracting laws.
Through orders, cities can negotiate the percentage of minority participation after the contract is awarded rather than in the bidding process, O'Malley said.
Chicago and Detroit have raised their participation rates to 45 percent, Harris said.
Matt Glavin, president of the Southeastern Legal Foundation that successfully challenged a similar minority contracting law in Atlanta, said such executive orders have yet to be addressed in court, but it is only a matter of time.
"There is not one racial preference program in America that has survived a court challenge since 1989," Glavin said. "An executive order, if it is being implemented as a racial preference program will be struck down as unconstitutional."
The Board of Estimates on Wednesday approved hiring two consultants to help increase the city's minority contracting numbers. Each consultant is to be paid $36,000 for six months.
Morris is interim head
Brian Morris, the chief executive officer of the Legacy Unlimited financial services company, will serve as the interim head of the city's Office for Minority and Business Development.
Morris will be aided by Bob Weston, who has helped raise minority contracting in the Montgomery County School System to about 50 percent, O'Malley said.
Although minority business leaders appreciate O'Malley's efforts, they intend to continue to press for results, Harris said.
"These minority owners have been out there for 30 years," Harris said. "Promises have been made with no progress."