Diversity Lags In Va. Program To Help Firms

"There is no comparison to where we were three years ago," said Samuel Hayes, director of the state Department of Minority Business Enterprise, which runs the program. "It's huge."

In the fiscal year that ended June 30, 5.34 percent of the state's $5 billion discretionary spending went to minority-owned businesses; 3.94 percent went to women-owned businesses; and 28.9 percent went to small businesses, all of them certified in the SWaM program.

By comparison, more than 17 percent of the state's businesses were minority-owned and almost 30 percent were women-owned in 2002, the most recent statistics available from the Small Business Administration.

"I certainly think Warner and Kaine need to be commended for their efforts, but it's going to take a long time to turn this ship around," said Del. Dwight Clinton Jones (D-Richmond), chairman of the Legislative Black Caucus. "The state had a culture of cronyism. To break that culture is very difficult. There's very little movement. We have a long way to go."

Since the 1960s, state and federal governments have experimented with goals and mandates to boost contracts to minority- and women-owned businesses. Some programs have been challenged in court.

At least 27 states, including Virginia and Maryland, have programs that certify businesses to compete for government contracts, according to the National Conference of State Legislatures.

Maryland's program, one of the nation's oldest and most ambitious, calls for 25 percent of state contracts to be awarded to minority- and women-owned companies. In 2007, the state achieved 20 percent. (It has a separate program for small businesses.)

The District's program, revamped in 2005, requires companies to be in the city -- regardless of the size of the company or the gender or race of its owners -- to support local businesses and keep tax dollars in the city, said Sara Gebhardt of the District's Department of Small and Local Business Development. About 1,100 companies are certified. (The District also has programs for small and disadvantaged businesses.)

Unlike other states, Virginia has never set aside any contracts for minority- and women-owned vendors. It does, however, set aside contracts for all SWaM-certified companies.

Hayes, who has run the department with 19 staffers and a $2.3 million budget for seven months, says the minority- and women-owned businesses in SWaM benefit merely by being exposed to more opportunities.

"It's one more thing that makes you better," said Glen Clark, sales manager at a small, woman-owned company, Interstate Office Supply, in Alexandria. Clark, who sought certification about five years ago, said he has seen a slight increase in government business this year, but cannot say how much was because of SWaM.

Purchases of less than $5,000 require at least one bid from a SWaM vendor; purchases from $5,000 to $50,000 require at least four; and purchases more than $50,000 require four of at least six total bids. If none is received or if the prices are not reasonable, then other companies are allowed to bid.