It's a start. That's the most charitable thing that can be said of the Prince George's County School Board's unanimous approval this week of a proposal designed to increase opportunities for minorities to bid on contracts for goods and services.
The unanimous vote aside, officials of the school system deserve a failing grade for obfuscating the issue and for failing to do their home work on a matter that the county government had already studied and incorporated in its procurement program.
The proposal originally called for the board to establish a goal for 30 percent of the school system's procurement contracts to be awarded to minority firms in the county. But the board, obviously influenced by worst-case-scenario projections of the costs that might be incurred, settled on a goal of only 10 percent.
Under the original proposal, minority businesses would be awarded so-called bonus points for bidding on contracts. Elements of the proposal were similar to provisions of a minority business procurement program with a 30 percent goal, that the county government implemented just over a year ago. But Superintendent John A. Murphy estimated that the 30 percent goal would cost the school system as much as $349,000, reducing funds for the instructional program. One estimate ran as high as $500,000.
School officials arrived at those estimates by calculating 30 percent of the total dollar amounts of contracts awarded in fiscal 1985, an administrator explained.
But that's not the way it works. That assumes that minority contractors will always be awarded contracts for which they bid and that their prices for goods and services will always be higher, costing the school system more money than would be paid to nonminority contractors. The Prince George's County government awarded contracts for goods and services worth $50 million in fiscal 1985, and the bonus system cost the county only $6,000.
The county government's program is based on recommendations from a special task force on minority procurement, which County Executive Parris Glendening appointed three years ago. The county government previously set a goal to spend 10 percent of its procurement budget with minority firms. Glendening not only endorsed the task force's recommendation to increase that to 30 percent, but encouraged the use of a bonus plan as an aggressive outreach program that would involve more minority businesses.
Under the bonus plan that has been incorporated into the county's regular purchasing operations, minority contractors are awarded from one to 10 points on a sliding scale, based on the size of a contract to be awarded in competitive bidding. A minority contractor may be awarded 6 points, for example, on a contract bid of $30,000. When the bonus-point value is applied (6 percent of $30,000) the adjusted bid amount would be $28,200. While that figure may be lower than the minority contractor's original bid, it doesn't guarantee that he or she will get the contract. A nonminority contractor -- who is ineligible for bonus points under the program -- would win the contract if his unadjusted bid is lower than $28,200.
Minority contracts increased only slightly in fiscal 1985 (up 3 percent), according to Dennis Brownlee, minority business administrator for Prince George's County. On the other hand, neither minority nor nonminority contractors have complained about the program, Brownlee adds.
In announcing the county's plan to expand the use of county and minority business firms two years ago, Glendening offered the following rationale: "This plan has the attributes of being easy to apply, of not distorting the market through set-asides, of attracting more minority firms to the county, and of helping to stimulate the overall economic development in the county."
Implicit in Glendening's remarks and in the recommendations from the task force is that the procurement program is not a giveaway of taxpayers' money. It's not a scheme to steal business from nonminority firms. It is an enhancement of the competitive bid process.
In the aftermath of the school board's vote, a minority businessman in Prince George's County noted his frustration over the amount of time the board spent debating "whether to let us have 30 cents on the dollar or 10 cents."
It's not so much the percentage of the school system's $40 million procurement budget that's at issue as much as it is an apparent failure to recognize the program's value in stimulating competition and ultimately holding down costs.
Aside from the economic considerations, however, the board is left to contemplate what may be an overriding issue in this case. Its policy on the use of minority contractors (the superintendent has been instructed to devise a specific policy and submit it for review within 60 days) ultimately will serve as a significant lesson for students in the system.