Staff Present
Dr. Roger Rasmussen, Director, Independent Analysis Unit
Mr. Michael Eugene, Business Manager, Business Services Division
Ms. Ann Fischer, Director, Procurement Services Group
Mr. Carey Peck, Vendor Services Manager, Procurement Services Group
Mr. Richard Sheehan, Special Counsel to the Board
At the request of Board Members and questions raised by Ms. Hayes concerning small business outreach at the LAUSD, Mr. Eugene presented a status report on the District's procurement processes, with an emphasis on outreach efforts to Small Business Enterprise (SBE) and minority and women owned business (MBE/WBE). He introduced Mr. Carey Peck, Vendor Services Manager, who gave an overview on the new LAUSD SBE program. An outline of the SBE program was presented to the Business, Finance, Audit and Technology (BFAT) committee in May 2002. The SBE program was designed to replace the previous program. The new program features a shift in emphasis based upon changes in state law and case law to a small business orientation based on size standards and reciprocal certifications by other agencies. Certifications are very staff intensive, so staff thought it would be better to use other established programs, such as the Small Business Administration, Metropolitan Transportation Authority, County of Los Angeles, and the City of Los Angeles. The District has reached agreements with these organizations to use their certifications. The current program was developed in coordination with the small business advisory council (SBAC), which the Board set up many years ago to advise on small business issues.
Mr. Peck responded to one the questions raised by Ms. Hayes on sub-tier programs. The District does not have a sub-tier program, it is a SBE program. In July, the Procurement Group together with Facilities Division presented a joint agreement with the Los Angeles Minority Business Opportunity Committee (LA MBOC) to perform outreach and attainment work for the new school construction program and the facilities construction program. LA MBOC will be responsible for this agreement.
Mr. Peck introduced Ms. Karen Blackwell, Mayor's Office of Economic Development, Director of
Economic Development, LA MBOC, and the Assistant Deputy Mayor, who stated that the city is looking
carefully and closely at developing and implementing programs that stimulate the small business economy.
Ms. Blackwell gave an overview of the LA MBOC program which specifically focuses on women and
minority businesses. They must be in conformance with Proposition 209 and everything that has happened
in the state of California to make sure that all outreach is inclusive. Ms. Blackwell provided an overview of
LA MBOC which was established in 1994 and funded primarily by the Minority Business Development
Agency (MBDA), United States Department of Commerce. A portion of the funding comes directly from
the Mayor's Office, allowing them to do substantial outreach. Ms. Blackwell said they have been most
successful in the area of construction. She discussed and provided a list of LA MBOC's program
accomplishments. The LA MBOC developed the model that was used for the Alameda Corridor Business
Outreach program, a $2.4 billion dollar construction project. The LA MBOC also does a lot of work with
private partners. Memberships include over 300 businesses, both minority women and majority owned
businesses. Public and private sector partnerships are an essential component of the program.
Ms. Blackwell discussed the District's small business initiative. The District's goal is hoping that 22% of the contracting for new school construction projects would be awarded to small businesses. She advised the District that they must educate and talk to prime contractors so they will understand the importance of meeting the goals and guidelines of the District. It is the owner (LAUSD) of the project who determines how stringent the guidelines (the level of participation) should be. The LA MBOC does the actual outreach. The success of the LA MBOC is attributed to a multi-faceted approach. Partners that are part of the LA MBOC Committee will be available to the District and sub-contractors for capacity building. She proposed that the District do overall outreach, working with the certified database of Cal Trans, the MTA, the City of Los Angeles, and the County of Los Angeles to put together the widest mailing and database of certified businesses that can participate.
Ms. Blackwell noted that the LA MBOC program with its minority, women, and all other business enterprises (M/W/OBE ) was challenged at one point. The case was heard before the State Supreme Court where it was determined that the outreach model does conform with the guidelines and intent of Proposition 209. By going with the small business designation, they are able to take advantage of the opportunities and resources available through the SBA as well as the local level programs. The LA MBOC is committed to helping the LAUSD reach their objectives. Ms. Blackwell introduced Saul Alvarado who will be very instrumental in the LAUSD program and Antonio Watson from the LA MBOC.
Mr. Peck discussed some of the possible enhancements to the outreach and attainment program. One of the obstacles small firms face when dealing with public agencies is understanding what is going on. He discussed a proposal to set up an electronic outreach, which would include a online vendor registration. A goal set by the Board of Education would be an enormous enhancement to the program.
Mr. Rod Garcia, Small Business Advisory Council, LAUSD, expressed support for the SBE program and the agreement the District is now entering with the LA MBOC. He urged the Board to consider setting a goal of 25%. He applauded the Facilities Division for setting a goal of 22% for the construction management contracts. Mr. Garcia spoke about various aspects of the program.
PUBLIC COMMENTS
Mr. Gene Krischer, Friends of the Children, expressed his concerns regarding comments made by a Board Member regarding speakers.
Mr. Lansing and Ms. Hayes responded to comments made by Mr. Krischer.
Ms. Fischer responded to the Committee Members comments and questions. Mr. Huizar suggested
moving forward with a Board Report to officially adopt the small business percentage the Facilities
Services are working with, and apply this to all business practices of the District. Mr. Huizar asked Mr.
Eugene to include in the report the status on the program enhancements.
Ms. Fischer responded to a concern raised by Mr. Lansing and questions raised by Mr. Sheehan.
ADJOURNMENT
The meeting adjourned at 2:19 p.m.
Persons who wish to address the Committee may sign up at the meeting.