Explained
A disparity study determines whether a government entity engages in practices that exclude minority, women-owned businesses when awarding work contracts, according to the Office of Business Opportunity.
Through surveys, focus groups and interviews, the disparity study conducted in 2023 looked at whether or not minority-and-women-owned businesses faced disparities in business categories such as construction, professional services and goods.
The study found there was no disparity for Hispanic-owned businesses in the construction and professional services categories. Asian-owned businesses in the professional services category faced no disparity either.
It was originally recommended that the groups facing no disparity be moved into a race-neutral, small-business enterprise category of city contractors. However, city officials spent a few weeks in April discussing with stakeholders about the study and its recommendations, many of them disagreeing with the recommendation and providing feedback on what the city could do instead, according to a previous Community Impact reporting.
However, Mayor Pro Tem Martha Castex-Tatum said based on the disparity study and talks with stakeholders, the proposed recommendations will keep the groups in the program and instead expand the small business certification program. The city will also add a new certification for veterans in the small business program.
“I think this is the most inclusive MWBE program that we have ever had in the city of Houston,” she said. “We have included everybody who wants to be included. At this point, we do need to move to accept the data and also make sure we are providing opportunities for people who want to participate in city contracting to have an opportunity to participate in city contracts.”
How we got here
The city’s Office of Business Opportunity has offered the MWBE program since 1984, which allows minority-and-women-owned businesses an equal opportunity to work on city government contracts.
However, the program could be eliminated because of a lawsuit filed in 2023 against the city by a white couple from Spring who own two landscaping companies, Cylenthia Hoyrd, director of the office, said during a March 19 Economic Development Committee meeting.
The lawsuit states the program violates the equal protection clause of the 14th Amendment of the Constitution. The couple claims their companies were in a five-year, $1.3 million contract with the city; however, under the program’s rules, they were forced to pay $143,000 to a minority-owned competitor to finish part of the work, according to the lawsuit.
The trial will determine whether or not the program is unconstitutional, and if so, the program could be forced to shut down, Hoyrd said.
If the city hadn’t approved the 2023 disparity study, Houston would have had to rely on outdated data from 2006, Castex-Tatum said.
What they’re saying
Council members voted 12-3 to accept the new study, with council members Mary Nan Huffman, Julian Ramirez and Twila Carter voting no. Council members Abbie Kamin and Fred Flickinger were absent.
Council member Joaquin Martinez said he hopes the next disparity study won’t take another 20 years but instead can come out in a couple of years.
“This has been a heavy conversation for about a month and a half, but I want to reassure all our communities that we are looking at you,” Martinez said. “This has taken almost 20 years to put together, and I don’t think we should be waiting 20 years for the next disparity study.”
Council member Willie Davis said he agrees with Martinez and hopes the city will conduct disparity studies every five years.
“We’re an international city,” Davis said. “We’re not just a state, we’re an international city, and all people have a right to participate. I think this is the right direction to go and I just want to reassure that whatever the outcome is, everybody’s at the table.”
The Mayor's Chief of Communications Mary Benton said there's no confirmed date on when the city will head to court for the ongoing lawsuit.
