December 7, 2010

MBE researcher awarded state contract despite protest

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By Andy Rosen
Andy@MarylandReporter.com

A new contract for the company whose work will be used to justify Maryland’s minority business contracting program was awarded in spite of protests from another bidder for the project, which argued that the current contractor puts the program at risk.

The Board of Public works gave a $2 million, three-year extension to National Economic Research Associates Inc., which has worked with the state on its Minority Business Enterprise program since 2000. Under the contract, NERA will continue to study whether the state still needs special programs to direct state contracting dollars to firms owned by minorities and women.

If the company finds that the state’s programs are justified, one of NERA’s responsibilities will be to supply expert testimony to help defend any challenge that the state faces to its minority business programs. The state generally sets a 25 percent goal for minority subcontractor participation in each contract that it awards.

Marva Deskins of Mason Tillman Associates, the unsuccessful bidder, said her company would do a better job protecting the state from legal action. The company’s protests of the contract were rejected by the Maryland Department of Transportation, which manages the state’s minority business program, and the state’s Board of Contract Appeals.

The state is now defending a suit challenging its minority business program, filed last year by Frederick-based Richard F. Kline Inc., which argues that the program discriminates against majority-owned subcontractors.

“If you allow NERA to conduct Maryland’s 2010 disparity study, you are putting the entity’s program at serious risk of being found unconstitutional, and the state will no longer have such programs” Deskins said. “That would be devastating to the state of the Maryland and the strides this administration has made with regard to minority businesses and rectifying past inequities.”

State Transportation Secretary Beverly Swaim-Staley said NERA has done a good job defending previous challenges to minority business laws around the country.

The suit was filed last November, and is in U.S. District Court in Baltimore. Kline, which works on paving, excavation and other projects, claims that the state did not do enough to consider other remedies to past racial inequalities that the minority contracting requirements are intended to address.

It also argues that the state didn’t consider harm to other groups from its minority contracting rules. Kline’s complaint stems from its bid early last year to improve Interstate 270. The company claims it was the lowest bidder, but was denied a waiver of a 30 percent minority contracting goal.

The BPW, which comprises Gov. Martin O’Malley, Treasurer Nancy Kopp and Comptroller Peter Franchot, approved the contract on Wednesday. There was some dispute over minority issues with another contract , as well, with Franchot questioning why a contract for the expansion of a water treatment plant in Somerset County only had one percent minority participation.