Committee on Contracts

Very shortly. Find your seats, please. Thank you. Good morning. Good morning. Welcome to New York City Council hearing on the Committee on Contracts. At this time, please silence all electronics and do not— Perfect. Good morning. Good morning. Welcome to the New York City Council hearing on the Committee on Contracts. At this time, please silence all electronics and do not approach the dais.

If you are testifying today, make sure— please ensure that you have filled out a slip with the sergeant-at-arms. Any other questions or concerns, you may reach a sergeant-at-arms and we will kindly assist you. Thank you for your cooperation. Chair, you ready to begin? Thank you. Thank you so much, Sergeant. Good morning. Good morning. Good morning.

My name is Lincoln Ressler. I have the privilege of chairing the Committee on Contracts. And usually at the end of my opening remarks, I thank the staff, but I just wanted to actually do that at the beginning because it's important. We are fortunate to have a, like, truly expert committee counsel in Alex Polonoff. So thank you so much for just providing such helpful guidance to us as the relatively new chair of this committee.

And I want to also thank our policy analyst, Alex Yablon, and the principal financial analyst, newly to this committee, Andrew Lane Lawless. Thank you all for your hard work. And I especially want to thank my chief of staff, Molly Haley, who is brilliant, and all of the smart things that are said today are a result of her, and all of the mistakes are a result of me.

So I'll begin with my opening.

We're having an oversight hearing on the city's Minority and Women-Owned Business Program. New York City first developed an MWBE program back in 1989, and after a review of the city's contracts, found that MWBEs were substantially underutilized. Unfortunately, the program was halted by Mayor Giuliani, one of his many failures, but the City Council reestablished the program back in 2005.

And over the past 20 years, we have made significant strides in opening up opportunities for MWBEs. in city contracting through small purchase programs, mentorship, and ambitious agency goals. But much more remains to be done. The Comptroller's Office releases a fantastic report each year on the City of New York's progress supporting MWBEs that provides a detailed breakdown on where city agencies are doing well and where they're coming up short.

In FY25, MWBEs received just 5% of the city's total contracting spend, $2.44 billion out of a $46 billion contract budget. These numbers have remained relatively stagnant for years. Looking more specifically at contracts— at contracts that are subject to MWBE goals under Local Law 174, there was an increase in the number of contracts going to MWBEs last year to 65%— 20,539 contracts.

But the share of contract value going to MWBEs fell From 17% back in FY24 to 8% in FY25, about half as much. MWEs won more of the contracts in FY25 but got less of the money. I commend the Office of the— of MWBE for the increase in the number of contracts awarded to MWBEs, and I commend SBS for the increased number of certified MWBEs, but I am concerned that MWBEs are only finding success in small-dollar contracts and not growing at the same pace as— and spend on MWBEs is not growing at the same pace as our overall contract budget.

The average contract registered to a non-certified firm, a non-MWBE, was $3.6 million, but the average MWBE contract was under $750,000, less than 25%. This is particularly notable in our construction contracts, MWBEs received just over 10% of the citywide contract value. There is also a deeply troubling, deeply troubling disparity within MWBE contracts. For all of the MWBE contracts awarded last year, Black-owned firms account for just 7% of MWBE contracts, and Latino-owned firms account for 7.9%.

The city's Black and Latino population are 22% and 29%, respectively, a majority of New York City. The disparities are even worse when we account for gender. Male-owned firms account for over 8 times as many contracts— male-owned MWBE firms account for over 8 times as many contracts as female-owned firms. Firms owned by Black women account for just 1.17% of MWBE contracts awarded, and firms owned by Latinas account for 1.22%.

This data is just unacceptable, and I am keen to understand what efforts are underway in the new administration to open up more opportunities for Black and Latino-owned businesses, especially businesses owned by Black women and Latinas. In FY25, about 65% of MWBE contracts were registered retroactively, meaning that the work began before the paperwork was done to be able to actually pay the company.

For a small firm, that means the company needs to front the funds to complete the work while they wait for the city to pay. That kind of risk can be untenable for a small business. There are also significant gaps in the data that is reported to the public. Since FY22, the city has registered nearly $33 billion in contracts subject to Local Law 174 goals with no subcontract records whatsoever.

I just want to say that again. $33 billion in contracts subject to Local Law 174 MWB goals with no subcontract data whatsoever. Records exist for about 1,100 of the roughly 12,000 prime contracts, just under— just about 9% of the total contracts. And more than 20 agencies, that's nearly half the city agencies, report nothing whatsoever on subcontracts during that time.

The Department of Design and Construction manages to report this data, so it can be done, but most agencies simply don't take the time or make the effort to report this information. What this means is that there's potentially significant MWBE utilization happening every day with subcontractors that are owned by Black, Latino, Asian, women-owned firms, but we have negligible data.

Without this data, there is no accountability. And without accountability, there will be no improvement. This issue extends to our human service contracts as well. Human service contracts are exempt from MWBE goals, but many of these contracts use for-profit subcontractors that may be MWBEs. For example, consider a nonprofit shelter. Operators— a nonprofit shelter operator hires a for-profit firm to deliver food or run security.

I've introduced legislation, Intro 834, which would require reporting on those subcontracts. I'm hopeful that better reporting on subcontracts will help us understand the MWBE landscape more broadly and identify more firms that we can support and connect to larger prime contracting opportunities that they may be qualified for. I hope we hear more today about how the Mondani administration plans to increase MWBE contracting opportunities, especially through cultivating a pipeline of MWBEs— of successful MWBEs that are already contracting with the city so that they can grow and take on larger and larger contracts.

I'm also keen to learn more about how we can elevate more Black and Latino, and especially Black women and Latina firms, to do more business with the city.

We'll also be hearing 3 pieces of additional legislation today. Intro 208, sponsored by Councilmember Shahana Hanif, would add Middle Eastern and North African Americans to the minority groups recognized under the city's MWBE program. Firms owned by New Yorkers of Middle Eastern and North African descent are effectively invisible in our procurement data, and this bill would begin to change that.

Intro 694, sponsored by Councilmember Farias— and thank you for joining us— would require agencies that miss their utilization goals to do something about it by conducting outreach and education targeted to the specific MWE categories where they fell short. I think this is a great bill. And finally, Intro 896 got squeezed into this hearing, sponsored by Councilmember Epstein, And it would prohibit city agencies from entering into or renewing contracts to purchase noncompostable single-use cups with exceptions for health and safety emergencies and agreements already in place.

I think this was an old Eric Botcher bill. Is that right? No, not an old Eric Botcher bill. Just kidding. And I want to recognize that the contract— and I want to thank again the staff who I thanked at the beginning for doing such a great job. I would now like to turn it over to Councilmember Frias for an opening statement.

Good morning. Thank you, Chair Ressler, members of the Committee on Contracts, for holding today's hearing on MWBE utilization in city contracting and for allowing me a moment to speak in support of my bill, Intro 694. New York City has established utilization goals because we recognize that minority and women-owned businesses have historically been shut out of government contracting opportunities.

But when an agency repeatedly fails to meet those goals, we cannot continue relying on the same broad outreach and expect a different result. Intro 694 responds by requiring agencies to focus their outreach on the specific MWBE categories in which they are falling short. That means working with community-based organizations and the Office of Ethics and Community Media to reach businesses through trusted local networks and provide practical information about certification, procurement opportunities, and how to compete for agency contracts.

This bill would also require agency MWBE officers to monitor progress within those categories and report on how these targeted efforts are being implemented. This creates a clear connection between the disparities an agency identifies, the corrective action it takes, and the results it produces. We know there are qualified entrepreneurs across the city who are ready to do business with New York.

Too often, however, they are left trying to navigate an unnecessarily complicated procurement system without the relationships, information, or institutional access enjoyed by larger and more established firms. The responsibility cannot remain entirely on small businesses to find their way into the room. When an agency consistently fails to reach a particular group of businesses, the agency must be responsible for changing how it reaches them and continues to do so.

Intro 694 gives agencies a more focused way to close those gaps and gives the council a stronger basis for evaluating whether their improvement plans are producing actual results. I'd like to thank Chair Ressler again for hearing this piece of legislation, and thanks to my colleagues who have joined me as co-sponsors. I really look forward to today's testimony from the administration as well as hearing from the public and continuing to work— continuing the work together to move Intro 694 forward.

Thank you, folks, and thank you, Chair. Thank you so much, Councilmember.

I'll now turn over to committee counsel to swear in the witnesses, and if there's a copy of testimony, we'd love to get it. Thank you, Chair. Will all members of the administration testifying today please raise your right hands? Or giving questions as well. Yeah. Do you swear or affirm to tell the truth, the whole truth, and nothing but the truth in your hearing today and to respond honestly to councilmember questions?

I do. Thank you very much. You may begin when ready. And if you have written copies of the testimony, please share them with the sergeants so that we can bring them up to the chair. Yes. Give them yours. Is this the latest? He has it. Oh, oh. Feel free to begin. Great.

Good morning, Chair Wessler and proposed bill sponsors Fariz, Hanif, and Epstein. My name is Michael J. Garner, and I serve as the city's first-ever Chief Business and Diversity Officer. It is a pleasure to engage with you on all of our shared commitment to the advancement of the city's MWBE program and to the health of the overall MWBE community.

As someone who has served a significant portion of my career advancing MWBE programming, first at the New York City School Construction Authority for 15 years and at the MTA for 15 years, and now at the City of New York, I'm honored to be here representing our program in City Hall along with my first Deputy Chief Business Diversity Officer, Dwight Flynn.

Also, my colleagues at the Office of Contract Services, MOCS, and the New York City Department of Small Business Services. Considering our shared commitments towards continuous programmatic and policy improvements to the city's MWB program, I am also here to share some of the great work that we have produced over the past 3 years, as well as to provide answers to the council's committee questions along with my MOCS and SBS colleagues.

As such, I would like to preface that my intent today is to respond to the contract committee's questions and to the best of my knowledge. However, we would be more than happy to schedule briefings with your respective offices to discuss matters raised today in need of other comments and information. Since my time as the Chief Business Diversity Officer, we've achieved key MWBE successes. and meaningful accomplishments that I would like to share with you today.

While we are sharing— working towards finalizing the past fiscal year's '26 full MWBE data, we remain confident that we are on track to continuing the positive trajectory of our program been on these last handful of fiscal years. The following key metrics represent the city's performance in the first 6 months of the current administration. FY26, quarters 3 and 4, 33% MWBE inclusion for agencies under Local Law 1, combined 36% MWBE inclusion for city-funded agencies and authorities, nearly $2 billion in MWBE contract awards.

The overall outcomes of the— of this administration in the first 6 months follow positive trends, further realizing our program's mission. In fact, last fiscal year, we achieved the city's aspirational 30% goal for agencies under Local Law 1, which was accomplished 2 straight fiscal years in a row. We also set an MWBE record to over $2 billion in contracts awarded by agencies under Local Law 1, and one NYC city record of $6.9 billion in MWBE contracts.

These achievements are 4 straight years of MWBE contracts above $6 billion that the city has awarded to city-certified MWBEs under One NYC. These contract awards is critical to support the city during our COVID-era economic recovery by addressing the city's most important goods and services. needs while creating and promoting measurable economic activity in our local MWBE neighborhoods. In the city's last 4 fiscal years, city-certified MWBEs have secured just over $28 billion in contracts, a national record for any program of its kind.

We also continue to prioritize MWBEs by putting them in the program's critical path. Leveraging the MWBE small purchase method, a procurement tool that allows for more streamlined processing contracting with city-certified MWBEs. We set 3 straight fiscal records for use of this method, totaling $350 million in MWBE contracts using the method in FY25 alone and over $1 billion during the 3 fiscal years timeframe.

Lastly, we were able to secure New York State legislative victories and local policy program improvements that allowed us to enhance our available tools and better coordinate our efforts citywide. These include raised MWBE small purchase method threshold twice from $500,000 to $1.5 million. Local Law 1 agencies secured ability to self-register in MWBE small purchase method contracts from the New York City Office of the Comptroller.

EOs 26 and 34 better aligned MWBE program and provided agency guidance on creation— of the creation of more equitable contracting opportunities wherever practical. And to share and report MWBE's data to the CBDO, funding was secured to evaluate and implement V2GNow as a tool to supplement the city's existing MWBE reporting capabilities. The system remains dependent on reliable data from authoritative source systems and does not replace Passport, FMS, or the systems used by non-mayoral entities, though will allow a more comprehensive, near real-time citywide performance reporting under One NYC program.

Establish weekly CompStat-like meetings to review key agencies' MWBE metrics. Weekly discussions with agencies on barriers in preventing MWBE in city contracting and discussing best practices solutions. Currently coordinating with agencies on strategies to maximize the use of the MWBE small purchase method to its upper limits of $1.5 million.

Regarding the bills scheduled to be introduced as part of this hearing, Intro Bill 208, we support the goal of evaluating emerging disparities in the city and look forward to further, further conversations with the bill sponsors. Intro Bill 694, the Mayor's Office of Contract Services, MOCS, supports the intention of this bill and looks forward to having further conversations with the sponsor.

Intro Bill Number 834. While we support the intent of this bill, based on MOCS review, Passport already captures the subcontract information required by the bill, including subcontractor's name, contract information, subcontract value, and the type of work. Passport also supports HHS and lower-tier subcontractors and MWBE certification information. is sourced from SBS through FMS. We look forward to further conversation with the sponsor.

Intro Bill 896. MOCS is currently evaluating this bill, and we look forward to having further conversations with our partner agencies and the sponsor. In closing, we certainly recognize that there's more work to be done, yet we remain appreciative of the opportunity to build on our progress. The leadership in City Hall, the dedication and competency of our oversight principles.

Chief City Procurement Officer and MOCS Director Kim Yu and SBS Commissioner Manaya are the collective commitment of our city and our city-affiliated agencies and authorities whose efforts have been the driving force behind the city's MWBE achievements. Lastly, and just as importantly, we recognize the council's overall support of the MWBE program. Our program is supportive of MWBE businesses and local economies and promotes economic justice citywide.

Thank you.

Great. Councilmember Farias is going to let me know if she chooses to jump in at her discretion because once I get going, I just get going.

We'll take a break.

So thank you very much. Thank you very much, Chief Garner, for your testimony. We really appreciate you being with us today. And, you know, I'll just say for a moment, I think that the Adams Administration prioritized this issue and had a success in engaging in contracting with more MWB firms. And there aren't many nice things I say about the Adams administration, so that's as close as I'll get to a compliment, and now move forward.

But I do want to recognize that sincerely. Thank you. I know that's not— I know it's not easy.

I just— I want to come back to some data to just kind of ground us, because you were using some data in your presentation— in your testimony. I had some data points that I referenced in my opening. You know, at a super high level, in FY25, the city had a contracting budget of about $46 billion, and MWBEs received $2.44 billion of that funds, about 5% of the total contract spend.

For the last few years, that percent has remained stagnant. MWBE growth has not kept pace with the growth of city contracting. which has increased. Looking at just the 40% of contracts that are subject to Local Law 174 goals, or Local Law 1, as you reference it in your testimony, the value share of prime contracts going to MWEs declined significantly from about 17% in FY24 to about 8% in FY25, about half as much.

How do you evaluate this overall performance? What was the cause of the significant decline from FY24 to FY25? Just at a high level, and then we can go into more specifics. So certainly we view City Comptroller's office as an ally and a partner. I've had a long-lasting positive relationship with City Comptroller Mark Levine. I was on his transition team when he ascertained the office of the Manhattan Borough President, Great.

We have a long working relationship. We both agree that we're going to work in tandem. However, the City Comptroller's report does not include any of the MWBE subcontractor activity or totals, and it does not include any of the non-municipal agencies, including the School Construction Authority, NYCHA, the New York City Public Schools, EDC, and Health and Hospitals, where between 55 and 65% of the city's procurement spend reside with those 5 agencies.

And so we are focused on a One NYC viewpoint of capturing all MWBE activities, Local Law 1 agencies, and the none. And so— And I, to be clear, I think that's the right orientation for you and your job. The challenge we have, that MOCS has, that all of us have, is we don't have access consistently to those non-mayoral agencies or the non-traditional agencies' data.

And so the controller's got the data he has, and he's giving us analysis based on that data. If, if you can help us, and MOCS can help us, get better data on what those kind of non-traditional mayoral agencies are doing and what's happening on the subcontracting level, then we have a different story to potentially tell. Absolutely. So, so 2 things are happening, and I'm glad that that you asked that question.

And so we have been working with creating a new MWBE information technology platform called B2G, and it is the same platform that was instituted at the state of New York. And my deputy here was in charge of instituting that program, that platform, at 97 different agencies and state authorities. And what this new platform is going to do is it's going to not only allow us in a centralized manner to capture MWBE contract awards, but more importantly, the payments.

And so we are now going to pivot from MWBE awards and highlighting the awards, but we're now going to more importantly focus on the payments. of MWBEs. That's— we're currently working internally right now. That process will go live in a very, very short period of time. Do you expect the B2G to go live this year? This fiscal year?

Yes, we are. Yes, yes, absolutely. And just to make sure that I properly understand how it's worked at the state level, so we're— just so I get it, we're expanding an existing state platform So that's city agency or it's a new— No, it's a new platform that we issued an RFP and secured the services of a firm to help us build out this project.

Based on existing state resource? Well, no. So we— I was only using the state as an example of how the state— So this is a new thing that we're creating? Yes, it is. Every city agency— so that data system, or that platform, will capture the awards and spend of every city agency's contracts? Yes. And indicate whether they're MWEs, and you think will comprehensively capture subcontracting as well through that system?

Yes. Yes. And DOE, NYCHA, Health and Hospitals, EDC, and the School Construction Authority are all going to fully participate? Yes. So what we, we, we agreed with the city controller that we are going to create one centralized platform that will highlight all of our MWBE activity. And can I just— this may not be a question for you, this may be a question for John, but why not Passport?

We have an existing system that captures all of our contract actions. Why— I just would assume that it's a cost and operational challenge for every procurement official in the City of New York to have to now use an alternative system to capture this data. Why not use our existing procurement system for gathering this information? So, I'll let John respond to that, but it's my understanding that the Big 5, as we call it, they do not enter their information into Passport.

And so we wanted to create something that will once again have the opportunity for everyone to go to one centralized platform, look into the system, and observe all of the MWB activity, including contract awards, but more importantly, the payments on those awards. Okay.

You want to jump in on the— on why we didn't use Passport here as well? Sure. Good morning, Chair Ressler. And it is an honor and privilege to be here this morning. Is this your 3rd time testifying this year? I think it is. I am not keeping count, but I am happy to see that you are. We are happy to see you, too.

At least we haven't been so mean that you have chosen not to come back. I will keep coming back as long as you are inviting. So I believe, just to take a step back for a moment about what the intent of Passport was to do, It's the city's sourcing and solutions portal for procurement activity. Its primary users are agencies that are really operating under a very specific governance for procurement.

The agencies that you were referencing operate under a different governance, and so I think that inherently creates a little bit of a challenge. I totally appreciate that. I think ultimately it's up to the mayor to tell them what to do. If the mayor was able to get them the these 5, the big 5, we'll call them that for the rest of the day to keep it simple.

The mayor was able to get the big 5, or Chief Garner was able to get the big 5 to agree to do this with BTG, B2G, B2G? Yes. To participate in B2G, why couldn't we get them to just participate in Passport? I think that's a question that might naturally move into a deeper conversation that we're happy to participate in.

One thing I wanted to add though— But the DOE just announced a series of procurement reforms None of which make them subject to the PPB rules, none of which increase their transparency in a meaningful way, or provide the same level of oversight that you have of every other traditional mayoral agency. So, I just feel like it would have been simpler to use an— I know that Passport sucks, and that everyone's frustrated with it.

Or is that not the— is that not how I'm supposed to describe it? Passport— everyone's frustrated with Passport. I won't— it has its limitations. But it just strikes me as challenging to create a whole new system that people are going to have to use to gather this information when we have an existing vehicle? The one thing I will say about Passport, and I won't judge for or against— You're not going to say on the record that it sucks?

I will simply state that that's the system that we're working with, and like anything, we work with what we have. Totally. Can I learn a little bit more about— There have been some enhancements. Yes, there have, and I appreciate it, and we funded them from the council side and pushed very hard for those resources and are excited to see see them implemented.

So can I just ask a couple questions about B2G so I understand it? Yes. So I'm going to defer to my top deputy who was responsible for— It sounds very exciting. —implementing B2G at the state. 100%. So can you, I guess, share any updates you can on the timeline for when you expect to see this implemented? I think if you could Give us some greater insight.

How is this data being implemented and gathered? Is it something that procurement officers and contractor and the vendors have to implement themselves, or is the data gathered from other systems already automatically? Yeah, just help shine some light for us. So, let's really quick— oh, first of all, thank you for having us here today, having me here today.

Chair and committee. To answer your question, the B2G system gets its source data from the owners of that data. So that would be, you know, FISA FMS or from Passport, MOCS, and— or SBS in terms of certification-level data. And what it's really good at, what it's really good at, is essentially aggregating and reporting out on MWB activity at the prime and sublevel.

That's sort of its main function. And as such— and the other thing is, as we get that data on a more regular cadence, because as you know, right now we get quarterly reports from Passport, that type of thing, and an annual report. We'll get more real-time data. Because one of the frustrations we've been having, of course, is that you want to actively manage opportunities and challenges as they come up.

If you're seeing them, you know, a month after the quarter is over, That's not always possible, and so B2G will allow the city's MWBE program to be managed on a more real-time basis to intercept challenges and take advantage of opportunities, and of course disseminate best practices. The system itself again there's no there's not a direct tie-in. It's not like it's electronically tied into into passport, but there are files that are shared on a regular cadence between. between MOCS and OTI B2G such that the system is updated on a regular cadence and agencies can go in and take a look at their MWBE contracts.

Take— make sure there are no errors, right? And if there are errors, they go back to the original system and they fix it because that means there's an error somewhere in Pathward or FMS. And they can then run reports, the likes of which they can't run right now. Right. They can project, and they can plan around their MWBE activity.

Our goal always is to maximize MWBE availability and participation at every agency, at every contract level. You need to have the tools to do that. And the city over the years has done an excellent job in pushing forward this policy. But, you know, as technology improves, we have to update with the technology, and that's what B2G allows us to do.

Just forgive my ignorance here, but just help me to understand it. If it's from Passport, we're not getting that information in Passport now. I mean, the Comptroller's report and what we reviewed— Let me see if I can— Found that we're seeing 9% of subcontracting information from the traditional mayoral agencies is reported in Passport. DDC seems to do a good job, and everybody else seems to be— poop in the bed, or not taking this seriously at all.

And so 90% of our contracts are not getting— the subcontracting information is not getting reported into Passport. We have no information. We can't do a global compare— we can't give a global answer on how much money is going to MWBEs because we don't know what's happening on the subcontracting side. And so I feel like there's actually a good story, good news story for the city to be telling.

It's part of the reason I introduced my legislation around the human services. Right? We— I don't— I won't go down that rabbit hole, but we don't have the data. So Passport, I feel like if the information is feeding from Passport into this, it's not going to help us. If it's feeding from FMS, that's— so we know the payments, but a payment's going to the prime, right?

The payment doesn't go directly to the sub. So let me just— we, in a more proactive measure, from a City Hall perspective, We have sent emails to all of the agency commissioners asking them to ensure that their third-party contractors and consultants are entering their MWBE payment data into Passport on a timely basis. We are monitoring that now.

Are you seeing any improvement? We just started this this year. Okay. We are now going to run a report with MOCS I will see that report on Friday, but we are targeting— That running these reports through Passport makes people's heads explode and that it takes a long time and that it's very painful and it's challenging to get right.

John has assured me that his staff is going to work with my staff in order to generate— So we're expecting a report this Friday? Yes, we are. So we're going to set up a briefing soon to go through it, to hope that we're starting to actually see the data information. Look, I welcome that. I I guess I'm hopeful that that will work, but just help me then.

Let's just say for argument's sake it doesn't, that we continue— or maybe say it works really well and you go from 9% to 50%, which would be remarkable and a huge accomplishment, but we're still not getting the subcontracting data for half the contracts. How are we actually going to get the data if these agencies are not reporting to FMS?

Well— There were 20 agencies that reported zero information on their subcontracting over the last 4 years. We are going directly to the agency commissioners. We have confidence and faith that those agency commissioners are going to require their staff to work with and enforce the contract requirements, which calls for MWBE or subcontracting payments to be entered into Passport on a regular basis.

I really appreciate you saying that because look, Yeah. This is a management issue. This isn't— it's— this is the law. This has already been the law that they have to report this information. I think we passed another bill that the Speaker passed earlier this year that further underscored this is the law, that this has to be reported, and agencies don't do it.

I think DDC does it because— for a variety of reasons, but I think they have a good news story to tell because they do a terrible job on their— they don't do a great job on their primes, and so they need to highlight their subs or it would be really ugly. So they try to share the information.

I don't know why other agencies don't do it. Do you have insight into why other agencies don't take this seriously? I've asked the question, and once again, we proactively now are reaching directly out to agency commissioners on a regular cadence. And I'm confident that agency commissioners will enforce their respective contract requirements. Okay. I really appreciate you saying that.

I really believe strongly that public accountability is key to holding agent— to actually getting agencies to change behavior. Management from City Hall and public accountability are both critical. Can we work together to ensure that this information is made public on a regular basis of what agencies are actually sharing the subcontracting data and what aren't so that we know who's taking subcontracting to MWB seriously and who isn't?

Certainly. Certainly. We, once again, we view the City Council as a partner. A win for us is a win for you. Well, I just generally, I don't mean to beat a dead horse here, but like inevitably we're doing a lot of subcontracting to MWBEs, but without the data we don't know. And we don't— there's, I presume, very large sums of money that are flowing out the door to Black, Latino, Asian, and women-owned firms every single day But we don't have any information to actually celebrate that or not, and the information we're getting is so sclerotic, it's coming— it's inconsistent that we don't— we can't tell a story.

Yes. And so, you know, I think the control— the way the Comptroller's Office over years now has handled their report by saying, we don't look at the subcontracting data because it's just too uneven and inconsistent and it's too fractured a story. Yes. So, I appreciate that you're making this a priority, and that you're trying to fix it, and you're bringing a management orientation toward telling the agencies they have to take this seriously.

We're very excited to see that information showing up in Passport. I get— so, then, just not to belabor my initial point, but if they are going to be putting that information to Passport, that's how it's getting into B2G. Yes. What's the added value that B2G has if we're just getting that information in Passport? The added value is once again— For the Big 5.

Yeah, the Big 5, and also having one centralized portal or information system where you can look at all of the MWBE activity and metrics for the city. And is there any other planned uses of B2G beyond the kind of data and accountability? It's a tool which allows agencies to better enforce their MWBE requirements. And you're— Based upon payments.

And I know I really appreciated your testimony where you highlighted that you're kind of taking a contract stat-like approach of engaging— contract stat or, or, you know, comp stat-like approach, excuse me. I'm the contracts chair. I think about things in contracts that way. The— that's not how the world looks at the work. I should pause and just say we're joined by Councilmember Althea Stevens, who I lovingly refer to as the vice chair of this committee because— Thank you.

She refuses the title, but I give it to her anyway because she is so passionate about contracting reform and making sure especially our nonprofit partners get paid, and I really appreciate her expertise. Thank you for being here, Councilmember Stevens, and jump in with questions whenever you'd like. And we have Councilmember Vernikoff on Zoom, Brooklyn's own. Thank you for joining us, Councilmember Vernikoff.

So is this data— the data will be valuable to you based on how often you're getting uploads from FMS and Passport feeding in. So are you expecting weekly reports, monthly reports? How do you anticipate utilizing the data in this new system? The cadence of the reporting is, as Dwight Flynn indicated, almost in real time. Let's— we— and this is going to be transformational because the city has historically evaluated their MWBE successes based upon contract awards.

The more important metric here is payments. Right. But payments are less than awards, right? Often. Well, they're— once contract matures, The payments will, at some given point in time, they will catch up. Hopefully. Right, yes. And so, for example, the estate has utilized this system for decades. They don't capture— they capture awards, but they capture, more importantly, the payments on those awards.

So, for example, if we report a $10 million contract that was awarded 5 years ago, not to exceed $10 million, At the duration of that contract, after 5 years, if only 50% of that contract has been actualized, you've overstated the success. So converting from contract awards now to payments is a better barometer of success. I guess it should probably get me to start asking you questions about how 65% of MWB contracts leave vendors working at risk and doing work before contracts are registered and they're actually getting paid.

So, it will also show that we're not doing a very good job of actually paying these firms that are often smaller firms that can't afford to wait for months or years to get paid, and that too many of our agencies don't have their act together and are delaying payment. So it may also tell a story that's not all that pretty for the city.

Is that right? Well, it's saying— it's my understanding that this administration is taking that very seriously. It's also my understanding that there has been a procurement reform committee that has been established to look at the time that is taken to award contracts and the time that is taken to pay vendors and contractors. I welcome the Mamdani administration's kind of earnest focus on how to make government work better.

And I know that the intentions are there. This stuff is hard. Administration after administration has struggled with these issues. These are evergreen challenges that frankly have not improved sufficiently over a long period of time, despite many mayors saying this is a priority and that they're going to fix it. And I just want to highlight, 35% of MWB contracts have not been registered for more than a month after the start date.

So when we're looking more closely at when people are actually getting paid, we're going to see that we're not doing a very good job of paying these folks. And, you know, if we want these smaller MWB firms that are receiving smaller city contracts to continue to grow and to get larger and larger contracts in the city, which I know is our shared priority here— Yes.

We need to pay them. Right? And we can't put them in untenable situations where they're waiting for months or years to get paid for the work that they've already done. So I think I'll complain to other people on another day about our failure to pay people on time. Chair Ressler, if I may just add to this point before we move on, if you wouldn't mind.

By all means. We're having a nice conversation. The Comptroller's report was a look back on the performance of the city. But since then, particularly with MOCS and Passport, we did have Release 6, and Release 6 did introduce a new centralized workflow that included a better way of recording and reporting subcontractor utilization, payments to subcontractors, tracking the performance of the subcontractor utilization goals.

And so that data does exist today. So you're seeing information increase in— Will be available for city agencies to— Is that the report that Chief Garner referenced that is coming to him on Friday? The subcontractor— I believe Chief Garner is talking about the subcontractor payments that are recorded. So, yes. Okay. So you think now, based on your expertise and the improvements in Release 6, that we actually have a much better understanding of the subcontractor landscape today than we did a year ago?

I would say it's fair to say that we have the tools now and the data available that will allow us to address the issue, which we agree it's a management, it's an oversight management performance issue. And we just want to be able to— what MOCS is always trying to do— get better data and make that more available. so that we can review and make more informed decisions.

But you don't yet have an understanding of, let's say, what percent of the subcontracts citywide are actually captured here so that we know how many of them are MWBEs? We don't know that? I think that's something that we would be able to provide, but we'd have to follow up on that. Okay. I think we'd love to follow up on that.

I'm glad to hear— I'll just take a step back to say I'm grateful that this is a priority that you all have identified and that you're working on. and that the new administration is really digging in on how do we do a better job of gathering this data comprehensively of subcontracts happening and how many are going to MWBs, and you're including the Big 5.

I think those are all the right things to be doing, and I really want to commend you for it. You know better than me whether creating a new technology platform was necessary to do this or not, but we're down that course, and I hope that it's successful. I continue to be skeptical that we're going to get the information into Passport that we need, But it sounds like everybody's trying, and that you're trying from a management perspective.

You're trying from a platform perspective— platform improvement perspective. And we'll all push together. I'm very happy to be a loud and obnoxious council member saying to agencies, do your damn job and report this data. It's really important. So let me know how I can be that partner as well.

Great. I did just— before we went down this rabbit hole, which I really did enjoy and found insightful, I just want to come back to the initial question I was asking you, Chief, which is in FY24, according to the Local Law 174 metrics, about 17% of contract value went to MWBEs. And then in FY25, we were at half that number, at just over 8%.

Could you help us understand why did we see that significant decline year over year? I would, I would need to, to follow up. And once again, I believe that we are now better equipped to capture the prime and the sub. I can tell you and give you— I'm just referring to primes. Yes. Yes, because I don't have the sub data.

Yes, I can tell you that we've been working internally in order to maximize prime contract opportunities. For example, we worked with SBS and with DCAS on an armed/unarmed security guard contract. That was the first time that that contract had been issued. the RFP. We were zealous of breaking down the contract, disaggregating it, as opposed to having one larger contract.

We now have 4. We had a series of meetings and invited MWBE firms to DCAS. I'm proud to announce that we've awarded a $400 million contract to an Hispanic-owned firm. Great. Almost one of the largest contracts in the history ever awarded to Hispanic-owned firms. The name of the firm is Intercom Security Systems. They have a major prime contract.

So we're focusing on creating opportunities for our MWBEs at the prime level. Good. That's helpful. We would like to get some clarity on what happened from '24 to '25 and why we saw that reduction. So if that's not something you're prepared to speak to today, we would definitely I appreciate a follow-up there.

So, I just want to kind of continue to harp on the issue of the value of MWBE contracts relative to non-MWBE contracts. So, the data we looked at from FY25 was that the average MWBE contract was about $750,000. The average non-MWBE, white male-owned firm, I should just say it that way, right? The average contract for a white male-owned firm was $3.65 million.

Could you explain what you think accounts for this disparity? I mean, that's more than 4 times differential, an average of a white male-owned firm versus a non-white male-owned firm. Why do you think we have such an extreme disparity there? Right. So, I mean, it is not unique to only the City of New York. I can tell you at the state— Oh, no, no, I agree. 75% of MWBE contract awards are awarded at the sublevel as opposed to the prime level.

When you factor in the lack of access to capital, when you factor in the lack of access to surety bonding, when you factor the lack of the right-size contracting for MWBE firms, you will always see that. But we are working internally, certainly with our partners at SBS, access to capital programs, debundling of contracts at the agencies, designing smaller packages.

And having the ability to go out and recruit MWBEs and put them in the contracting critical path that they can bid as primes. Because winning a contract as a prime, as you know, you are in control of your own destiny. Right. And so we are very focused on creating opportunities for our MWBE firms at the prime level.

Working as a subcontractor, hey, listen, it's a good business for some. But let's not fool ourselves. We need to do a more effective job of creating prime opportunities for our MWBE firms. So I— and to be clear, the disparity I'm referencing is between prime contracts. But I do want to kind of harp on that point, which is we have— we've clearly done a very, I think, an admirable job as a city of connecting more MWBEs to small contracts through the $1.5 million procurement cap without a competitive process and being able to select an MWBE for work?

Well, let me— we— one of the first things that we did when we came to the administration, that we changed the name of the noncompetitive. It is not noncompetitive. Agencies have the ability to go out in the marketplace Solicit prices only from MWBE firms. As long as that pricing is aligned with historical pricing, the agency has the ability to award the contract.

Bless you. Thank you. The agency has the ability to award the contract right there on the spot. Great. But, and so we've— They can go through a competitive process to try to get the best price, but they also don't need to go through a competitive process if that's just the fastest procurement vehicle and they want to move quickly.

John, do you want to respond to that? Sure. There's still an obligation to have some level of consideration for price and what operates as the best value to the city. So I hear what you're saying. Well, I don't want there to be a misunderstanding that there is a straight line to a particular vendor that's an MWE that excludes any other.

We want to give due consideration to anyone, but the important part is that there's a dedicated space right now for those MWBs to operate and have that ability to get those awards. And so I think that's more the— Let me— maybe I'll say it a different way. Yeah. Agencies can more quickly— oh, you guys are ready for questions.

I'm sorry. You know, I get carried away. I'll do— I'll just finish this and then I'll pass it to you guys. Agencies have a faster procurement vehicle to go to MWBs for under $1.5 million than not. So there's an incentive there if you want to get something out the door quickly and get the work done to engage an MWBE.

For the Local Law 174, 5 area— 5 priority areas, we're connecting, you know, city traditional— the non-Big 5 city agencies. It's like 65% of contracts are going to MWBEs. That's a positive thing. But it's for a teeny fraction of the total spend. And— What I'm— it's this, I think, the same point you're making about subs. Also for these small contracts where you're the prime, which is most of what MWBEs are getting, they're getting very small contracts under $1.5 million.

Their average spend is $750,000, which is not nothing, but it's not— when the average city contract is 4 times that amount, there's a real question. How do we build that pipeline? How do we help engage the MWBEs that have city contracts? that are working with the city, that are demonstrating that they're effective, that they're doing a good job, how do we help them grow to take on larger contracts so that they're not just seen as a faster route to procurement for under $1.5 million?

I will answer that and then I want to defer and turn it over to SVS to talk about some of the supporting programming that they have for MWBEs. But I will tell you, we are starting to see a change. I mean, the mere fact that we have the ability to award a $400 million contract to an MWBE tells us that what we're putting in place is working.

And so your question is that we have to have the ability to equip our MWBE firms with access to capital, surety bonding assistance, and we have to have the ability to integrate them into the critical contracting path, allowing them to bid on larger projects. And we're starting to, in fact, do that. Thank you, Chair, for your question.

Haris Khan from Small Business Services, Chief of Staff. Wanted to add as well, in partnership with the Mayor's Office of Contract Services and the Office of MWBE, we work very closely in developing, delivering programming to support the capacity building of smaller MWBE firms. One particular program I'd like to highlight, Contract Financing Loan Fund. This is a revolving low-interest loan fund for MWBEs that they could use to grow their capacity, hire more staff, do capital improvements as they fulfill city contracts.

So get upfront capital at a roughly 3% interest rate, much lower than market rate, and start delivering on the work that they have been engaged with a contracting agency. And that's just one of the variety of services we have. One-on-one technical assistance, capital access support, some legal help available, educational programming. And we're really proud of organizing, and we promoted it across all of our CBO partners and with the district offices as well of our NYC Contracting Summit.

Tagline, a new era for small businesses. This was on January 14th, the second week of this administration. Deputy Mayor Su was the keynote. Chief Garner was the keynote as well, where we talked about and promoted under one roof over 100 city and state agencies, programs, and resources for MWBE firms. That crowd, it was open to all businesses, but overwhelmingly over 80 5% of the attendees there were minority and women-owned.

So look, I appreciate both of your answers, but I don't think it's enough. I— not to be so blunt, but I think access to capital is really important, and I'm glad that you're— you both mentioned that and you're focused on it and trying to help in that regard. But I actually think as a city we need a much more proactive approach where we're identifying MWBE vendors that are doing a really excellent job with smaller contracts and providing technical assistance and professional development to support them on how they can grow and thinking about where are their pipelines for them to do more and do better with larger city contracts.

And that should be our base that we're looking to support because they're already working with the city, they know all of the ways in which the city's a pain in the butt, and they're working with us anyway, and they want to do more, let's help them. And I just feel like we need a proactive, deliberate strategy to engaging those vendors That's how we're going to change 65% of contracts but only 8% of spend, right?

That doesn't— that's not a pretty picture, right? I mean, it's an improvement from where we were, and I realize that, but we should be doing so much better in that regard.

So I have, as you can imagine, a bunch more, but I've really appreciated the direct responses. Let me pass it to Councilmember Stevens and then Councilmember Farias.

Hello. Good morning. Morning. Thank you for being here with us. I just have a couple of questions as I'm looking through some of the information and specifically around, like, Black-owned women and WBEs and seeing the numbers being so low and such a disparity in the MWEs is also crazy, right? But just also just thinking about what policies have you implemented to address those concerns?

Are there specific things that you're doing to ensure that, like, these other groups who are not getting these contracts are doing other than capital. And I think it's hitting on what Councilmember Russell is saying, like, could you talk about specific policies? Because I think the numbers are so glaring for me as a person who will be in charge.

I'm like, okay, so we need to start here to figure out how do we do this other than capital? Because we know that the whole point of this is like a lot of these folks are smaller businesses and they need additional services. And it It just can't be capital. So, I would love to hear more specifically about the policies that's been created to kind of address the disparities even within this, in WBE categories, and specifically looking at Black minority-owned women businesses.

They only got like 371 contracts. And looking at Native American women, they got 1. So, like, how— why are we not starting there? And could you talk specifically about what policies have been implemented? to address that. And I just want to add a data point that I had in my opening that I think both of you would appreciate.

Out of every 100 MWB contracts, one went to a business owned by a Black woman, one went to a business owned by a Latina out of every 100 contracts. Sorry, but her question. I'm sorry. No, no, it's a great question. So, so certainly we are prioritizing this now. We, we first got here, the City of New York's MWBE percentage was 23%.

Last year, that number increased to 36% MWBE inclusion. So we wanted to focus on increasing and exceeding the city's annual goal of 30%, and we've done that for 2 years and counting. Now we are focusing on the disparity within disparity, focusing on Black and Hispanic-owned businesses and women-owned businesses. Certainly, we have a lot of work to do when it comes to the recruitment, certification, and engagement of women-owned businesses and integrating them into the procurement process.

And so could you talk about some of the policies that you're creating to actually do that? What does that look like? What are the steps that you're taking? Do you have like an action plan? Do you have dates and like milestones and goals? I would love to like get into the nitty-gritty of it so that we can have a better understanding because I understand, yes, increasing from 23 to 33 sounds great, but it sounds like we're still targeting specific groups that are in this, this group.

Because I'm looking at the numbers, right? Like, and so Asian males got 13,337 contracts, whereas again, Black women got 300. Well, let's go to the Black men. Black men organizations got 1,400. So how are we even diversifying in these groups? Like, great that it increased by that percent, but it's not being diversified. So could you talk about some policies and like a timeline of what this would look like in the next 6 months?

Are you like, other than like saying we're recruitment, what does that recruitment look like? Could you just give some details? Because I think that like this is like really important for us to make sure that we have a plan. And if not, like definitely happy to like brainstorm around that. But I think that it's really important. Yeah.

Yes, it is. And we, and we, we share your concern. We are meeting every week with agencies, looking at best practices, focusing on the lack of contract awards that's going to women. We are instituting a roundtable discussion with agency commissioners in a very, very short period of time. We are, we are going to be working with our agencies and also SBS in once again recruiting these businesses, giving them, equipping them with all of the resources that they need, and finally, once again, integrating them into the procurement process.

Okay. Definitely would like to just kind of keep staying in conversation with you guys. I have a couple more questions. Sorry. Oh, I still have time.

The next question I just wanted to go on to, your office is also in charge with oversight and accountability, which agencies have identified underperforming MWBs. What specific corrective action plans has your office required for them to happen? So if you are underperforming, what does that look like? And have you created some steps to ensure that they— that their behaviors need to be corrected?

Yes. So we have— we are finalizing our MWBE results from the most previous fiscal year. That analysis will be finished towards the end of this month. We are going to start meeting with individual agencies, sharing their data with them. For those agencies who are under 30%, we are going to meet with the agency commissioners, their respective ACOs, and their MWBE staff to determine what we should and could be doing in order to get them over to 30%.

Additionally, as we just indicated, we want to focus on the disparity in disparity? Why is it that certain groups are not receiving their fair share of contracts? And so we will be working with our agencies in a very, very short period of time. We started those meetings, and then those meetings will continue as soon as we finalize the data for the most concluded fiscal year.

What accountability and compliance mechanism has been put in place since you've taken this off, then how often does your office review agency performances, and what happens when an agency consistently misses its goals? So we basically meet with agencies every week, every Monday at 3:00 PM. We call them the MWBE CompStat meetings, and we want to look at their metrics, and we're generating data now once a month from the Big 5, and we are generating data from MOCS every quarter.

And we're looking at this data to observe trends and what we should be focusing on for improvements. And you asked the last question about the accountability of— Yeah, what are the accountability mechanisms that you guys have in place if they're like inconsistent or missing their goals? Like if the MWB is missing their goals, What accountability mechanisms have you guys put in place?

Well, certainly we are bringing it to the attention of the agency commissioners. I mean, and also we're working internally with MOCS and other stakeholders here to enforce and have the agencies enforce what their contract requirements are.

I have a couple more questions, but I'll pass it off and do another round. Thank you. Thank you, Vice Chair. Thank you.

Thanks, folks, for coming today and testifying, and thank you, Chair, for giving me some time for questions. Just in terms of my bill introduction 694, walk us through what happens when an agency misses the utilization goals. Apologies, I had to get attendance at another hearing, so if you spoke about that and I missed it. How many improvement plans were submitted last year?

Who reviews them? How do they get worked through? Utilization goals, if we miss them, improvement plans. So MOCS works with SBS and OMWB to review agency utilization plans, monitor the performance, support the agency-specific improvement These efforts are complemented by outreach and technical assistance, and it's more— the corrective action is more of the analysis and then what can be done better to achieve better results going forward.

Okay, and remind me again, how many— I mean, how many improvement plans were actually submitted last year, if we have that number? That's something I'll have to get back to you guys. Okay, great. And then tell me again, who reviews them? How many folks are in line of reviewing each of those improvement plans for corrective action? So what I was describing was something that's done at the beginning of a procurement process.

You're reviewing that utilization plan so that you can make your determination about what goals you set and how you're establishing your contract. Looking at the Performance on how you're doing once you have that contract in place is that constant monitoring, checking in with those agencies. And then the follow-up is how did we— what was the end result and what do we need to do?

Where do we need to target our focus to achieve a higher engagement with MWBEs for future needs? Okay. And so where those utilization goals are maybe failing or underperforming, Do we do targeted outreach in those areas to either improve the numbers or gain more? So in that area, I'll defer to my colleagues on that for the outreach efforts.

Certainly on the outreach, and I will defer over to SBS also as well, but I can tell you since the time that we got here, we wanted to take the MWB program to the community. And so we've been scheduling MWBE outreach in conjunction with the borough president's office and the various chambers of commerce. And so we've been to every borough, including Staten Island, for targeted MWBE outreach in boroughs in the Bronx, Queens, Manhattan, Staten Island, and Brooklyn.

And then just Quickly, in relation to what my colleagues were talking about, when we're looking at numbers of where contracts are being, like, actually procured and who's getting them, and looking at these utilization numbers, and we're seeing certain groups or certain demographics underperforming, how are we addressing that? I mean, I'm not a small business owner, so maybe I'm missing the targeted ad on Instagram or something that's trying to get more people registered. as an MWBE, or maybe, um, maybe I'm missing something because I'm not part of that target outreach group, but I'm just wondering, how are we ensuring that these plans are being put in place and/or the numbers that we're looking at or the demographics that we need to look at that we're clearly failing as a city to provide procurement opportunities to?

How are we adjusting here? I mean, uh, thank you so much, Councilmember. Um, so I think I'd like to just add, uh, more, more context. It's a program, it's a very important program for the city, and there's 3 key agencies that are involved. Uh, SBS is the education outreach programming arm to support the individual business when the individual business needs resources.

So we have a contract financing loan fund product that gives an MWB firm, if they have a contract upfront capital that they could use to get started on the work. We've got an online business directory of all MWBE firms that is another tool for— based on the certification that we manage, that is a tool for all of the agencies to utilize as they search for potential qualified firms.

They could leverage that directory. But in addition to that, we have a buyer services team that not only just supports city agencies but even other entities, including as we had the FIFA World Cup in the city, we attempted to make sure that the organizing team in Jersey understood and knew that the city has a directory of all MWBE firms.

And if they wanted to engage with us, we could even give them a curated list based on the types of industries or the types of contracts they're interested in and respond to them. One relevant example to what you've asked is recently the Mayor's Office of Media and Entertainment and OTI reached out to us for a $7.5 million opportunity of a professional services contract related to grantmaking.

We leverage understanding, asked them some questions, better understood what they were looking for, gave them a curated list of 20 MWBE firms that are currently in the directory. So while we in this tri-agency oversight role are simply an education and a resource provider, and the governance on utilization rests with our partner agencies. When an agency approaches us and they have a clear sense of what they're looking for, what they need, we will give them a curated list and try to better understand their needs and then give them firms that they should consider in their contracting process.

We are not in their contracting team, so we have no idea the next steps as to how they manage those contracting decisions, but we're here as a resource for the vendors, the firms, as well as the procurement officers. Yeah, I, I think we all understand that there's a There's a part here that's, I guess, not necessarily connecting.

What is the purpose of any of us promoting MWBE certification if the numbers that we're hearing in this hearing were 1 Black woman company and 1 Latina woman-owned company out of 1,000 that are provided or offered? Sorry. So I wanted to— maybe I misspoke. What I was referencing was not a promotion of certification writ large, but rather providing qualified firms.

I understand that, but I'm saying for us, when we're here in our oversight ability and we're looking at the actual data and you folks are looking at the data, whether you're procuring a list of 20 people to recommend for a $7 million contract, what is the point, I suppose, for businesses across the city, specifically Black women, Latinas, women of color?

They see these numbers, they're hearing these numbers. Why would they go through this convoluted process, this long application, pay to do all of this when the likeliness of all of the businesses— what's the percentage of businesses that are Black women-owned that we have in the MWBE system? Do we know the percentage? Of firms that are certified, Councilmember?

We can get that to you. We definitely have it. Okay. For example's sake, let's say 20% of the businesses are Black women-owned, 10% of the businesses are Black women-owned. they're hearing the number of 1 out of 1,000. What's the point of recertifying if the likeliness of them getting that contract is slimmer to none than anything when they have to do this annually and the likeliness of them getting in?

I think that's part of the reason why we're looking at legislation. It's part of the reason why we're having this hearing. And we've had this hearing year after year in the council. Realistically, we are not utilizing the data in front of us. We're not seeing utilization goals, coming up with plans, or even doing the outreach necessary in communities where we're lacking certification, where we know businesses exist and we're not getting them in to, to take 20 lists and make sure 15 out of those 20 people that we're going to promote to an organization or an agency for a $7.5 million contract is either a woman and/or a Black woman and/or a Latina. et cetera.

Like, I think that is what we're really talking about here and what we're trying to get to at the crux of. I know you folks know this as well, but I think we need to put bigger thinking hats on when we're looking at these— the data is in front of us along with the utilization goals and potentially these improvement plans on how to get more people in to ensure that they're actually getting the contracts that are afforded to them by the taxes they pay. and being a part of New York City.

I look forward to getting the response on the question that I asked before. And I'd love to hear from you folks. Sure, go ahead. I do have the— so it's 33% of the certified pool is African American certified businesses. Yeah, that's a pretty big percentage comparatively to looking at hearing the number of 1 out of 1,000 for Black women getting a contract in New York City.

I'd love to hear— I can assure you that we are having internal conversations I'm taking this personal. Yeah, it's personal to me too. That we have to do a better job and we will do a better job of broadening the contract awards to all groups that we certify. We appreciate that. It's getting better. It's not where we want it to be, but it's gradually improving because we have an emphasis on it.

Yeah, I think I hear that, and I look forward to seeing our numbers improved. You know, I think also, at least from my first term and coming into the second term, we constantly hear from people, from entrepreneurs and small businesses, that this process is convoluted, paperwork is intense, it's time-consuming. There's streamlining that has to happen. There's simplification that has to happen in order for, like, our folks and our communities to actually compete.

Like, there's a level of competition that we have to also help folks streamline to improve these numbers. And even in the subcontracting process, making sure payments go out first to those people despite the completion of the job. Like, there's a lot of steps that we as a city have to rectify that we've been talking about for a lot of years that I hope we can get to really soon.

Just in my last thought, I'd love to hear, you know, if and when these bills pass on the subcontracting side for Councilmember— for Chair Wrestler's bill, excuse me, Will they then be included in this level of reporting for— in connection to my bill for the utilization goals and the improvement plans? Will they be a part of— the subcontractors be a part of those plans potentially?

I think that whatever the results are of what bills are passed, Naturally, we will— the administration will take whatever steps to incorporate the requirements of those laws into our practices. Okay. Thank you, folks, so much for the time. Thank you, Chair.

Thank you both for, I think, totally spot-on questions that are— I really strongly, strongly agree with the line of questioning and the points that you are both making. So thank you for making them so persuasively. I just want to come back to what Councilmember Farias was asking about, Mr. Khan. I just want to make sure that I understand it.

So you're telling us that from the total number of certified MWBEs, could you just break down what percentage is Black, what percentage is Latino, what percentage is Asian, what percentage is white women? So it's 33% as African American, 28% women-owned business. We can get you the breakdown of the subgroup data. It's all quarterly reported to the council as well, and it's all public information.

And MUCS also maintains an indicators page on their website where it's updated. So I guess it's just the data I'm looking at is different, so that's why I'm confused. So it fluctuates year to year. There's recertifications, there's certifications. The controller might be looking at FY25. We did— I did want to note that the number on Latinos. So we have in FY26, I think I do have the numbers now.

We've got Asian firms at 23%, Black firms at 33%, Hispanic firms at 19%. And then we have Um, white women firms at 26%. Got it. Women form 55% of the full program. So, I just want to make sure that I'm thinking about things the right way. Please feel free to correct me if I am. But that— we'll start with black firms as an example.

About 33% of registered MWBEs. So, we're doing a good job on outreach. in reaching Black firms across the city, helping to get them registered, certified, but less than 7% of MWB contracts are going to Black-owned firms. Is that approximately— do I have the right contrast? I defer to the City Hall colleagues here on the— if we're looking at Local Law 1 or One NYC, but what we have— the certification numbers is what you're citing.

I'm just looking at the comptroller's report. This is what he had in his report for Local Law 174. So I just want to highlight, 33% of certified MWEs Black, just less than 7% of contracts for traditional city agencies going to Black-owned firms, 19% of contracts of vendors that are certified are Latino-owned, and less than 8% of contracts are going to Latinos.

Just as examples. So those are areas where we just clearly have a lot more work to do. And I appreciate your point, Chief Garner, that, you know, there's been an effort to improve things, but the status where we are today is profoundly unacceptable. And I just think this has to be a major priority for this administration to start engaging Black and Latino firms in particular in a real way because they're not— I think that we are not achieving the goals of our MWBE programs if we're not engaging those firms and contracting with those firms at scale.

So I think that my colleagues have asked the questions around what efforts are being made to boost participation, especially of women of color-led businesses, and I just I, you know, really want to underscore, I hope that that is happening on steroids.

I'll do a handful— well, I won't— let me not overpromise. I'll keep going until Vice Chair Stevens tells me she wants to jump back in. There is significant variation in MWB performance across city agencies. Some do pretty well. Some seem to not care about this at all, um, in the previous administration, just looking at the data from previous years.

I imagine in this administration everybody will make it a big priority and the— and everything will be perfect. Um, but for example, DDC seemed to be performing significantly better than the Health Department, for example. Could you just walk me through an agency like the Health Department failing to do its job, not taking, uh, contracting with MWE seriously, not making it a priority, What's your intervention to try to get them to course correct?

Right. So once again, we're, we're looking at data on a more regular basis. I'm having meetings with agencies and at the, at the commissioner level, working with their ACOs and working with their MWBE staff, giving them the support that they need, creating programming That would allow them to do a more effective job in their contracting. So we are up close and personal.

And, you know, this— it has to be the era of transparency and accountability. And we are using the data in order to drive effective change at these agencies, allowing them to do a more effective job of broadening their contract awards. For the public, what's the best real-time information or kind of regularly updated information that we can access to understand how agencies are performing throughout the fiscal year?

Well, certainly with the introduction of B2G, it's going to give us like almost real-time of contract award data. And also, more importantly, once again, the payment data. And so— sorry, you okay? Once the system is fully operational, we can generate data almost on a daily basis. Great. So I think we'll have to figure out a public reporting cadence of the B2G data as that platform comes online.

And— No, we're— go ahead. So, I, you know, I guess I don't mean to pick on anybody. This is the previous administration, I guess, that I can still pick on because it's the data we're looking at. But we found that generally some of the smaller agencies have had greater success in both their percentage of contracts that go to MWBs and the percentage of their overall contract budget that goes to MWBs.

MWBEs, and that larger agencies have not been able to kind of integrate MWBE prioritization as effectively. I know that's an oversimplified analysis, but, you know, for example, Chief Kahn, in the latest controller report, SBS was among the worst performers in your own contracting with MWBEs. and recorded zero subs, which may be the types of contracts that you all have.

You may not have as many subcontracts, but just how are you as an agency, just as an example, trying to course correct and do better in this new administration? So we are very, very small contracting— we're an incredibly small contracting agency, but we can get back to you on what we've done on MWBE. We usually have performed at the highest of the pack. most of the years in our MWBE performance.

So whatever the data discrepancy is here, we'll look at it and we'll follow up. Okay. I mean, I would imagine this is, you know, a real priority for you all considering the— you've got a Deputy Commissioner that's responsible for this portfolio of certifying firms and doing outreach and engagement. I know that most of the folks you contract with are nonprofits, you know, BIDS, et cetera, but local development corporations.

Yes, we just don't— we don't have capital dollars. We don't do construction in the city. We don't run incredibly complicated programs. We do direct service work. Most of it is done in-house. Some of it is done through contracted partners. No, but you're the agency sitting at the table. These guys don't— none of the people to your left do any contracting.

So you're the person I can pick on. And it's just to say as an example, you're— SBS, which is like your mission is this work, still in the relatively small amount of contracting you're doing, at least for FY25 in the Comptroller's most recent report, because that's the data that I use as my Bible, wasn't contracting with MWEs at the scale that we should be.

So, I can go through the specifics if it's helpful, but, you know, I think we just want to underscore that every agency needs to make this a priority. I think we've gone pretty deep into subcontracting.

But I don't think I've asked specifically about my bill, so let me just do that. Sure. I— as I think I've explained, we have some large nonprofit contracts, like with a shelter operator or a close-to-home operator or something like that, where there are significant subcontracts to for-profit firms. In fact, in the DHS space, it's been where we've seen a lot of corruption over the years, unfortunately. to have transparency and accountability there.

Is our legislation that would require nonprofits to report on whether they're subs or MWBEs something that the administration supports? I think it's consistent with the broader mission that you're laying out around better data around subcontracting so we can tell a more comprehensive story of how we're contracting with MWBEs? Let me defer to Max first, and then I will hone in.

Thank you for the question, Chair Ressler. It's something that we're looking at, but just given what I was sharing at the hearing today about the information that we are collecting, the ability to report on level of subcontracting across all contracts, not just MWBEs, but Any prime contractor that has a subcontractor, it's being recorded and reported in Passport along with payment information.

And that's something that I think when you look at what currently exists today and you compare it against what this bill is recommending, it may seem like there might be some duplicative work here. I'm— if— But we're certainly happy to have a— If you adopt the improvements from Release 6, are— have been so dramatic and there has been, like, a sea change of compliance with subcontracting reporting in Passport in the intervening year since the last Comptroller's data and report, then I'm happy to pull back my legislation.

But I don't believe that that is the case, and I don't— and I think that we need this data, and I think we need this data across the board. Like, I am eager to see updated data from you all on how we're doing on the subcontracting piece, but I think this is going to be very hard to actually get agencies to comply and submit this data.

So, and I— it sounds to me like B2G is kind of dependent on agencies actually taking this on seriously and submitting their subcontracting information into Passport. So, I appreciate that we have City Hall support on this, but, like, this has been impressively not done across the board. clearly not cared, despite this being local law and despite this being a priority.

So I— if you can show me a data report that shows you have all this information, I will tell the speaker that I no longer want to pass this bill. I don't believe such a data report exists, but I'm open to being persuaded. Councilmember— Chair Wrestler, I'm sure that Director Yu would be more than happy to incorporate this into the regular cadence that she has with your office to discuss viewing this data on a regular basis.

I appreciate it. I just— to be clear, in the last controller's report, 9% of subcontracts were reporting to Passport. 9%. So unless you've got a report that shows me that 100% is happening now, we're going to push this legislation and we're going to be really aggressive in trying to support your efforts because this is what Chief Garner is saying is a priority. major priority for him.

You correct me if I'm saying anything incorrectly, but it's a major priority that we get all agencies to report their subcontracting data so we can see where funds are going to MWBEs. I, you know, so, but if Director Yu and you have a report that can show me that we're magically doing this today and we weren't doing 9% a year ago, I will be thrilled.

I might not have had the hearing. I mean, that's not true. I would have had the hearing for other reasons, but I wouldn't have spent half the time talking about this topic that I think is so important. So I will just say again for the record, for Councilmember Brewer's benefit, that I think it's over the last 4 years there was $33 billion in spending that's subject to Local Law 174 where there's no subcontracting data reported into Passport whatsoever in aggregate over that 4-year period.

That is a lot of money where we have no idea whether we're supporting MWEs with it or not. And it makes Chief Garner look bad. Right? Because he could be getting credit for billions of dollars that are going to MWBs. We might be supporting more Black women-owned firms and more Latina firms and more other firms through subs that we don't have the data for.

So if that data is there now and we're doing a better job and we're making this a citywide priority, I will be the happiest man in the City Council. But I am waiting to be persuaded. So I think I've asked enough about my bill.

Councilmember Herbold. Councilmember Brewer, before I keep going, do you want to jump in?

Yeah, one question that I hear all the time, and again, this is on the larger scale, is it's too complicated to apply. Is that not true about to be an MBWB? I hear that all the time. Councilmember Brewer, thank you so much for joining us. I was next door. I wasn't far, just so it's clear. Go ahead.

Oh yes, I'm sorry. So yes, the application really depends on the business structure and ownership structure, and there is a requirement to produce business origination documents, ownership structure, bank letters, and this is all the required documents that the city— and the state program as well has similar requirements. What we're really excited about is the state recently announced a streamlined state certification portal, and we're in active conversations with the state to come up with a way that both of these things work seamlessly and makes the process faster for a New York City firm that wants to apply to city and state certification.

Because essentially, if you're interested in city contracting, you probably could also be very interested in state contracting and vice versa. So they would be the same? When you say streamlined, they would be— Not necessarily the same, but we are working very closely with the state portal, and they do have some functionality where an applicant that is applying through the state's portal could select themselves as a person interested in the city portal.

What's the timing on that? Do you have any sense? They've just launched the state-facing portion of it, and we're in active conversations. It's somewhat of a tech project, so it will require deep coordination, but we're really excited on the prospects of that. And as of right now, separate from that potential even further streamlining effort that we are underway, if an MWBE firm approaches the city and is a state-certified firm, we're looking at an average of— and we aim to deliver a response to them, a certification decision to them within a month if they have that state certification.

Again, it really depends on ownership structures. If you tell us you have 15 partners in your business, that will complicate things because now you've got 15 different sets of ownership documents we have to review.

Another thing I hear, but maybe this isn't a statistic that's available, so you are an MBW, you get certified, how many of those get city contracts? My friends are difficult. They say, oh, Gail, I will apply and I won't get a city the contract, so why do I even apply in the first place? So is that a number that exists, or is it something that just, you know, you don't keep track of?

That is a number that Chief Garner and other principals in City Hall are driving agencies to achieve higher utilization. On our end— He's been doing that for years, that guy. Sorry, I missed your question. He's been doing that for a long time. Go ahead. So I know they're driving that effort and driving the governance and the policymaking for this program, what we're really proud of, because we're a resource provider, education agency, and then we do the certification process, is that of the MWE firms that do win contracts, over 70% of them have benefited from SBS services along the way.

Wow. Which kind of drives the point that we could be pushing agencies to do more. We can also be supporting the MWE firms to be best positioned for these contracting opportunities. And so we have a robust set of programming that we're always engaged in and always interested in providing support to businesses and putting their best foot forward.

I guess down the line would be making the world know that this number of persons have been certified, and if you are certified, then X percentage are likely of all of you to get contracts from the city. So it's worth you putting the time in in the beginning. Something to think about, to let people know. Thank you.

Vice Chair? Can I make a slight correction, Chair? Sure. 76% of all the firms that won contracts in FY26 received one or more of our services, either the one-on-one technical assistance that we provide, the connection to the contract financing loan fund, or one of our large networking events where we bring over 100 city and state agencies so the MWB firms can actually network and meet contracting professionals. 76% got services.

That's excellent. We just don't know of all of those who have registered, how many actually got contracts? I think it was like 18 or 19, 20% last fiscal year got a payment. Is that— it's the number in my brain, but Molly can correct me. She knows the answer. There's like 3 different metrics, so it's hard to— I think from city agencies.

You're right, though, you know, as we talked about a little bit earlier in the hearing, Councilmember Brewer, it's like the big— the 5 non-mayoral agencies, or, you know, whatever, SCA, H&H, it does get complicated on how we track that data. I'm trying to tell you how people do not apply because they don't think they're going to get a contract.

Totally. But if— oh, sorry. At the end of fiscal year, at the end of the fiscal year, there were 11,382 certified MWBEs and just 2,500— 2,478 entered into a new contract or PO in FY25. So, yeah, I was pretty close. I think it's one— That's the problem. That is the problem. 78% of certified MWUs failed to win a new contract with the city in FY25.

So, Vice Chair? Lincoln, just because you say it doesn't mean it's true. I'm going to just will it into existence. He's really trying to get this thing to stick. Stop trying to make fetch stick.

And so, like, as I'm just sitting here and just looking at some of this, and I know you had said that especially you guys are doing a lot of work with the agencies around figuring out how they are like going about doing this. But like, let's say I'm MWB, because I want to second what Councilmember Ruiz just said.

I know, I know a number of people who are like, I'm not doing it because that paperwork is just too much. And then the results just aren't there. Like, they just don't match for the effort. But let's say I am a business, I do get certified. Like, is there a place where I can go where there's like a list of best practices for folks who have already, who've gotten contracts and what they've done and are able to, or could I be like, hey, I need additional help.

Could you pair me with another MWBE to give me some support or some type of mentor? Because it is true, it is a lot of work to kind of do it for a lot of times no results. So just trying to get a better understanding, 'cause again, I'm looking at the numbers and disparities and they look like In, you know, in groups that already have disparities, there are certain groups that are doing this well.

And a lot of that, a lot of times that's because in that community they're helping each other. And so are we setting up situations so that like all folks have places they can go and get the support that they need and trying to figure those things out? Yeah. So that's where we're really proud that 76% of any of all MWBE firms that won a contract last year benefited from one of our services.

We really want to encourage every single New York City New York City— So don't say that because I just have to stop you there. And I say that because, again, we're looking at the numbers. It's not saying that. And so, like, yes, all, all of you in the despair is when I'm looking at the numbers, what the— what Chair said, there's 1 in 100 contracts is a Latina or a Black woman.

Like, that's clearly not happening because those folks aren't doing it. So I'm asking, are there like best practices that like those folks who are certified and they're can go to so that they can start getting those contracts? Because again, I know it's easy to kind of like talk about the broader stuff and be like, oh, we've increased by 10% and we've done this.

That's a lot easier. But I'm talking about getting down into the disparities and like, how are we like saying, okay, this group is doing good in best practices. So do we have best practices that we can share with these groups to make sure that we can start to have diversity in who's getting these contracts? And I know specifically you guys keep talking about the agencies.

But I'm talking specifically about the businesses. So, so yes, Councilmember, we have an MWE mentors program that creates space for peer-to-peer mentorship, networking amongst the firms. So how many of those are done within the specific— and again, and even looking at the Native Americans, they got one contract. So like, how are we reaching out to those groups and pairing them with mentors to ensure that they're getting these contracts?

So we've done borough-based events, we've done webinars, we've done one-on-one technical assistance. We did 2 large-scale events, both of which Which had 1,800 attendees on one end, with half of the attendees African American. Have you even looked at the list of folks who are like, who've already certified at NWBB and have not gotten a contract, and they haven't had a track record, they haven't gotten awarded?

Have you reached out to them specifically and said, you're already certified, let's figure out what's missing so that you can either get the support that you need to get a contract? Have you guys done that? The way in which we get 1,800 to show up under one roof with over 100 services is we reached out to of the certified firms and said, hey, if you're a certified firm in New York City, um, you should come to this event where we're going to bring all of these resources in one place, do workshops on passports, do workshops.

And your, your thought is that in that space and 1,000 people, that they're going to get the resources that they need? We had one-on-one sessions, consultations. We had workshops at the same event. We did everything you could possibly think of. I'm just trying to— I don't feel like I'm coming at you, but like, I'm trying to get to the answer of it, because having a big event with a lot of numbers is nice.

And I'm saying, like, what— how are we getting to the nitty-gritty? Because from that 1,000 people who showed up, how many people got a contract after that? So, Councilmember, we are not the contracting agency that makes the contracting decisions, right? But what we did at the event is we provided over 300 direct one-on-one services. These are not a large event.

Everybody showed up. They were sitting and we spoke to them and lectured them. We had 300 people, one-on-one sessions. We put all of our staff online. And it's just one-on-one. How many staff do you have? Because you had 300 people have direct sessions. How many people were there? We had over 60 people working at that event. You had 60 staff there and you met with 300 people.

How long were those meetings? Councilmember, we can get you a full briefing on— we can give you a full briefing on the details of that event, but it's just one event of all of the programs we do year-round. And the number that I was pointing out earlier, Councilmember, was of any firm that ends up winning a contract in the city, an MWBE firm of the full fiscal year that we're looking at, last fiscal year, FY26, FY26, it's 76% of them win a contract, which for us demonstrates the need for us to do more, get the word out about these services, get the word out about the program, the mentorship support, the technical assistance.

We help businesses write a capability statement, and we also help them understand the platforms that are used. Passport is not— But even when you say that, the results are still having the disparities that they're having. Clearly, that's not working. And so if one in every hundred MWBEs that are getting contracts are Black women and Latinas, it's not working for them.

So maybe we should think about other things to do because that's not getting to the people who aren't getting the contracts. So again, I'm asking the questions because maybe we should think differently, right? Maybe we should think maybe that thousand event that we had that we can come here and say we had an event where a thousand people showed up.

Is not where the Black women or Latino firms are coming to get the information that they need to get certified. And, and I know you're about to say, what are you talking about? We got 10% this and that. No, no, no, no, no. What I was going to just say is the majority of the event was, uh, Black and Latino community members.

All right, so then I guess the numbers that we have aren't real. So even if they were there, they're still not getting the contracts, correct? So the— and Chief Garner has described those cities. I'll defer to people who are showing up. Let me speak, because then you are having people that are showing up, doing the work, becoming certified, and then still not getting the contracts.

So then what's that going to do is discourage them from actually coming to other things. Yes. So, so we are, we are in total, total agreement with you that we must do a more effective job of not only certifying businesses, but once a business is certified, integrating them at the agency level. in the critical path of contracting and procurement.

We hear you. We are working internally overtime in order to increase the City of New York's ability to award contracts in a more broad aspect and focusing on the disparity within disparity. Certainly, what the city has done thus far with awarding contracts to Black women and Hispanic women and Asian women is not satisfactory. And we are working internally.

And you have my word that these numbers are going to get better. It's not just the word. I need us to think outside the box and think differently. So clearly what is being done is not working. So to tell me you're having events where thousands of people are showing up and they're still not getting contracts, that's not— that's not a fix.

And so I hear that. I hear you like, oh, there was a lot of Black women there. There was a lot of Latino women there. And those That sounds great. But if they're showing up, they're certified, they're doing all the things that they need to do, and they're still not getting the contract, what we're doing isn't working.

Right. So— and we don't want women, especially women who do extra work all the time, to then get burnt out and say, you know what, I'm not doing this anymore. And that's what's happening. So we have to also speak to that of people wasting their time. Yes. It's not easy to be certified, which you all know. It's not easy to then have to run a business, to come to these meetings, to have one-on-one consultations and still lose.

Like, that's a lot, and that's a lot to ask for. So what we're doing isn't working. So maybe we should change the trajectory and say, okay, that didn't work. Let's consult and figure out— let's go back to the drawing board. I'm here to help, to have ideas. I always have ideas. I'm not a council member who's just going to sit here and go, why are you doing this?

I'm saying, what are we going to do? Let's figure it out together, because what you're doing isn't working. That's what I'm saying. Got it. Great. And that is why she is the vice chair of this committee, because she's spot on. And it's right. The data, you know, I think it's important to recognize progress where it's happened, and we see things moving in a positive direction.

But we're not doing enough to contract with Black and Latino-owned firms. And it's a serious issue. It's a serious inequity. It's one of the core purposes of this program existing and the work that we do in this area, and it's not happening. It's not happening at the scale that it should. And so I appreciate the councilmember's commitment to kind of say, let's come up with new ideas for engagement.

Let's help get people actually into city contracts. Sure. And, you know, I don't doubt the commitment of the MWB office and the administration, and we really want to see results. So, we're eager to work on this together. Hopefully, we can— you know, some of the things that we've discussed today, I think, can get us there.

I want to just do a couple very brief things before we can close out this panel. I know, Chief Garner, you formerly worked at SCA. I heard that there were recent changes to the mentorship program at the SCA. Any insight you can offer there? Is the DDC mentorship program continuing, or is that discontinued as well? Is that a model that was no longer working?

What perspective do you have? Yes, I'm not sure about the SCA, but I can tell you that the mentor construction model, which evolved from the SCA to the MTA, and which which we at the MTA, we changed the state law in order to implement that construction mentoring program. That model has worked in some very difficult construction organizations.

There is a movement in implementing a race-neutral small business program. Um, um, as, as we move forward. Okay. Um, you know, as you learn more about some of the changes that are happening at SCA, I'd be interested in your insights. Um, and can you just help me understand a little bit, since I think a lot of this falls on your office, what's your current headcount and kind of budgeted and actual positions, uh, that are reporting to you?

So we have, um, 13, 14. But what happened with an EO is that the ACOs at the respective agencies and their respective MWBE staffs report to their agency commissioners, but they also report into City Hall on MWBE issues and initiatives. And so we're using Those that headcount at the agencies as extension of staff in driving the city's MWBE commitment.

Every agency has an MWBE director. What's the name of the position? Officer? Is it varied? So they're ACOs, right? The contracting officer on the procurement side, but then they also also have MWBE officers, right? Depending on the designated liaison at every agency. Yes, yes. And so that's who you're speaking to as the extension of your staff? Yes.

Yes. Okay. All right.

I think I'll just summarize what I think was a good conversation, and I appreciate you all coming today. For me, there are 3 key takeaways that I really want to focus on moving forward as a committee and working together. One is our just inadequate results in contracting with Black and Latino-owned firms, especially Black women and Latina-owned firms, where the numbers are especially abysmal.

Secondly, I'm really excited about the new data you're going to be gathering, and that seems like administration-wide effort to better understand how we're subcontracting, because there may be a good news story to tell there about how we're engaging Black and Latino-owned firms. that we're not currently seeing once we have a better comprehensive understanding of the subcontracting universe.

And then thirdly is the pipeline, where we've clearly done a, I think, admirable job of engaging more MWBEs in small contracts with the city, but that's not translating into our spend. And so it's still a very small percentage of total spend is going to MWBEs just within the Local Law 174 framework, um, and that has to grow.

And I really think a deliberate effort to engage the firms that we're working with that are performing well about how do we chart a kind of pipe— a path forward for them to take on larger contracts is a, is a, a good priority area for the administration, uh, to, to focus on. So, with that, I'll say thank you very much for coming in today.

We really appreciate you taking the time answering questions.

Was there one more point you wanted to make? Just wanted to, uh, give you the answer on that question on, um, Local Law 1 spending for SPS on FY25. So for FY25 and FY26, they were similar. And in FY26, it was $2.7 million, which was roughly 74% of the Local Law 1 target. Okay. Maybe I'm looking at FY25 data and that was the issue.

I don't know. We haven't seen FY26 data, have we? No, we don't have. So that's great to hear that you turned it around in FY26. So mazel tov.

With that— Let me say that I want to thank you for this opportunity. And as Council Lady Gail Brewer and I go back a very long time— Everyone goes back a long time with Gail Brewer, you know. We were advising the council when James Saunders was in the council. Oh, I remember. State Senator James Saunders was one of the— He championed this legislation to expand the small purchases for MWUs, which has really made a difference.

So I think he deserves credit. I'm not going to say anything about the assembly member who sponsored that bill because I'm not talking talking nice things about her these days. But with that, thank you all very much. Thank you. Althea laughed, thank you. And appreciate you guys being here. Bring up our next panel in just a moment.

Assemblyperson, county leader, law school— I'm not, I'm not saying anything nice. We're gonna— no, I'm going to the next panel.

Um, oh, I gotta do— I am now opening the hearing for public testimony. I would like to remind members of the public that this is a formal government proceeding and decorum shall be observed at all times. I will try to maintain that myself. As such, members of the public shall remain silent at all times. The witness table is reserved for people who wish to testify.

No video recording or photography is allowed from the witness table. Further, members of the public may not present audio or video recordings as testimony, but may submit transcripts of such recordings to the sergeant-at-arms for inclusion in the hearing record. If you wish to speak at today's hearing, please fill out an appearance card with the sergeant-at-arms and wait to be recognized.

When recognized, you will have 2 minutes to speak on today's hearing topic. If you have a written statement or additional written testimony you wish to submit for the record, Please provide a copy of that testimony to the sergeant of arms. You may also email written testimony testimony@capsule.msc.gov within 72 hours of this hearing. Audio and video recordings will not be accepted.

I will now call up the first panel, and I'm going to actually just call up all five folks if they're here. If the sergeant wouldn't mind bringing another chair up, and I apologize, not everybody's handwriting is as legible as I might hope. So if I butcher your name, please forgive me. I believe the first person is Habiba Eryida.

Rana Abdelhamid. Did I get that right? I'm sorry, Rama. I'm sorry. I'm sorry. I'm a terrible person. I apologize. Ekram Arowamim. I'm screwing them all up. Shit. Gail, don't give me a hard time. I'm struggling here. Ekram Arowamim. I'm sorry. I'm trying here. Bayadir Muhammad Osman and Naima Tahir from the Arab American Family Support Center based in District 33.

Good to see you, Naima. Wherever you are. There you are. Okay. And you all feel free to testify in whatever order you are so moved. Okay.

Good afternoon, council members. Nice to see you as well. Actually, a lot of us are here on behalf of the New York Middle Eastern and North African Coalition, and we're a coalition of organizations across New York State and New York City that represent the needs of North African and Middle Eastern New Yorkers. And we're here to support Intro 208, so I'll read my testimony.

So my name is Rana Abdulhamid. I'm the founder and executive director of Melika, which is a Queens-based organization that has worked for nearly 2 decades alongside immigrant, working-class, Muslim, Middle Eastern, and North African New Yorkers. I'm also the daughter of Egyptian immigrants, born and raised in Queens, and I'm here today to testify in support of Intro 208, in support specifically of a disparity study for the MENA community.

Um, at its core, the disparity study would simply ask the question, who has access to economic opportunities created by our city and who's being left out? For many MENA New Yorkers, the problem has been that the city has not even had the data necessary to adequately answer that question. Despite the fact that for generations Middle Eastern and North African New Yorkers have contributed— you all probably have gone to a deli and met an auk or had halal cart food, so you know— have contributed to the business ecosystem of the city, we still are not included in many of these studies.

We want to make sure that our businesses are adequately counted and that we can measure the number and the realities that impact MENA-owned firms across the city. That's why this disparity study matters. This legislation does not ask the council yet to presume what the data will show. It just asks the city to collect the data and to look.

We appreciate already the commitments made from SBS and this current administration to include MENA-owned businesses in the next disparity study, but we want to make sure that this is a legal requirement that is codified into the law because we understand that administrations change, commissioners change, priorities change, but the legislation will make sure that our communities are counted despite any changes that might happen.

And so today I urge the council to pass Intro 208 to permanently codify the inclusion of Middle Eastern and North African businesses in future disparity studies. Thank you.

Thank you, Rana. I really appreciate your testimony. It's good to see you. Good to see you. Good afternoon, everyone. My name is Ikrama Rumayem, and I'm here on behalf of the Women's Empowerment Coalition of New York City. WCNYC is a community-based organization that supports women and immigrant families through education, workforce development, social services, and other women empowerment programs.

Every day we work with women, immigrant families, and small business owners, including many from the Middle Eastern and North African communities. We see their talent, their hard work, and the contribution they make to New York City's economy. But we also hear directly from our community about their experiences, the challenges they face when they try to grow their businesses and access opportunities.

That's why this disparity study is so important, and True to 8 would require MENA-owned businesses to be included in future disparity studies. This would provide the data needed to better understand whether disparities exist and where they exist and how they affect businesses in our community. WCNYC stands with our community partners in asking the city to make sure MENA-owned businesses are counted, studied, and visible in this process.

This study is an important opportunity to make sure those experiences are reflected in the data. When we better understand the disparities our small businesses experience, we can better understand their needs and the opportunities available to them. When our small businesses grow, our families, neighborhoods, and our entire benefit. Thank you.

Thank you so much. I really appreciate your testimony. Hi, everyone. My name is Bayadur Muhammad Osman. I'm here on behalf of Muslim Community Network. We are a New York City-based nonprofit organization that promotes civic engagement, community empowerment, and advocacy. Today I am testifying on behalf of one of my colleagues, Saleha. She's an able to be with us today, but I wanted to share her story.

This is from her voice. I'm a Yemeni American, and this issue is personal to me. My father owns a bodega, and growing up, I saw firsthand some of the challenges he faced as a small business owner. He experiences barriers related to language, navigating systems, and accessing opportunities that could help his business grow. Currently, MENA-owned businesses are not separately identified in New York City's Disparity studies.

Without this information, the city cannot fully understand how MENA businesses are participating in public contracting or whether they face any barriers to opportunities. This specific Intro 208 would help address this gap by requiring MENA-owned businesses to be included in future disparity studies. MENA businesses are an important part of New York City's neighborhoods and economy, as we mentioned before, small business— small businesses like my father's bodega provide jobs, serve local residents, and become an important part of communities they are located in.

Their experiences should not be overlooked simply because they're not separately represented in the city's data. I urge the council to pass Intro 208 and ensure MENA-owned businesses are meaningful— include— meaningfully included in New York City's disparity analysis. Thank you.

Thank you. Good afternoon. My name is Habiba Al-Aidi. I'm representing Malika. The city's MWB program is designed to expand opportunities for historically underrepresented businesses to complete for-city contracts and accept and access critical business development resources. Yet right now, Middle Eastern and North African-owned businesses are entirely excluded from being recognized as minority-owned businesses. Under this program. This is not an administrative oversight.

It is a profound data failure with economic consequences. New York City's most recent disparity study failed to separately identify MENA-owned businesses, meaning that the city lacks the baseline data necessary to measure their availability, utilization, experience, and discrimination— experiences of discrimination. Instead, the MENA firms are often lumped in with white-owned businesses, benchmarks and masking systematic barriers and creating a false sense of equity.

Across our neighborhoods, inclusion along vibrant commercial corridors like Steinway Street in Astoria, where I'm from. Many entrepreneurs operate grocery stores, restaurants, pharmacies, retail stores that serve as the heartbeat of our local economy. Many of these immigrant-owned businesses navigate severe linguistic and cultural barriers, making specialized technical assistance and municipal contracting opportunities through the MWBE program critically necessary for their survival and expansion.

Without these recognitions, our businesses remain invisible and locked out of these tools needed to scale and thrive. We are lacking behind other levels of government. In 2024, the federal government established MENA as a distinct race and ethnicity category, and New York State subsequently enacted Executive Law 170-H, which requires state agencies to collect and report data on MENA populations separately.

New York City must align with these crucial progresses that this federal and state government have made. I strongly urge the council to pass Intro 280. Thank you for your time.

Good afternoon, Chair Ressler, Councilmember Stevens, and Councilmember Brewer, and members of the Committee on Contracts. My name is Naima Dahiya. year, and I'm the advocacy manager at the Arab American Family Support Center, also known as AAFSC. AAFSC serves over 20,000 New Yorkers each year. Our staff speak more than 20 different languages. Over 70% of our clients were born outside of the United States, many from historically underserved communities.

Our work centers on families by helping them stabilize during challenging times, maintain stability and ultimately thrives— and ultimately thrive. This includes uplifting economic empowerment and making sure our communities have the opportunities to thrive in New York City, including through small business ownership and economic support. Middle Eastern and North African communities have been long overlooked despite their contributions to the culture and makeup of New York City.

MENA-owned businesses are staples in our communities and are well loved by the people they serve. These businesses go through many of the same hurdles associated with small business ownership, but are currently not recognized as minority-owned businesses under New York City's MWBE program. This classification has significant consequences for our communities and highlights an unfair gap in the city's economic opportunity programs.

New York City's most recent disparity study did not look at MENA-owned businesses separately. Because of this, the city does not have enough information to know how many MENA businesses are competing for city contracts, how often they receive these contracts, how much funding they receive, or whether they face discrimination. Instead, MENA-owned businesses may be counted as white businesses, which makes their particular and unique experiences and challenges invisible.

We have seen the real impact of these disparities. At the height of the COVID-19 pandemic, when businesses were receiving rent relief and other support, Arab-owned businesses were often left out or had difficulty accessing these resources. This shows why it's important for MENA-owned businesses to properly be identified and included in the data the city uses to make decisions about economic opportunities and support.

Intro 20A, sponsored by Councilmember Shahana Hanif, would require MENA-owned businesses to be included in future disparity studies used to determine eligibility for the program. This is a critical first step towards greater inclusion of MENA-owned businesses. We urge the committee to advance Intro 208 and the full City Council to pass it without delays. MENA-owned businesses have contributed to New York City's economy for generations.

They should no longer be invisible in data that determines the economic opportunities and the supports that they need to succeed. Thank you so much.

Thank you. And I really want to thank this whole panel for coming and for your thoughtful testimony. My favorite Mike Bloomberg quote is always, in God we trust, everyone else bring the data. And it's so true. If we don't have the data to understand the demographics of the MENA community, the businesses in the MENA community, then we can't structure the right policies to support the that community.

And as the councilmember who represents Atlantic Avenue and downtown Brooklyn and Boerum Hill, like many of the— you know, there are just extraordinary, extraordinary MENA businesses that have been— that have called our community home for 100 years and have done so much to make our community the special place that it is. And so there's a lot more that we can do to support those businesses and that community that has done so much to support New York City.

And I really am grateful to Councilmember Hanif for pushing this legislation, and I'm happy that we had the opportunity to have a hearing on it today and look forward to working forward with all of— look forward to working together with all of you on the next steps. So thank you so much. Unless either of you have questions?

No? Thank you. Appreciate you all being here. Thank you.

And then we've got 2 folks on Zoom that we'll go to now. Matt Gove and Eve Fox. Matt, we can begin with you. Can we unmute Matt? Is that possible? Is there somebody— can we do that? Can I do that? You did that? We did that. We're working on it. We're working on unmuting you, Matt. If you can hear us, we apologize.

Hi. All right, we're good. Matt, go for it.

Yeah, I'm here for the, the bill about reusable and single-use cups that's on the agenda. Go for it. Oh, we're doing it all right now? This is you. This is your chance to give your 3 minutes of glory. All right, well, I thank y'all for, for hearing this bill, and sorry, I was— I lost track of what was going on with the first issue on the agenda that was going on for the last 2 hours.

I'm Matt Goff from the Surfrider Foundation, and we appreciate Councilmember Epstein's bill to try to reduce single-use cups used by city government. I think everyone knows now how much damage plastic has to human health and also how much garbage it creates, and the city has to pay to get rid of that garbage. And when that garbage is burned, it releases lots of pollutants.

So we thank you for the bill. And I've heard there are rumors Rumors that the text may change. We're very concerned with the text where it says the city can just replace those single-use cups with compostable cups. Compostable sounds good, but it's, it's one of those rabbit holes that you go down and then you are not wanting to use one of these compostable cups because they're, they're just as bad, sometimes even worse than just a regular throwaway cup.

So we're hoping that'll be taken out. Thank you. Really, the only option is a reusable cup, or if you have to, there's those very thin aluminum cups that can be reused or easily recycled. So, so sadly for cups, there's not a lot of options, but reusable always works. So we thank you for this bill, and thanks for the time to testify.

Thank you so much, Matt. We really appreciate your thoughtful testimony in support of Councilmember Epstein's legislation around compostable cups. It's— we're really happy to have had the chance to have a hearing on it today. We'll now go to Ms. Eve Fox.

Hi. Thank you so much. My name is Eve Fox. I'm the director of development and marketing at the Story of Stuff Project, a nonprofit dedicated to waste reduction and sustainability. Prior to that, I served on the leadership team at Beyond Plastics, a nonprofit led by Judith Enck, former U.S. EPA Region 2 Administrator. And while I applaud the intent of the bill, I agree with Matt, it contains a critical loophole that threatens to undermine its goals.

Exempting compostable single-use cups creates a false solution. Replacing conventional plastic cups with bioplastic or compostable alternatives fails to protect public health and the environment for 4 reasons. 4 main reasons. One, they're still plastic and therefore pose serious health risks because even compostable plastic cups are often made entirely of bio-based plastics like PLA, or those that look paper are often lined with a hidden plastic film.

Bioplastics are manufactured using the same chemical processing methods as traditional plastics and frequently contain toxic chemical additives including PFAS that are used to make them more resistant to water and grease. In fact, a peer-reviewed April 2025 study in Food Safety and Toxicology revealed that exposure to starch-based microplastics resulted in liver and intestinal lesions, elevated blood sugars. It messed with lipid metabolism and disrupted gut microbiota, leading the authors to urge strict evaluation of bioplastic safety before use in food packaging.

So-called compostable plastics also have a heavy climate footprint and use a ton of resources. They are not carbon neutral. Growing these crops to produce them takes up a lot of land, water, and fossil fuel inputs and takes farmland away from actual food production. Furthermore, when compostable packaging, which includes cups, inevitably ends up in a landfill due to a lack of industrial processing, it breaks down anaerobically and releases methane, which is a greenhouse gas that's roughly 30 times more potent than carbon dioxide.

There is the elephant in the room with all things compostable that are beyond green waste is that there's a lack of industrial composting processing and infrastructure. Certified compostable plastics don't break down in backyard compost bins or a natural environment. They require high-heat industrial composting facilities that have precise control over temperature, moisture, and oxygen, which is something that many communities lack the access to.

And even when they do make it into composting systems, there is a widespread facility rejection due to system contamination. Municipal and commercial composters increasingly refuse to accept compostable foodware, such as cups, because these products introduce toxic chemicals that may include PFAS into their finished compost, and they create severe consumer confusion, which leads to even more widespread contamination. from conventional plastics that are mixed into the composting stream.

Major composting operators, including those serving the state of Oregon and commercial facilities across California, now explicitly request keeping bioplastics out of their composting systems. Time expired. Thank you. Thank you so much, Ms. Fox. That was really insightful testimony, and we really appreciate you taking the time to share your expertise with us around compostable cups and the importance of of tailoring this legislation correctly.

We will now go to Vicki Abdu-Ghalioum. And, Miss— and, ma'am, I apologize if I've mispronounced your name. Hello. You have 3 minutes if you'd like to testify, starting now.

Thank you so much. Chair Ressler, members of the Committee on Contracts, my name is Vicki Abdu-Ghalioum, and I'm delivering my testimony today on behalf of the Story of Stuff Project and as a member organization of the Reusable New York City Coalition. The Story of Stuff, as my colleague shared, is a nonprofit organization advocating for solutions to the plastic waste crisis, and one of our main focus areas for addressing the plastic waste crisis is through reuse as a solution to plastic pollution.

As was already shared in other testimony, we know we're drowning in disposables. Each year, the US food service industry purchases nearly 11 trillion disposable items, which equates to a $24 billion spend on products that are used for literal minutes and then thrown away. In New York City alone, the cost of collecting garbage for disposal surpasses $1.7 billion annually, with $381 million of those dollars due to packaging waste, most of which is food packaging.

So we're really excited to see the council considering a bill that aims to reduce plastic pollution generated by agencies through banning single-use plastic cups. But I echo the concerns of the others providing testimony with Intro 896 has a major flaw allowing single-use compostable cups for the same reasons that were already stated. And so I'll make the most use of my time by saying that I agree with the concerns shared by others on the toxicity of compostables and the inability of our current systems to really even handle them and generate quality compost product, and focus my testimony on reuse as a solution to that issue.

As a leading advocate in plastic, single-use plastic waste, pollution and reusable solutions. We are seeing municipalities all across the country struggle to source compostables and enforce a switch from plastic to bioplastic and so-called compostables. So it's our position that if the goal is to reduce single-use disposables, why not ban all types of single-use cups? In my written testimony that I submitted, I recommended some changes to the bill text, namely removing the language about compostables being acceptable, and then also implementing language that encourages the use of reusable beverage bottles when possible and the implementation of accessible water bottle refill stations per 500 occupants authorized under a building's maximum capacity.

And additional, um, text changes that the council might consider that are regarding reusable beverage cup reuse systems being implemented in agency offices, buildings, or indoor facilities and on agency property, as well as prohibiting the distribution of beverages in disposable beverage cups on those properties. Hierarchy focuses on reduce and reuse. Um, thank you for considering my testimony. We really appreciate it.

Thank you for the thoughtful testimony. testimony and for providing feedback on the legislation that we will be sure to share with the bill sponsor, Councilmember Epstein. We will now ask Jacob Yatzilael to testify as well. You have 3 minutes beginning now.

Can you hear me? We can hear you. Okay. Thanks for having this meeting. And I do want to agree with the Chairman Ressler. There's not too many good things that can be said about the Adams administration. I want to make a suggestion that these hearings could probably be more fruitful if you were actually to include testimony from small women-owned businesses with equal time as the people who have been appointed by the city.

We, the Association of Black Contractors, I'm the chair of the Association of Black Contractors, and we have a— we issue regular reports. And our latest report entitled, uh, MWBE: The Mechanism of Disenfranchisement, that was forwarded to your office. And it was given that title because the policies, practices, and procedures of New York City dismantles small Black women-owned businesses.

Now, the Association of Black Contractors, we have submitted legislative proposals. And the, uh, the system that we're currently under, it needs to be reformed. And if it's not reformed, we're just moving chairs around and nothing is being accomplished. If the system is not reformed, we would, we would push for the taxpayer to be freed from the burden of funding these failed programs.

When you look at our data, which we regularly, uh, we regularly issue reports, you look at our data combined with the comptroller's report, and I do believe the comptroller's data is correct. You will come to the conclusion that, uh, the, uh, the, the chair's hunch is correct, that these agencies do not care. So we're calling for oversight hearings to include testimony from the affected parties, which are the small women-owned businesses.

And we welcome the opportunity to work with Chairman Ressler's office to bring about these legislative proposals.

I really want to thank you for your testimony, and we would love to engage further with the Association of Black Contractors and yourself. Appreciate the feedback on our hearing today. And, you know, I share your sentiments. I feel like we would have been better served by more participation from MWBE firms and associations that advocate for those firms.

And in future MWBE oversight hearings, we'll do a better job of making sure that those folks are properly engaged and participating. Thank you. participating. So thank you, and, and we very much look forward to following up.

And the last person slated to testify today doesn't share their name, so we'll have to ask you to share your name on the record, but we have you listed as the new BXCC. Good afternoon, Chair Ressler and members of the Committee on Contracts. My name is Tanisha Heard, and I'm representing the Bronx Chamber of Commerce. The Bronx Chamber is really critical in helping local businesses in the Bronx grow, thrive, and remain competitive.

And for many Bronx entrepreneurs, especially first-gen business owners, the chamber is the very first place they turn to for support. And so the Bronx Chamber fully supports Intro 694, which would expand government outreach when MWBE utilization targets are unmet. And Intro 208, which will include Middle Eastern and North African entrepreneurs in getting NWBE certifications. In the Bronx, the Middle Eastern and North African community is a vital and growing part of our borough, home to cultural centers like Little Yemen.

Nationwide, we've seen how Middle Eastern and North African Americans are underrepresented in government data, which suppresses the economic needs of this group and preventing them from accessing programs. To build on the great work MWBE is doing, we would assess Middle Eastern and North African Americans for program eligibility, especially as our community continues to grow here in the Bronx.

As it relates to Intro 694, will— where it study businesses owners within the group through— where it will study business owners within this group through disparity studies. If the results show that they're eligible, the program will include them in the MWBE benefits and continue supporting the growth for Bronx businesses. Alongside adding new business owners, the MWBE program must also strengthen mechanisms to improve equity in the Bronx by implementing Intro 208.

By requiring government agencies to conduct education and outreach if they do not reach their goals, businesses under MWBE will have improved access to contracts and opportunities, and their success will expand through the borough. Expanding access to MWBE programs and strengthening its requirements will help ensure more city dollars reach Bronx businesses and communities. By investing in our diverse businesses, we strengthen our local economy, our borough, and of course, the city at large.

So we look forward to working with the council to continue to strengthen local businesses, and the chamber fully supports Intro 208 and 964, and we hope that you are able to move these critical, critical bills forward. Thank you so much. Thank you so much, Ms. Heard, and we really appreciate you taking the time to testify and I look forward to working with the New Bronx Chamber of Commerce.

I think that they're definitely an important partner for SBS as we do more to engage more MWBEs and get them connected to city contracts.

I think that that is all we have for today. So with that, I just want to thank everybody for coming. Ashley, thank you for spending however many hours with us, and everybody else for being here. We appreciate you, and I hope everybody has a wonderful afternoon. And we're adjourned. Thank you. Take care.