How Philly Can Include Black and Brown Entrepreneurs in Its Construction and Development Industry

Op-ed: City leadership must be more intentional about breaking and rethinking systems that are failing to create inclusive growth.

(Photo by Jose Fontano / Unsplash)

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Philadelphia is one of the largest majority-minority cities in the country. But this picture is lost in local development and supplier contract acquisitions.

Winners and losers are decided by markets, yes, but they also are decided by people. Know the right ones and you’ll succeed and grow. If you don’t know them, good luck growing your business in the city.

I started my own firm aware that access to the market would require hard work and pragmatic approaches. As an African American man with degrees in engineering and information science, I’d developed the skills and learned the industry. I created a unique business model that integrates biotech, construction and social equity. I started small and took the time to grow efficiently.

What I did not anticipate were the roadblocks in Philadelphia that my education and experience could not move: the barrier of a complicated administrative infrastructure and long-standing exclusive networks.

We live and work in a city where more than half of the people are people of color, people who must fight to get a seat at the boardroom table or build their own table. In 2023, this dysfunctional system and its impact continue to challenge access and growth for many Black- and Brown-owned small businesses in Philadelphia, resulting in limited access to relationships and networks, professional resources, and capital.

However entrenched these obstacles are, there are signs of hope. As systems are built, they can be improved and recalibrated.

For decades, I’ve watched Philly leaders say they want diversity in local supplier and construction industries. I’ve also watched the systems get tougher to access, even with all the right qualifications. Through policy changes, regulatory reform, improvements to business services and access to capital, we can create more opportunities for Black and Brown-owned businesses to succeed.

MBE certification

First, now is the time to implement real regulatory changes to increase the ease of doing business, including revisiting the minority and/or women-owned business enterprise (MBE/WBE) certification process, fees, and administrative assistance.

While I of course understand the need for these types of certifications, the current process makes it harder and more expensive for actual MBEs who are qualified to do the work, can do the work and want to actually do the work. To become MBE-certified, I must go outside of the city and pay — what could be an exorbitant amount of money — to become certified.

The city should have a process to certify MBEs, outside of the Rebuild Initiative, that walks business owners through the process and does not require an annual renewal. The renewal process is just as tedious and expensive as the initial period, so why not extend the certification to only recertification every three years? This provides ample opportunity for the business owner to prioritize the expansion of their network and the company’s portfolio. As a business owner, I would rather spend my time focused on business development growth and the overall growth of the city.

Local institution leaders and city officials can teach business owners how to work with MBEs in an equitable way and hold them accountable when they are caught using MBEs as place fillers or quota markers. When systems fail to hold people accountable for unethical behavior, they are automatically rewarded. Developers who use MBEs to simply secure a contract are not often held accountable. Not holding these businesses accountable and awarding them new contracts also makes it harder for MBEs who want to do the work.

Access to capital

We’ve discussed the lack of access to capital and bonds ad nauseam. Let’s fix it. The city can help by doing two things.

One solution is to provide the upfront capital to help secure the bond via a non-interest bearing loan. The business owner will have the dollars to secure their bond and complete the project. At the end of the project, the business owner pays back the loan and has expanded their portfolio.

A second solution is that the city — and its large institutions — can self-insure their projects and eliminate the bond requirement on projects below a certain dollar value. This will provide more minority-owned businesses with an opportunity to secure larger scale projects and successfully exhibit their abilities and capacities.

Access to city leadership

Black and Brown business owners and their professional networks must have direct access to the mayor’s office, and this office must rigorously enforce prompt payment regulations. The mayor’s team – the people who are doing the work to implement policy and facilitate projects – must also be accessible, and most importantly, share the vision of an equitable and inclusive City.

Leaders can have transformative visions and idealistic goals, but if the people hired to bring these visions to life are not committed to changing the landscape of the city through inclusion and equity, then the climate for MBEs will not improve, and opportunities for Black and brown people will not improve. This also applies to large institutions.

Philly’s leaders and contract decision-makers must stop underestimating (and devaluing) the capabilities of Black and Brown business owners to manage the work and deliver successful projects. We can develop, construct and produce.

As those closest to these challenges, we are also doing our part to expand the ecosystem of Black- and Brown-owned businesses in Philadelphia by finding pathways for businesses to build and scale and unearth untapped business venture markets. We are also working with like-minded advocates at the Inclusive Growth Coalition to advance our shared goals. This coalition has been pushing to make substantive changes on behalf of small business owners in Philly. Working together will get us closer to effective change.

These solutions are critical to creating a sustainable ecosystem for businesses owned by talented and qualified people of color in Philadelphia. By working with elected officials, city departments, the public and the private corporate community, we can create a more equitable and sustainable future for minority-owned businesses in the development and supplier industries.

If Philly leaders are truly invested in growth for all, then they will be more intentional about breaking systems that are not effective and efficient in creating inclusive growth.

Our community of business owners of color is strong, innovative and determined, but there is still a long way to go to ensure equity and inclusivity. We need a city government that will work to help expand the ecosystem, be more inclusive and push for implementing solutions when addressing the challenges facing minority-owned businesses in these industries.

To find success, we need everyone, from the greater business community, neighborhood commercial corridors, and decision-makers at all levels, to join us at the table – now, more than ever.

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Calvin Snowden, Jr. is president and principal of BDFS Group in Philadelphia.

Tags: philadelphiadevelopmentdiversity

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