Guest Editorial: Baltimore’s Next Mayor Should Prioritize African American Businesses Growth and Longevity

By Wayne Frazier

(BALTIMORE – May 15, 2020) – For many years now, the City of Baltimore has offered minimal support to its African American business interest, ownership, and development. Considering that African Americans make up approximately 62% of the city’s population, this is a true misstep on the city’s part. As a result, Baltimore’s next mayor should make African American business development a top priority. The current worldwide pandemic caused by COVID-19 has had a tremendous negative effect on Baltimore City’s revenue sources. However, prior to COVID-19’s arrival, a pandemic among the city’s African American businesses already existed and has resulted in a catastrophe of very few highly successful African American businesses domiciled in Baltimore City.

Sure, we are proud of the few highly successful African American businesses based in Baltimore, including The Harbor Bank of Maryland, Murphy Falcon Murphy, Brown Capital Management, The Forum Caterers, R.E. Harrington Plumbing, Heating & Utilities Company, P&J Contracting, Valstone Partners, MCB Real Estate, A&R Development, Mahogany, Inc. and Abrams, Foster, Noel & Williams, P.A., for their growth and success, but beyond those, there are no other African American firms that match their success.

In order for construction firms to bid on projects in excess of $100,000.00, they must provide a surety bond, which is a promise by a surety guarantor to cover the project owner for a particular amount if the construction firm fails to meet some obligation, such as fulfilling the terms of a contract. Currently, there are only four African American construction trade firms with surety bonding capacity above $15 million for a single project.  If African American businesses cannot obtain a required surety bond at this value, it limits their ability to compete and become more successful. This in turn creates a despairing reality for Baltimore’s African American entrepreneurs, because it limits their ability to expand employment, which ultimately impacts Baltimore’s soaring crime rate, low generation wealth among African American families, and declining rate of high school graduates. It is pure citywide devastation without any overt incentives for African Americans to start businesses in Baltimore City.

Baltimore’s next Mayor must intentionally address this issue and force economic and cultural change from the top-down to assist existing and encourage new African American business development.

Recommendations for Immediate Improvement

1. All city financed development projects or land acquired from the city by a developer should have African American equity partners up to 25% of the consideration.
2. All city funded projects, including professional services such as: banking, insurance, design, investment services, etc. approved by the Board of Estimates, should have African American partners up to 25%.
3. All Board of Estimate approved contracts must include a minimum African American sub goal of 15%.
4. All existing contacts under Baltimore’s Bureau of Purchasing, once expired, must be rebid and include a minimum African American sub goal of 15%.
5. Establish a robust Mentor-Protégé program for African American city certified concerns for all contracts above one million ($1,000,000.00).
6. All Baltimore City Public School procurements must include a minimum African American sub goal of 15%.
7. Prompt payment of all contractor invoices should be processed and paid by Baltimore City within seven business days of receipt.
8. All construction contracts procured by Baltimore’s Departments of Public Works, General Services, and Transportation should be offered at no more than $5 million to ensure African American trades can successfully finance and bond them.
9. Prime contractors not achieving assigned MBE goals and African American sub goals should be fined equal to the dollar amount committed and/or missed and excluded from future Baltimore City contracts/projects for one year.
10. Advertise all new bid/contract opportunities for intentional public awareness.

While these initial recommendations may seem drastic, they are justified because Baltimore’s African American business community is in dire need of support. Unless the new mayor addresses this concern, our hardworking and deserving African American firms will fall further behind, creating an enormous disparity for Baltimore’s largest racial demographic.

The author of this article is: Wayne R. Frazier, Sr., President of MWMCA, 443-759-8580, wrf@mwmca.org