‘“It’s a small step ... that we can do to undo the racism that has systemically hurt communities of color over time.’”

Ward 3 Councilman John Donegan

Debate at times grew tense Monday as the City Council’s Finance Committee debated a proposal that would provide incentives aimed at diversifying the roster of businesses with which the city contracts for products and services, although there was broad agreement in favor of further study of the issue.

“I don’t want to keep kicking the can down the road … I don’t want to see this just getting continued, month after month,” said Ward 3 Councilman John Donegan, the sponsor of the proposal.

The measure would offer bid discounts for businesses that are based in Cranston or are owned by women or members of minority communities. It had been continued from previous meetings based on questions from other council members and administration officials.

It would provide discounts of 2 percent for each of those three classifications, Donegan said – so a Cranston-based business owned by a Black woman, for example, would be eligible for a discount of up to 6 percent.

Under Donegan’s proposal – which he said is based on a similar program used in Cleveland, Ohio – the discount would be applied to the amount of the bid for a product or service during its consideration by the city’s Purchasing Department and Board of Contract and Purchase.

Citywide Councilman Steve Stycos offered an example in which a bid of $100,000 submitted in response to a city-issued request for proposals “would essentially turn into a $98,000 bid,” reflecting a 2 percent discount from the figure submitted by a qualifying bidder. The bid would still cost the city $100,000 for the product or service offered, but the process would result in that bid having additional competitive weight.

“It’s to help invest into communities that have historically been marginalized,” Donegan said. “It’s a small step, but investing in minority business enterprises is one small thing that we can do to undo the racism that has systemically hurt communities of color over time.”

Donegan said based on his review of Cranston business data on the Rhode Island Secretary of State’s website, 322, or just more than 24 percent, of the city’s roughly 1,300 businesses are qualified women-owned business enterprises, or WBEs. Another 54, or roughly 5 percent, of businesses are qualified minority-owned businesses, or MBEs.

If adopted, it appears the program proposed by Donegan would be unique in Rhode Island. State government and other communities, such as Providence and Pawtucket, do have requirements to direct a percentage of procurement toward certified MBEs and WBEs.

Donegan said those targets are often not met, however, and he noted that Rhode Island Black Business Association recently gave the state a grade of D for its handling of contacts for minority-owned businesses. He said his proposal represents a “more attainable” approach.

During Monday’s debate, Donegan offered a successful amendment that would require that businesses receive certification as an MBE or WBE through the Rhode Island Minority Business Enterprise Compliance Office to be eligible for the bid discounts.

Donegan’s proposal includes a cap of $50,000 on the value of any discount – a number he acknowledged was “arbitrary” and represented half of the cap included in Cleveland’s program. He said he is supportive of the cap being adjusted to more appropriately reflect the city’s needs.

The debate became heated at times as some council members and representatives of the administration questioned the financial impact and logistical challenges of the proposal.

Donegan and others, including Ward 1 Councilwoman Lammis Vargas and Citywide Councilman Steve Stycos, pushed back, suggesting the trepidation was part of a pattern of questioning and delaying proposals that are not supported by the council’s majority or the administration.

Ward 6 Councilman Michael Favicchio, the chairman of the finance panel, questioned the need for the bid discounts, saying the city’s bid process is already transparent and keeps the identity of bidders anonymous.

“How are we discriminating if it’s a blank page? Nobody even knows who the person is who’s bidding,” he said, adding: “Our people don’t discriminate. They want the best bid … There’s no evidence of any particular companies not winning a bid because of their race or their gender.”

Finance Director Robert Strom added: “We have never, ever discriminated against any minority company that’s bid.” He also said the city already works to contract with locally owned businesses when possible.

Concerns were also raised over the degree to which the bid discount program would impose new and potentially time-consuming requirements on city officials.

Those remarks prompted an impassioned response from Donegan.

“No one is saying that [the city discriminates against any business] … No one has accused anyone of that,” he said. “It’s ridiculous. I’m sorry. It’s absolutely pathetic that this is where this conversation is going. It’s embarrassing.”

He added: “We both know in good conscience that over time there have been economic barriers to minorities gaining generational wealth, through racist housing policies, lending policies … Are we going to debate here the merits that systemic racism exists?”

Vargas also pushed back strongly, calling the course of the conversation “really quite sickening.” She said the council should consult with leaders from Pawtucket and other communities that have implemented programs aimed at increasing the number of contracts awarded to MBEs and WBEs.

“This is not about discriminating. This is about being inclusive … What we’re saying is, we should look at the fact that other cities in the state have a minority business enterprise program,” she said.

Donegan also took issue with the new questions and concerns given that the matter had been previously discussed and continued. Stycos echoed that point and said officials should be willing to take steps such as the bid discount program, with the understanding that they can be updated as needed.

“We have a problem in society, that as John said, is systemic racism. And we need to try to attack that in our little Cranston world, and we need to try different things, and then we need to evaluate them,” he said.

He added: “It’s not enough not to be a racist. You have to be an anti-racist to solve this problem in the country.”

Citywide Councilman Ken Hopkins suggested the measure be discussed before the city’s Diversity Commission, on which he sits along with Vargas.

“I like the idea, I really do. I think we need to do more and more to encourage minority-owned businesses and women-owned businesses to come into Cranston. But I think we need to do some more work on it,” he said.

Ward 5 Councilman Chris Paplauskas concurred, saying: “I think this is a good bill, and I want to vote on it, but I think we could make it better.”

Ward 4 Councilman Ed Brady thanked Donegan and Vargas for “your passion and your efforts in this conversation.” He also said he favors additional review, however, to “get it right,” particularly to ensure protections are in place to ensure the bid discount program benefits the intended businesses and is not susceptible to fraud.

The committee ultimately voted 5-0 in favor of continuing Donegan’s proposal until its September meeting.