NEW PLAN OFF TARGET

The Illinois Target Market Plan (TMP), authorized by Senate Bill 51 (Public Act 96-0975) to achieve diversity goals in procurement with contracts with the Illinois Department of Transportation (IDOT), is contrary to the guidelines that the U.S. Supreme Court has issued to remedy discrimination in contracting. The Court has ruled that quotas are illegal. So then why is the State of Illinois trying to implement the program?

Some background on the program. In his message to the general assembly about Senate Bill 51, Illinois Governor Pat Quinn said, “The abuse of state procurement has been a consistent feature of corruption scandals involving high-ranking officials of Illinois government.” So because there has been abuse in procurement, the State of Illinois is making the minority quotas higher? How does that make sense?

On the application site for a company to become one of the special few, it states that the firm has to be “at least 51%-owned by a socially and economically disadvantaged individual(s) who also controls the firm.” But it does not explain who a socially or economically disadvantaged person is—not by color, race or gender. But we know they mean women and minority owned. Then again, who is a minority? More definition is needed.

 To become qualified as a disadvantaged business, the firm also has to be a “small business.” How small is small? The firm has to have revenues that don’t exceed $22.41 million in annual gross receipts. That does not seem very small to me!

 Also interesting is that on the site for the program IDOT admits: “The department believes that the TMP, in its current form, could be prohibited by federal requirements unless or until there has been input and approval from the federal government.”

IDOT is planning to spend approximately $103,000,000 in 2011 on state-funded highway projects and their goals for DBE participation are:


IDOT's 2011 Target Market Program includes the following elements:
 Estimate of total eligible dollar value for 2011 program dollars $103,536,000


Estimate of Target Market Percentage 30 %


Target Market Dollars $31,060,800


Minority-Owned Firms (50%)  $15,530,400


Women-Owned Firms (50%) $15,530,400


13 Projects (in Districts 1,4,8)


7 minority-owned $1,810,000


6 women-owned $1,185,000

In a story in Crain’s Chicago Business, they pointed out that one of the problems with TMP is cost. “From the broader viewpoint of taxpayers, the concern is that by restricting competition, the state is raising its cost when Illinois already is bleeding red ink.

How much higher is hard to say, but one white subcontractor who's suing the Illinois Department of Transportation says he lost 91 contracts in 2009 and 2010 to disadvantaged firms whose bids averaged 16.4% more than his, costing the state at least $870,000 more than his collective bids of $5.3 million.”


Another contractor said, “Charlie Gallagher, president of Gallagher Asphalt Corp., says his Thornton-based company couldn't bid last week on a 1.7-mile resurfacing job in Will County because IDOT has reserved it for minority contractors. 'These are the kind of jobs we bid aggressively on,' he says. 'With less competition, prices will be higher.'”

I don’t agree with set-asides or minority-based contracts when it comes to construction.  I want the best bridge builder to be building the bridge I am driving over.  I don’t care what the color of the contractor’s skin is or their sex, I just want to make it safely to the other side!