DWP bucks proposal for certifying minority firms.

It says fewer companies will be registered for contracts

If the L.A. Department of Water & Power is forced to contract with the City of Los Angeles' Public Works Department for certification of minority-owned firms, far fewer such businesses will be registered with the DWP and qualify for advantages in obtaining contract work with the utility.

That was the testimony last week of Richard Moore, director of purchasing at the DWP, at a meeting of the Governmental Efficiency Committee of the L.A. City Council.

The council is considering whether to take action to attempt to force the DWP and the Department of Airports to join in a citywide interdepartmental effort to consolidate and streamline the certification process for ethnic minority- and women-owned business enterprises (MBE/WBEs).

Government entities -- such as cities, states, public utilities and transportation agencies -- set goals for contractors to include, or make an effort to include, MBE/WBEs as subcontractors in their bids for government contracts. Only businesses certified by the government agency "count" toward meeting those goals.

The L.A. City Council wants to make the certification process simpler by setting up a one-stop certification center for all 40 city departments. But some city departments -- such as the DWP, the airports, the harbors and the Community Redevelopment Agency -- are governed by independent commissions and are not directly under council control. Two -- the DWP and the airport department -- have resisted consolidation.

Moore told the council committee last week that bringing the DWP into the program would mean that almost 3,000 businesses registered with the city utility would no longer be qualified as MBE/WBEs. This is because the DWP accepts certification from a number of government entities -- such as the Metropolitan Transportation Authority and the Department of Airports -- that the Public Works Department does not accept.

The DWP doesn't actually certify businesses; it simply registers MBE/WBEs that are certified elsewhere, Moore said.

"If a vendor already has a certification, we want to continue to accept it. We are concerned about the 3,500 vendors we have on our database," said Moore. "Public Works, to date, has only 700 firms certified."

Bernard Gilpin, inspector of public works, countered that some agencies whose certification is accepted by DWP don't thoroughly scrutinize whether businesses are truly owned by ethnic minorities and women.

"You just walk up and sign up as anything you want," Gilpin alleged.

Some business owners agreed that scrutiny is important because otherwise they have to compete with companies operated by white men who pretend their firms are owned by female relatives. Minority business owners who testified favored consolidation, saying it would eliminate duplication and make it less expensive and time consuming for companies to get certified.

Councilman Richard Alarcon objected to what he categorized as a "secessionist" attitude at the DWP.

"The DWP has a passive attitude toward certification, which indicates to me that they don't take this seriously," said Alarcon.

No one from the airport department testified at the hearing. Earlier, Judy Sobject, director of contract compliance at the Department of Airports, said the airport department has 10 people working on certification, people who often have to rush the process so a contract can be awarded, while the public works department is offering to provide only two staffers to handle the work.

The airport department does certify businesses itself, unlike the DWP, and spends close to $1 million per year on its MBE/WBE program, noted committee Chairman Joel Wachs.

Diane Castano Sallee, director of the Minority Business Opportunity Committee (an interagency committee based out of L.A. Mayor Richard Riordan's office), said her committee is working to establish a one-stop greater L.A. area certification office. At such an office, businesses could simply check off the government entities they wish to do business with, and agencies having particular requirements could scrutinize that portion of the application.