TESTIMONY OF
JACQUELINE HILL, DIRECTOR
PENNSYLVANIA MINORITY BUSINESS ENTERPRISE CENTER
Committee on Commerce & Economic Development
Council of the City of Philadelphia
November 4, 2009
Pennsylvania Minority Business Enterprise Center American Recovery and
Reinvestment Act Advocacy and Outreach Initiative
Promoting Minority Business in the Economic Recovery of the United States

Good morning Chairman Goode and Members of Council.
My name is Jacqueline Hill. I am director of the Pennsylvania Minority Business
Enterprise Center, a program funded by the United States Commerce Department’s
Minority Business Development Agency. I want to thank you for giving me the opportunity to testify before the Committee regarding proposed ordinances to the
Philadelphia Code to: 1) provide a local bidding preference for contracts funded by the American Recovery and Reinvestment Act; and 2) require an Economic
Opportunity Plan be included on all stimulus-funded projects.
The Pennsylvania Minority Business Development Center provides access to capital, capacity building, business education and economic development opportunities to high-growth potential minority entrepreneurs. Through our portfolio of business acceleration initiatives, we seek to better position minority enterprises to compete in the local, regional, and global economies.
The Pennsylvania Minority Business Enterprise Center (PAMBEC) is one of the
Enterprise Center’s signature programs. PAMBEC is the region’s leader in minority business development services. We focus on offering three vital services to minority businesses: professional consultants, access to capital and contract procurement opportunities.
Since 2004, PAMBEC has generated over $290,000,000 in contracts and capital for minority business enterprises and created over 600 full-time of jobs in the
Greater Philadelphia region. Our efforts have resulted in a $50 Million contract from the University of Pennsylvania for an African-American Business in West
Philadelphia that created 6 new full-time jobs bringing total employees to 28.
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PAMBEC was recently awarded a contract by the Minority Business Development
Agency (MBDA) to promote minority business participation in stimulus-funded projects in Pennsylvania. We are currently identifying procurement opportunities at the federal, state and local levels, and matching those opportunities with certified minority-owned businesses. We are also advocating for policies, programs and best practices to ensure that minority businesses have greater access to stimulus contract and grant opportunities.
We report to David Hinson, National Director of MBDA, who reports to
Commerce Secretary Gary Locke and Vice President Biden on this initiative.
The Vice President has been asked by President Obama to oversee minority business inclusion. Vice President Biden holds weekly conference calls with
Governors across the country to discuss progress. Among the issues discussed are the challenges and successes that we encounter in implementing the Stakeholders
Outreach Initiative (Attachment A).
The Pennsylvania Minority Business Enterprise Center Advocacy and Outreach
Initiative is one of seven such efforts funded to enhance the nationwide push to create jobs and jumpstart economic growth.
In announcing the awards, MBDA National Director David Hinson noted that
President Barack Obama and his Administration are committed to ensuring that minority businesses receive their fair share of contracts in rebuilding our economy.
Mr. Hinson also noted that minority-owned firms play a significant role in the nation’s economic growth. “Why is this important?”
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According to U.S. Census Bureau projections, by 2043 the United States population will be 50 percent minority and 50 percent non-minority. If you drill deeper into the statics of the non-minority population, white females will represent
30 percent of the white population.
This means that the United States population will be comprised of 80 percent of people who fall into the minority category. Only three percent of minority-owned businesses, which include ethnic minorities and white females, are generating $1 million in revenue.
According to the 2002 American Community Survey, there are 67,006 businesses in the Greater Philadelphia Region, 58.6 percent of which are minority-owned
(30.3 percent owned by people of color; 28.3 percent owned by white Females,
4l.4 percent owned by non-minority).
Category of Businesses Number of Businesses % of All Businesses
African-American 10,576 15.8
Hispanic
Asian
6,337
3,211
9.5
4.8
Native American
White Female
Total Minority
Total Businesses
171
18,976
39,271
67,006
.2
28.3
58.6
100%
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The majority of Philadelphia’s business owners are minority. If the majority of these owners are excluded from regular city contract and stimulus opportunities, how do we expect to grow our local economy?
The exclusion of minority businesses stifles job growth, and tax revenue. These are the firms that will sustain and create employment in our region. Exclusion is not a strategy that will benefit our City.
Increasing opportunities for minority businesses is not about social policy, it is an economic imperative. It’s about the City of Philadelphia’s economic viability and growth. With the changing demographics, minority-owned businesses must grow so that the City’s, Commonwealth’s and nation’s economy can grow.
Setting ranges from the Office of Economic Opportunity database does not solve the issue. When you combine businesses of color and white Females, there are close to 40,000 businesses. The database has less than 900 certified firms. Not exactly a representation of the available pool.
On October 23, the Pennsylvania MBEC ARRA Advocacy and Outreach Initiative held a business-to-business forum for pre-screened certified minority-owned businesses who are interested in pursuing ARRA procurement opportunities. We had representatives from state and local agencies, including PennDOT, the
Department of Environmental Protection, the Philadelphia Industrial Development
Corporation, Philadelphia Housing Development Corporation, the Philadelphia
International Airport, SEPTA and a number of prime contractors who have been awarded state contracts.
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Secretary James Creedon, Chief Implementation Officer for the ARRA for the
Commonwealth of Pennsylvania, provided an overview of Pennsylvania’s
Recovery Plan.
Of the nearly 100 “prepared and ready” minority businesses in attendance, only one has received a stimulus-funded contract. Clearly, the Commonwealth of
Pennsylvania and the City of Philadelphia must do better.
Access to stimulus projects is critical to help minority businesses weather the economic storm. But we should seize this opportunity to fix the current system that has not served minority-owned businesses in the past. A procurement system that allows for engagement and increased contract opportunity must be implemented by the City to grow these firms.
We still do not know what goals, if any, have been established for minority business participation on ARRA-funded projects. And if goals have been established, what is the strategy for achieving them?
The local bidding preference and requirement for Economic Opportunity Plans would provide accountability metrics to ensure that minority businesses receive their faire share of stimulus contracts. Such requirements would also help realize
President Obama’s promise that minority businesses will receive a fair share of stimulus contracts.
In closing, government contracting opportunities represent a huge opportunity to grow minority businesses in our City. We hope the Council enacts legislation that
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not only allows for fair and equitable participation in stimulus contracts, but also for ongoing City Contract opportunities as well.
I want to again thank Chairman Goode for the opportunity to testify today. I would be pleased to answer any questions that you may have.
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