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Executive order meant to expand SWaM procurement opportunities

7/22/2014, 8:01 p.m.

Virginia Gov. Terry McAuliffe has signed Executive Order 20: Advancing Equity for Small, Women, and Minority Owned Businesses (SWaM), which expands contracting opportunities for small businesses.

The executive order sets the highest contracting goal in Virginia history of state expenditures to SWaM-certified businesses at 42 percent. It also creates a new "micro business" designation for small businesses with no more than 25 employees and no more than $2 million in revenue. Currently, over 80 percent of SWaM certified companies fall under this micro business category but often have to compete with companies over ten times their size for contracting opportunities.

"Today’s order will enable women and minority small business owners to compete on a level playing field," said state Sen. A. Donald McEachin (D-Henrico). "It will help ensure that small businesses are chosen for the quality of their work, and it will help give women and minority owners a fair shot at success.

“I have repeatedly introduced a bill to address unfair contracting disparities, but have not been able to get it passed. Now, thanks to Governor McAuliffe, at least for the next three-and-a-half years, the problem is finally being fairly addressed.

“I hope that next year, the General Assembly will revisit the issue and make this progress permanent.”

Multiple reports have shown that Virginia routinely under-uses women- and minority-owned businesses (M/WBE) in its procurement processes. From 2005 to 2009, for instance:

• 1.87% of construction contractors were M/WBEs

• 1.34% of architecture and engineering consultants were M/WBEs

• 2.33% of professional services consultants were M/WBEs

• 2.96% of goods and supplies vendors were M/WBEs

There was a substantial disparity between the availability and use of M/WBEs across all four categories.

McEachin has sponsored several bills designed to address procurement disparities, including SB 781in 2013 and SB 651 in 2012. Both bills would have mandated that the governor “require state agencies to implement appropriate enhancement or remedial measures” whenever there is a documented, statistically significant under-use of women- and minority-owned businesses in state procurement.

Under current law, the governor merely has the option to impose such requirements.

“The Virginia Legislative Black Caucus is pleased that Governor McAuliffe is issuing an Executive Order that focuses on small, women, and minority owned businesses," said state Sen. Mamie Locke (D-Hampton). This is a necessary step to ensure fairness, transparency, and equity for these businesses that are often left out of the procurement process. I am especially excited about the opportunities for minority owned businesses for which the Caucus has been a strong voice and advocate.”