Open Letter To Governor Scott And CFO Jeff Atwater

April 24, 2013 No Comments by Raul Espinosa

Both Florida Governor Scott and CFO, Jeff Atwater, have received this letter requesting the suspension and review of the process that would issue up to 3 awards on FDOT solicitations to register, certify and train DBE and to begin negotiations to incorporate
a sustainable public private initiative (PPI) into the State Procurement System

Bringing Fairness and Transparency to the Florida Procurement System

During the Cabinet Meeting in Saint Augustine, on April 2nd, I was privileged to have discussed the accomplishments of the Fairness in Procurement Alliance (FPA) Think Tank and its flagship, the Umbrella Initiative in my conversations with you and your staff. I addressed the Florida procurement dilemma and the opportunities that a sustainable public-private initiative (PPI) could bring to the State. You both were enthused by the information and requested further details including the expected benefits. This communication is the follow-up to said request.
During the 2013 Legislative Session, the State of Florida has a great opportunity to take the national lead in procurement transparency, accountability and diversity by ordering the deployment of a sustainable unified procurement solution (UPS) that would bring added transparency and allow the tracking of procurement results especially diversity and inclusion. To this end, we request that you consider the shifting of existing budgets and projected expenditures, and issue a state-wide directive requesting cooperation with our effort.

Under the authority of CF 49 CFR Part 26, the Florida Department of Transportation (FDOT) has been spending $1.4M each year, in federal funds, to register, certify and train disadvantaged businesses (DBE), including minorities (MBE) in the State. Additionally, under the authority of sec.287.09451(6), Florida Statutes, the Department of Management Services Office of Supplier Diversity (OSD) has been spending $385,070 each year as well to increase the number of DBE and MBE doing business with the State and to make sure they are allowed to compete for public contracts. Although the FPA Think Tank applauds those efforts, as they are absolutely necessary, these bureaucratic efforts have proven duplicative, inefficient and wasteful with limited results.

The Umbrella Initiative, whose mission is “to double the number of disadvantaged businesses (DBE) contracting with the federal, state and local government by 2020,” has identified a universe of 680,069 minority firms (MBE) – without counting women, veterans and disabled veterans which qualify as DBE – and 1,586 public entities issuing public contracts in the State and… they are not keeping track of results, specially diversity and inclusion. The State registration, certification and training efforts of DBE firms involved in construction, for example, has been dismal, at best, and their methods are not the way to build DBE capacity. The officially recognized training resources and providers in the state, for instance, (i.e., the Small Business Development Centers) nor regional chambers and community groups have been involved on these efforts and there is duplication, inefficiency and waste of taxpayers’ money:

Small businesses (SBE) in Florida 2.1 Billion
Minority businesses (MBE) in Florida 680,069
MBDE record of Florida MBE involved in construction and transportation 70,518
OSD success at certifying Florida MBE 1,778
FDOT success at certifying Florida DBE 2,921

The FPA Think Tank wishes, herewith, to make its case for incorporating a sustainable unified procurement solution (UPS) into the State procurement system which would provide – under one umbrella – access to all procurement opportunities not to mention all the essential procurement services in one place, including diversity and inclusion results.

With support, not necessarily new legislation (although it would be welcomed), from the Florida Legislative Branch, the Governor can re-arrange and consolidate budgets to permit the creation of this sustainable solution to make better use of taxpayers’ money, prevent duplicative efforts and properly give DBE and MBE an opportunity at creating jobs. Here are the immediate steps which would be necessary to accomplish the desired results:

  1. Suspend the renewal of two (possibly three) FDOT contracts designed to register, certify and train DBE. This will allow the State to put to better use $1.4 Million in federal funds annually for the next four years (a total of $5.6 Million.) The objective of this action is to eliminate duplication, improve efficiency and create a sustainable solution which will really help Florida accomplish its objectives.
  2. Negotiate for the deployment of the Umbrella Initiative, a public-privative initiative (PPI) to overhaul the plan that implemented Executive Order 99-281. Even a better solution would be for the Governor to consider writing a new Executive Order of his own for this purpose. The objective of this action is to help the State increase government transparency as proposed by the Five for Florida, already supported by Jeff Atwater.

By implementing the recommendations above, immediate results, such as the elimination of the barriers and abusive procurement practices that are expected to be identified by the City of Jacksonville Disparity Report can be achieved. Please note that the possible suppression of the results of this report have galvanized support for our efforts and have united the business organizations representing DBE and MBE in Northeast Florida. The DBE businesses in Northeast Florida stand to benefit from the allocation of $698.7 Million in construction and transportation projects on the Governor’s record $74.4 Budget. Larger amounts are expected for South and West Florida as well.

Attached is a copy of the Umbrella Initiative Executive Summary providing recommendations to the Governor and the Legislature for moving forward. We trust both the Governor and the Legislature will support these actions before they recess. Please advise us how the Governor and the CFO intend to proceed.

TEXT OF COMMUNICATION TO FLORIDA CHIEF PROCUREMENT OFFICER

Please kindly consider suspending the proceedings required to issue awards – using $1.4 Million in federal funds ($5.6 Million over four years) pursuant to 49 CFR Part 26.87 – on the Florida Department of Transportation RFP-DOT-12/13-9027-JP; RFP-DOT-12/13-9028-RC, including soliciting for a renewal or an extension of the contract resulting from RFP-DOT-11/12-9015-JP pending a review of a request submitted to the Governor and to CFO, Jeff Atwater.

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