American DBE Magazine - Spring 2021

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spring 2021

Russell Innovation Center Boosting Atlanta Businesses

Head start bonding program surpasses $100 million Russell Center Chair H. Jerome Russell Jr. and CEO James “Jay” Bailey

putting dbes in the game with sandag

S. Levy Foods Sweet Success Wake County Public Schools New Vision AMAC Strong in Pandemic / spring 2021

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Atlanta | Mobile | Orlando

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Features

DBE Power Player

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Putting DBEs In The Game With SANDAG

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Russell Innovation Center Boosting Atlanta Businesses

DBE Program Spotlight

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Head Start Bonding Program Surpasses $100 Million

INDUSTRIES

28 33 36

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Airports

AMAC Strong: Helping Airport Industry Firms Endure Pandemic Impacts

Transit

WMATA Expanding Small Business Opportunities

Civil/Highway

Ferrovial Projects Surpass $1 Billion In DBE Payments

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S. Levy Foods Sweet Success by Sarah Magargee

Wake County Public School System New Vision by Sarah Magargee

Business Development

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ACDBE Tips For Thriving After Covid-19 by Michael Freilich

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Legal Updates for DBE, SBA and M/WBE Programs by Colette Holt, J.D. and Joanne Lubart, J.D

Editorial

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Open Letter to USDOT Secretary Buttigieg from the National Association of Minority Contractors


23 Spring 2021 Volume VIII - Issue 2 Publisher Shelton A. Russell

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Editorial Michael Freilich Sarah Magargee Collette Holt, J.D. & Joanne Lubart, J.D. Shelton A. Russell Wendell Stemley Shelton A. Russell

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Headquarters 514 Daniels Street, #186 Raleigh, NC 27605 Website www.AmericanDBE.com About American DBE Magazine American DBE Magazine is the premier industry resource for individuals and stakeholders who work within the federal Disadvantaged Business Enterprises program administration. American DBE Magazine is published quarterly and distributed in all 50 states—plus Puerto Rico and the U.S. Virgin Islands—to DBE program administrators, business owners, and professionals in the Aviation, Highway Construction and Public Transit industries.

Subscriptions American DBE Magazine is published quarterly in Fall, Winter, Spring and Summer editions. The annual subscription rate is $24.99 including online editions, special industry reports, and four issues: single copy list price is $6.99 plus postage originating from Raleigh, North Carolina.

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From the publisher

Accountability and Responsibility are Keys to Progress Diversity, inclusion, equity, fairness, affirmative action, equal opportunity, nondiscrimination, and civil rights are all terms that describe efforts in America to treat non-Caucasian people and women the same as Caucasian males are treated. It will take focused and dedicated action to repair the damage caused by the historical mistreatment of these groups of people. Programs created for business owners since the 1970s use an equally expansive number of titles to describe their efforts: minority business, women business, equal business opportunity, historically underutilized business, disadvantaged business, and small business. All these titles focus on groups of people affected by the actions of others; yet, who are still lacking the necessary power and resources to correct the inequities they have endured. While many programs achieve some measure of success and are certainly better than no programs at all, I have yet to see a program perform well enough to eliminate need for the program. I believe this is because the focus of

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the program is always on the affected group, and not on the group doing the affecting. If programs focused on those accountable and responsible for the results, the performance would be different. I would welcome an “Accountable Business Program” (ABP), where a government agency or corporation makes itself accountable for the program’s results, or a “Responsible Business Program” where an organization takes responsibility for meeting its programs goals. The focus would then turn to executive leaders and program administrators to deliver results. While this is sometimes expressed through adding accountability for business program results to performance reviews and organization metrics, I am hard-pressed to identify an example of someone losing their job or jeopardizing their career because they failed to meet diverse business programs goals and objectives. If these thoughts seem a little over-thetop, we must ask ourselves why. Is it just not that important? Surely, there are several organizational goals and metrics executive leaders are accountable for that will quickly get them replaced if they fail to meet them, but Diversity & Inclusion just is not one of them. Yet, our communities and nation remain woefully unequal in areas of income, wealth, education, health, housing and employment, to name a few; but diverse businesses can help close this gap. It should be every government agency’s mission critical goal to address these disparities, and corporations that do not embrace these goals should not be supported with sales revenue. This issue of American DBE Magazine recognizes organizations demonstrating accountability and responsibility in addressing inequity in business opportunity and wealth creation. Our cover story features one of America’s largest African American-owned construction firm’s efforts to give back and help other businesses succeed through the Russell Innovation Center for Entrepreneurs in Atlanta. The issue also highlights the San Diego Association of Governments’ (SANDAG) innovative strategy to increase diverse businesses participating in professional services contracts; and the Hensel Phelps construction firm leveraging its resources to increase bonding capabilities for diverse firms that will enable them to complete larger contracts and increase wealth. Another story in this issue profiles the Wake County Public School System successfully

leveling the playing field for diverse architects to successfully compete in the design bidding process. Our DBE Power Player is S. Levy Foods, a woman-owned airport concessionaire leveraging the Airport Concession Disadvantaged Business Enterprise (ACDBE) Program to grow her streetside candy and baking company to having stores in two of the nation’s largest airports. Finally, this issue also highlights the National Association of Minority Contractors (NAMC), Ferrovial Construction US, Washington Metropolitan Area Transit Authority (WMATA), and the Airport Minority Advisory Council (AMAC) – as we further the conversation about the importance of Accountability and Responsibility. Enjoy!

Peace and blessings,

Shelton A. Russell, Publisher American DBE Magazine

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EDITORIAL

An Open Letter to USDOT Secretary Pete Buttigieg participation. Nearly 50% of all states did not make the DBE participation goals established for minority- and women-owned businesses required by federally funded or federallyassisted projects. Additionally, to provide adequate and fair protections for minority- and women-owned construction contractors who build our nation’s infrastructure, NAMC strongly encourages the Administration to pursue policies that ensure Wendell R. Stemley, CMAA Emeritus National Director

Hopefully President Biden’s $2.2 trillion Infrastructure Bill will allow Transportation Secretary Buttigieg to address generations of infrastructure discrimination. As America continues to struggle, “The Administration’s Priorities for Transportation Infrastructure” hearing, was held on March 25 by the House Committee on Transportation & Infrastructure. The star witness for the hearing was newly-confirmed Secretary of Transportation Pete Buttigieg. In the wake of COVID-19, America needs to take advantage of every economic opportunity possible. Fortunately, the construction sector has the potential to play a key role in our nation’s financial recovery. The Administration must understand that without the will to enforce Disadvantaged Business Enterprise (DBE) compliance, the federal government will be compounding the problem by giving funding to the same states and governors that did not comply with federal participation goals in the past. In some cases, states that have chosen to focus on limiting minority voting rights will think nothing of continued non-compliance for DBE

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proper bonding is in place for new forms of project delivery that provide essential payment and performance protections through surety bonds. These bonds have long played a critical role in protecting subcontractors, workers and suppliers – including Disadvantaged Business Enterprise Program participants. As Congress continues to consider ways to jumpstart our economy, to include investment in infrastructure, lawmakers need to ensure

State

2019 Participation Goal

% State Missed the Goal

Connecticut

12.10%

-0.24%

Georgia

16.00%

-3.76%

Hawaii

29.05%

-21.95%

Idaho

8.30%

-1.62%

Illinois

18.70%

-3.65%

Iowa

5.94%

-0.06%

Kentucky

11.95%

-2.70%

Louisiana

13.09%

-3.43%

Maryland

26.04%

-7.58%

Michigan

9.20%

-2.01%

Minnesota

12.23%

-1.77%

Missouri

16.05%

-5.31%

Montana

6.14%

-0.56%

North Carolina

14.00%

-1.72%

North Dakota

4.91%

-0.30%

South Carolina

13.20%

-3.72%

Ohio

15.60%

-4.33%

Oklahoma

9.20%

-1.92%

Texas

12.60%

-2.09%

Washington

19.00%

-6.53%

Wisconsin

12.33%

-1.77% Source: USDOT


that these potential solutions have the right protections for economically disadvantaged rural and urban communities, which are underserved and underfunded. Too often, federal funds come in to improve these communities only to end up being diverted at the state, county and city level, thus leaving these areas in the same condition in which they were found. “Whether it’s flooding from severe weather events like hurricanes or it’s something like this severe cold, the history of our response to disasters is that our communities are hit first, harder and have to suffer the longest,” said Robert Bullard, a professor at Texas Southern University and an expert on wealth and racial disparities related to the environment, in a recent New York Times interview with James Dobbins and Hiroko Tabuchi. Cities like Flint, Michigan, the Gulf Coast region from Texas, and the Mississippi Wetland Rivers of Louisiana suffer from corrosion, leaks and breaks in old pipes that degrade water delivery and sewage treatment systems critical to public health and the environment. Every day, 850 water main breaks occur in North America at a total annual repair cost of over $3 billion. This doesn’t include the high cost of emergency equipment, depleted water supplies, traffic disruptions, and lost work time. Experts note that corrosion is the leading cause of this water main break epidemic. The American Society of Civil Engineers has consistently given poor marks to the nation’s public drinking and wastewater systems saying hundreds of billions of dollars must be spent

over the next two decades for upgrades and replacement. The Gulf Coast region from Texas, the Mississippi Wetland Rivers of Louisiana from north Baton Rouge to New Orleans have been plagued with so many infrastructurerelated and industrial accidents that it has been nicknamed Cancer Alley. The minority community I grew up in is called the Standard Heights neighborhood of Baton Rouge, where we lived with mysterious flakes falling from the sky and in the water. Standard Heights is now mostly 20 square miles of abandoned structures tucked into a corner of the Exxon Mobile plant in North Baton Rouge, a region dependent on the oil industry. The Environmental Protection Agency (EPA) was called in to test the air, the water, the soil, the urine, the blood and everything else for specific chemicals, but results weren’t provided or clearly reported to the community. No settlement was ever reached and hundreds of houses were lost, abandoned or otherwise sold for offers of less than $19,000 dollars to relocate. There is nothing left of that neighborhood. Retired U.S. Army Lt. General Russell Honoré, known for his excellent work on rebuilding New Orleans after Hurricane Katrina, spoke from the Louisiana Environmental Action Network (LEAN) Office, saying, “So I ask people, if the industry is doing so well for us, do we have the best roads? The best schools? Hospitals? The answer to all of them is we’re either last or second to last to Mississippi, and Mississippi hardly has any oil and gas. We got the largest

concentration of pipeline in the U.S., so where’s the money going?” (Story by David Hanson) Infrastructure is not just about roads. While funding this bill will help tremendously with infrastructure upgrades, without adequate protections for urban and rural communities, funding the Infrastructure Bill alone will not be enough to resolve local concerns and infrastructure discrimination. Without adequate protections, one part of a city will enjoy the benefits of new infrastructure while other communities will continue to suffer from a lack of access to broadband services, a stable electrical grid, clean drinking water, and reliable sewer systems. Infrastructure discrimination impacts every aspect of our lives, ranging from medical care and access to quality food and beyond. Citizens must remain involved with local leaders, such governors, mayors, city council members, and congressional representatives, to ensure their communities’ and individual needs are included in government appropriations to protect America’s infrastructure as a human rights issue that includes jobs and business opportunities for all. A CALL TO ACTION Because infrastructure discrimination impacts every aspect of our lives, citizens must remain involved with local leaders, governors, mayors, city council members, and congressional representatives for a fair share of the infrastructure money.

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SANDAG Equi t y Pl a n and Bench Program Put DBEs in the Game

SANDAG Diversity and Equity team holding “BENCH” sign in front of the San Diego skyline. From left David Santos, Senior Compliance Analyst; Raychel Jones, Small Business Coordinator; Elaine Richardson, Director of Diversity and Equity; Brittany Yamagata, Small Business Coordinator; Erik Staples, Senior Compliance Analyst; (Not Pictured) Alexia Spivey, Senior Administrative Analyst.

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or many Disadvantaged Business Enterprise firms, the most challenging part of gaining traction in the transportation industry is securing their first contract. The reason is the proverbial Catch-22; it takes prior experience to win a contract, but it is impossible to get experience until someone provides an opportunity. This situation can leave firms stuck on the outside trying to find a way in, and sometimes leads to DBEs seeking opportunities outside of the transportation sector to fulfil their business goals. The San Diego Association of Governments (SANDAG) is addressing this dilemma through a program designed to offer a streamlined path into public transportation opportunities; especially for DBEs providing professional services in the Architecture, Engineering and Construction Management fields. The SANDAG Bench Program was created in 2012 to provide DBEs greater opportunity to work on capital development projects.

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SANDAG is the Metropolitan Planning Organization (MPO) for San Diego County and 19 local governments in Southern California. The agency is one of few MPOs that administers capital development activities for the region, and one of few that administers a Disadvantaged Business Enterprise Program for projects funded by the USDOT Federal Transit Administration and Federal Highway Administration. The SANDAG DBE Program is closely aligned with the agency’s overall commitment to equity and inclusion. The SANDAG Board of Directors has affirmed support of greater Diversity, Equity & Inclusion through adopting a “Commitment to Equity” statement to accompany the agency’s vision and mission statement. “This statement is the foundation for the actions SANDAG will take to incorporate diversity, equity, and inclusion in all programs, projects, and policies,” said SANDAG Executive Director Hasan Ikhrata. “The goal is to capture

the agency’s unequivocal commitment to antiracism and provide a foundation from which to develop an equity action plan in 2021.” The statement identifies how the agency will move forward to create greater equity and says, in part: “In 2021, SANDAG will develop an equity action plan that will inform how we plan, prioritize, fund, and build projects and programs; frame how we work with our communities; define how we recruit and develop our employees; guide our efforts to conduct unbiased research and interpret data; and set expectations for companies and stakeholders that work with us.” Although SANDAG has a track record of promoting opportunities for small, minorityand women-owned businesses, the new equity action plan is included in the agency’s current Regional Transportation Plan and will further strengthen these efforts.


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DOING BUSINESS WITH DISADVANTAGED BUSINESS ENTERPRISE (DBE) PROGRAM SMALL BUSINESS PROGRAM BENCH PROGRAM SANDAG procures construction and maintenance services, hardware, software, information systems, data, and facilities equipment and supplies.

SANDAG also hires consultants in categories such as intelligent transportation systems, planning, environmental, communications, public outreach, finance, legal, construction management, and engineering.

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Bench Program A key strategy SANDAG uses to promote equity and provide opportunities for small and diverse firms is its Bench Program. The program provides small companies and DBE-certified firms an opportunity to submit information and be placed on a list, called the “Bench,” - with the possibility of being selected to work on Architecture and Engineering (A&E) or Construction Management (CM) contracts. Bench firms are available to work as subconsultants on task order contracts performed by several prime consultants holding an “on call” contract with the agency. The Bench Program was launched in 2012 in preparation for a Request for Proposals for oncall contracts for A&E consultants. The creation of the Bench led to a substantial increase in the number of subcontracts provided to small businesses and DBE firms. Prior to 2012, prime consultants were required to submit a listing of their DBE subconsultants during the proposal

process to receive an on-call contract, but oftentimes DBEs listed in the proposal did not match the categories needed to complete specific task orders, so opportunities were limited. The new Bench Program eliminated this challenge by allowing SANDAG to set DBE or small business goals on each task order and requiring prime consultants to select companies from the list of Bench firms that were approved to work on SANDAG projects. Depending on their qualifications, small and DBE firms were approved in 45 different A&E categories to provide prime consultants an ample supply of capable subcontractors. After the Bench Program was implemented in 2012, the number of DBE firms participating as subconsultants on the A&E on-call contracts increased significantly from 15 to 78 firms. Additionally, payments to small business and DBEs increased from $9.4 million to $50.4 million. This data confirms that the Bench Program tremendously increased awards to women- and minority-owned businesses. Elaine Richardson, SANDAG Director of Diversity and Equity, said, “We develop programs at SANDAG not just to follow the

Aerial view of the SANDAG $2.2 billion Mid-Coast Trolley project.

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regulations; instead, we do it because it is our responsibility as a public agency to assist businesses of color and women by implementing these programs so they may have the same opportunities as any other firm that wants to do business with SANDAG.” The agency expects even greater results from the Bench Program as proposals were submitted in Spring 2021 for the next round of on-call contracts. For the latest consultant selection process, SANDAG has added a small business component by breaking out smaller contracting needs available to state certified small businesses.

Speed Networking Events Part of what makes the Bench Program so successful is the outreach conducted by SANDAG through speed networking events. SANDAG hosts large speed networking events to ensure that small and DBE firms on the Bench are able to meet with prime consultants in a one-onone format for 5-minute networking sessions. These events are planned and coordinated for every new series of A&E and CM on-call contracts, and SANDAG holds one event at the procurement stage and another when the contracts are executed. Before the COVID-19 pandemic, SANDAG held speed networking events in-person at a venue that holds over a thousand people. The venue would be lined with rows of tables set up in a “speed dating” style. Hundreds of small business owners eagerly awaited the opportunity to network with prime consultants. However, once the pandemic occurred, it was necessary to shift to a virtual event.


SANDAG hosted two virtual events to support The lead contractor on the project, the expanded from Ms. King as the single employee the new A&E and CM on-call procurements. Mid-Coast Transit Constructors (MCTC), is a to 20 employees, and grown from one dump This new virtual method of hosting the speed joint venture of Stacy and Witbeck, Herzog, truck to 18 trucks, including multiple water networking was a game-changer for small and and Skanska. MCTC has worked closely with trucks and a street sweeper. King shared DBE participation. For her advice to other CM, over 600 networking DBEs seeking business connections were made opportunities: “Don’t be between potential prime discouraged if you don’t consultants and small get a call back right away. and DBE firms. The A&E Don’t be afraid to pick speed networking event up the phone and call had over 1,600 one-onthem (contractors) and one meetings scheduled take charge at the risk between primes and of being a little pushy. Bench firms. SANDAG Go for it. The worst that representatives are could happen is they ecstatic about these say no!” results and grateful to Richardson said that the prime contractors the SANDAG Bench who volunteered their Program has proven to be time and resources to one of the agency’s most accommodate these Small businesses and prime contractors participate in a speed networking event for the successful programs meetings with small SANDAG Mid-Coast Trolley project in 2019. because it has increased and disadvantaged small and disadvantaged businesses and continue business opportunities; to support the SANDAG additionally, it promotes Bench program. and fosters diversity, the SANDAG Office of Diversity & Equity to and acts as a conduit for creating valuable ensure DBEs had access to opportunities on business partnerships between large and DBE Success Stories the project; and they have been an active small firms. She also attributes the success participant in the San Diego Construction and of the SANDAG DBE Program to the strong The success of the Bench Program is a clear Collaboration (C&C) Mentor Protégé Program. support of the agency’s Board of Directors and indication of the positive impact the SANDAG The mission of the C&C Mentor Protégé Program Executive Director Ikhrata. She said: “It is so DBE Program has on the agency’s equity goal. is to provide a forum for small businesses and very important, because if you don’t have their The agency’s overall accomplishments for prime contractors seeking to connect through support, you cannot implement these types DBE participation are also impressive. During collaborative and cooperative partnerships. of programs. It takes support from leaders, federal fiscal year 2020, SANDAG achieved DBE Through the contracting outreach, Bench project managers, and staff to make it work.” awards of 16.7%, far exceeding its FTA-approved Program and mentoring efforts, the Mid-Coast goal of 10.3%. SANDAG also maintained this Trolley project has resulted in several success performance during the 2021 fiscal year and stories of DBEs growing their company size is currently tracking at 16.1% DBE participation and overall capacity while working on the for the current federal fiscal year. project. None of those success stories is Much of the success during the past few more impressive than the growth of Leinaia’s years is related to creating DBE opportunities Transportation, a woman-owned DBE firm. on the $2.2 billion Mid-Coast Trolley project. Company owner Leinaia King attended several The project is one of the largest ever in the San small business outreach and workshop events Diego region, extending the Blue Line Trolley hosted by SANDAG and MCTC during the early from Downtown San Diego approximately 11 stages of the project. King persistently followed miles to the north and terminating at University up with people she met at the meetings and City, near the University of California, San Diego. was invited to bid on trucking services with The project began in 2017 and will open to MCTC. Her company then won its first contract public during the 4th quarter of 2021. SANDAG for $500,000 in May 2015. established a DBE goal of 11.3% for the project Since the first contract, Leinaia’s and has achieved 13.3% DBE participation to Transportation has continued work on the date, with 109 different DBE firms completing project, and its contract value has grown to work on the project. approximately $9 million. The company has

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Russell Innovation Center Boosting Atlanta Businesses Through Information and Transformation

Russell Innovation Center for Entrepreneurs building in Atlanta, Georgia. The 50,000 square-foot facility is home to a nonprofit corporation with the mission to empower entrepreneurs and innovators to create, invent and learn while being engaged and motivated to develop game-changing new ideas to promote economic empowerment.

The Russell Innovation Center for Entrepreneurs (Russell Center) is a welcomed addition to the Metropolitan Atlanta business landscape. The Russell Innovation Center for Entrepreneurs (Russell Center) is a welcomed addition to the Metropolitan Atlanta business landscape. The City of Atlanta is a dichotomy. On one hand, it is one of the largest and most economically vibrant cities in the country. It is headquarters to numerous major

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corporations such as Delta Airlines, UPS, Coca Cola Enterprises and Home Depot. The city is also widely regarded as a mecca for black wealth and entrepreneurial success – with a vibrant African American entertainment industry highlighted by the presence of music, television and movie stars. It is home to Tyler

Perry Studios, the largest black-owned movie production studio in the nation. Metropolitan Atlanta also was ranked as the fifth best city for black-owned businesses by the website www.overheardonconferencecalls.com due to the high number of businesses owned by African American located in the city.


On the other hand, Atlanta is also ranked as the number one city in America for income inequality according to a 2018 Bloomberg analysis; and the 2018 World Inequality Report states that a child born into poverty in Atlanta has less than a 5% chance to ascend to the top 20% of income earners in the city. The U.S. Census Bureau 2018 American Community Survey also found that 73.8% of Atlanta’s poor are black, while making up 51% of the city’s population.

rental units. “We are still growing and looking to acquire more property in this area,” Jerome said.

about creating a shared workspace concept, something like a WeWork; but then we had the chance to look at a facility in New Orleans that was converted into a nonprofit to help small businesses grow and develop, and we really liked that idea,” Jerome said. The Russell family began to study the concept of using the building as a foundational asset to create a nonprofit corporation dedicated to growing and advancing African American businesses in Atlanta. The family hired a distinguished Atlanta law firm to complete a study called a “case for support” to see if the idea could gather support from the business community. The research yielded a positive response, and The Russell Innovation Center for Entrepreneurs was born.

This challenging duality represented a compelling need and a great opportunity for the family of the late Herman J. Russell Sr., as they considered options for the redevelopment of their 50,000-square-foot commercial building that was The Russell’s next step was the previous headquarters for selecting James “Jay” Bailey as H.J. Russell & Company. The President and CEO of the Russell building was largely vacant Center in March 2018. Bailey’s after the company moved role is leading the development its offices to a new location and operation of the center, in 2016. The company had which includes planning and reduced its number of staff implementing the renovation of over the past decade and the building, leading the program required significantly less space The Russell Innovation Center for Entrepreneurs Board Chair H. Jerome development and launch of for operations. However, the Russell and President & CEO Jay Bailey lead the development and adminthe center, and participating original headquarters building istration of the nonprofit corporation. in fundraising efforts to gain still stands as a hallmark of financial support. “We had to build the historic Castleberry Hill neighborhood, However, determining how to best it from the ground up,” Bailey said. “When the one of the first areas in Atlanta where African develop the former headquarters building Russell family hired me, there was an idea American businesses were located. represented a challenge for Donata, Jerome for what we wanted to create, but we had to and Michael Russell, the heirs of the H.J. build it from there. There was no blueprint Castleberry Hill is located on the western Russell organization. “At first, we thought for this,” he said. edge of downtown Atlanta, just a few One of the things that was important blocks from the Atlanta University to the Russell family and Bailey was Center, which contains the Historically including opportunities for blackBlack institutions of Spelman College, owned companies to participate in the Morehouse College, Clark Atlanta design and construction of the building University, and the Morehouse College renovation. This strategy both provided School of Medicine. “My father had the opportunities for the types of companies vision that this area would one day be a the center serves, but also honors the part of downtown Atlanta, so he bought legacy of Herman J. Russell Sr. and the H.J. much of the land in Castleberry Hill over Russell & Company as one of the most the years,” H. Jerome Russell Jr., son of renowned African American companies Herman J. Russell, Sr. and board chairman in the country. for the Russell Center, said. Thanks to Mr. Russell’s foresight, the family now owns In line with this objective, Bailey and approximately 40 acres in Castleberry the Center’s board of directors selected Hill – and has developed much of the Russell Center stakeholder companies attend a a team of black-owned companies area for residential and commercial presentation by Facebook in September 2019. to complete the redevelopment of

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the facility. The Dragon Group, an Atlantabased project management firm, was brought on board as the Center’s owner’s representative and project manager to oversee the development work; and to serve as the liaison between the center’s leadership and the team of professionals working on the project. The general contracting firm FS360 was awarded the contract to lead the construction activities after submitting a winning proposal. The FS360 contracting team also included several black-owned firms to work as subcontractors on the project. Other African American-led companies selected to work on the project include Reclaimed Karma, a furniture, fixtures, and equipment supplier; INEX Systems & Designs, an audio/visual and wiring contractor; and XMETRICAL LLC, an architectural design consultant. “This group will essentially help complete the whole Russell Center, including creating a two-story atrium, a rooftop deck, and additional collaboration and learning space,” Randall Dragon, co-founder and principal of The Dragon Group said. The consulting and contracting team started working in 2018 and is about halfway through the renovation of the building. Projects completed so far include a multi-purpose classroom and meeting space, a Chase Bank-sponsored lounge area, an office suite, administrative offices, conference rooms and other meeting spaces. Having a team of black-owned companies completing the redevelopment of the Center also demonstrates the capabilities and talent of companies in the Atlanta region. “One of the things that has been beautiful to see is that other major companies are starting to realize how much depth the City of Atlanta’s black construction community has – and not just contractors; it’s architects, engineers and all the contract partners,” FS360 President & CEO Ernest L. Ellis said. Ellis believes this project demonstrates that black-owned companies have all the skills necessary to complete major construction projects, and to do it with excellence. “It has been intentional from the Russell Center’s standpoint, and from all the stakeholders involved that we have black contractors, black and brown people doing the work; and not only delivering but delivering excellence,” Ellis said. Although work on the project has been steady since 2018, the work is ramping up due to the April 2021 announcement that the

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Russell Center won an additional $5.267 million grant from the U.S. Economic Development Agency to continue the buildout of the facility. The new award follows an initial $3 million grant provided by the EDA in 2017. The center has also received significant donations from many private sources including a $5 million commitment from the Ressler Gertz Family Foundation (in partnership with the Atlanta Hawks), and a $1 million gift from the Chickfil-A restaurant chain. Jerome believes the total investment in the Russell Center will tally approximately $25 million to develop a state-of-the art facility with the latest technology, amenities and resources to help businesses reach their highest potential. “We have already put about $10 million into it, including the value of the building; and the $5 million from the EDA will take us further towards where we need to go.”

The ramp-up in development of the Russell Center is timely, as the coronavirus pandemic comes to an end and the demand for enrollment in the center’s program is extremely high. The center’s first cohort of 100 stakeholders joined the center in 2019. Stakeholder companies are the businesses with ongoing membership and access to the center and are selected through an application process. Companies selected for the program are those identified as ready and willing to put in the work to succeed in the program. Businesses applying to become a stakeholder must demonstrate their commitment to improving their business and sign an agreement with the Center to complete a curriculum developed for firms at different stages of their development. The center’s development curriculum is called “Big IDEAS,” an acronym that breaks the stakeholders


Members of the design and construction team for the Russell Innovation Center for Entrepreneurs (front row, from left) Chris and Yvonne Johnson, Reclaimed Karma; Yvonne and Randall Dragon, The Dragon Group. (Back row, from left); James Waldon, XMETRICAL, LLC; Channing Baker and Ernest Ellis, FS360 General Contractors; Zebadiah Henry, Inex Systems & Designs.

into five phases of development – Inspire, Develop, Execute, Acquire and Sustain. The phases are designed to take a business from the conceptual phase (Inspire) through the maturity phase (Sustain). The center partners with academic, consulting and business development professional to implement the curriculum for stakeholder companies. Ten of the 100 stakeholders are classified as “Pacesetters for a two-year period.” Pacesetter firms are further along in their development and are identified as ready for accelerated growth through the assistance of resources the center provides. During this period “companies receive individualized content, state-of-the-art space, and wraparound services,” Bailey said. “The focus is on access and community – access to partnerships, expertise and capital – while also being embraced by a community that believes in them.”

Although the remaining 90 stakeholders do not have an office located in the facility, they are still able to work in the facility using co-working stations located around the fourstory building and are required to participate in the other educational and development programs offered by the center. In May 2021, the center will begin selecting 50 additional companies to become stakeholders and plans to continue growing the number of stakeholders as renovations to the building are completed. “We are moving businesses from information to transformation, and we are doing this by providing everything they need to be successful,” Bailey said.

reflects on how the center’s renovation and programming are coming together. “To have this happening here in Castleberry Hill, where my father started, is a dream come true. Our hope is that the Russell Center will be a catalyst for innovation and research on closing the equity gap for black businesses in Atlanta.”

Jerome is excited about the future of the Russell Center and its ability to make a difference in the success of black-owned businesses in the Atlanta area. “We are living a dream! It’s beautiful,” Russell said, as he / spring 2021

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Capacity builders advocating for contractors nationwide.

410.876.9610 • thebarbourgroup.com

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Integrity

Transparency

Service

Law / Public Policy Consulting Disparity Research / Disparity Studies Supplier Diversity Program Management

/ spring 2021

235 Peachtree Street, N.E. | Suite 400 | Atlanta, Georgia 30303 | Phone: 404-584-9777 | Fax: 404-584-9730 | GSPClaw.com

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Participants in the Hensel Phelps Technical Assistance Program celebrate completion of the program in 2019 at the Tysons Corner, Virginia office.

Head Start Bonding Program

Surpasses

H

ensel Phelps, one of America’s largest construction firms, recently announced that the Head Start Bonding Program has surpassed $100 million in surety bonds for small businesses participating in the program. The program is a three-way partnership between Hensel Phelps, The Barbour Group and RLI. The Barbour Group serves as the program’s bonding agent, working with small companies to help them complete the bonding application process; while RLI is the program’s surety company, underwriting the bonding applications submitted by participants.

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$100 Million in Contracts Supported

The $100 million milestone represents over a decade of support the program has provided to companies seeking their first surety bond to support contracts on major construction projects with Hensel Phelps. As of 2020, 122 bonds have been provided to 66 different companies, with an average bonding amount exceeding $800,000. The program has also helped participants increase their business capacity and performance to a level where many firms are now bonded contractors outside of the program. Hensel Phelps Operations Manager William Thumm said: “Our goal when we started the

program was to help subcontractors who, under normal bonding conditions, would not get a bond – but were starting to show the signs of having the right systems, managerial procedures, experience, and backlog; and with assistance, help them get to the level where they can get a bond. Then, after two or three years can graduate to become a viable bonded company. The program has exceeded our expectations and been a big success.” Hensel Phelps Corporate Director of Supplier Diversity Brad Lewis leads the company’s involvement in the program and said: “This


program is the only one of its kind in the country. We know that bonding is a challenge for many small businesses as they are trying to grow, and we want to help them get over this hurdle and become successful contractors in the construction industry, for Hensel Phelps and for other contractors as well.” “If it wasn’t for bonding, we would not be where we are today,” Fran Eaton, president of F&C Eaton said. F&C Eaton received its first $1.5 million bond through the Head Start Bonding Program in 2016. F&C Eaton is a material and equipment supplier based in Dallas, Texas, focusing on supplying items not typically supplied by small and diverse firms. “We have supplied things like train lift equipment, a helicopter de-paint system and access flooring,” Eaton said. Since the initial bond, F&C Eaton increased its bonding capacity to $5 million, then to $10 million, and now has a $30 million bonding capacity. “It’s a great program for companies that need to get a bond. It forces you to build capacity, because you have to put money back into the company, and the bonding company is looking at how you manage the business,” Eaton said.

Hensel Phelps is currently substantially complete with the new $275 million Concourse D & Terminal Wings project for the Nashville International Airport. The project has achieved 29.81% on a goal of 19.42% for small, minority- and women-owned companies. Total spend was $82 million.

navigate the process and receive positive outcomes from the experience. First, Hensel Phelps seeks to identify good candidates for the program through its subcontractor solicitations, networking events, and referrals. This effort includes Hensel Phelps staff meeting with potential business partners to determine if they have the needed experience, capabilities

and capacity to become a subcontractor on a large construction project. “We must have checks and balances to make sure we help the subcontractor be successful, and also make sure we don’t push risky contractors into the program,” Thumm said.

Beechfield Landscaping Inc. also increased capacity through the program. The Marylandbased commercial landscape installation and maintenance company received its first bond through the program in 2015. The bond was used to complete a $600,000 landscaping installation job on the Social Security Administration National Support Center in Maryland as a Hensel Phelps subcontractor. “It was one of the largest projects we’ve had,” said Beechfield Landscaping General Manager Matt Postlethwait. “It had irrigation, turf paver roadways, plantings, and native materials. Since successfully completing the project in 2016, Beechfield has completed eight additional bonded projects for clients.” The program’s success is largely due to excellent collaboration between the Brad Lewis of Hensel Phelps (second from right) discussing the success of the Head Start Bonding Program with three partners – Hensel Josh Lopez, Karen Barbour and Vanessa Lopez at the Hensel Phelps office in Tysons Corner, Virginia. Phelps, The Barbour Group and RLI. The partners all play a crucial role in helping firms

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Next, the Barbour Group works with companies identified by Hensel Phelps to assist them in completing the bonding application and addressing deficiencies required to make the company bondable. Assistance may include evaluating the company’s bond readiness and referring them to additional resources like a construction accountant, lawyer or banker to get the firm prepared to submit a successful application. Postlethwait said: “The Barbour Group does a great job, and Karen Barbour is an excellent businessperson who genuinely cares about the community and helping contractors. She is a wonderful resource to have.” RLI is the third member of the team that receives and underwrites the bond application. Although, the program participants have been pre-screened by Hensel Phelps and The Barbour Group, it is ultimately RLI that provides the surety bond to the

company. “As an employee-owned company, it is inspiring for us at RLI to participate in a program that helps small businesses thrive,” RLI bond underwriter Brian Averell said. “These small business owners bring the background, skills and knowledge to be successful, and through this program, there are now ways to help them succeed and grow.” Hensel Phelps is poised to continue growing the Head Start Bonding Program and to implement it in other areas of the country. They have significant projects in Nashville, Tennessee; Seattle, Washington; and Alabama in addition to the Greater Washington, D.C. area. In fact, The Barbour Group now plans to open a new office in Nashville to meet the growing demand in the market. “In the beginning, I tried to work with other general contractors on this program, but none of them were willing to do what Hensel Phelps was willing to do,” Barbour said.

The Executive Networking Conference Returns to Pinehurst

The Executive Networking Conference (ENC) was established in the mid-1980s as a means of building relationships and supply chain opportunities for minority business executives. After a four-year hiatus, ENC returns this year, celebrating resilience in the face of adversity, and reflecting on the legacy of one of the Institute’s founding leaders, Ms. Andrea Harris. For more information and registration:

www.TheInstituteNC.org/ENC

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The success of the program thus far is one of the few times when all parties involved in the process are winning. Subcontractors can work on projects they otherwise would have not been able to do; RLI and The Barbour Group gain new business, and Hensel Phelps is able to bring on new subcontractors to help with its growing volume of work. Thumm said: “We view our small business subcontractors as partners, because 80% of our work is performed by them; so, if we don’t help develop small businesses partners, how are we going to stay in business as a big contractor? And that’s a cultural thing we do.”


DBE Power Player

Sweet Success Sarah Imberman’s journey from a

Chicago Bakery Owner to a Successful ACDBE By Sarah Magargee

national acclaim with a Imberman was offered three more deals with debut on The Food Network, SSP in Phoenix, Sacramento, and San Diego a visit from cooking and and decided to pivot her business entirely to lifestyle connoisseur Martha airport concessions. Stewart, and the publishing “Closing my bakeries was one of the of her cookbook “Sweetness: hardest decisions of my life,” Imberman Delicious Baked Treats For said. “But I knew it was the right direction Every Occasion.” to go. A lot of the skills that I had developed In 2009, Imberman running Sarah’s Pastries & Candies applied encountered the world to this new endeavor, and SSP America of airport concessions provided great support teaching me the through SSP America, a nuances of airport concessions.” division of SSP Group Sarah Levy Imberman, president and CEO of S. Levy Foods and a leading operator of food and beverage brands in travel locations worldwide, and the Airport Concessions arah Imberman’s journey from making Disadvantaged Business Enterprise chocolates in her mom’s Chicago (ACDBE) program. kitchen to becoming a rising star in Imberman explained that running a the airport concessions industry is bakery is hard work: she worked six days an inspiring story of sweet success. In 2004, a week and started every workday before Imberman began selling chocolates under her sunrise. “I saw many opportunities in the original brand Sarah’s Pastries & Candies, at airport concessions industry and a chance several Chicago, Illinois, Whole Foods locations. to have a more sustainable schedule,” From there, her business grew – moving into Imberman said. “Leaving the retail bakery a kitchen space and expanding offerings of world was scary because it was all I knew, other sweet treats, including pastries, specialty but had I not taken that risk, who knows & wedding cakes, chocolate gift baskets, and where I would be now.” more. Imberman became ACDBE certified in By 2007, Imberman was selling her Illinois before landing her first deal with confections in numerous locations, including SSP America in 2011, in Terminal 4 of the her two store-front bakeries; and garnering JFK International Airport. Six months later, Sarah Imberman (right) welcomes Martha Stewart to her

S

retail location in Chicago, Illinois.

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In 2012, Imberman rebranded her business to S. Levy’s Foods, a certified ACDBE, and her new journey took off.

A Unique Partnership The airport concessions industry presents a unique set of challenges and benefits for entrepreneurs. For example, funding an airport venture through a traditional bank can be difficult. Imberman explained she did not have sufficient collateral to go through a conventional funding channel. “I concluded that I could either own 100% of my business and have very little, or I could give up some equity so that I had future opportunities.” Imberman entered a joint-venture partnership with SSP America, which helped her secure a loan from a private equity company. In addition, she contributed her pro-rata share of capital to build out the restaurants at the airports. Similarly, Imberman created a second layer by partnering with local restaurants in the cities where she was bidding on contracts. SSP America entered the U.S. market as the first concessionaire to focus on bringing local restaurants to the airport. Today, SSP America partners with authentic restaurants – bringing them to life at the airport and creating “a taste of place” that stays with passengers long after their flights take off.

“This focus resonated with me,” Imberman said. “I loved the idea of partnering with other local businesses and helping grow their brand and presence. For example, my partner, Matt’s Big Breakfast, in Phoenix (Arizona) has been able to open more street-side businesses since our partnership at Phoenix Sky Harbor airport. It is awesome to see these folks thrive, thanks to the partnerships.” Imberman continued to grow S. Levy Foods in 2016 by partnering with Hudson Group, a leading North American travel retailer and relaunched her famous candies with the opening of Sarah’s Candies at Chicago O’Hare International Airport. “It was so good to come back to my roots,” Imberman said. “If I’m honest, this entire journey started with my love of chocolate and dessert!” In May 2021, Imberman opened a second Sarah’s Candies at the Chicago Midway International Airport. Both Sarah’s Candies locations feature Imberman’s famous chocolates in addition to a variety of locally sourced confections with nationally recognized brands. She said: “Our motto at these locations is ‘Pamper your palette.’ We strive to entice all five of your senses – from the smell of the chocolates, to the jewelry store-styled tables piled with local delicacies, to the bright and cheerful jelly bean wall.”

Support When Needed Most

S. Levy Foods partnered with Hudson to open its latest location at the Chicago Midway International Airport in May 2021.

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Today, Imberman and S. Levy Foods have jointventure partnerships with SSP America in John F. Kennedy (JFK), Sacramento, Phoenix Sky Harbor, Chicago Midway, Sacramento, and San Diego airports, and two partnerships with Hudson Group. Imberman said she remains heavily involved with each of her brand partners. She has weekly calls and monthly visits with the managers at each location to go over all the inner workings of airport concessions, from

ordering goods to maintaining excellent customer service. “As their brand partner, I am now on the flip side of things,” Imberman said. “As a former bakery owner, I have a deep appreciation for the challenges of owning a restaurant. I understand that most of my brand partners are new to the airport industry, and I can guide them through the unique challenges facing airport concessionaires. I also understand that their brand is their baby, and I respect that.” Imberman is a savvy businesswoman who did all the preparation necessary to become an award-winning ACDBE. “I thought we had planned for everything and anything,” she said. “But then the pandemic hit, which was something I had never, in a million years, anticipated.” At the start of pandemic lockdowns in 2020, Imberman found her business activity down a staggering 98%. “If people are not flying, airport concessions have to shut down,” Imberman said. “This has been an incredibly challenging time for everyone. Traditional brick and mortar restaurants were able to pivot and find creative ways to stay open, but for airport concessions, there was no way to pivot.” Imberman’s joint-venture partnership with SSP America rose to the occasion, helping her concessions stay afloat. “As a joint-venture partner, they had a vested interest in our surviving the pandemic,” Imberman said. “If we fail, they will fail, too.” As a driving force in airport concessions, SSP America – along with other industry leaders like the Airport Minority Advisory Council (AMAC) – was able to lobby heavily for federal support for concessionaires. SSP America also kept in constant communication with its partners through weekly updates and calls. “This is a real testament to the joint-venture model,” Imberman said. “If we had been tenants in the airport and left to weather the storm on our own, it would have been very challenging.” As travelers return to airports, concessionaires are beginning to reopen. “It is slow, but I see the light at the end of the tunnel,” Imberman said. In the meantime, Imberman remains in constant communication with her partners and looks forward to future growth opportunities as business travelers take back to the sky.


Columbus Urban League:

RECOVERY, REFORM AND RESILIENCY SO BLACK ENTREPRENEURS SUCCEED “The lending gap for Black-Owned businesses was nearly twice as large pre-COVID as it was pre-recession…” *

Since March 2020… Engaged Entrepreneurs

2,400

Loans, grants/Funding Secured

$8.6 Million Jobs Saved/Created

• Led a collaboration that invested $2.6 million to shore up disadvantaged businesses jeopardized by COVID-19. • Piloting two initiatives so 70 Black entrepreneurs gain free expert consulting and are better positioned to win greater revenues.

1,500/1,200

• Ensuring local Chamber of Commerce members increase their use of Black vendors.

Connections/Touches

• Helping Black businesses qualify for MBE certifications and compete for state contracts.

37,000

More sponsors and partners needed. Join us today! J. Averi Frost Program Manager (614) 484-0940 CUL.org *Columbus Business First, 2021 / spring 2021

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Program spotlight projects for WCPSS. “I am so proud that three highly-qualified and innovative black-owned firms are going to be working with WCPSS,” said Pamela Gales, HUB Program Manager for WCPSS. She said: “The more diversity, ideas and backgrounds you bring to a project, the better it is going to be. The designs each of these firms submitted are top-notch and are going to help take WCPSS in a new direction.”

Schools for the 21st century Webster explained that for years WCPSS has subscribed to using prototype designs for schools, creating cohesion across the district. After looking at school systems around the country, WCPSS realized it was time to develop schools that readily responded to the unique demands of the 21st century and the communities they serve. Vines Architecture is a fullservice, design-driven firm based out of Raleigh, North Carolina, dedicated to creating spaces that serve the unique needs and people of their communities. Vines Architecture will design a new 135K-square-foot elementary school in Holly Springs, North Carolina, that focuses on creating flexible, multipurpose spaces that can quickly transform to meet a public school’s unique needs. Vines Architectures’ transformative spaces allow schools to meet teachers’ and students’ many needs while still working with space and budget constraints. “Vines Architecture has done this with many public libraries,” said Jolie Thomas, design principal at Vines Architecture. “There are spaces within schools that are more public, such as the cafeteria or gym, where we can begin to rethink how those spaces can function on a multipurpose level. For example, perhaps a cafeteria can also function as open classroom space.” Andre Johnson Architects in Raleigh, NC, which specializes in creating unique designs for both higher-education and K-12, will be rebuilding Baucom Elementary school in Apex,

School System Designers Construct a New Vision, Path Forward Wake County Public School System opened the Neuse River Middle School in 2020 after achieving M/WBE participation of more than 25% on the project.

Wake County Public School System ushers in a new era of design, led by three black-owned architecture firms By Sarah Magargee

In 2020, Wake County Public School System (WCPSS) leaders in North Carolina made the bold decision to chart a new vision that would emphasize innovation in new schools’ design. Shane Webster, Senior Facility Planner for WCPSS, explained that for years the district had worked with the same designers for all new building and renovation projects. “WCPSS and the project planning team wanted to bring in new talent with a fresh perspective,” Webster said. “When the planners have been inside the box for so long, it is hard to think of things differently.” The WCPSS building program is massive. Since 2014, the district has consistently built or renovated four to six schools a year. In 2020 the school system sent out a Request

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for Qualifications (RFQ) for five new schools that heavily weighted design innovation, while adhering to public education’s fixed budgets. WCPSS also assembled a selection committee of architects and designers, a shift from the traditional committees that had designers on the periphery. The open RFQ and design-focused selection committee helped attract new firms that presented qualifications not before seen in WCPSS building projects. Unknowingly, this also opened the door to more diverse firms and led to three top-notch, minority-owned architecture firms winning projects. Vines Architecture, EVOKE Studio Architecture, and Andre Johnson Architects are the first black-owned firms to lead building


North Carolina. Andre Johnson, the firm owner, said that their design focuses on connecting the school’s architecture to the land and the community. “One of the things we never do when designing a structure is to come in and just plop a spaceship down,” Johnson said. “Every design we do is about how we can connect the space to the site and the people. For Baucom Elementary, we want to emphasize

Making History

Bringing in new and diverse firms for these projects was a critical step toward building a school system that is diverse, inclusive and responsive to the needs of the county. For six-years, Gales has worked to make the WCPSS HUB Program more inclusive for MWBE and DBE firms, shooting for 20% MWBE participation in projects rather than the mandated 10%. With two large architecture schools in North Carolina, there is a wealth of talent to draw upon, so when WCPSS put out the call for fresh, innovative designs, they received many qualified proposals. Gales said: “The designs that Evoke, A n d re J o h n s o n Architects, and Vines Architecture submitted stood out. I had hoped the committee would select one of them to lead a project. When WCPSS Historically Underutilized Business Program Manager Pamela Gales they chose all three, (right) hosts the 2019 City of Raleigh Small Business Expo with Cheryl Sutton I was overjoyed. We (left) and Maria Torres from the City of Raleigh MWBE Program. take pride in having a diverse school community. We want to be inviting, respectful the beautiful landscape, preserve the trees, and inclusive to everyone. The selection of include large windows for natural light and these firms is testament to the talent in North fresh air, and make sure the structure pays Carolina and the evolution of WCPSS. ” homage to the original building.” Johnson said: “I don’t know if there is Evoke Studio Architecture, a firm in Durham, another area that has such a high concentration North Carolina, founded by Teri Canada, Billy Askey and Edwin Harris, was selected to design of HUB firms at the higher stratosphere. I want a 300K-square-foot middle school with a high to pay homage to the excellence of HUB firms school component in a new community on the in this area. For Evoke, Vines Architecture, and outskirts of Morrisville, North Carolina. For this Andre Johnson Architects to be in the first wave project, Evoke envisions using architecture like this is humbling, and I am honored to be and design to become the community’s making history.” All three firms also expressed a commitment anchor point – an element often lost in areas to diversity and inclusion and letting rising experiencing rapid growth talent shine. “Our list of consultants is “Evoke sees this as the perfect opportunity intentionally diverse and includes people from to create the heart of this up-and-coming all walks of life, ” Canada said. “Not because community,” said Teri Canada, managing they are minorities, but because diversity in principal and co-founder of Evoke Studio our team enhances our work.” Architecture. “We strive to create spaces and WCPSS will open bidding to subcontractors in places that speak to the community. Building 2022. Gales explained that this is an excellent a school is a large investment of the public’s opportunity for other MWBE and DBE firms to money, and I think the public should be able participate in these projects; work alongside to experience and benefit from it.” Vines Architecture, Andre Johnson Architects,

and Evoke; and highlight their excellence while constructing buildings that will impact the community for decades to come. All projects will bid as Construction Manager at Risk (CMAR), and notification will be sent to MWBE and DBE contractors for outreach and prequalification opportunities.

A Worthy Investment “How you invest your money as a society is a reflection of your goals and priorities,” said Edwin Harris, design principal and co-founder of Evoke Studio Architecture. “Public schools are not just inventory and commodities; they are real investments in our people. If you invest in your public schools, you are going to better society.” Gales and Webster echoed this sentiment, explaining that WCPSS saw an opportunity to pivot and change how they approach buildings’ design. The designs of these new schools will prioritize the needs of teachers, students and the community, setting a new standard for excellence within WCPSS. “We believe that architecture and design can improve our communities,” said Harris. “We want to create spaces that teachers and students are excited to be in and feel safe within. This is an exciting time for Wake County Public Schools and Evoke, Vines Architecture, and Andre Johnson Architects. We are so excited for the opportunities that lie ahead.”

Teri Canada, principal and co-founder, EVOKE Studio. EVOKE Studios was selected to design one of three new school buildings for WCPSS.

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AIRPORTS

AMAC Strong:

Organization Steps Up to Help Airport Industry Firms Endure Pandemic Impacts

F

ew industries were hit as hard by the COVID-19 pandemic as the airport industry. U.S. airports experienced a reduction in revenues of more than 90 percent during the second quarter of 2020 and stayed above 60 percent throughout the rest of the year as air travel effectively came to a halt when the economy shut down after stay-at-home orders were enacted across the country. As a result, many airport businesses, whose sole source of revenues come from airport passengers, were unable to pivot their companies in ways that could sustain revenues. The Airport Minority Advisory Council (AMAC) responded to this devastating challenge by increasing its efforts to serve thousands of members across the country. First, AMAC established a resource center in partnership with the Denver Commerce Hub, where financial resources and COVID-19 related legislation were provided to airport industry businesses. Second, AMAC mobilized its members to advocate for relief funding through the Coronavirus Aid, Relief and Economic Security (CARES) Act by launching the #SavetheTravelExperience campaign to communicate the severe impact of the pandemic on airport-based companies with members of Congress and the general public. Third, AMAC hosted a series of meetings and workshops to discuss “survival” through this period, recovery of the industry and the new passenger experience. Airports also had the opportunity to share how they have provided relief measures for Airport Concessions Disadvantaged Business Enterprises (ACDBEs), that were especially hit hard during the COVID-19 pandemic. The charge to remain active and engaged during the COVID-19 pandemic was led by Ricky Smith, newly-elected AMAC Board

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of Directors Chair and CEO of Baltimore/ Washington Thurgood Marshall International Airport, AMAC Committee Chairs and the AMAC National Office. These internal stakeholders banded together to support and encourage airport industry businesses across the country, helping them find the strength to make it through the most difficult industry experience of this generation.

Advocacy and Support At the ground level, AMAC conducted a series of virtual meetings featuring airport executives who discussed how their airports were collaborating with concessionaires and their ACDBE partners to create mutually agreeable modifications to contract agreements and requirements to allow companies to gradually experience revenue recovery, while still meeting the needs of the airport. These meetings helped AMAC members understand the strategies airports were using to provide relief and assistance to airport concessionaires and other vendors, in response to the extreme reduction of passenger traffic and the resulting business revenues. The AMAC Government Affairs Committee furthered AMAC’s outreach and worked with Congress to include airports and concessions operators, particularly ACDBEs, in federal relief packages. AMAC Government Affairs Committee members also testified before Congress on the importance of the Disadvantaged Business Enterprise/Airport Concessions Disadvantaged Business Enterprise (DBE/ACDBE) federal programs. The advocacy efforts of AMAC and members of an industry coalition resulted in $200 million in direct COVID-19 relief for airport concessionaires, particularly ACDBEs. Furthermore, the Biden Administration’s

$1.9 trillion American Rescue Plan included $800 million for airports to provide rent and minimum annual guarantees relief for airport concessionaires.

COVID-19 Pandemic Recovery Now that vaccinations are ramping up across the country, AMAC is continuing its efforts to prepare businesses for recovery and resume operations to pre-pandemic levels. How to return to in-person and hybrid professional settings were discussed at AMAC’s upcoming annual Airport Business Diversity Conference. The 36th Annual AMAC Airport Business Diversity Conference returned this year, albeit in a virtual format, with the theme “Honoring the Legacy, Perfecting the Present & Building for the Future.” Hosted by Hartsfield-Jackson Atlanta International Airport (ATL) from June 14-16, 2021, the virtual conferenced celebrate the history of AMAC and the City of Atlanta in advancing the inclusion of minority- and female-owned businesses in the airport and aerospace industry, while striving to provide information to businesses to recover from the current challenges and moving successfully into the future. Smith said: “As we reflect on the challenges of the past year, I reiterate AMAC and its membership’s resilience throughout the COVID-19 pandemic. AMAC continues to look forward to brighter days ahead.”


Highlights from the Virtual 2021 AMAC Business Diversity Conference in Atlanta, GA

AMAC Chair Ricky Smith makes remarks to open the Virtual AMAC Catalyst Awards Program.

Pete Buttigieg, Secretary, U.S. Department of Transportation makes remarks during AMAC Legislative & Policy Updates session.

Atlanta Mayor Keisha Lance Bottoms gives Remarks during the Virtual AMAC Legislative & Policy Updates session.

Maxine Waters, U.S. Representative, California 43rd Congressional District makes remarks during the Virtual AMAC Legislative & Policy Updates session.

Hartsfield-Jackson Atlanta International Airport General Manager Balram Bheodari speaks during a panel discussion.

Federal Aviation Administration Deputy Administrator A. Bradley Mims gives remarks during the AMAC Legislative & Policy Updates session.

Alicia Ivey and Robin Gibson host the Virtual 2021 AMAC Catalyst Awards Program.

ACI World Director General (retired) Angela Gittens accepts the President’s Award during the Catalyst Awards. / spring 2021

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Derryl Benton of HMS Host gives remarks after receiving Hall of Fame AMAC Catalyst Award.

Frank Wengler of AECOM makes remarks during the Virtual AMAC Foundation Scholarship Awards.

Myrna White, Ricky Smith, and Shannetta Griffin welcome conference participants to the virtual exhibit hall.

Jamie L. Rhee, Commissioner, Chicago Department of Aviation gives remarks during the Virtual Conference Closing & 2022 AMAC Annual Business Diversity Conference Chicago Preview.

What’s the Big Deal? Opportunity and Inclusion in Airport Mega Deals - Moderated by Amber Meshack, Los Angeles World Airports (left). Featuring (clockwise) Aaron Yohnke, PCL Construction; Frank Rucker, Hartsfield-Jackson Atlanta International Airport; Dr. Giovanna Brasfield, Flatiron Construction; and Darryl Daniels, Jacobsen|Daniels.

Airport Director’s 20/20 Vision Forum – (top row) Perry Miller, Richmond International Airport; Mario Diaz, Houston Airport System; Cynthia Guidry, Long Beach Airport; (second row) Marshall J. Taggart, Jr.; Montgomery Regional Airport (former); Ron Mathieu, Birmingham Airport Authority; Jamie L. Rhee, Chicago Department of Aviation; (bottom row) Balram Bheodari, Hartsfield-Jackson Atlanta International Airport

Questions and Answers: FAA and DOT Civil Rights Leadership Moderated by Wande Diatke Leintu, Metropolitan Washington Airports Authority (left); and featuring John Benison, Federal Aviation Administration; and Irene Marion, Departmental Office of Civil Rights, U.S. Department of Transportation.

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Heather Barry of SSP America hosts the Virtual AMAC Foundation Scholarship Awards.

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Weathering the Storm During Turbulent Times: Strategies for Resilience and Recovery – Moderated by Lance Lyttle, Port of Seattle (left); and panelists (clockwise) Lou Russo, HNTB; Julius Davis, VoltAir Consulting; Carolyn Ellison, Turner Construction Co.; and Beverly Thomas, Regional Contracting Services.


HAMPTON ROADS CONNECTOR PARTNERS invites you to be a part of

VIRGINIA’S LARGEST TRANSPORTATION PROJECT The I-64 Hampton Roads Bridge-Tunnel in southeastern Virginia has long been one of the region’s most congested corridors. The existing 3.5-mile facility consists of two 2-lane immersedtube tunnels on artificial islands, with trestle bridges to shore. These tunnels opened in 1957 (current westbound lanes) and 1976 (eastbound lanes) and are approximately 7,500 feet long.

OVER

$300 MILLION

IN PROJECT OPPORTUNITIES FOR DBE AND SWaM FIRMS

Traffic on these four lanes exceeds 100,000 vehicles per day during peak summer traffic. The Hampton Roads Bridge-Tunnel Expansion Project will ease this congestion with the addition of twin 2-lane bored tunnels just west of the existing eastbound tunnel. Also, the 4-lane segments of the I-64 corridor in the cities of Hampton and Norfolk will be widened.

WORKFORCE PARTICIPATION GOALS FOR LOCAL MINORITY AND WOMEN JOB CANDIDATES ON THE JOB TRAINING OPPORTUNITIES

Visit the project’s website at

www.hrbtexpansion.org

to stay up to date on opportunities. Hampton Roads Connector Partners | 240 Corporate Blvd. | Norfolk, VA 23502 | 757-578-9284 HAMPTON ROADS CONNECTOR PARTNERS IS AN EQUAL OPPORTUNITY EMPLOYER

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Transportation Communications Experts As a national leader in communications for more than 30 years, Jones Worley (JW) has carved a niche in the transportation industry, having worked at 27 airports and 27 transit systems across the country. From strategic branding and marketing to wayfinding, signage, and experiential graphic design, JW’s work has enhanced the customer and stakeholder experience and raised the profile of authorities throughout the United States. Our aviation work extends to airside and landside, new and upgraded facilities, and domestic and international

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cjparks@jonesworley.com 404-876-9272 / spring 2021

initiatives, including terminals, concourses, curbside modernization, inbound roadway improvements, amenities and retail, car-rental and parking structures, and marketing communications services for large and small operations. JW has also helped strategically brand, implement, and launch transformational transit campaigns for network redesign, bus rapid transit, light rail, on-time performance, real-time passenger information, code of conduct, increasing ridership, and for new apps, fare media and technology.

Jones Worley. A small DBE firm with big business expertise in strategic marketing, branding, outreach, campaign development, wayfinding, experiential graphics and signage design.


TRANSIT

WMATA To Expand Small Business Opportunities with Two New Certification Programs The Washington Metropolitan Area Transit Authority (WMATA) is a tri-jurisdictional government agency that operates transit service in the Washington, D.C., metropolitan area. WMATA was created by the United States Congress as an interstate compact between the District of Columbia, the State of Maryland, and the Commonwealth of Virginia and is responsible for 91 Metrorail stations and 117 miles of track, along with managing 1,500 buses, 24 hours a day, seven days a week. Building and maintaining the agency’s transit system is done with financial assistance from the Federal Transit Administration (FTA) and its three sponsoring government agencies. Through the Disadvantaged Business Enterprise (DBE) Program, WMATA provides opportunities to small, women- and minority-owned businesses to participate in contracts receiving financial assistance from the FTA. The agency is now adding to these opportunities by creating a Minority Business Enterprise (MBE) Program and a Small Business Preference Program (SBP) to also create greater opportunities on WMATA purchases made with funding from local government sources. WMATA Director of Small Business Program Meshelle Howard is leading the development of the new programs as one of her first initiatives since joining the agency in August 2020. Howard brought a wealth of experience to the agency after retiring from the Maryland Transportation Authority after 28 years of service, where she worked in procurement and DBE Program administration. Howard believes these two new programs will provide greater guidance and incentive to WMATA staff and will maximize opportunities for businesses in the agency’s small business programs. The new programs will allow businesses to compete on a level playing field for Metro’s

Artist rendering of the Hitachi 8000 Series Railcar. WMATA announced a $2.2 billion contract with Hitachi in March 2021 to provide a base order of 256 railcars, with options to build up to 800 in the fleet.

procurement opportunities – either directly as a prime contractor or indirectly through subcontracting. The contracting opportunities that will be subject to the MBE and SBP are funded with local dollars, and therefore are not subject to DBE Program requirements. “We created the programs to provide contracting opportunities for certified small, minorityand women-owned businesses in areas that weren’t covered by our DBE Program,” Howard said. The charge and encouragement to expand opportunities for small businesses is supported by WMATA’s Board of Directors and leadership team. “I have to say that the leadership here

at WMATA is extremely supportive of the Small Business Program,” Howard said. “Not only do I have direct access to leadership, but our board members also ask questions to see if we are meeting our goals, and to make sure we have the resources needed for the program.” The agency’s efforts to expand opportunities is happening just as the agency moves forward on a $2.2 billion contract with Hitachi Rail Washington, LLC to deliver new 8000 series railcars to replace its aging fleet. The contract includes a base order of 256 cars with options to build up to 800 cars in the fleet. Hitachi will complete the final assembly of the railcars in the Metro D.C. region and plans to offer new

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WMATA rail tracks at Washington Dulles International Airport. The tracks are part of the second phase of the Silver Line Metrorail project, slated to open in 2022.

jobs and contracts to diverse businesses. “The rapid growth of our business translated into direct and indirect U.S. jobs and further capital investment,” Andrew Barr, CEO, Hitachi Rail Group, said in a press release. “We also believe that our downstream supply chain offers considerable opportunities for the participation of diverse business enterprises. We value diversity in the workplace and the marketplace.” The Hitachi contract was awarded in November 2020 and is planned to last 10 to 15 years. WMATA has assigned an 8% DBE goal on the contract and Howard said the specific scopes of work Hitachi will make available for small businesses is still being determined. “We are working out all the details and working closely with Hitachi to see what types of opportunities will be available for Small Businesses to go after,” she said. DBE participation on the Hitachi contract will go a long way to helping WMATA reach its overall DBE goal of 25%. The agency has consistently reached its FTA-approved goal in past years, and in fiscal year 2020 achieved 25.1% DBE participation on its federally funded contracting opportunities. DBEs will have opportunities to do business with WMATA as contracts are picking up, coming out of the

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nationwide coronavirus pandemic. In April 2021, the WMATA board of directors approved a $4.7 billion operating and capital budget for fiscal year 2022 (beginning July 1, 2021) that maintains current service levels and enhancements, while continuing to accelerate capital investment in safety-critical repairs and service reliability improvements. Included in the budget is funding to continue an aggressive rebuilding campaign as part of the agency’s $2.6 billion capital budget that invests in safety and service improvements, critical repairs to platforms and structures, and system State of Good Repair (SGR) needs. For example, WMATA’s Platform Improvement Project will complete platform rehabilitation work at Green and Yellow line stations this summer, with work at the final stations beginning next year. The four-year project is part of a major initiative to reconstruct 20 deteriorated outdoor platforms and add customer improvements to modernize stations. In addition, WMATA continues to invest in customer improvements including new faregates and fareboxes, along with parking lot and garage rehabilitation, and a multi-year escalator replacement project. Howard’s Small Business Programs Office is preparing firms for these opportunities by

hosting a series of “Meet the Prime” events that allows small businesses to connect with large contractors planning to do work for WMATA. The first virtual event was held in March 2021, with two other events planned for June and September 2021. “These events have been successful. Our certified businesses have the chance to speak directly with prime contractors and visit their rooms in the virtual webinars,” Howard said. “We have between four and six primes at every event, and over 1,000 firms participated in the first session.” Although the pandemic delayed some contracting opportunities during 2020, WMATA is quickly returning to normal as transit passengers and the nation’s economy rebounds in 2021. Howard plans to make sure the Small Business Programs Office is ready to meet the need of businesses seeking to return to normal and pursue WMATA opportunities. She said, “We want to rally small businesses around what we are doing so they can participate; and we also want to raise the number of business certified with us to make sure they are ready.”

WMATA Small Business Program Director Meshelle Howard


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CIVIL/HIGHWAY TRANSIT

Ferrovial Construction US Projects Surpass $1 Billion in Payments to DBEs in Past Decade Working on major highway projects can However, the company quickly embraced the requirements are performed in a timely and be challenging for many Disadvantaged program and selected Angela Berry Roberson, professional manner. Business Enterprises. Since DBE firms are an experienced DBE Program professional, to A key factor in Ferrovial’s overall success with small, by definition, the companies often do lead its DBE Program and contract compliance administering a successful DBE Program on its not have the capacity, working capital, and efforts. This hire gave Ferrovial the in-house projects is recruiting experienced professionals staff size necessary to take on projects where expertise to create an effective DBE Program to lead compliance efforts. These positions subcontracts can total millions of dollars. and assist project managers through the provide expertise regarding the DBE Program Ferrovial Construction US (Ferrovial) has faced process of implementing DBE Program – and the skills to effectively serve as a liaison this challenge head-on while working as a lead requirements. between project staff, a government agency’s construction firm on major DBE Program staff, and the highway projects, primarily DBE business community. in the Southeastern U.S., and has found creative ways Transform to partner with DBE firms 285/400 to exceed participation Interchange goals on each project. Improvement These results have helped Project Ferrovial surpass $1 billion in payments to DBEs firms One example of the success since beginning work on of Ferrovial’s DBE Program its first U.S.-based projects is the Georgia Department to build the North Tarrant of Transportation’s $800 Express Freeway and the million Transform 285/400 LBJ Express Freeway in Interchange Improvement the Dallas Metroplex in Project in the Atlanta area. Construction of the collector-distributor lanes of the Georgia 2010. Since that time, The Ferrovial-led North Department of Transportation Transform 285/400 Interchange Ferrovial has been the Perimeter Contractors (NPC) Improvement Project in Atlanta, Georgia. lead construction firm for team hired Nykita Hurt to six additional projects, with serve as diversity contract three currently in progress. compliance manager for One of Roberson’s first initiatives was the project. Hurt joined the NPC team after Ferrovial is the U.S. subsidiary of Ferrovial, S.A., a Spanish multinational infrastructure establishing the practice of hiring a full-time retiring from GDOT as an Equal Employment company based in Madrid, Spain, with diversity contract compliance manager for Opportunity Officer in the Office of Civil Rights, annual revenue exceeding €6.3 billion. The every project. The compliance managers ensure where her role included certifying businesses parent company is involved in the design, Ferrovial maintains day-to-day administration for the DBE Program. This experience allowed construction, financing, operation (DBFO) of the DBE Program on each project; making Hurt to hit the ground running and to advise and maintenance of transport infrastructure sure DBE firms, project staff, and project NPC project staff on GDOT’s expectations and and urban services. Although Ferrovial is a owners have a direct point of contact for requirements regarding working with DBE firms. worldwide leader in the infrastructure industry, the administration of the DBE Program. The “I had a personal connection with many of the company leaders had little experience with presence of a full-time compliance manager DBE firms after retiring from GDOT as an EEO the USDOT Disadvantaged Business Enterprise also ensures ongoing outreach efforts, Officer in Metro Atlanta where I had certified Program when they entered the U.S. market. contract compliance activities and reporting many of the firms,” Hurt said. “So, I could call

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them, tell them about the project and ask them to submit a proposal to do some work for us.” NPC’s support of the DBE Program led to exceeding the project’s 17% DBE goal by more than $10 million so far, with more DBE payments expected before the completion of the project in December 2021. NPC has paid more than $11 million to design/professional services DBE firms on 29 different subcontracting agreements and has paid more than $75 million to construction-related DBEs on 49 different subcontracting agreements. Hurt is particularly proud of the efforts of NPC to offer opportunities to DBEs that had not worked on GDOT projects in the past. One DBE received a small contract for marketing and information services, then after completing that contract, mentioned to Hurt that their company also could provide guardrail installation and maintenance services. Hurt shared this information with NPC project staff, and the company was awarded a small contract for guardrail services. Hurt said, “The DBE firm exceeded expectations on the first guardrail work and was able to ask VDOT to add guardrail services to their DBE capabilities; and they have been blowing up ever since.” The same firm has since purchased a few dump trucks and added hauling to its list of approved services. These creative approaches offering opportunities to DBE firms demonstrate the commitment of Ferrovial to meeting its clients’ expectations and supporting the intent of the DBE Program. Hurt said: “There were scopes of work that the DBEs in Georgia weren’t prepared to do, so we sat down and evaluated the capacity of each firm and allowed them to tell us what they were comfortable with doing. We then adjusted our contracts to accommodate their comfort level. Then as they completed contracts, we would issue change orders to add more work and keep them on the project.”

I-77 Hot Lanes DBE Success Another successful project for Ferrovial’s DBE Program is the North Carolina Department of Transportation I-77 Hot Lanes project in the

Charlotte area. The Ferrovial-led Sugar Creek Construction, LLC team completed the state’s first public-private partnership by overcoming several obstacles to complete the project on time and within budget. The project also has been a success for DBEs in the Charlotte region by achieving over $119 million in payments to DBE firms – more than twice the project’s 12% DBE goal of approximately $59.6 million. Like the Georgia project, the I-77 Hot Lanes project was Ferrovial’s first project in North Carolina, and virtually none of the DBEs in the state had heard of the company. However, through extensive outreach efforts during the proposal stage and the hiring of Michael McKoy as Sugar Creek Construction’s Diversity Contract Compliance Manager, the DBE Program excelled. McKoy joined Sugar Creek upon retiring from the North Carolina Department of Transportation after more than 25 years of experience in roles with the Highway Construction Unit and the Civil Rights Department. McKoy led the DBE Certification Unit within the NCDOT Civil Rights Department for several years. McKoy’s experience provided the Sugar Creek team valuable knowledge of DBE firms in the Charlotte area and knowledge of the procedures used by NCDOT project staff when managing construction projects. McKoy said, “For DBEs to have a recognizable face that they could come to and ask questions was a good place to be to facilitate partnerships with the Sugar Creek team.” McKoy used his knowledge of the North Carolina DBE community to identify firms for specialized scopes of work in areas like pavement markings. “A DBE was probably not going to be able to do all that pavement marking work, but we were able to separate areas like the y-lines and the service roads to allow a DBE to do that work, as opposed to doing the long line markings on I-77,” McKoy said. This strategy allowed a DBE firm to perform more than $4 million in pavement marking work on the project. McKoy also helped assemble a team of DBE hauling firms that could meet the needs of the Sugar Creek

Nykita Hurt, diversity contract compliance manager for North Perimeter Contractors LLC.

Michael McKoy, diversity contract compliance manager for Sugar Creek Construction LLC.

team, since no one DBE firm had the capacity to take on the hauling work for the entire project. These types of DBE recruitment and contracting strategies on both the Georgia Transform 285/400 Interchange Improvement Project and the North Carolina I-77 Hot Lanes Project have increased opportunities for DBEs on Ferrovial-led projects across the Southeast region of the country. Combined with other initiatives – such as increasing the speed of

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payments to DBEs for certain scopes of work to take extra steps to provide contracting Although Roberson left the company and increased outreach through participation opportunities. “I feel we have gone above and to pursue another opportunity in May in local and national organizations – there is beyond in giving DBE opportunities that they 2021, Ferrovial appointed Stella Vargas increased DBE recognition of the Ferrovial would not have had otherwise,” said Hurt. “I to serve as the new director of corporate brand and widespread acceptance in know in Georgia, we have companies working diversity and inclusion. Vargas also brings the market. on the project that have been certified for 20 significant expertise to the position, after Ferrovial has continued its success with DBEs years, but have never had an opportunity to serving in a similar role for Webber Inc., a on its latest two projects: the VDOT Transform work on a GDOT project.” subsidiary company of Ferrovial located in 66 – Outside the Beltline The Woodlands, Texas. project in Northern Vargas said, “My goal is Virginia working as to continue strengthening the lead contractor in Ferrovial’s reputation as the FAM Construction a company that values Joint Venture, and the contributions that the TXDOT $1.5 billion our DBE community can Interstate 35 Northeast make towards a project’s Expansion project near successful completion. San Antonio. Ferrovial I also want to keep is already well ahead of empowering our diversity achieving the 15% DBE team to find creative goal on the I-66 project solutions to maximize DBE and is confident in its participation and growth.” potential for success in San Antonio. Hurt believes the success of Ferrovial’s DBE Southbound I-77 Express Lanes driving toward downtown Charlotte. Program is due to staff members being willing

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BUSINESS DEVELOPMENT

Tip

The COVID-19 Pandemic’s Impact on the ACDBE Program – Moving from Surviving to Thriving By Michael Freilich

This article will discuss the recent struggles in the Airport Concession Disadvantaged Business Enterprise (ACDBE) Program during the pandemic, tips for success, and next steps to take, moving forward. Most readers of American DBE Magazine are familiar with the U.S. Department of Transportation’s (USDOT) DBE Program (which levels the playing field for federally assisted highway, transit and airport contracts), but how does the ACDBE program differ? The ACDBE Program applies only to airports and primarily affects businesses that operate in airport terminals, such as restaurants, shops and car rental agencies. The ACDBE community has suffered great economic devastation, created by COVID-19. Air travel dropped dramatically, and consequently, airport concessions revenue dipped from 60% to 90%, forcing the closure of many locations. Nevertheless, in reaching out to representatives of various parties that comprise the ACDBE Program, some effective strategies and tips emerged.

Tip

1

Flexibility

Recent direction from the Federal Aviation Administration (FAA) Offices of Airports and Civil Rights provides pandemic related guidance. Former FAA Airports leadership stated at a May 2020 Airport Restaurant and Retail Association meeting that the clear intent of Congress was that CARES Act funds should free up cash for airports so that, at least in part, they can ensure that their various stakeholders

are able to get through the current economic downturn. Obtaining funding is often difficult for ACDBEs. Existing FAA Civil Rights leadership stated at a September 2020 Airports Council International (ACI) Business Diversity Subcommittee meeting that an airport sponsor may make a loan to a concessionaire (including an ACDBE) that is a tenant on the airport if they meet certain conditions. The FAA also has indicated flexibility in administering the DBE/ACDBE programs regarding termination and substitution.

Tip

2

Collaboration

Ricky D. Smith is the Executive Director of the Maryland Aviation Administration, including the leadership for Baltimore/ Washington International (BWI) Thurgood Marshall Airport. Smith’s view is that service providers need to be ready to provide services and the airport needs to be able to address its own finances, while at the same time helping concessionaires minimize their losses. This takes ongoing communication and honesty. One thing that worked at BWI was to work with concessionaires to allow enormous flexibility with their operating hours. Another general strategy has been to remind individuals that this bad situation is temporary, and to avoid making mistakes thinking that the downturn is permanent. Smith believes that as business returns to normal, the previous demand and workforce will be there.

3

Advocacy

Smith also serves as the Chair of the Airport Minority Advisory Council (AMAC), a trade association that, among other things, advances the full participation of minorities and women in contracting opportunities throughout the aviation industry. Helpful guidance was knowing that the federal government would provide relief; and also being able to draw on a vast pool of talent within AMAC’s membership. AMAC, in partnership with other trade associations, was able to influence policies to maximize benefits to ACDBEs in part by ensuring that the government understood the needs of the ACDBE community. Smith said, “You have to trust each other that everyone wants to do the right thing.” Airports, the FAA, concessionaires, ACDBEs and others are all a part of the same interrelated and interdependent ecosystem, and therefore, for one to do well, all must do well.

Tip

4

Dedication

Ronald Gomes is the Vice President of Strategic Alliances for HMSHost, a concessionaire that operates restaurants in over 120 airports worldwide. Gomes believes that the success of the ACDBE Program is closely tied to dedication by all the parties involved – the concessionaire and ACDBE partner, as well as the airport itself. He expressed that the airport “has a clear obligation to create a viable ACDBE marketplace.” So, in the COVID-19 environment, when airports are receiving substantial federal relief funds, they should offer financial solutions such as rent waivers where appropriate to at least partially offset concessionaires’ mounting operating losses.

Tip

5

Resilience

Chuck Covington is the CEO of People’s Transit, which provides ground transportation and paratransit services for airports, cities and counties across the country. Existing contract models did not anticipate reduced passenger contributions, or the associated additional

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costs for things such as required cleaning and disinfection protocols and resultant loss of productivity. Part of his success in weathering the economic downturn was a result of various types of contracts, as well as geographic diversity. Had he kept his original model of servicing one major client, he would have gone out of business. The variety of contracts also meant that some were considered essential (such as shuttle service to medical appointments), even during a pandemic. He recommends that those considering opening a business “like what you are doing, but don’t just do what you like” – because what worked yesterday or today may not work tomorrow. Help is on the Way - Some good news is that Congress has been providing ongoing relief. In March 2020, the CARES ACT provided $10 billion in funds for airports, but it did not specify use for rent relief. A second relief bill in December 2020 provided $2 billion in funds for airports, including $200 million for use for rent relief. FAA guidance specified that airports must prioritize relief from rent to minority-owned businesses. The most recent

$1.9 trillion American Rescue Plan Act, passed in March 2021, included $8 billion in assistance to airports. There is $800 million in rent relief for airport tenants: $160 million for large airport concessions and $640 million for small airport concessions (including joint ventures). Much like there is hope with the ongoing COVID-19 vaccinations, the injection of funds from the most recent stimulus bill – along with the recovering economy in general – should facilitate a gradual healing of the ACDBE Program.

The ACDBE Program is more than just a set of requirements, it is also a community; and a community requires mutual trust. With flexibility, collaboration, advocacy, dedication and resilience, we can get through this together. Finally, don’t forget that professional networks can be a great resource, so it’s important to reach out for help from peers, the FAA, USDOT, trade associations and consultants.

Michael Freilich has 30 years of Federal civil rights experience, most recently as a senior national-level leader overseeing all matters of airport civil rights compliance. He is now the owner of Michael Freilich Consulting (MichaelFreilichConsulting.com), offering assistance to clients on DBE/ACDBE, disability, and other civil rights requirements. He can be reached at MichaelFreilichConsulting@gmail.com or (703) 501-2125. Michael Freilich

Colette Holt & Associates provides legal counsel and consulting services to governments and businesses. Colette Holt & Associates is a firm of nationally recognized experts in conducting disparity studies and designing, implementing and defending successful affirmative action programs. • Minority / Women / Disadvantaged Business Programs • Affirmative Action and Compliance Consulting and Training • Disparity and Availability Studies • Speaking and Presentation Services • Expert Witness Services • General Counsel to American Contract Compliance Association

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BUSINESS DEVELOPMENT

Important Updates on DBE, SBA, AND M/WBE Programs By Colette Holt, J.D. and Joanne Lubart, J.D., Colette Holt & Associates

Colette Holt, J.D.

Joanne Lubart, J.D.

In recent months, there has been a flurry of activity related to DBE and/or M/WBE programs. This article discusses amendments and guidance as well as three recent lawsuits that need to be closely watched.

U.S. Department of Transportation Disadvantaged Business Enterprise Program Inflation Adjustment to the Size Limits for Certified DBEs Effective January 13, 2021, two changes were made to the U.S. Department of Transportation’s DBE Program size standards. • The statutory gross receipts cap for certified DBEs mandated in 49 C.F.R. §26.65 is adjusted for inflation from $23.98M to $26.29M. If a firm’s gross receipts averaged over the firm’s prior three fiscal years exceed $26.29M, then it exceeds the small business size limit for participation in work funded by the Federal Highway Administration and the Federal Transit Administration. The DBE Program requires that the cap be adjusted on an inflationary basis, and future adjusted amounts will be published on the DOT website. A DBE must still meet the size standard appropriate to the type(s) of work it seeks to perform on DOT assisted contracts. The rule is not applicable to airport concession DBEs under 49 C.F.R. Part 23.

• The statutory gross receipts cap no longer applies to eligibility determinations for projects funded by the Federal Aviation Administration. DBE firms working on these projects must only meet the size standard(s) appropriate to the type(s) of work based solely on the applicable NAICS code(s) size standard(s).

Official DOT Guidance On limiting dbe and acdbe certification for non-transportation industry businesses On September 1, 2020, the DOT issued new guidance in the form of an official Questionand-Answer concerning DBE and ACDBE certification for non-transportation industry businesses. DBE and ACDBE certification should be limited to firms that intend to seek construction and non-construction work on DOT assisted contracts (including suppliers to airport concessionaires). DOT funding recipients are directed to emphasize this information to applicant firms as well as to state and local agencies and are authorized to

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make inquiries into the nature of the work an applicant performs. Certifiers may recommend that a firm not pursue certification if it has no intention of participating in, or bidding on, DOT assisted contracts. Note, however, that many local agencies accept the DBE certification for their own programs, often because of scarce certification resources and to reduce the burdens on minority- and woman-owned firms to seek multiple certifications.

U.S. Small business administration 8(a) program Small Business Administration Interim Final Rule On January 13, 2021, the SBA issued an interim final rule amending the 8(a) Business Development (“BD”) program to carry out changes made by recent legislation. The BD program is designed to provide a level playing field for small businesses owned by socially and economically disadvantaged persons or entities. Under the program, the federal government limits competition for certain contracts to qualifying entities. Under Section 330 of the Consolidated Appropriations Act, 2021 and Section 869 of the National Defense Authorization Act for Fiscal Year 2021, certain 8(a) participants are authorized to extend their 8(a) BD program term for one year from the end of their program term of 9 years. The extension is authorized regardless of whether the firm previously opted to voluntarily suspend its program participation as the result of Donald Trump’s nationwide coronavirus emergency disaster declaration on March 13, 2020. The extension option is not afforded to firms that graduated or left the program prior to March 13, 2020, or were admitted to the program after September 9, 2020. The rule clarifies that the extension is not applicable to participants who were terminated, graduated early or voluntarily withdrew from the program in lieu of being terminated or graduating early between March 13, 2020, and September 9, 2020.

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Comments on the interim final rule were due to the SBA no later than March 15, 2021. The SBA will post all comments on https:// www.regulations.gov.

litigation updates

under the rules governing civil procedure and the production of evidence in litigation. This decision suggests disclosure protection actions should be considered by agencies and disparity study researchers to ensure that study documents and records be identified up front as protected trade secrets if that is permissible under state law.

COVID-19 Relief for MinorityOwned Businesses: Lawsuits in Confidentiality of Disparity Study Documents: Palm Beach County Commissioners Colorado and Oregon v. Mason Tillman Associates, Ltd.

In a recent order arising out of the 15th Judicial Circuit in Palm Beach County, Florida, the court determined that transcripts of the anecdotal interviews conducted by Mason Tillman Associates, Ltd. (“MTA”) as part of the disparity study for Palm Beach County constituted trade secrets protected under the State of Florida’s trade secret law. The County sued MTA and requested that it turn over background documents developed as part of its disparity study contract. Initially, these documents were sought by the Associated General Contractors of America (“AGC”). The County filed suit after it was unsuccessful in its efforts to obtain documents from MTA based upon an AGC public records request. The County sued MTA for breach of contract and to compel MTA to provide the County with all study records, including the availability database information, underlying data, and anecdotal interview identities. In September of 2020, the court directed MTA to deliver the records to the court for a confidential inspection and to file its answer and defenses to Palm Beach County. On November 17, 2020, the court found that certain documents generated by MTA constitute protected trade secrets and are therefore exempt from the public record requests under Florida’s Uniform Trade Secrets Act. In Florida, a trade secret is defined as information (including a process, device, or business method) that derives independent economic value by not being generally known to and not being readily discoverable by others who can obtain economic value from its disclosure or use. Moving forward, this development may lead to AGC bringing suit against the County’s M/ WBE program. The trade secrets shield against the public records request may not be available

Colorado The state of Colorado had appropriated $4M in COVID-19 relief payments for “minorityowned businesses.” Senate Bill 20B-001 (“SB1”) directs the Colorado Minority Business Office to use a portion of the funds to provide technical assistance and consulting support to minority-owned businesses across the state and to establish a process for them to apply for economic stimulus benefits. Plaintiffs filed suit in December 2020, in the United States District Court for the District of Colorado. They argue that their business has been adversely impacted by the COVID-19 epidemic and would be a candidate for relief for SB1’s economic benefits but for the exclusion of Caucasian-owned businesses from receiving these payments. Plaintiffs argue that the racebased exclusion violates the Equal Protection Clause of the Fourteenth Amendment under the strict scrutiny analysis imposed by the Croson decision and its progeny. Strict scrutiny is the highest standard of constitutional judicial review because it classifies individuals based on race. Plaintiffs allege that Colorado could adopt race-neutral remedies such as stimulus payments based upon geographic areas or sectors of the economy most impacted by the COVID-19 epidemic. They seek to enjoin the defendants from disbursing relief payments, loans, grants, or other support due to racebased classifications and they request money damages. The case is pending. Oregon The state of Oregon recently settled a lawsuit challenging the Oregon Cares Fund. The state-funded program directs a portion of its Coronavirus Aid, Relief and Economic Security Act monies to address the disparate impacts of the global pandemic faced by Black


Oregonians. Grants from the Fund are available only to individuals and business owners who “self-identify as Black.” The plaintiff is a non-Black-owned small Oregon logging company that has endured financial reverses during the global pandemic. It alleged that the use of strict race-based criteria for distributing funds from the Oregon Cares Fund for Black Relief and Resiliency (“Fund”) is unconstitutional. The plaintiff contended that the Equal Protection Clause requires the government to identify discrimination with specificity; to provide actual evidence of discrimination demonstrating that racebased action is necessary; and to prove that the program is tailored to that discrimination. It argued that the Oregon legislative analysis relied upon a single draft report from the National Bureau of Economic Research based on national and state data showing that the Black community is experiencing a disproportionate share of negative economic and health effects due to COViD-19. The plaintiff argued that because Oregon did not

link the grant program to specific “identified discrimination,” the defendants did not meet the requirement that the Fund further a compelling state interest. It also did not conduct a narrow tailoring analysis. Finally, the plaintiff also alleged that the Fund violated federal anti-discrimination law, including Title VI of the Civil Rights Act of 1964 and 42 U.S.C. § 1981, since “purposeful discrimination” that violates the Equal Protection Clause also violates Title VI and §1981. If the settlement is approved by the Court, the state will immediately release $5.3M to Black-identifying and Black-owned applicants. The plaintiff will subsequently receive $45,000$20,000 as a service award.5 Other non-Black applicants will receive the full amount their applications support. In lieu of spending taxpayer money on extensive litigation, the state has committed to focusing on increasing its collection of disaggregated data on race and ethnicity to develop the information to invest in communities that have faced ongoing systemic oppression and exclusion.

WANT MORE? Check us out at:

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More of the info you need from the source you trust.

American Disadvantaged Business Enterprise Magazine

American DBE Magazine is your premiere networking resource for businesses, administrators, and stakeholders in the USDOT Disavantaged Business Enterprise Program. FEATURES • DBE Business Opportunities • Industry Best Practices • Business Profiles • Business Development Articles

Read the latest issue and subscribe today at www.AmericanDBE.com Contact us at editor@americandbe.com or (919) 741-5233 for more information or advertising opportunities.

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PROUD TO GIVE BUSINESSES A LIFT CATS is proud to provide opportunities for businesses to create local jobs through the advancement of transit projects. CATS also seeks to create an environment that gives small and socially or economically challenged local businesses the opportunity to compete for publicly funded contracts by participating in the Small Business Opportunity (SBO) and the Disadvantaged Business Enterprise (DBE) Programs. On the LYNX Blue Line project, for example, CATS spent $42.9 million with 38 DBE firms to build the new light rail system. As the major provider of public transportation to Charlotte and the surrounding region, CATS relies on the communities we serve to build and operate the service every day. By working together on these new opportunities, we can all keep our communities moving in the right direction. For more information, visit ridetransit.org.

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SEEKING DIVERSE SUBCONTRACTORS & CONSULTANTS

FOR THREE INFRASTRUCTURE PROJECTS FAM Construction, LLC

Transform 66 Outside the Beltway, Northern Virginia

This project will transform 22.5 miles of Northern Virginia’s Interstate 66 between I-495/ Capital Beltway and U.S. Route 29 in Gainesville, VA into a multimodal corridor. The $2.3 billion design-build project will build two new express lanes alongside three general purpose lanes in each direction; auxiliary lanes where necessary, major interchange improvements, new expanded park and ride lots with more than 4,000 spaces, and multiple segments of a corridor-wide shared use path. Contact dbeinfo@fam66.us for contracting opportunities or more information

North Tarrant Infrastructure, LLC (NTI)

North Tarrant Express 35W- Segment 3C, Denton County, Texas

NTI is building a new extension (segment 3C) to the North Tarrant Express in Texas worth $910 million. This segment will extend 6.7 miles from Heritage Trace Parkway, in Denton County. Existing lanes will be upgraded and will continue to be toll-free, while two tolled managed lanes each way will be built, as well as on-ramps. Construction is under way and the road is expected to be open by the end of 2023. Contact DBEinfo@Ferrovial.com for contracting opportunities or more information

Grand Parkway Infrastructure

Texas SH 99 Grand Parkway Segments H, I1 and I2, Houston, Texas TxDOT awarded the design-build contract for two segments of SH 99 Grand Parkway to Grand Parkway Infrastructure – a joint venture between Ferrovial Agroman, Webber LLC and Granite Construction Inc. The segments begin north of Houston, TX in New Caney, TX and continue south for more than 52 miles to Baytown, TX; spanning four counties – Chambers, Harris, Liberty and Montgomery. The construction value of the project is approximately $900 million and has a 10% DBE goal. Contact info@gpi-99.com for contracting opportunities or more information

POTENTIAL CONTRACT OPPORTUNITIES* Barrier/Guardrail, Bridge Construction, Aggregate/Material Suppliers, Erosion Control/SWPPP, Concrete Structures, Drainage, MSE Walls/ Panels, Noise Walls, Misc. Design Services, Misc. Utilities Services, Traffic Control, Drilling (Sign Posts/Caissons), Utility Relocation Design**, Rebar , Flatwork, Electrical Work, Demolition- Exterior, Grading/ Earthworks, ITS and TCS Civil Work, Landscaping, Materials Testing, Lighting, Saw Cutting/Sealing, Striping, Steel Stud Walls, Utility Relocation**, Recycling/Milling, Paving, Excavation, Environmental, Geotechnical, Fencing, Misc. Concrete Work, Technical Design Engineering, Signage, Surveying, Ready-mix Concrete, Traffic Supplies/Signals, Trucking/Hauling. *PLEASE NOTE: This list is not inclusive of all available opportunities, but a sampling of potential services that could be available on a project. The opportunities available on specific projects may vary depending on the type, scope and size of the project. ** Additional pre-qualifications may be required for these services.

Register as a vendor to prepare for bidding opportunities

fcc.diversitycompliance.com

Contact the email address for each project listed above for specific contracting opportunities. However, for general questions about the Ferrovial Agroman Diverse Business Program email DBEinfo@ferrovial.com

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/ spring 2021