NEW YORK CITY-Though they disagree on what must be done to change the current state of affairs, the Democratic party candidates for Comptroller and for Mayor all firmly believe the city can do much more than it does currently to conduct business with minority and women-owned companies in the real estate sector.

Former New York state Governor Eliot Spitzer and Manhattan Borough President Scott Stringer took part in a panel discussion on how each of them would improve the city's efforts on this front during a candidates forum Tuesday morning in Harlem. Sponsored by the New York Real Estate Chamber, the morning also included a panel discussion among mayoral candidates, including former Congressman Anthony Weiner; Comptroller John Liu; Public Advocate Bill de Blasio and former Comptroller Bill Thompson. Lead candidate Christine Quinn, City Council Speaker, reportedly declined NYREC's invitation to the event.

Calling itself “a new chamber of commerce” made up of residential and commercial developers, community development corporations, general contractors and property managers from minority communities, NYREC works to expand minority business participation and community developments in the city.

When asked to grade the city's efforts on working with MWBE's, “F-minus,” said Thompson, “it's doing nothing. There's a lack of commitment and focus at the top. The goal in New York City seems to be gaining certification as a MWBE, but what's the point when it's not a question of getting people business? That's a major flaw.” Liu says the figure is as low as 3%, which he called “woefully inadequate.” His grade for the city was “a big fat F.”

Fundamentally, asserted Weiner, “the city has done worse than any other administration.” The city says [in response to this issue] 'we're going to chose the best,' contractor, developer etc. for the job, but inherit in that is that if you go with a minority owned company, you're giving up on value.”

Governor Andrew Cuomo has set the state's goal for the amount of business it does with MWBE's at 20%, an estimate that carries room for improvement but is a step up from current levels, several candidates noted. Meanwhile, the more diverse city is at starkly lower levels. “The city does just 9% of business with MWBEs; that's absurd,” says Stringer.

As Comptroller, he would work to change this by appointing a “chief diversity officer who monitors city agencies on procurement and we need targets on the investment side. Our diversity should be reflected in our money managers.” As part of that process, Stringer would work to grow “emerging managers,” or up and coming asset managers or fund managers, particularly those in the minority and women-owned space.

Spitzer took a different approach. “A diversity officer is great but decisions have to be made by the portfolio manager.” Instead, he proposed curtailing the city's practice of always hiring known developers like Related Cos., Forest City Ratner and others, or household name investment banks such as Goldman Sachs, and instead looking to entrepreneurs and new players in the market.

“We're spending $400 million in fees and we're getting performance that's subpar,” he said. “I don't want to pay that to people who are risk averse so they go back to Goldman, Chase, etc. I want someone who says we have to invest in MWBEs both morally and for the return. ” To get this done, current lending criteria of the city as well as private firms—both of which look for a proven track record for the borrower—would have to change.

“If all we do is lend to people who've worked with the city before, without a track record, we'll never get ahead,” said Spitzer. “You have to measure people based on their skill and capacity. If I'm elected comptroller and you approach the city, the mere fact that you're a first time borrower will not disqualify you.”

Liu agreed with that approach. “Some of the procurement rules need to be changed because they stack the deck in favor of entities that have been working with the city year in, year out. You have to break the mindset and take some risks.” He proposed eliminating current city bonding and insurance requirements.

Weiner had a similar outlook, but said relying on known firms is a cost issue for city residents. “When you have more firms doing a job, it forces down the cost for taxpayers. And why isn't it a condition of the Midtown East rezoning that a portion of the firms are minority owned? The administration needs to default not to a comfort zone but to a diversity place.”

He continued, “Too much investment favors those who've gotten investment before. If you change the mindset and make even just two big firms minority owned, it would change real estate in New York overnight.”

Added de Blasio “Taking us to the 20% goal and enforcing it is the right beginning point but we can do better over time. Procurement is an obvious goal but let's talk about construction. We don't have a coherent vision locally to hire locally people who look like NYC. Or what about zoning?”

All of the candidates vowed to get at least to that 20% level, if not exceed it.

But the city must look inward too, said de Blasio. “It's a matter of hiring diverse people up and down the administration. All of our resources should be focused on bringing economic fairness to New York City.”

Instant Insights /

Democratic Mayoral Candidates Support MWBEs

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