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Study: Mo. Government Discriminates When Issuing Contracts

A study conducted by the Missouri Office of Administration found Missouri’s government discriminates against race and gender when issuing state contracts.

The study looked at the contracts the state offers and who they are sold to, and took an in-depth look at women-owned and minority-owned businesses. The goal is 10 percent for minority-owned businesses (MBE) and 5 percent for women-owned businesses (WBE).

Commissioner of the Office of Administration Doug Nelson said the MBE was greater than 10 percent but reached only 3 percent in WBE.

“I think we need to focus on is that a lot of that money, a lot of that work, came in only about 3 out of about 34 NAICS [North American Industry Classification System] codes which are categories of what the state sells,” Nelson said. “I’d like to see more diversification across those codes to allow more businesses the opportunity to participate.”

The study recommends increasing the goal for WBE to 10 percent and Nelson thinks that is achievable.

Nelson wants to focus on outreach and he anticipates partnering with Missouri Department of Transportation.

“There’s just not a lot of information out there,” Nelson said. “They [minority and women business owners] don’t know how to get the information on the opportunities that the state presents.”

Nelson said the OA is going to look into offering contracts specifically for small businesses, possibly unbundling some contracts, and making bonding and funding requirements more accessible for minority and women owned businesses.

There are a few challenges.

Bundled contracts receive a better price and it is more beneficial for the taxpayers, Nelson said. Offering contracts specifically for small businesses also poses a problem. The state can’t set a quota that is gender or race based and those contracts would have to be opened up to all small businesses.

Governor Jay Nixon has created an oversight commission that will prepare a report for the governor with recommendations. Nelson said a report will be given to the governor in about 90 days.


Jen Gradl was a student reporter at KRCU in 2014.