http://washingtonpolicyblog.typepad...m_campaign=Feed:+WashingtonPolicyCenterBlog+% An interestingly-written PowerPoint presentation from the City of Seattle caught our attention recently. As Seattle moves forward with the Mercer mess construction project, a multi-year and multi-stage project to basically re-make the South Lake Union neighborhood, it has set up rules and regulations in concurrence with federal and state regulations for working with contractors and subcontractors. Some of the money set aside for the Mercer Corridor Project comes from the American Recovery and Reinvestment Act, aka the "stimulus package" President Obama signed into law in early 2009. As stipulated by federal requirements, the city must set aside a certain amount of work for disadvantaged business enterprises (DBEs) -- these are businesses owned and operated by women or minorities -- and certified by the state's Office of Minority and Women's Business Enterprises. The state DOT says, "The purpose of the MWBE program is to provide maximum practicable opportunity for firms owned and operated by minorities and women in public works projects and procurement." The city of Seattle recently hosted a pre-bid meeting to let contractors and subcontractors know how to comply with training requirements for minority apprentices. Apparently the current system is complex enough to merit extra explanatory meetings. On the PowerPoint presentation (slide 7) is the bullet point telling interested subcontractors that they "Must use under represented groups -- No white males w/o WSDOT approval and extensive good faith effort documentation." So what does this really mean? Could the city of Seattle really be telling contractors and subcontractors bidding for work on this project that no white males need apply? Fortunately, the answer is no; but the City sure has a funny way of putting things. Turns out that both federal and state laws require outreach for DBEs on public projects. These programs are to ensure that DBEs get a shot at doing lucrative business with government entities. The phrase "no white males" is actually hinting at a federal training program requirement. The Federal Highway Administration has apprenticeship programs set aside for minority workers. It is possible for non-minority workers to get into these apprenticeship programs, but they need a special waver. This is what the PowerPoint slide refers to: no white males in these apprenticeships programs unless they've already received the official exemption. Should government projects extending business opportunities to DBEs? Probably not. But according to the city itself, this PowerPoint presentation was necessary because according to the city, "The City of Seattle has seen a large increase in rejected bids due to bidders incorrectly using DBEs toward the contract goal. In order to reduce these errors, the City of Seattle is holding an additional pre bid meeting for the Mercer Corridor Project." Obviously, this is a big construction project with tens of millions of the public's money. But a few things stand out. First, it is evident that the rules as applied to these projects are so complicated that a special meeting had to be held to explain how businesses could apply. This does not bode well for low barriers to entry for small businesses in competing for work. Second, doesn't anyone proofread these presentations? Did no one think that a slide showing that "No white males" need apply would go unnoticed? Third, even though these programs are set up with the best intentions, during this time of economic recession, shouldn't we take a look at temporarily suspending some of these rules? A bigger question should be, are these rules ruling out competitors from bidding, thereby shutting out competition or potentially raising the cost to the taxpayer? Among the other rules that contractors have to abide by are the prevailing wage laws, which, as we've said before, artificially raise the cost of projects (which are funded by taxpayers). When you add up the cost of compliance with some of these well-meaning rules, are the benefits outweighed by the costs? What does it say when small businesses in the construction industry (the two worst combinations of business classifications during this recession) feel like they are unable to compete for public works projects based on racial preferences?