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New York City Council
Oversight - M/WBE Utilization in City Contracts
Read summaries and jump into the video at the segment start.
Council staff asks attendees to find seats and silence electronics, and directs witnesses to fill out slips with the Sergeant at Arms. Staff confirms the Chair is ready to begin the Committee on Contracts hearing.
Chair Lincoln Restler introduces himself and thanks committee counsel Alex Polinoff, policy analyst Alex Yablon, financial analyst Andrew Lane Lawless, and chief of staff Molly Haley. He sets up the oversight hearing on the city's minority and women-owned business program.
Restler traces the MWBE program from 1989 through its halt under Mayor Giuliani and reestablishment in 2005. He notes two decades of small purchase programs, mentorship, and agency goals but says much remains to be done.
Restler highlights the Comptroller's annual MWBE report showing MWBEs received just 5% of total city contract spend in FY25, or $2.44 billion of a $46 billion budget. He notes contract count rose to 65% but value share fell from 17% in FY24 to 8% in FY25.
Restler says average non-MWBE contracts were $3.6 million versus under $750,000 for MWBEs, and construction MWBEs received just over 10% of citywide contract value. He flags that Black-owned firms got 7% of MWBE contracts and Latino-owned firms 7.9%, with Black women and Latinas each around 1.2%.
Restler notes about 65% of FY25 MWBE contracts were registered retroactively, forcing small firms to front costs. He says nearly $33 billion in Local Law 174 contracts since FY22 have no subcontract records, with only about 9% of prime contracts reporting subcontract data.
Restler explains that human service contracts are exempt from MWBE goals but often use for-profit subcontractors that may be MWBEs. He introduces Intro 834 to require reporting on those subcontracts and calls for a pipeline for MWBEs to grow into larger prime contracts.
Restler previews three additional bills: Intro 208 adding Middle Eastern and North African Americans to MWBE disparity studies, Intro 694 requiring targeted agency outreach when utilization goals are missed, and Intro 896 restricting non-compostable single-use cup contracts. He thanks staff and turns to Council Member Farías.
Farías says agencies that repeatedly miss MWBE utilization goals must focus outreach on the specific categories where they fall short. She describes working with community-based organizations and ethnic media to reach businesses through trusted networks and require agency MWBE officers to monitor progress.
Restler turns to committee counsel to swear in the administration witnesses. Witnesses affirm to tell the truth, and Restler asks for written copies of testimony before inviting them to begin.
Michael J. Garner, the city's first Chief Business and Diversity Officer, introduces his background at the School Construction Authority and MTA. He appears with First Deputy Chief Business Diversity Officer Dwight Flynn, MOCS, and SBS colleagues to discuss the MWBE program.
Garner says FY26 first-half data show 33% MWBE inclusion for Local Law 1 agencies and 36% combined for city-funded agencies and authorities, with nearly $2 billion in awards. He cites FY25 as achieving the 30% aspirational goal for two straight years and over $6.9 billion in MWBE contracts citywide.
Garner says the MWBE small purchase method set records, totaling $350 million in FY25 and over $1 billion across three fiscal years. He lists state legislative wins and local policy changes, including raising the threshold to $1.5 million and securing B2G Now for reporting.
Garner says the administration supports the goals of Intro 208 and 694 and looks forward to further conversations. On Intro 834, he says Passport already captures required subcontract information, and on Intro 896, MOCS is still evaluating the bill.
Garner acknowledges more work remains and thanks City Hall leadership, MOCS Director Kim Yu, and SBS Commissioner Mania. He says the program supports MWBE businesses, local economies, and economic justice citywide.
Restler acknowledges the Adams administration's MWBE contracting gains but asks why MWBE value share fell from 17% in FY24 to 8% in FY25. He asks Garner to evaluate overall performance and explain the significant decline.
Garner calls the Comptroller an ally but says the report excludes MWBE subcontractor activity and non-municipal agencies like SCA, NYCHA, Public Schools, EDC, and H+H. He says those five agencies hold 55-65% of city procurement spend and the city is focused on a OneNYC view.
Restler agrees with the OneNYC orientation but says the Council and MOCS lack consistent data from non-mayoral agencies. He asks Garner to help get better data on those agencies and on subcontracting so the city can tell a different story.
Garner says the city is creating a new MWBE IT platform called B2G, modeled on New York State's system, to capture contract awards and payments centrally. He says the platform will go live within the fiscal year and will shift focus from awards to payments.
Restler asks whether B2G is a new platform and whether it will capture awards, spend, and subcontracting for every city agency. Garner confirms it will cover the Big Five agencies and provide one centralized platform for all MWBE activity.
Restler questions why the city is creating a new system when Passport already captures contract actions. He raises cost and operational concerns for procurement officials having to use an alternative system.
A MOCS representative says Passport's primary users operate under specific procurement governance, while the Big Five operate under different governance. Restler pushes back, noting the mayor got them to participate in B2G and asking why not Passport.
Restler credits Council-funded Passport enhancements and asks for more detail on B2G implementation. He asks whether procurement officers and vendors must enter data themselves or whether B2G pulls automatically from existing systems.
Dwight Flynn says B2G pulls source data from FMS, Passport, and SBS certification records, and aggregates prime and subcontractor MWBE activity. He says it will provide more real-time data so the city can manage opportunities and challenges rather than waiting for quarterly reports.
Restler notes only 9% of subcontracting information from traditional mayoral agencies is reported in Passport, with DDC a rare good performer. He asks how B2G will help if agencies are not entering subcontract data into Passport or FMS.
Garner says City Hall has emailed all agency commissioners to ensure third-party contractors enter MWBE payment data into Passport timely. He says MOCS will generate a report he expects to see Friday.
Restler says even a jump from 9% to 50% would still leave half of subcontract data missing, and notes 20 agencies reported zero subcontracting information for four years. Garner says the city is going directly to agency commissioners to enforce contract requirements.
Restler says reporting subcontract data is already law and management from City Hall plus public accountability are both critical. Garner agrees to work with the Council to make public which agencies are sharing subcontracting data and which are not.
Restler says without subcontract data the city cannot celebrate large sums flowing to Black, Latino, Asian, and women-owned firms. He asks what added value B2G provides if the information is coming from Passport, and Garner cites the Big Five and one centralized portal.
Restler asks about Garner's contract-stat approach and how often B2G will receive uploads from FMS and Passport. Garner says reporting will be near real-time and transformational because the city has historically measured success by awards rather than payments.
Garner explains that a $10 million contract awarded five years ago may only be 50% actualized, so payments better measure success. Restler notes payments are often less than awards and asks how this affects vendors working at risk.
Restler notes 65% of MWBE contracts leave vendors working before registration and 35% are not registered for more than a month after the start date. He says the city must pay smaller MWBE firms on time if they are to grow into larger contracts.
A MOCS representative says Passport Release 6 introduced a centralized workflow for recording subcontractor utilization and payments. Restler asks whether the city now has a better understanding of the subcontractor landscape, and MOCS says the tools exist but data coverage still needs follow-up.
Restler asks again why MWBE prime contract value fell from 17% in FY24 to just over 8% in FY25. Garner says he needs to follow up but cites efforts to maximize prime opportunities, including a $400 million contract to Hispanic-owned Intercom Security Systems.
Restler notes the average MWBE contract was about $750,000 versus $3.65 million for white male-owned firms. Garner attributes the disparity to lack of access to capital, surety bonding, and right-sized contracting, and says the city is working to create prime opportunities.
Restler says the city has done well connecting MWBEs to small contracts through the $1.5 million procurement cap. Garner and MOCS clarify that agencies can solicit MWBE pricing but still must consider best value and cannot simply award to any vendor.
Restler says MWBEs win 65% of contracts but only 8% of spend, with average awards of $750,000. He asks how the city will help MWBEs already performing well grow into larger contracts rather than remaining a fast small-purchase route.
Garner says the city is starting to see change, pointing to a $400 million MWBE award. SBS Chief of Staff Haris Khan highlights the Contract Financing Loan Fund, one-on-one technical assistance, and the NYC Contracting Summit with over 100 agencies and resources.
Restler says access to capital is important but the city needs a deliberate strategy to identify MWBE vendors performing well on small contracts and help them grow. He says 65% of contracts but only 8% of spend is not a pretty picture.
Council Member Althea Stevens says the disparities for Black women and Native American women are glaring, with Black women getting only 371 contracts and Native American women one. She asks what specific policies beyond capital are addressing these gaps.
Restler notes that out of every 100 MWBE contracts, one went to a Black woman-owned business and one to a Latina-owned business. Garner says the city first raised overall MWBE inclusion from 23% to 36% and is now focusing on the disparity within disparity.
Stevens asks for an action plan with dates, milestones, and goals for recruiting and integrating Black, Hispanic, and women-owned businesses. Garner cites weekly agency meetings, upcoming commissioner roundtables, and SBS recruitment efforts but does not provide a detailed timeline.
Stevens asks what corrective action plans the office requires when agencies underperform on MWBE goals. Garner says the city is finalizing FY results, will meet with agencies under 30%, and will work with commissioners, ACCOs, and MWBE staff.
Stevens asks how often the office reviews agency performance and what happens when agencies consistently miss goals. Garner says the city holds weekly MWBE CompStat meetings, generates monthly data from the Big Five, and brings issues to agency commissioners.
Farías asks what happens when an agency misses utilization goals, how many improvement plans were submitted last year, and who reviews them. A MOCS representative says MOCS works with SBS and OMWBE to review utilization plans and monitor performance.
MOCS says it reviews utilization plans at the beginning of procurement, monitors agency performance, and follows up on results. The corrective action is analysis of what can be done better to achieve higher MWBE engagement.
Farías repeats her question about the number of improvement plans submitted last year and who reviews them. MOCS says it will have to get back to her and describes the procurement-stage review and ongoing monitoring process.
Farías asks whether the city does targeted outreach in areas where utilization goals are underperforming. Garner says the city has taken MWBE outreach to every borough with borough presidents and chambers of commerce.
Farías asks how the city is adjusting outreach and plans for demographic groups that are not getting procurement opportunities. SBS's Haris Khan explains SBS programs, the online MWBE directory, buyer services, and a curated list for a $7.5 million contract.
Farías asks what the point of promoting MWBE certification is if only one Black woman-owned and one Latina-owned firm out of a thousand receive contracts. She questions why businesses would endure a convoluted application for such low odds.
Farías says the city is not using the data in front of it or ensuring utilization goals and improvement plans reach underserved communities. She calls for bigger thinking to ensure Black women, Latinas, and other women of color actually get contracts.
Khan says 33% of the certified MWBE pool is African-American businesses, which Farías contrasts with one in 1,000 contracts for Black women. Garner says he is taking the issue personally and promises to broaden contract awards to all certified groups.
Farías says entrepreneurs find the certification and contracting process convoluted, paperwork-heavy, and time-consuming. She asks whether subcontractors will be included in utilization goals and improvement plans if the bills pass, and MOCS says the administration will incorporate new legal requirements.
Restler asks for the percentage of certified MWBEs that are Black, Latino, Asian, and white women. Khan says African-American firms are 33%, Asian 23%, Hispanic 19%, white women 26%, and women overall are 55% of the program.
Restler notes Black firms are 33% of certified MWBEs but receive less than 7% of MWBE contracts, while Latino firms are 19% of certifications but less than 8% of contracts. He says the city is not achieving the program's goals if these firms are not contracting at scale.
Restler notes significant variation in MWBE performance across agencies, with DDC performing better than the Health Department. He asks what intervention the city uses when an agency is not taking MWBE contracting seriously, and Garner describes meetings with commissioners and ACCOs.
Restler says smaller agencies often perform better than larger ones, and SBS was among the worst performers in the latest Comptroller report with zero subs. Khan says SBS is a very small contracting agency and will follow up on the data discrepancy.
Restler explains Intro 834 would require nonprofits with large city contracts to report whether their for-profit subcontractors are MWBEs. MOCS says Passport already records subcontractor and payment information, and Restler says he will pull the bill only if updated data shows compliance.
Council Member Gale Brewer says she hears the MWBE application is too complicated. SBS's Haris Khan describes required ownership and business documents and says SBS is working with New York State's new streamlined certification portal.
Brewer asks what percentage of certified MWBEs win city contracts, saying business owners doubt it is worth applying. Khan says 70% of MWBE firms that won contracts benefited from SBS services, and Brewer suggests publicizing that success rate.
Khan corrects the figure to 76% of firms that won contracts in FY26 having received SBS services. Restler notes there were 11,382 certified MWBEs and only 2,478 entered a new contract or PO in FY25, meaning 78% did not win new city work.
Stevens says many certified MWBEs, especially Black women and Latinas, are not winning contracts and asks if there are best practices or mentor pairings. She questions whether the city reaches certified firms that have never received an award.
Khan points to the MWBE mentors program, borough events, webinars, and one-on-one technical assistance. He says a large event drew 1,800 attendees and provided over 300 direct one-on-one sessions with more than 60 staff.
Stevens says if one in 100 contracts goes to Black women or Latinas, the current approach is not working for them. She urges the city to think differently and not burn out women who certify, attend events, and still lose out; Garner agrees and promises better results.
Restler says progress is real but the city is not doing enough to contract with Black and Latino-owned firms. He calls it a serious inequity and says the committee wants to work together on new engagement ideas and results.
Restler asks about recent changes to the SCA mentorship program and whether the DDC mentorship program continues. Garner says he is unsure about SCA but describes the construction mentoring model from SCA to MTA and a movement toward a race-neutral small business program.
Restler asks how many staff and budgeted positions report to Garner. Garner says 13 or 14, but agency ACCOs and MWBE staff also report into City Hall on MWBE issues, and every agency has a designated MWBE liaison.
Restler says the hearing showed inadequate results for Black and Latino firms, especially Black women and Latinas. He also highlights new subcontracting data efforts and the need to help MWBEs grow from small contracts into larger prime work.
Khan says SBS's FY26 Local Law 1 spending was $2.7 million, roughly 74% of target, similar to FY25. Restler thanks the administration witnesses and closes the panel.
Restler opens the hearing to public testimony, reminding attendees to remain silent and that the witness table is reserved for testifiers. He explains that speakers get two minutes, written testimony can be submitted to the Sergeant at Arms or emailed within 72 hours, and audio/video recordings are not accepted.
Restler calls up the first panel of public witnesses and apologizes for struggling with some names. He introduces Habiba Eraida, Rana Abduhamed, Ekram Arowamin, Bayadir Mohamed Osman, and Naima Tahir from the American Family Support Center.
Rana Abdelhamid, founder of Malika and member of the New York Middle Eastern and North African Coalition, supports Intro 208. She says MENA New Yorkers have contributed to the city's business ecosystem but are not counted, and urges codifying MENA inclusion in future disparity studies.
Ikram Arumaim of the Women's Empowerment Coalition of New York City says the organization supports immigrant women and small business owners, including MENA New Yorkers. She says the disparity study would provide data to understand whether disparities exist and how they affect MENA-owned businesses.
Bayazir Muhammad Osman of the Muslim Community Network reads testimony from colleague Salah Hashi, a Yemeni American whose father owns a bodega. She says MENA-owned businesses are not separately identified in disparity studies, leaving their barriers and participation invisible.
Habiba Laidi of Malika says MENA-owned businesses are entirely excluded from minority-owned recognition under the MWBE program. She says the city's disparity study failed to separately identify MENA firms, masking barriers and creating a false sense of equity.
Naima Dahir of the Arab American Family Support Center says MENA communities are overlooked despite their contributions. She says MENA-owned businesses may be counted as white, making their challenges invisible, and urges the committee to advance Intro 208 without delay.
Restler quotes Mike Bloomberg, saying in God we trust and everyone else bring the data. He says without data on MENA businesses the city cannot structure the right policies, and thanks Council Member Hanif for pushing Intro 208.
Restler calls up two Zoom witnesses, Matt Gove and Eve Fox, and works through unmuting issues. He invites Matt Gove to begin testifying on the single-use cup bill.
Matt Gove says the Surfrider Foundation appreciates Council Member Epstein's bill to reduce single-use cups. He warns that replacing them with compostable cups is a false solution and says reusable or thin aluminum cups are better options.
Eve Fox, director at the Story of Stuff Project, says the bill's compostable exemption undermines its goals. She argues compostable bioplastics contain toxic additives like PFAS, have heavy climate footprints, and require industrial composting infrastructure that many communities lack.
Vicki Abu-Ghallous of the Story of Stuff Project and Reusable New York City Coalition says the city spends $1.7 billion annually on garbage collection, with $381 million from packaging waste. She recommends removing compostable language and adding reusable cup systems and water refill stations.
Jacob Yatsiliel says the Association of Black Contractors' report calls MWBE the mechanism of disenfranchisement for small Black women-owned businesses. He calls for oversight hearings to include affected small women-owned businesses and says the system must be reformed or taxpayer funding should stop.
Tanisha Hurd of the Bronx Chamber of Commerce says the chamber supports Intro 694's expanded outreach when MWBE targets are unmet and Intro 208's inclusion of MENA entrepreneurs. She says MENA communities are growing in the Bronx and should be studied for MWBE eligibility and access. Restler thanks her and adjourns the hearing.