Gov. Shapiro’s executive order to help Black and other small firms get state contracts

Gov. Josh Shapiro, D-Pa. has signed an executive order directing state agencies to help Black-owned and other small firms to get more state contracts by increasing eligibility, capital and technical support.

Helping more small and small diverse businesses compete for state dollars, Shapiro said, is not just the right thing to do – it’s the smart thing to do.

“By supporting our small diverse businesses, we’ll not only grow our economy and strengthen our communities – we’ll also create more competition for Commonwealth business and secure higher quality products and better results for all Pennsylvanians,” Shapiro said. He made his comments on Tuesday at The Enterprise Center in West Philadelphia, headed by Della Clark, where he signed the order in the presence of several city, state officials, business and community leaders.

Regina Hairston, president of the African American Chamber of Commerce of PA-NJ-DE, who was present at the event, said the executive order will make it easier for African American entrepreneurs to do business with the commonwealth.

“It increases the opportunities for Black businesses to compete by removing administrative hurdles, such as the 10-day subprime payment, reducing the time to get certified as a minority business,” Hairston said.

“Having this in place will allow more participation by Black businesses in government contracting and that’s what we want to see. That’s what we talk about all the time at the chamber. Having consistent contracts is what allows businesses to grow in scale and create generational wealth. The red tape can be oftentimes as big as challenge as access to capital and information.”

Among the government officials that attended the event included: U.S. Rep. Dwight Evans, D., Pa.-3rd District; State Sen. Vincent Hughes, D.-7th District, State Rep. Rick Krajewski, D.,-188th District; State Rep. Morgan Cephas, D.-192nd District; and City Council President Darrell Clarke, D.- 5th District.

A non-profit group that provides support for small business, The Enterprise Center, Shapiro said, was also one of the sites where he and Lt. Gov. Austin Davis spent time listening to African American entrepreneurs talk about the barriers to getting state contracts on the campaign trail. Some of those barriers included a lack of access to capital and too much red tape, Shapiro said, and he wanted the entrepreneurs to know that his administration heard that message.

In addition, the executive order creates the Pennsylvania Advisory Council for Inclusive Procurement (PACIP), to be chaired by Davis. Reggie McNeil, secretary of the Department of General Services, and Michael Carroll, secretary of the Department of Transportation (PENNDOT), will be co-vice chairs of the panel.

“I’ve seen firsthand that small businesses owned by women and Black and brown Pennsylvanians are vital to our communities. They are gathering places – centers for connection and conversation, and they are job creators and innovators,” Davis said. “We must support small-business owners by cutting red tape and putting resources into economic development and innovation.”

According to Shapiro, the executive order and a host of other actions are designed to promote growth by small diverse, women and veteran-owned businesses and help them to create jobs.

For example, the Department of General Services has reduced the time to be certified as a small diverse businesses by 33%; created a prompt payment requirement that sub-contractors to be paid in 10 days by prime contractors; and reduced the time needed to get a business license from eight weeks to three days.

The Bureau of Diversity, Inclusion, and Small Businesses certifies small, diverse businesses.

The administration seeks to build on the progress of the previous administration of Gov. Tom Wolf, D-Pa., Shapiro, said, which increased the amount of spending for small, diverse businesses to 11.3% in 2022, from 4.9% in 2015.

So, the Shapiro-Davis Administration has earmarked a $20 million in the recently passed state budget for it’s Historically Disadvantaged Business Program to invest in, support and help grow small, diverse businesses.

In addition, the state will release data on all of its department spending with small, diverse businesses, every six months.

“Having an advisory council will ensure that the intended result,” said Hairston, of the African American Chamber. “It speaks to the commitment of the governor.”

Clark, the Enterprise Center, president, said there is no substitute for capital or revenue from state contracts when it comes to African American entrepreneurs.

“Opening the doors wider to lift up small and diverse businesses requires institutional buy-in at all levels,” Clark said. “We view this Executive Order as the first step to combining contracts, capital, and expertise to intentionally grow small and diverse led businesses across the Commonwealth. Thank you to the Shapiro-Davis Administration for their leadership in driving change.”