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Should the governments give LGBT-owned businesses a leg up in public contracts?

Marketplace Contributor Jan 29, 2018
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Cities and states have long given underrepresented groups like blacks, Latinos and women a leg up in bidding on public contracts. Now there’s an effort to include LGBT-owned businesses in that group.

Take Marc Coleman. He runs the Philadelphia digital design firm The Tactile Group. Coleman is also black and gay, and his identity, he said, has made him lose business.     

“People found out that I had a husband and decided not to work with us before, so there are actual real stigmas and barriers,” Coleman said. Which is why Coleman thinks LGBT-owned businesses should be given equal access to city work: to help even the playing field in the face of discrimination.

In 2016, 30 percent of the $991 million Philadelphia awarded in city contracts went to firms owned by racial minorities, women or people with disabilities. 

Jonathan Lovitz, with the National LGBT Chamber of Commerce, wants LGBT businesses to have a slice of that pie. California, Massachusetts and Washington state’s King County have all moved to help LGBT-led companies win public contracts after lobbying from Lovitz’s group.

“Historically, contracts have gone to those who have the most access to the people who make the decisions, and all we’re trying to do is all make sure those great LGBT business enterprises in Philadelphia have a seat at the table,” Lovitz said.

But adding another group to the minority set-aside category isn’t as easy as writing them in. First, the groups have to prove they are really disadvantaged, which would require a city study looking at whether LGBT businesses are subject to bias in city contracting. 

“If you can’t prove that there’s a disadvantage, or a disparity, then it wouldn’t make sense to provide extra benefits,” said Amber Hikes, who heads the city of Philadelphia’s Office of LGBT Affairs.

Philadelphia city officials and LGBT advocates are still in talks about when the study will be launched. On the Pennsylvania state level, meanwhile, the governor last fall kicked off a study looking into how to protect LGBT businesses and other groups from discrimination in government contracting. 

UCLA law professor Eugene Volokh has examined the issue and is a critic of public contract quotas. 

“As best I can tell, neither being gay nor straight makes you a better construction manager, let’s say,” Volokh said.

But advocates of adding contracting preferences for LGBT businesses say it’s especially important now, in light of the Trump administration’s effort to reverse Obama-era LGBT workplace protections.

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