MnDOT Audit Finds Rampant Trouble with Women and Minority Contracting Program

Jim Anderson, Star Tribune, September 22, 2013

Minnesota has failed for three years to meet federal requirements for a program designed to steer millions of dollars in state transportation projects to minority- and women-owned businesses.

The program has been so plagued by mismanagement and weak oversight that some firms were awarded multimillion dollar contracts for which they might not have otherwise qualified.

In one case, nearly $1.6 million for buying materials on the Union Depot project in St. Paul was funneled through a minority- or women-owned firm to a non-minority-owned contractor. In another case on the same project, nearly $2 million was improperly credited to a non-minority-owned firm.

The findings and others, included in an internal audit of the Disadvantaged Business Enterprise (DBE) program, have led to a shake-up in the Minnesota Department of Transportation’s Office of Civil Rights and may result in additional investigations.

{snip}

The 30-year-old DBE program has long been plagued with fraud and oversight problems at both the federal and state levels. In 2010 and 2011 alone, U.S. Department of Transportation fraud investigations led to $88 million in recoveries, restitutions and fines, along with 10 federal indictments and eight criminal convictions.

Locally, it’s also been a source of long-standing, and often costly, frustration for large contractors and DBE contractors alike, said state Rep. Michael Beard, R-Shakopee, who described the program as a “very twitchy, explosive and sensitive subject.” {snip}

{snip}

The DBE program is designed to put firms owned by minorities and women in a better position to compete for public works contracts by requiring states to set minimum goals for their participation. Each state is responsible for seeing that DBE contracting goals are met, that DBE firms are properly certified as eligible for the program and that the pool of DBE-eligible firms is expanded. If those goals are not met, it can mean a loss of potentially millions of federal transportation dollars.

Among the audit’s most serious findings, MnDOT, despite its reports to the contrary, never met its DBE participation goals for 2010, 2011 and 2012, which had been set at 8.76 percent. The audit could not substantiate the percentage of construction dollars given to DBE firms, and when documents and calculation were requested, “for some reason the information or calculations were not retained. An attempt to recalculate the rates proved unsuccessful.”

The audit also found that MnDOT’s Office of Civil Rights was not properly monitoring DBE subcontractors. The audit “found several examples of potential wrongdoing in this area,” chiefly, that contracted work that was to be completed by DBEs was never completed by DBEs, yet was included in the participation rate.

{snip}

Contractors have long complained that the DBE goals are arbitrary and too difficult to meet, and can result in higher costs for taxpayers.

C.S. McCrossan Construction Inc. in Maple Grove was the low bidder by nearly $6 million on a $52.3 million contract for the new St. Croix bridge but MnDOT officials determined the company hadn’t made clear it would comply with the goal of 16.7 percent participation by DBE firms in the project.

The company disputed that decision and sued. The case was settled last month.

Charlie McCrossan, who runs the business with his son, Tom, said firms like his struggle to comply with the demands of the program laid down by MnDOT, especially when the agency shifts the rules as he said it did in the case of the St. Croix bridge bid. The loss of a potential contract was disappointing, he said, but the state’s wasting of so much money is inexplicable.

{snip}

The bridge contract is not the first low bid rejected over DBE issues, but it is the largest.

Over the past three years, MnDOT, the Metropolitan Council and the Metropolitan Airports Commission awarded 20 contracts to firms that didn’t submit the lowest bids but met requirements for giving work to women or minorities certified as disadvantaged. Those 20 contracts cost a total of $1.8 million more than the lowest bids of other contractors for the work.

One successful contractor won a job even though he charged 11 percent more—$380,000—than the low bidder.

{snip}

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  • D.B. Cooper

    If the white man just sits there and takes it, why not award a full 100% of contracts to the families of Je$$e and Our Pal Al?
    What’s stopping you? We know that white people either support this, or support a Republican party that supports it. Most of these Amren readers will vote for Cruz, Rubio, Prescott or any other fake whom the GOP force feeds them.

  • Rhialto

    The war against White men rages on, while the Connedservatives blabber about Assad and the great threat that he poses to America.

    • Anybody but a white man ……

      • dukem1

        Hasn’t it ever occurred to any of these geniuses that contracting a “small business” to build a superhighway may not be the route you want to take? So to speak.

    • Thankfully, lamestream conservatives are opposed to going into Syria. Not even all of the neo-cons are, however, the loudest voices on the “right” for going into Syria are neo-cons.

      • So CAL Snowman

        I think I hate Lindsey Graham more than I hate the ebony devil.

  • Minnesota has failed for three years to meet federal requirements for a program designed to steer millions of dollars in state transportation projects to minority- and women-owned businesses. The program has been so plagued by mismanagement and weak oversight that some firms were awarded multimillion dollar contracts for which
    they might not have otherwise qualified.

    Isn’t that sorta duh? They “need” the affirmative action and set asides precisely because they’re not qualified to bid for those projects to begin with.

  • JohnEngelman

    Women prefer successful men. Men are much less likely to prefer successful women. Women usually reject men who are less successful than they are.

    Consequently men have a powerful incentive to be successful that women do not have.
    This alone is sufficient to explain sexual differences in earning and business ownership.

    • WR_the_realist

      I suspect that one of the very many reasons why marriage is so rare among American blacks is because black men screw up so much that even black women of modest accomplishment find it hard to find black men more successful than themselves.

      • JohnEngelman

        In addition successful black men frequently prefer white women.

    • Jefferson

      So most men would rather date a woman who is on welfare and lives in Section 8 housing than date a financially successful woman who makes 6 figures a year ?

      • Sick of it

        Difference in income is the secret to maintaining a marriage in the modern age. My parents divorced because my mother made more than my father, of all things (her idea).

        • Jefferson

          If you want to marry a poor women, you better be making a lot of money to financially support the both of you or else you are just helping to increase the number of households in the U.S who live below the poverty line.

          • Sick of it

            That was the idea.

      • JohnEngelman

        That is an extreme example. Women prefer successful men. Men prefer young women.

        During the Nixon administration beautiful young women competed for the attentions of Henry Kissinger. Handsome young men did not long for Bella Abzug.

        • dukem1

          Good point!

        • Jefferson

          That would explain why you have a very hard time getting a White woman or Asian woman to marry you, it is because you are broke.

          I remember you said in the past that you live in a neighborhood that has a large Black population, so you are obviously not financially successful in life.

          • JohnEngelman

            What you say is true. I have never pretended otherwise. Nor have I directed hostility against Jews as a result.

            There is no rational reason to hate Jews. Many failures hate them because Jews are so successful. I am a failure. I am not one of those failures.

            I also welcome the success of Orientals in this country.

          • Jefferson

            You ever thought about getting romantically involved with a Black woman or a south of the border Squat Monster woman ? Most of them are at the bottom of the financial food chain just like you are. Since you make very little money, you do not have a lot of options when it comes to White women and Asian women.

  • Daniel Schmuhl

    The more articles on this stuff I read, the more I think we’re just increasingly living in some anti-white male communist state. This is Soviet style central planning with the same kind of fraud and failure.

    • Sick of it

      Notice the infrastructure deterioration? The lack of real scientific progress? The economy going kaput? All sure signs that we have become the Soviet Union.

    • dukem1

      Communism without comrades!
      Double Fail!
      I’m beginning to wonder if every water pipe in America is made of lead.

  • bigone4u

    Some of the profs at my former university employer started companies with minority front men and front women professors as “CEOs”, but backed by white investor dollars. The whole notion of preferences for minorities is un-American and filled with opportunities for fraud. None of the prof “CEOs” could manage their way out of a paper bag, but they sure know how to feed at the public trough, like the pigs they are.

  • Hal K

    We need pro-white and pro-male identity politics to fight this. If whites and men would start defending their group interests explicitly then it would change the psychology of society.

    For a long time, mainstream conservatism has been avoiding white and male identity politics. What they do instead is try to prove to nonwhites and women that liberals don’t really care about them. This strategy has not worked. As long as both mainstream parties keep pandering to nonwhites and women, the status quo will continue. The only way things can be changed is if mainstream conservatives and the GOP get their heads out of you know where and start engaging in white and male identity politics.

    Group loyalty is a conservative trait. This is explained in Jonathan Haidt’s book, The Righteous Mind. By pandering to nonwhites and minorities, mainstream conservatism steps on the natural group loyalty of white conservatives.

    • Sick of it

      If men had acted like men in the first place, this country would not have ended up the way it has.

      • dukem1

        Eff’n A, man.

        • Sick of it

          Are you a fan of Duke Nukem by chance?

  • Spartacus

    Diversity is our greatest strength… But then the bridge you’re driving over collapses because Shitavious traded building materials for crack and used chewing gum instead.

  • WR_the_realist

    All this waste and fraud would have been avoided if only the federal government hadn’t imposed those absurd “women and minorities” mandates in the first place.

  • joesolargenius

    White Men were the driving force behind making America the greatest country in the World , they created many great institutions and companies. Since Legalized discrimination started against them those institutions and this Country have gone downhill , how can you expect something to stay on top when you prohibit your most capable people from being leaders anymore !

  • joesolargenius

    I could get a great tan and change my last name to Santiago and because I speak Spanish I would have a better chance at getting a good job then being a White American Male Military Veteran.

    • MBlanc46

      You’d certainly be a minority of some sort.

  • Luca

    Some small businesses simply assign the business in the name of their mothers, sisters, wives or daughters. The women in turn, generally do some book keeping, answer phones, show up for meetings or do some sales calls. Maybe.

    Minority businesses are sometimes run out of a trunk of a car. Mr. Black (a minority business) is bidding on a contract for lumber, so he goes to a local large lumberyard and strikes a deal with the owner, Mr White.

    Mr. Black is given a 10% minority preference, so he bids at about Mr. White’s low bid price plus 10% and is awarded the contract. Mr. Black is awarded the contract. When the buyer calls Mr. Black with an order, he agrees to fill it and simply calls Mr. White and arranges the delivery. Mr. Black has no office, no overhead, no inventory, no insurance, no shipping costs, no employees, no lumber, etc but makes about 10% just for relaying phone orders. Mr. White looks like a hero because he lists Mr. Black as a minority subcontractor on other bids. The only one who loses is the taxpayer who winds up paying about 10% more for lumber then if they had bought it direct from Mr. White.

    Mr. Black goes around to different cities and counties running this scam and he does pretty well for himself.

    And that ladies and gentlemen pretty well describes the benefits of the women/minority business program. In other words, it’s a scam.

  • MBlanc46

    Government contracts are magnets for fraud to begin with. Add something like minority set-asides, and the potential for corruption probably increases by an order of magnitude.

  • Libs are We Todd Ed

    Affirmative Action is anti-White male.

  • JohnEngelman

    Some white women are attracted to black men for reasons I will not explain for fear of bringing a blush to the cheeks of Courtney from Alabama.

    Nevertheless, I doubt many white women want to marry a black man unless he earns a good paycheck.