Cleveland’s Office of Equal Opportunity reports $92 million in diverse commitments from 19 community benefits agreements

Tyson Mitchell, director of the Office of Equal Opportunity, told the Cleveland City Council Workforce Committee on the workforce committee’s agenda that his office certified 847 companies in its database and signed 19 community benefits agreements in 2024 representing about $503,000,000 in total project cost.

The community benefits agreements, Mitchell said, accounted for $285,000,000 in hard construction cost and roughly $43,000,000 of city financial incentives (including tax increment financing, grants, loans, tax abatements and city-funded infrastructure). He said those 2024 CBAs include $92,000,000 in committed diverse spend: $44,000,000 to minority business enterprises (MBE), $24,000,000 to female business enterprises (FBE) and $24,000,000 to Cleveland small businesses (CSB).

"OEO's work falls into 4 major categories — certifications, bid and proposal evaluations, contract compliance, and the wonderful community benefits agreements that have been added," Mitchell said. He also highlighted growth in certifications year over year: "in 23, we had 305 MBEs, and in 24, we have 444," and noted 54 Hispanic-owned firms counted in 2024 compared with 41 in 2023.

Why it matters: Council members pressed OEO about whether the city is turning those commitments into broader supplier growth and how the office will respond to recent court decisions affecting race- or gender-based goals. Committee members emphasized that the CBAs and related programs are intended to move businesses from subcontractors to prime roles, expand workforce pipelines and keep public investment local.

Monitoring, penalties and software costs

Mitchell described the office’s monitoring work for Section 187 and Section 188 (the Fannie Lewis law) and said OEO uses B2GNow and an LCP tracker to track compliance. He said software and monitoring costs are rising with the volume of contracts and estimated the software budget at about $200,000 a year.

Mitchell said OEO collected $61,766 in penalties in 2024 across nine projects and explained that penalties are rare because staff work with contractors during performance and sometimes reduce goals for legitimate project obstacles (for example, pandemic-related supply issues). The director said penalty calculations are contract-specific and typically prorated; as an example, he said minority/female/small-business shortfalls are generally calculated at 25% of the city financial contribution and then prorated for partial success.

He told the committee that penalty receipts are placed in a separate fund (Fund 10) and used for staff augmentation and contractor support, not the general fund.

Addressable spend and participation

Mitchell reported that, of contracts reviewed in 2024, $313,000,000 came through OEO review. He said $80,000,000 of that total was excluded because subcontracting opportunities were impracticable (specialty purchases, vehicle procurements, or highly specialized work), leaving $232,000,000 of "addressable spend" across 91 contracts. From that addressable pool he reported $12,300,000 of MBE spend, $33,700,000 of FBE spend and $97,600,000 of CSB spend for 2024.

Council members asked for clarification about overlaps among certified categories (for example, firms certified both as MBE and CSB) and whether those figures were double-counted. Mitchell said the annual report provides a disaggregated breakdown clarifying certifications and noted the summary figures represent certified-firm commitments in each category; he said the office can provide more detailed charts by industry and by firm.

Community benefits, equity fund and outcomes

Mitchell described program outcomes reported in 2024: 40 mentor–protégé relationships, 55 apprenticeships, 63 paid internships (described in the presentation as totaling about $32,000 in payments for Cleveland Municipal School District students), 44 community engagement meetings, nine job fairs, six lead sustainability projects, 10 neighborhood or infrastructure improvements and three affordable housing projects. He said two project labor agreements (PLAs) were signed and three developers agreed to use the municipal utility as their preferred electric provider.

The director asked the council to consider how the Community Equity Fund should be used going forward; he said the city has received one payment into the fund (about $100,000, from a single project) and that penalties are also deposited into that fund. "What we, as a city, do with that fund is on us," he said, urging future committee-level conversations.

Outreach, enrollment and next steps

Mitchell described outreach steps the office used to grow certifications — a new Hispanic business fair attracted 65 registrants and roughly 36 attendees — and said one practical change that boosted recertifications was extending the certification period from one year to two years.

On process improvements, Mitchell said OEO is discussing whether to provide an opt-in notice or listserv to notify certified firms of bid opportunities and whether Purchasing should proactively send public solicitation notices to the vetted database. He said disagreements exist internally about whether proactive alerts would create fairness issues, and the office favors an opt-in notification system for certified firms.

Mentor–protégé program and staffing

Mitchell said the office plans to bring the mentor–protégé program in-house and adopt best practices from other jurisdictions. He told the committee OEO had 12 staff and no vacancies at the time of the presentation and that four compliance officers are dedicated to community benefits monitoring. He said expanding a structured mentor–protégé program or a business-development function would likely require additional staff.

Legal and policy changes

Mitchell said OEO is reviewing its MBE/FBE goal program in light of a recent Supreme Court decision affecting higher education and broader attacks on DEI policies. He said the office plans to move toward race- and gender-neutral, but race- and gender-conscious, mechanisms where legally required and emphasized the council will need to consider adjustments to the city’s approach to Section 187 and 188 when challenges arise.

Council response and planned follow-ups

Several council members asked for a more complete breakdown of certified firms by industry and by firm size, regular publication and a committee hearing on the annual report. Councilmember Spencer and Councilman Slife asked for improvements in outreach so certified firms receive notice of opportunities and for data showing whether the diverse spend is going to a concentrated set of businesses or broadening to new firms.

Mitchell said OEO will publish a more detailed annual report that will include community development/economic development projects and committed to meeting with the Finance, Diversity, Equity and Inclusion Committee about potential enhancements to CBAs and to the Community Equity Fund.

"We are going to have to work very close with you as a council," one council leader said, noting that legal challenges and voluntary agreements make the coming period "a tricky, tight rope to watch." Mitchell said the office will continue outreach events, a planned MBE summit and additional webinars and web resources in 2025.

Ending

The committee asked OEO to provide a detailed, disaggregated chart of certifications by industry and to schedule a Workforce Committee hearing when the annual report is published; Mitchell and staff agreed they would provide the report and meet with the committee.

(Reporting based on presentation remarks and committee discussion recorded on the Workforce Committee transcript.)