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Compliance staff propose new waiver form and possible bid preference to boost targeted‑business participation
Summary
City compliance staff reported progress and gaps on prevailing wage and targeted business goals, including that women’s workforce participation is below the 9% goal (3.83%) while minority participation has exceeded the 15% goal (18.21%). Staff proposed a waiver form and asked council to consider awarding a contract up to 10% above the lowest bid if the higher bid meets targeted‑business goals.
Edgar De Veyra, a compliance specialist in the city’s Diversity, Equity and Inclusion office, gave a compliance update to the City Council on April 14 reviewing prevailing wage, targeted business utilization and workforce participation on publicly funded projects.
De Veyra explained prevailing wage basics and local figures: Minnesota’s minimum wage (as presented) is $11.13, the city cited a living‑wage figure of $22.05, and he used an example prevailing wage rate of $61.32 for a laborer on a road project (wages plus benefits). He said prevailing wage rates are set by the State Department of Labor and Industry and vary by county and funding source.
On workforce participation goals, De Veyra recapped city targets of 9% women and 15% minorities on public construction projects. He reported the 2020–2024 averages were 3.83% women (short of the target) and 18.21% minorities (exceeding the target). For targeted business contracting, De Veyra said the city invested $128,751,981 in infrastructure projects from 2020 through June 2024 and awarded $8,717,967 to targeted businesses — a 6.8% utilization rate — while currently active projects show 8.5% utilization.
To improve consistency and accountability, the office proposed several process changes: a Prebid Wage Determination Form to standardize determination of prevailing‑wage applicability and appropriate targets; streamlined reporting cadence (milestone reports rather than monthly reporting for shorter contracts); an electronic compliance stack (B2GNow and eComply replacing LCPtracker) to reduce manual reporting; and a new waiver form requiring bidders who do not meet targeted‑business goals to document good‑faith outreach efforts.
De Veyra also asked the council to consider a policy that would permit the city to award a contract to a bidder up to 10% higher than the lowest proposal if that higher bidder meets targeted‑business goals and the lowest bidder does not. He framed the proposal as an incentive to make targeted business participation feasible for prime contractors who are otherwise competitively priced but include more certified disadvantaged, minority and women‑owned firms.
Council members asked for more trend data and examples before endorsing a policy change: they requested staff to report how often low bids fail to meet targeted goals, whether the city tracks repeat vendors who fail to meet commitments, and how any incentive would be structured and verified. Administration staff said they have tracking data and will provide trends and options, including whether administrative penalties for contractors who fail to meet committed goals are warranted.
Ending: Staff did not ask for immediate policy action; they requested feedback and said they would return with more detailed analysis and recommendations on how a 10% preference (or another incentive structure) might operate in practice.
