August 17, 2007

Democrats Call on Government to Increase Minority Advertising Contracts

WASHINGTON – Leading Senate and House Democrats urged federal agencies to take an active role in increasing the amount of federal advertising contracts awarded to disadvantaged and minority-owned businesses. Their action comes in response to a report by the Government Accountability Office (GAO) that found that federal agencies are falling short of the standards set by an executive order issued in 2000 calling on the government to “aggressively” reach out to minority and underserved firms.

Senate Majority Leader Harry Reid, Small Business and Entrepreneurship Committee Chairman John Kerry, senior Senate Judiciary Committee member Chuck Schumer, and Congressional Black Caucus Chair, Representative Carolyn Kilpatrick sent letters to the Departments of Defense and the Treasury expressing concern for their poor record of awarding contracts to minority and disadvantaged businesses and requesting the agencies outline specific steps they are taking to increase contracts with minority advertising firms. 

The Defense Department awarded minority advertising firms only 1.8 percent of contract dollars and paid them on average nearly 84 percent less per contract than majority firms. The Treasury Department awarded minority advertising firms only 1.9 percent of contract dollars and paid them on average nearly 47 percent less per contract than majority firms. The GAO also reviewed the records of three other agencies which all spent more advertising dollars with minority firms: Health and Human Services Department (24.6 percent), Interior Department (6.4 percent), and NASA (88.9 percent).

“I am deeply concerned that the Departments of Defense and Treasury are denying minority advertising firms the opportunity to work with the federal government. That they may even be discouraging hiring minority firms and paying them nearly 84 percent less than majority firms is even more disturbing. We will continue to aggressively monitor these and other federal agencies to make sure that our government meets our own standards of contracting with minority firms,” said Senator Reid.

“This report shines a spotlight on the federal govern-ment’s failure to make equal opportunity a reality, not just rhetoric. The Defense and Treasury Departments are woefully behind the curve. Awarding less than two percent of advertising contract dollars to minority-owned and disadvantaged firms is unacceptable and this report must be a wake up call. My Committee will keep up the pressure and stay on top of this until these agencies drastically improve their contracting practices,” said Senator Kerry. 

“Despite an Executive Order, federal agencies are not providing minority business owners—who pay taxes, provide jobs, and help strengthen our economy—with equal opportunities in the federal contracting process. Failure to promote inclusion and fairness in contracting is not only an egregious disservice to America’s families, but it is also a mockery of the promise upon which our country was founded,” said Congresswoman Kilpatrick. “We must continue to advocate for the underserved and underrepresented and encourage our government to lead by example. Diversity is America’s strength. By expanding access, we improve our ability to compete in the global marketplace, ensure that all people have the chance to achieve their potential, and enhance efforts to build a united America.”

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