February 11, 2000
(Editors Note: Last week in La Prensa San Diego, dated February 4, 2000, Vol. XXIV No. 05, we published a story by the National Minority Supplier Development Council that outlined changes affecting ownership levels which identified a minority-owned business. The changes lowered the threshold of ownership from 51% minority ownership to 30% minority ownership. The change was made to create more equity capital accessibility.
In response to this change Black and Hispanic business leaders have released their response to these changes.)
WASHINGTON, D.C. February 3, 2000 - On October 14, 1999, Hispanic and Black leaders joined forces to denounce a proposal by the National Minority Supplier Development Council (NMSDC) that threatened loosening the rules defining minority-owned businesses. The NMSDC proposed to lower the 51% ownership threshold as necessary for an enterprise to qualify as minority-owned.
On February 1, 2000, the rules changed without the consent of Hispanic and Black leaders. The leaders were outraged at such a change because the proposed rule has the potential of becoming a defacto national policy that could change the distinction between truly minority-owned companies and minority-managed businesses. This action could result in the weakening and destruction of programs critical to the continued growth and development of minority-owned companies.
The United States Hispanic Chamber of Commerce (USHCC) was one of the key opponents to this ruling. Mr. George Herrera, President and CEO released this statement:
"The USHCC takes very seriously the action of Corporate America via the NMSDC to arbitrarily change the definition of minority businesses without engaging the Hispanic business community in this process. The complete and total disregard of our community is offensive and reprehensible.
"The Hispanic community is well established in the U.S. marketplace as a result of increased purchasing power, expanded business entrepreneurship, and greater political participation. Over a relatively short period of time, the phenomenal growth of the Hispanic market has dramatically transformed the U.S. demographic landscape and business environment. Simply stated, Hispanic buying power is booming and projections indicated that this trend will continue throughout the 21st Century!
"Currently, our community represents 11 percent of the national population and over 12 percent of the school-age population. Hispanics will add more consumers to the national economy than any other group. By the year 2010, the Hispanic American population will exceed 39 million and Hispanics will become the largest ethnic minority group in the United States. In less than forty years the Hispanic population will have increased from 9 percent to more than 20 percent of the total U.S. population.
"For Corporate American the increase in numbers translates to billions of dollars for the U.S. economy. The unprecedented population increases and economic growth is especially reflected in the marketplace. Hispanic men, women and children patronize supermarkets, dealerships, general and specialty stores, restaurants, airlines, banks, credit unions, real estate, travel agencies and others. Currently, the annual purchasing power of Hispanic Americans is approximately $348 billion. By our total numbers, the Hispanic population in the United States is the fifth largest Hispanic community in the world and the wealthiest.
"As loyal consumers of Corporate America's products and services, its disregard of our community in this dialogue is unacceptable. Thus, the rules of engagement have been altered by Corporate America. We will encourage our constituency to patronize only those companies who have a genuine commitment toward establishing mutually beneficial business relationships. We buy from you, you buy from us. Anything less is unacceptable.
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