NEW YORK – A new New York package will strengthen the program, known as MWBE, to support minority and women-owned businesses, Governor Kathy Hochul announced Thursday.
One of the pieces of legislation in the package will prevent fraud and abuse within the MWBE program and create a framework for a fund that will investigate and verify misconduct within the program. A 2014 New York State Supreme Court Grand Jury report revealed that more than $ 10 million earmarked for honest MWBEs had gone to fraudulent non-MWBEs. This legislation will ensure the integrity of the program by creating a statewide MWBE registry, increasing penalties for fraud and establishing an MWBE fund to investigate misconduct.
In addition, another part of the package will allow businesses to use funds from the Loan and Development Program of minority and women-owned businesses to refinance existing debt. For many business owners, corporate credit cards are the first and only means of accessing credit, which often means high interest rates on debt. Allowing businesses to refinance that debt under one of the existing state microloan programs could reduce interest payments to as little as $ 1,200, saving the company nearly $ 3,000 annually.
Another measure will authorize New York City to increase MBWE premium amounts for non-competitive contracts from $ 500,000 to $ 1 million. The city has undertaken many efforts to address this discrimination, including setting subcontractor participation targets for MWBE, and previously, municipal agencies could contract MWBEs for contracts no greater than $ 500,000 MWBE without a formal competitive process. The new law will allow the city to raise the procurement threshold to $ 1 million, which will improve access to capital for MWBEs seeking to bargain with the city. This legislation was a citizen program bill introduced by Mayor Eric Adams.
While signing the legislation, the Governor noted that New York exceeded the MWBE utilization target in New York State contracts with a utilization rate of 30.64% during fiscal year 2022, the MWBE utilization rate. highest in the country for the second consecutive year. Nearly $ 3 billion in state contracts have been awarded to MWBEs during fiscal year 2022 and nearly $ 24 billion in state contracts have been awarded to MWBEs since 2011. The signing of the bill, as well as the steady increase in the rate of Using New York’s MWBEs underscores Governor Hochul’s commitment to supporting MWBEs and being a champion of the greatest economic opportunities across the state.
“New York draws strength from its diversity and ensuring that economic opportunities are inclusive and fair across the state is a priority of my administration,” Governor Hochul said. “For two consecutive years, our nationwide leading MWBE utilization rate underscores our commitment to providing the tools and resources everyone needs to create pathways to economic success. Continuing New York York’s strong MWBE utilization rate. demonstrates the state’s commitment to advocate for greater equality of economic opportunity for MWBEs “.
