Written Testimony — Senate Committee on Small Business and Entrepreneurship, Gary Moore, May 6, 2024

Summary

Written testimony dated May 6, 2024 by Gary Moore, Senior Business Development Specialist for the Maryland Minority Business Development Agency (MBDA) Business Center, headed for the Senate Committee on Small Business and Entrepreneurship and addressed to Senator Cardin, Senator Van Hollen, and Representative Ivey. The testimony describes the center's work with minority business enterprises on access to capital, procurement and certifications, including programs like the SBA's 8(a) Business Development program. It recounts client accounts of bidding and lending experiences, including a certified client whose revenue grew from $300,000 - $400,000 per year to over $6 million annually. It states that clients believe the Nuziard v. MBDA ruling will hurt programs that helped their businesses grow. The testimony is three pages.

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                                      May 6, 2024
         Written Testimony-Senate Committee on Small Business and Entrepreneurship
                                      Gary Moore


Good morning Senator Cardin, Senator Van Hollen, and Representative Ivey; thank you for invit-
ing me to testify today.

My name is Gary Moore; I am the Senior Business Development Specialist for the Maryland Mi-
nority Business Development Agency (MBDA) under the U.S. Department of Commerce. I have
been with the Maryland MBDA Business Center for over seven (7) years. My primary responsi-
bility is to keep in alignment with MBDA’s mission which is to foster growth and global compet-
itiveness of Minority Business Enterprises (MBE’s).

In my role I work with government agencies, institutions and privately held corporations on behalf
of Center clients; advocating for access to capital, procurement opportunities and providing them
with overall strategic business consulting. Our Center has directly serviced over one thousand
(1,000) minority businesses where I have heard countless stories of disparities in minority partic-
ipation in private, state and local procurement opportunities. Not long ago, a major east coast com-
pany’s project manager, who was Caucasian, told me a story of why they have not used any
MBE’s. This privately held company had a need for subcontractors for a particular project and
invited several Caucasian companies and one (1) MBE to bid on their project. The MBE was un-
able to make the initial scheduled pre-bid site-visit. The project manager told the MBE that he
would meet him on site on the day of the MBE’s choosing. The MBE met the project manager on
a Friday and was told the bid was due on the following Monday. The MBE was unable to turn in
his bid within the short window of time. The project manager told me that they “just don’t have
any luck with MBE’s”, as if this was something he did not experience with Caucasian owned
companies. I would like you to know, as a former successful contractor for over fourteen (14)
years, Caucasian contractors miss site visits and deadlines for bids very often. The impact of the
MBE not attending the pre-bid site visit is the prime company may not offer an MBE an oppor-
tunity again; and will continue to only use Caucasian companies for their projects. After looking
at the Board of Directors and their leadership online, I found that they were all Caucasian males
and one Caucasian female. The conclusion is their leadership, like many companies, lacks the
importance of diversity and inclusion.

There are several multi-billion-dollar companies that have indicated they don’t have a need to use
MBE’s as they are simply “given” awards by the federal government before projects go out to bid.
For example: I work with many minority-owned businesses who are highly capable and experi-
enced in their trade, as MBDA has parameters set as to whom can become a client of the Business



           1 North Charles Street, Suite 707 Baltimore, Maryland 21202 | T: (667) 303-3530 | F: (667) 303-3547
Centers. One of the Center’s minority-owned companies had difficulty procuring work; we be-
came aware that he did not have any certifications, which had not limited him from performing
and being awarded contracts in the past as his work spoke for itself. The Maryland MBDA Busi-
ness Center assisted him with becoming certified on all levels; federal, state, and local. Once cer-
tified, his company’s revenue of $300,000 - $400,000 per year grew to over $6 million annually.
As he told me, "Those certifications allowed me to grow. Without them I would have been stuck
at my prior revenue levels.” After assisting with obtaining his certifications the Center directed
him to various projects that we believed would give him an opportunity for growth. His business
grew as he began winning contracts for projects that required MBE utilization and he is currently
working on all levels; federal, state and private projects that have specific goals to meet MBE
utilization. As a Senior Business Development Specialist with the Maryland MBDA Business Cen-
ter, I help clients gain access to networks, information, and resources – including programs like
the SBA’s 8(a) Business Development program. Certifications are essential to our clients as our
client indicated that before becoming certified, relying solely on capacity and experience, “no
prime would give him the time of day!” Suppliers would not sell to him, as the specifications on
projects were proprietary, allowing only the larger primes and Caucasian subcontractors to bid on
projects. Without an MBE goal, our client would not even be able to request a price from the
supplier, and most often, would be given a higher price than his Caucasian counterparts.

Another MBE client bid on a non-MBE project as the lowest bidder. On any large project (this
project was for over $3,000,000) you must present your qualifications, financials for bonding,
references and your capacity to do the work before the bid so that all that is left to do while con-
ducting a low bid meeting is verification of each line item. When the client arrived at the meeting
he knew the minute he walked in, by the prime’s startled looks and subsequent questions, they
were not expecting a person of color. Instead of conducting a normal low bid meeting, the ques-
tions shifted from the bid requirements to him as an individual. Statements were made such as
“you're very articulate,” and questions were asked such as “how did you grow to have a com-
pany in double-digit millions of revenues?” These are not statements and questions posed to
Caucasian business owners I speak with. Though my client was highly qualified to perform the
work, had full bonding capacity ($3MM) and was the lowest bidder, it was given to someone else
who was of Caucasian decent. Focusing on our client as an individual, and not the company’s
success and ability to perform the work is blatant discrimination. If an MBE is the most capable,
and is the lowest bidder, the MBE is in a good position to win the award when MBE participation
is required. This is not the case when MBE goals are not present, or when primes are not held
accountable to the goals. Before becoming certified, our client had difficulty getting work with
prime contractors; becoming certified has helped open doors for him in cases where MBE utiliza-
tion requirements are in place.

Access to capital is also very difficult for minority businesses and affects their ability to participate
in commercial and public contracting opportunities. For example: a Center client was unable to
obtain a line of credit increase from a bank that holds the mortgage on his business property, which
they appraised, and has worked with for many years. He has only used 50% of his line of credit
and is looking to increase it as he has a very large backlog of over $12M. This means he has $12M
dollars in signed contracts for the year. He spoke to two of his Caucasian counterparts who work
with the same bank and was told by them that the bank increased both of their lines of credit. The
minority customer requesting the increase was in better position as his Caucasian counterparts as
their backlog was of much less value, they had more debt, and companies had less revenues than
              1 North Charles Street, Suite 707 Baltimore, Maryland 21202 | T: (667) 303-3530 | F: (667) 303-3547   2
our client. Our client has never missed a payment on any loans or mortgage and has excellent
credit.

Our clients believe that the impact of the Nuziard v. MBDA ruling will hurt the same programs
that have helped their businesses grow, despite the ongoing discrimination faced in obtaining cap-
ital and procurement opportunities. Our clients have expressed they “don’t need to have more of
an opportunity than anyone else, just the ability to compete on a level playing field.” Specific
clients believe the court ruling is not in the “spirit of America,” nor in the spirit of the MBE pro-
grams created to advocate for equality. "Why must we perform above and beyond anyone else, be-
fore they will even look at us?"

These stories reflect the wider discrimination and barriers that minority business owners face daily
as it relates to denying MBEs access to capital, procurement opportunities, networks and resources,
as well as adverse treatment by Caucasian prime contractors both in private and public sectors. I
would like to reiterate our client’s sentiments that this is not in the “spirit of America,” where if
you work hard and are in compliance within the law you can accomplish anything you want and
succeed. To not hold others accountable to that dream will lead to the inability to leave a legacy
of wealth to their children and erase all the work we have done, in service, to advocate on behalf
of minority businesses in alignment with MBDA’s mission of prosperity and growth for all.



Thank you,

Gary Moore
Gary Moore
Senior Business Development Specialist
U.S. Department of Commerce of Commerce, Minority Business Development Agency
(MBDA) Maryland Business Center owned & operated by L. S. Caldwell & Associates, Inc.




             1 North Charles Street, Suite 707 Baltimore, Maryland 21202 | T: (667) 303-3530 | F: (667) 303-3547   3


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