Misuse of city reporting systems within Atlanta’s Office of Contract Compliance has made it “impossible” to pinpoint the amount of money the city spends on minority and female-businesses, a recently released audit found.
Back in 2022, Atlanta City Council members wanted to know how much money was going to contracts with minority and female-owned businesses. The body passed a resolution requesting that the auditor’s office review the amount of funds spent to hit the city’s equal opportunity goals outlined in city code. The Office of Contract Compliance is responsible for keeping track of that.
That audit reviewed subcontractor data from July 2021 to March 2024 and found it was so incomplete that auditors couldn’t determine if the city was meeting the diversity requirements — and that previous numbers given to City Council in a fiscal year 2023 report were overstated “by a significant amount.”
The report said the city spent nearly $230 million on minority business contracts, while the audit found the total closer to $133 million. Similarly, the report said $88 million was spent on female-owned businesses, while the actual amount was closer to $38 million.
“We were unable to determine the extent to which minority-owned and female-owned enterprises were used as subcontractors on city contracts,” the report says.
And some businesses listed as equal opportunity program participants didn’t meet that criteria at all.
Non-female owned business owners accounted for more than $6.5 million of the amount credited to female-owned businesses, according to the audit. And non-minority owners accounted for over $550,000 recorded as part of the city’s minority-owned business goals, the audit said.
“This is so concerning,” Council member Marci Overstreet said during the audit presentation to the finance committee last week. “Somewhere around the second page, I stopped writing questions down.”
“And this is about minority participation directly,” she added. “It’s our stalwart. This is something we’re supposed to be leading in the nation — we’re a role model, it’s our bedrock.”
Council member Byron Amos pointed out disparities between the numbers in the audit and more positive statistics given to council members by the Office of Procurement just moments before the audit was presented.
The department said that of the new registered contractors with the city this year, 11% of contracts were given to woman-owned businesses and 54% given to minority businesses.
“How did we get these glaring numbers without recognizing the inefficiency of the very program that these numbers were supposed to be fed into and pushed out of?” he asked.
The startling audit aligns with the 50th anniversary of Atlanta electing its first Black mayor, Maynard Holbrook Jackson, Jr. During his time in office, Jackson is credited for ushering in a new era of political and business representation for Black Atlantans.
At the time he became mayor, Jackson said only 0.5% of city contracts were going to Black-owned businesses. So, he established the Minority Business Enterprise program, which mandated that 35% of all city contracts go to minority firms.
Jackson also ordered that 25% of contracts in building the airport go to women, Black and other minority-owned firms.
---
Got tips, tricks or just want to say hello? Email me at riley.bunch@ajc.com.
Miguel Martinez
Miguel Martinez
About the Author
