The multibillion-dollar Alameda Corridor project has been a windfall for minority contractors, making it a national model for public projects.
According to the latest data from the Alameda Corridor Transportation Authority, 22.6 percent, or $258 million, of the $1.1 billion in contracts awarded thus far have gone to “disadvantaged business enterprises,” essentially women and/or minority-owned businesses.
“That is a huge number,” said Mario Marin, program manager of the Alameda Corridor Business Outreach Program. “At the federal level, they usually aim at 10 percent of the contracts going to disadvantaged business. We are now used by the U.S. Department of Transportation as a national model for business outreach to minorities.”
Marin attributes the high level of minority participation to a number of factors, including a bid to help general contractors on the project make a “good faith” effort to hire minority subcontractors, and the creation of a large database of disadvantaged business in various specialties to contact when work became available.
“They have done an excellent job networking,” said Debra Berg, owner of Berg & Associates Inc., a construction management consulting firm and one of the few “disadvantaged” businesses to be hired as a prime contractor on the corridor. “They made an effort to create a spirit of cooperation for contractors to get to know each other and build relationships, not just for this project but also for future ones.”
Marin said 7.8 percent of corridor contracts have gone to African-American-owned businesses, 10.3 percent to Latino-owned firms, and 2 percent to other minority-owned companies.
Still, the bottom line for obtaining construction contracts is to come in with the lowest bid. And although Alameda Corridor authorities can build relationships between contractors, they can’t make anyone hire a minority firm if the price is too high.
“The reality is that nothing is easier for minority businesses,” said George Molina, president of Interior Demolition Inc., which also worked on the corridor. “To say that they want to help minorities is just politics. I have never gotten any work because I’m a minority, but only because I’ve been the lowest bidder.”
The problem that many small, minority-owned contractors face is that it is more difficult for them to come in with the most competitive bid for a project because they do not have the financial depth and economics of scale of the bigger contractors.
“White people have the machines and Latinos have the shovels,” said Dean Jones, executive director of the South Los Angeles Economic Development Partnership, referring to the division of labor on construction sites along the corridor. “Black contractors don’t have the cash flow and the equipment to compete for these projects. We don’t have a base here that can meet the requirements for a project like the Alameda Corridor.”
The biggest contracts have gone to the same large firms that worked on other mega-infrastructure projects in L.A., such as Pier 300 and 400 in the Port of Los Angeles and the Hyperion Treatment Plant in El Segundo.
They include Tutor-Saliba Corp., which is doing most of the work on the trench through which the trains will run from the ports to the railway hub east of downtown; Kiewit Pacific Co., which worked on a bridge over the L.A. River; and Shimmick/Obayashi JV, which is doing grade separation at Henry Ford Avenue in Long Beach.
