More minorities to receive Katrina contracts

updated 2:00 p.m. ET Oct. 11, 2005

WASHINGTON - The Bush administration said Tuesday it would boost the number of contracts given to small and minority-owned businesses for Hurricane Katrina cleanup work, calling the amount now awarded too low.

The Federal Emergency Management Agency said it would set aside an allotment for disadvantaged businesses following its announcement last week that it would rebid millions of dollars in contracts handed out with little or no competition.

The initial $100 million contracts to be rebid were given to four major construction firms — Shaw Group Inc., Bechtel Corp., CH2M Hill Inc. and Fluor Corp. — which had prior relationships with the government.

The Commerce Department, meanwhile, announced a new information center and Web site to help smaller, disadvantaged firms get information about how to competitively bid for Katrina contracts.

The move follows criticism in recent weeks by minority businesses who said they were paying the price for the decision by Congress and the Bush administration to waive competition rules for many of the larger recovery contracts.

‘Reaching out to companies of all sizes’
About 1.5 percent of the $1.6 billion awarded by the Federal Emergency Management Agency has gone to minority businesses, less than a third of the 5 percent normally required.

“This administration is reaching out to companies of all sizes, especially minority-owned enterprises, to guarantee that those seeking to join the rebuilding efforts can navigate federal agencies and bid for contracts with ease,” said Commerce Secretary Carlos M. Gutierrez.

“We’re looking to improve to make participation stronger,” Gutierrez said. He said that would include the setting of numerical targets for minority participation, although a specific number had not yet been set.

Under the procedures detailed Tuesday by FEMA, federal officials will solicit competitive bids for remaining Katrina work. Contracts will be for five years, with preference given to small and minority-owned businesses.

“We will now use competitive strategies everywhere possible — placing priority on the use of local and small disadvantaged businesses — as we move into the long-term recovery phase,” said Acting FEMA Director David Paulison.

Those businesses can register to receive information on Katrina contracts at the Commerce Department’s Hurricane Contracting Information Center at www.rebuildingthegulfcoast.gov. Businesses can also call the center’s help line at 1-800-4USADOC to receive counseling on navigating the bidding process.

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