The Baytown Sun (Baytown, Tex.), Vol. 76, No. 83, Ed. 1 Thursday, February 5, 1998 Page: 5 of 16
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OPED
Minorities deserve share of government contracts
Douglas Gray started up his computer
services firm seven years ago with a
$1,500 personal loan and one employee —
himself.
Today, San Diego-based Gray Systems is'
. a growing $5 million small business,
boasting 18 employees.
Gray Systems is the kind of minority-
owned company that politicians of both
■ parties, and at all levels of government, .
would hail as a success story.
They would cite the firm’s exponential
growth—from $36,000 in revenues in
1991 to $1.2 million in 1995 to $4.6 mil-
lion last year—as prima facie evidence of
the business opportunities available to
minorities.
But it is worth taking a closer look at
how the entrepreneurial Gray built his
business.
Since his local bank would loan him no
more than $ 1,500 to get his company off
the ground, he had to turn to friends, busi-
ness acquaintances and other investors to
raise operating capital. Of course, he had to
pay a higher interest rate—a “risk premi-
um” of sorts — to his investors than he
would have had he secured bank financing.
Gray decided to enter the burgeoning
market for computer services— including
local area network (LAN) cabling, soft-
ware training, and computer maintenance
—though he lacked an extensive back-
ground in computers.
He did, however, have the business savvy
to hire computer experts to service his
clients while he was on the learning curve.
Gray Systems has contracts with several
private-sector companies, including Xerox
and minority-owned Maxie Corp. But the
bulk of its business comes from govern-
ment agencies, including the state of Cali-
fornia, the U.S. Postal Service, the Navy
and the Department of Veterans Affairs.
Gray Systems has been successful in
winning millions of dollars worth of gov-
ernment contracts because of the quality of
its services. But, the fact is, it also has won
those contracts because the company hap-
pens to be minority-owned.
Indeed, Gray Systems was recently
awarded $12 million in contracts from the
VA after being certified by the Small Busi-
ness Association as a minority concern.
Gray Systems has won similar contracts
from the City of San Diego and the State
of California through minority contracting
programs.
Yet there is a widening campaign, on the
federal, state and local levels, to do away
with programs that target minority-owned
firms, like Gray Systems, for government
contracts. The rationale is that business
owners of all colors should compete for
government contracts on equal footing.
This is a high-minded principle with
curement.
As it happens, San Diego provides a case
study. In 1993, the Associated General
Contractors, made up mostly of white-
owned construction companies, won a fed-
eral lawsuit against the city that struck
down a contracting program that set hiring
goals for minority-owned firms on con-
struction projects.
Since then, the percentage of white-
owtfed construction companies that have
voluntarily brought on minority subcon-
tractors has fallen from 26 percent to 6 per-
cent.
The Associated General Contractors
attributed the fall off to hard economic
times for the local construction industry,
affecting white and minority firms alike.
But, in fact, San Diego city construction
contracts increased from $63 million in
1993 to $405 million in 1996.
I am not prepared to ascribe this dispari-
ty to discrimination against minority-
I personally find nothing wrong with this
when we’re talking about private compa-
nies doing business with other private
companies, with no tax dollars involved.
After all, the First Amendment guarantees
the freedom of association.
/’ But when tax dollars are involved —
money raised not only from white Ameri-
cans, but also from minorities — compa-
nies winning government contracts enjoy „
no absolute freedom of association. They
should share some of the pie with firms
owned by minorities, who make up 27 per-
cent of the U.S. population.
That is not to endorse quota programs
that reserve a fixed percentage of govem-
„i ment contracts for minority-owned firms
whether or not they are qualified.
But if a small, minority-owned business,
like Gray Systems, demonstrates its ability
to competently provide certain goods or
services, they should not be closed out of
government contracts merely because their
owners lack the school, club, neighbor-
hood or other advantageous connections of
non-minority businesses.
Joseph Perkins is a columnist for the San
Diego Union-Tribune.
which most Americans, including yours
truly, philosophically agree. But Gray and
other minority entrepreneurs operate under
real-world conditions. \
And the reality is that, if the government,
the largest purchaser of goods and services
in this country, makes no effort to reach out owned construction firms. I think it is
to the 5 percent of U.S. firms that are more a matter of association.
owned by Hispanics, the 4 percent that are
owned by blacks and the 4 percent that are
owned by Asian-Americans, then minority
business owners will receive a dispropor-
tionately small share of government pro -
Business owners tend to work with those
with whom they share something in com-
mon, whether it be school ties, party affili-
ation, club memberships, neighborhoods or
perhaps even ethnic heritage.
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Thanks to ‘Sun’ for helping
make blood drive a success
Thanks so much for The Sun’s quick response
on the immediate need for blood donors.
Your newspaper’s coverage helped to make the
community aware of the blood shortage and
encouraged them to donate the “gift of life.”
Your assistance will go a long way in improving
the blood supply.
As you may know, the need for blood is ongo-
ing.
Red blood cells last only 42 days and platelets
mus^be transfused within five days.
We must constantly educate the public on the
importance of repeat blood donations.
If every eligible donor were to give twice a year,
instead of just once, we would seldom have a
shortage.
As always, we appreciate your support of the
regional blood program and we look forward to
working with you again in the future.
' — Megan A. Colson,
The Blood Center
Send us a letter
The Baytown Sun welcomes letters to the edi-
tor.
Please send signed letters to: Gary Dobbs or
David Eldridge, The Baytown Sun, P.O. Box 90,
Baytown, Tx. 77522. Or, fax them to: (281) 427-
6283. Or, e-mail us at:
baytownsun@aol.com
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Washington’s airport for
former President Reagan
WASHINGTON (AP) — A
bill to rename Washington’s air-
port for Ronald Reagan is on its
way to becoming law just in time
for his 87th birthday — despite
complaints from Democrats that
Congress is trampling local
rights.
President Clinton will sign the
bill, said spokesman Mike
McCurry, because “I think for
him it came down to a question
of honoring Ronald Reagan.”
The Senate passed one bill
Wednesday to rename Washing-
ton National Airport the Ronald
Reagan Washington National
Airport, 76-22. Later in the day,
the House approved a slightly
different bill, 240-186^ leaving
out the word “Washington.” The
House was expected to adopt the
Senate’s version on Thursday, the
eve of Reagan’s birthday.
House Speaker Newt Gingrich
praised the renaming as a fitting
to an ailing president
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“who transformed the world” by
helping bring down inflation and
end the Cold War.
“I hope that the president and
Mrs. Reagan, watching this hap-
pen, will have some small sense
that there is enormous affection
in this country for Ronald Rea-
gan, and there is a deep sense of
gratitude for the leadership that
he showed,” Gingrich said.
“Ronald Reagan is the most
loved man in America today,”
said House Majority Leader Dick
Armey.
Reagan suffers from
Alzheimer’s disease.
Despite the outpouring of sen-
timent, opponents of the bill
promised a court challenge. They
contend the measure violates the
federal government’s lease to a
local airport authority, which
Reagan in 1986 signed into law.
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Dobbs, Gary. The Baytown Sun (Baytown, Tex.), Vol. 76, No. 83, Ed. 1 Thursday, February 5, 1998, newspaper, February 5, 1998; Baytown, Texas. (https://texashistory.unt.edu/ark:/67531/metapth1176722/m1/5/: accessed July 18, 2024), University of North Texas Libraries, The Portal to Texas History, https://texashistory.unt.edu.; crediting Sterling Municipal Library.