At a recent meeting of the South Central Texas Regional Certification Agency (SCTRCA), part of which was closed to the public, interim Executive Director Charles Johnson defended to the board the agency's controversial Small Business Enterprise (SBE) certification of Go Rio.
Mery & Associates, representing Buena Vista Barges, had challenged Go Rio's SBE certification that gave the company an edge in the bidding process to win the City's 10-year, $100 million river barge contract. Johnson was named interim executive director following Julio Fuentes departure from the agency soon after approving Go Rio's certification in January.
The SCTRCA last month upheld Go Rio’s SBE status, a decision Mery & Associates is appealing. But SCTRCA Board Chairman Dwayne Robinson said the board has fully supported Johnson's decision.
“It was just a matter of him letting the board know his thoughts on the challenge and why he ruled in the manner he ruled," said Robinson, who is also constituent services director for Bexar County. "From his perspective, it was easy to uphold the decision.”
But Robinson acknowledged that the issue has placed the previously little-known organization in the public eye. Questions about the SCTRCA's structure and processes come at a time when the 2017 bond program is gearing up for implementation and the City will rely on SCTRCA certifications as it selects companies that bid on projects large and small.
A nonprofit corporation founded in 1988 to represent several public entities, including the County and the City of San Antonio, the SCTRCA is charged with ensuring that firms submitting bids for government contracts and procurement opportunities are eligible for certifications including:
- Airport Concessionaire Disadvantaged Business Enterprise (ACDBE)
- Disadvantaged Business Enterprise (DBE)
- Small Business Enterprise (SBE)
- Minority Business Enterprise (MBE)
- Woman Business Enterprise (WBE)
The certifications are given to firms that meet requirements defined by the SCTRCA Business Enterprise Certification Policies and Procedures Manual.
The SCTRCA is funded by major contributions from public entities, including the City, Bexar County, San Antonio Water System, and VIA Metropolitan Transit. Seven more groups also provide some funding: the Alamo Community College District, University Health System, Port San Antonio, Brooks, the San Antonio River Authority, the San Antonio Housing Authority, and the San Antonio Independent School District. Corporate sponsors such as Zachry and Boeing also provide funds in smaller amounts of around $1,000, according to Robinson.
The agency also conducts two fundraisers a year that he said serve mainly as networking events for certified firms and the entities that rely on SCTRCA.
“The SCTRCA has been around for 20 years doing this work. Every now and then a particular issue will come up, and you take away from all of the years of good work by letting one issue bring this into question,” Robinson said, referring to the Go Rio's certification. “We were around before this issue, and we will continue to be around after it’s settled.”
With the May 6 passage of the $850 million municipal bond program, the City has released Requests for Qualifications for design services for 105 of the 180 projects of the bond that are moving forward.
That effort will involve the SCTRCA in a big way.
Mike Frisbie is City engineer and director of the Transportation and Capital Improvements Department, which manages most of the infrastructure projects for the City. He said "virtually all" City projects have a small-business component to them.
Small businesses certified through the SCTRCA allows them to be included in the City's central vendor registry. "So now we know they are certified and available to work on City projects," Frisbie said.
Frisbie said the City is currently undergoing the process to select design firms to support the bond program contracts. "From there, we'll be going through the process project-by-project with construction awards for contractors, too, and a lot of contractors are small business as well," he said. "[Certification] is an important part of the process."
But being certified isn't the only criterion, he added. There's also a local component. Firms that want to be considered for bond contracts and connect with SCTRCA can learn more at the City's Small Business Office site.
“The SCTRCA may be an obscure nonprofit to many, but to a company that competes for government contracts, it’s the key,” said Doug McMurry, executive vice president of the San Antonio chapter of the Associated General Contractors. “It is the foundation on which the special preference program is built. Millions of dollars in contracts are awarded every year, often related to gender and ethnicity.
“It’s up to SCTRCA to qualify firms for special preference, and it can be tricky.”
In 2011, Bexar County temporarily withdrew its funding of the SCTRCA "at the request of one individual," according to Robinson, which he said turned out to be a bad decision based on a personality clash alone.
Turmoil among certifying agencies is not an unknown occurrence. In 2014, the North Central Texas Regional Certification Agency faced questions about its efficiency and performance while attempting to keep its records from the public. Changes were made after The Dallas Morning News reported problems with the NCTRCA’s management, oversight, and operations.
Austin also experienced fraudulent certification problems eight years ago, a source who is close to the situation told the Rivard Report.
Michael Sindon, assistant director of the Economic Development Department for the City of San Antonio who also serves on the SCTRCA board, said City staff validates that firms are certified appropriately and contacts SCTRCA if there are questions.
“They follow the practices we want them to, obviously that’s why we go through them,” he said. “We use SBA [Small Business Administration] standards to certify vendors. … From a vendor standpoint, I can see it being kind of nice that they don’t have to question whether they meet the size standards with the City, but maybe not with SAWS [San Antonio Water System] or the County. Having a unified entity which every agency follows kind of sets that one standard that if you are certified, then that qualifies you to be eligible with the different governmental agencies around.”
As for the SCTRCA staff, Sindon said they are experienced enough to do the job well.
“They are very capable, and we are pleased with their efforts and ability to demonstrate leadership," he said. "One of the older employees left with the executive director [Julio Fuentes] to start a consulting company, but before that, the staff was consistent. So [there was] a little bit of turnover from the executive director side, but we hope we can address the turnover and move forward.”
And the process works well, he added, ensuring access to contracts for historically underutilized or disadvantaged business owners. In 2016, for example, 75% of all architectural and engineering contract dollars went to locally owned and women-owned small business.
“That’s pretty successful, from a program standpoint,” Sindon said. “There are benefits and opportunities [firms] have if they go to the SCTRCA and get certified.”
At last Monday’s SCTRCA meeting, the board reviewed an ongoing candidate interview process and timeline for hiring a permanent executive director.
“I don’t want to speak for the committee chair, but we are hoping to have someone in the position at the beginning of next month,” Robinson said.