Local Business Fights For a ‘Piece of the Pie’

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A firefighter retrieves his gear from an engine. Photo by Scott Ball.

Scott Ball / Rivard Report

A firefighter retrieves his gear from an engine.

A City contract with a Massachusetts-based medical manufacturing company for defibrillators and supplies is on hold because Council members want to give a local company a shot at some of the business.

The unanimous decision came Thursday after Council heard from advocates of several women and minority-owned businesses who said the Small Business Economic Development Advocacy (SBEDA) program, which was formed in 1992 to ensure local access to such contracts, was largely ignored.

This struck a chord with Councilman Alan Warrick (D2), who noted that February is Black History Month.

San Antonio Fire Department Chief Charles Hood

“We’re asking for a piece of the pie where there was no piece before,” Warrick said. “20-30 years ago we couldn’t even have this conversation.”

The two-year, $2.6 million contract with Zoll Medical Corporation allows the city to buy up to five more defibrillators, but the bulk of the money will go towards accessories and maintenance of heart monitors and defibrillators in EMS vehicles. MEDWheels Inc., a local company that also submitted a bid, could make most of those accessories, said founder Jane Gonzalez.

San Antonio Fire Department Chief Charles Hood stood beside City staff to defend the decision to keep the Zoll contract.

“Having the same equipment is critical for us,” Hood told Council. In the field and in emergency situations, he doesn’t want the variability of products – electrodes, pads, tubes – from different types or brands getting in the way of functionality.

Zoll, which has locations worldwide, obtained a waiver from the typical, competitive selection process because the contract relates to the “public health or safety of the city’s residents.” Now the contract is heading to a Council committee that reviews high profile contracts.

“We’re ready to work with purchasing and SBEDA for a contract that’s amenable,” Michael Trotter, vice president of Zoll sales in North America, told the Rivard Report.

“There’s a risk to patient care and the investment of training and service that [are] in question here,” he said, adding that the components and processes are extremely complex and FDA regulations make including another third party prohibitively even more so.

Zoll has had a contract with the City of San Antonio since its initial contract to supply the City and the Fire Department with advanced defibrillators in 2012. MEDWheels makes vastly different defibrillators, but, Gonzalez said, could certainly ramp up new products given the opportunity.

“I have the utmost confidence that we have the ability to handle this contract,” Gonzalez told Council members.

Hood noted that, whatever the outcome of the contract, these supplies are running low.

“We have less than a 90-day supply,” he said.

Warrick and other City Council members, including Councilman Joe Krier (D9), directed staff to develop a short-term contract with Zoll to provide supplies in the interim.

Due diligence on the contract and the inclusion of local businesses, if possible, is more important that getting it done fast, Krier said. “I expect that we’re not going to let anyone die in the meantime.”

Warrick asked for staff to outline how many goods and supplies contracts have been given to such businesses in 2016. Out of about $20 million-worth of goods and supplies contracts, about $2.7 million, 14%, were awarded to small, women, or minority-owned businesses.

“I don’t have an issue with Zoll products if the Fire Department wants them,” Warrick said. But he was troubled by this case and the statistics.

In a city that’s more than 60% Hispanic, Warrick said, these numbers should be better.

Goods and supplies are one of five types of contract that SBEDA tracks. Others include architecture and engineering, professional service, construction, and “other” services.

 

 

The SBEDA ordinance was established in 1992 after a disparity study in 1989 “indicated only 10% of the City’s purchases came from [small, women and minority owned businesses].”

Out of the $465 million in contracts awarded last year across all five categories, 33% were women or minority-owned and 12% were small business.

Those numbers were at 34% and 9%, respectively in 2015, which had a similar total dollar amount of contracts.

“The City of San Antonio strongly supports small, local, minority and women owned businesses as demonstrated through our improved performance over the past decade,” City Manager Sheryl Sculley stated in a text on Saturday.

While MEDWheels, Zoll, and SBEDA staff work out the details, Mayor Ivy Taylor called for an update from City staff on the five-year Diversity Action Plan. Throughout the discussion, some Council members worried it may not be achieving goals as quickly as expected. The plan was established in 2013 to “increase the number of minority and woman-owned firms in the City’s Central Vendor Registry” and increase their participation as contractors and consultants on contracts “as necessary to address their underutilization in the marketplace.”

In 2013, 29% of the total $252 million in contracts were awarded to women or minority-owned businesses and 14% were small businesses. While women and minority-owned percentages are slowly rising, the small businesses percentage has a bumpier trend line.

It would have been more efficient to have had this conversation in committee, Taylor said, adding that she’s confident a contract will emerge that meets the Fire Department’s needs and follows the SBEDA policy goals.

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