Tag Archives: racism

Empty Jackpot

14 Jul

Illinois celebrates its program to steer state contracts to businesses owned by minorities, women and people with a disability. But a closer look shows the state may not be fulfilling its goals.

Shaking hands with officials from the Illinois Lottery, Bob Dale felt like a winner. No, he didn’t win the jackpot or even one of those scratch-off cards. But his business, R.J. Dale Advertising, had just sealed a $100 million contract with the Illinois Department of Revenue, one of the largest contracts awarded to a black-owned business in Illinois.

But looking back on his big win now, Dale doesn’t feel so lucky. Low commission rates and sky-high legal fees from state audits meant R.J. Dale Advertising didn’t even make a profit for being the lottery’s chief advertising agency.

“Quite honestly, it damn near put us out of business,” he said.

The lottery, on the other hand, fared well. During its five-year contract term, revenue from the lottery increased by $490 million. Dale and hiscolleagues hoped that success would generate new business.

As it turned out, the lottery contract opened no new doors for the firm. Major corporations “didn’t care about the phenomenal success we had,” Dale said. “They just weren’t interested in hiring a black-owned business.”

Many minority business owners say they still face significant discrimination in the marketplace. To help remedy that, some states, including Illinois, have created programs to make sure that some government contracts go to diverse businesses.

Dale’s contract was part of the Business Enterprise Program, Illinois’ effort to award government contracts to businesses owned by minorities, women and people with a disability. But a Chicago Reporter investigation found that even though the State of Illinois sets lofty goals and touts its overall successes, some of its departments aren’t even coming close to the program’s goal of steering 20 percent of all contracts to target businesses.

Between fiscal years 2007 and 2010, 13 out of the 28 state departments with at least $10 million in their contract budget during those years failed to meet the program’s 20 percent goal, including five of the six departments with the largest budgets. Four of these departments even fell short of the 12 percent minimum required by law.

And even when departments are meeting their goals, the money is often going to one big contract with one single firm, like Dale’s lottery contract. Forty-five percent of state departments awarded more than half of their contract dollars for the program to just one firm.

Dale said every time those goals aren’t met, it means minority communities miss out. If every department had met its goal, businesses owned by minorities, women and people with a disability in Illinois would have earned another $586 million between fiscal years 2007 and 2010.

“The black unemployment rate is at least twice as high as the general market, maybe even three times as high,” Dale said. “Every time we don’t get a contract, that’s jobs that black people don’t get.”

Read more at The Chicago Reporter…

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Unlucky 13

1 May

An increasing number of people are turning to bankruptcy for a fresh start, but many are leaving themselves susceptible to more debt by opting for a Chapter 13 protection, which has a high failure rate.

Freeman Hess sits at the dining room table in his brick bungalow in Roseland on Chicago’s South Side. At 78, his gray hair is thin and fuzzy, like the coating of a peach, but his arms are muscular. He hasn’t lost the physical strength he acquired from operating a forklift for Cook County for 43 years. But in all his years of work, starting off picking cotton in Brownsville, Tenn., and coming to Chicago for better opportunities, he never imagined retirement being so stressful.

“I manage,” says Hess, his jaw tense. “But sometimes I just don’t have the money to pay my bills. They are taking it all.”

“They” is a collection of people—his lawyers, his creditors and the bankruptcy trustee. Hess filed for bankruptcy two years ago, and ever since, he’s been paying $1,090 a month, the majority of his income, to try and get rid of his debt, with two more years to go.

With the economic downturn, many Cook County residents are facing a similar situation: less money coming in, and more bills than they can handle. And more people, like Hess, are turning to bankruptcy for relief.

But many, particularly those in black communities, have been filing Chapter 13 bankruptcy, which carries a high risk of failure, leaving themselves vulnerable to end up with yet another mountain of debt, instead of a fresh start.

According to new data supplied to The Chicago Reporter by the Chicago-based Woodstock Institute, nearly a third of all bankruptcies in Cook County were filed under Chapter 13. Among filers living in communities where African Americans made up more than 80 percent of the population, the rate was much higher, with nearly a half of bankruptcies filed under Chapter 13.

Read more at The Chicago Reporter…