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For more information contact: Morgan Hook, 518-474-8418/212-681-4640

Governor Paterson Accepts Final Report from MWBE Task Force, Hails Historic Improvements

ALBANY, NY (03/24/2010)(readMedia)-- Governor David A. Paterson today accepted the final report from the Minority and Women-Owned Business Enterprise (MWBE) Task Force, the capstone of the State's evaluation of its use of MWBEs. The Task Force began its work at the direction of the Governor in June 2008 to review how authorities issuing State-supported debt selected underwriters and other professional services. Following a thorough examination of State procurement processes, the Task Force delivered a series of recommendations designed to provide MWBEs with an opportunity to compete for contracts. The final report outlines how the adoption of these recommendations have led to significant improvement in the utilization of MWBEs, setting a foundation for future progress and making New York a national leader in MWBE economic development.

"In 2006, the Department of Economic Development reported some very alarming numbers. Only 3 percent of all State procurement contracts were awarded to businesses owned by women or minorities: 2 percent of those were minority-owned, including African-American, Hispanic and Asian; and a mere 1 percent belonged to women. It was with these figures in mind that one of my first acts as Governor was to create a task force to address this inequity," Governor Paterson said. "Today, we see the results. These recommendations have developed a uniform procurement process, removed barriers to entry and improved the diversity of debt underwriters and other professional service firms working with New York State."

"There is more progress to be made, but this Task Force has laid a strong foundation. To help ensure that the work of this Task Force is not diminished with the passage of time, I will soon submit legislation to ensure that the progress that began with the Task Force continues," the Governor added. "I congratulate the MWBE Task Force and Chairman Paul Williams. Their impressive results will continue to be used as a guide for diverse economic development in New York and across the country."

Task Force Chairman Paul T. Williams Jr., the Executive Director of the Dormitory Authority, said: "MWBE firms have new opportunities to do business with and in New York State – progress we would not have made without Governor Paterson's commitment to this issue. As more MWBE financial and professional service firms earn senior roles as underwriters, attorneys, bankers, brokers, agents and advisors, these firms will be able to expand their capital and customer base. That will create new jobs here in New York and help develop the next generation of minorities and women in the financial services profession. I look forward to working with the Governor and the MWBE team to ensure that a new and vibrant MWBE financial sector continues to grow in New York."

The MWBE Task Force developed recommendations to increase the State's use of MWBE underwriters, legal, financial and other professional service providers:

Underwriter Recommendations

The Task Force made 30 underwriter recommendations in October 2008. Chief among those adopted is the uniform Request for Proposal (RFP), which removes barriers to entry, reduces RFP cycles for all underwriting firms, and standardizes measures. This includes a mid-cycle performance review of each authority's underwriting panels. Based on those reviews, firms have the ability to advance to more senior levels in the underwriting panels. Authorities have also used various syndicate structures to reach an aspirational goal of 20 percent MWBE participation.

Legal Services Recommendations

The Task Force Recommendations Regarding Best Practices in Procurement for Legal Services, adopted in May 2009, cover bond counsel and other legal services provided to the Task Force members. Recommendations include the elimination of barriers to entry for MWBE firms, outreach to organizations that serve MWBE firms, shorter RFP cycles, encouraging joint ventures and partnering arrangements, and requiring all firms to disclose their diversity practices. As a result of these recommendations:

Financial Services Recommendations

The Task Force Recommendations Regarding Best Practices in Financial Services, adopted in November 2009, focus on increasing MWBE participation in accounting, banking, broker-dealers, certificates of deposit and money market fund investments, financial advisory and swap advisory services, risk management, and insurance brokerage services. The recommendations are centered on outreach to MWBE firms, the RFP process and evaluation criteria, establishment of aspirational goals, encouragement of joint ventures and partnership arrangements, consideration of the diversity practices of firms which hire minority and women financial professionals and the periodic evaluation of firms selected.

As a result of these recommendations, authorities have already begun procurements based on the principles adopted. MWBE accounting firms, financial and swap advisors, and broker-dealers are now experiencing new opportunities to participate in authority financial services procurements. Examples include:

To ensure that this progress continues, Governor Paterson will submit legislation that would mandate that the State's procurements conform to the Best Practices recommended by the MWBE Task Force. The legislation would:

The Governor created the MWBE Task Force through Executive Order No. 10. It includes representatives from DASNY, ESD, EFC, the Housing Finance Agency (HFA), the Thruway Authority and members appointed by the Governor including a representative of the Office of State Comptroller and the Governor's Office. Paul T. Williams Jr., the Executive Director of the Dormitory Authority, has served as the Task Force Chairman.

A full copy of the final report is available at: http://www.dasny.org/finance/mwbe_taskforce/E_O_10_report/index.php.

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The following quotes were provided in support of the Final Report from the MWBE Task Force:

Majority Conference Leader John L. Sampson said: "Diversity is good for business. It fosters competition and helps develop greater opportunities for women and minority owned enterprises that will spur the economy. Enhancing the success of MWBE's in securing financial and professional services contracts as well as diversifying assessment practices for vendors is critical to improving the prospects of MWBE's across the state. I commend Governor Paterson for creating this task force and everyone who participated in the process."

Assembly Speaker Sheldon Silver said: "It's crucial that we continue to encourage the development of minority- and women-owned businesses in New York State. The recommendations of the MWBE Task Force are a strong first step toward encouraging the growth of these enterprises and incorporating these vital businesses into the financial sector and other areas of the state's economy."

Assembly Member Felix Ortiz said: "I applaud the strides made by New York State and Governor Paterson in increasing opportunities for Minority and Women-Owned Business Enterprise Firms. We need to continue the positive steps made in the last two years so that doors will continue to open for these businesses!"

Assembly Member Richard Brodsky said: "State contracts should reflect New York's rich diversity. We made major strides in the Public Authority Reform Act by covering all authorities and extending the MWBE requirements to financial and other protective services. There's much more to do but we've taken giants steps in the past six months. I applaud the Governor and the MWBE Task Force for their dedication to equality for all of New York's businesses."

Dennis Mullen, Task Force member and ESD Chairman and CEO designate, said: "Thanks to Governor Paterson's unwavering dedication to MWBE firms, we have made significant strides with increased economic opportunities for MWBEs statewide. Recommendations made by the Governor's Task Force have already yielded tremendous results with a more efficient certification process and increased participation in State procurement contracts. This progress guarantees these firms have a stronger foothold in a more diversified business community in which they can grow and thrive. By providing more opportunities for MWBEs going forward, the State is promoting equality and opening itself up for business both now and in the future."

Matthew Driscoll, Task Force member and EFC President, said: "Governor Paterson's recommendations today will ensure that all New Yorkers benefit from job creation as the State recovers from the current recession. As the MWBE Task Force final report highlights, progress has been made, but more progress is needed. Comprehensive MWBE initiatives are critical to the long-term health of our State's economy."

Judd S. Levy, Task Force member and Chairman of the Housing Finance Agency, said: "We believe it is important to level the playing field so that all eligible companies in New York State have an equal opportunity to compete for our business. Acting on the recommendations of the Task Force, we have already taken significant steps to diversify the list of bond underwriters and law firms that advise HFA on bond financings, as well as other agency matters. Implementing these proposals insures that New York State will have access to the broadest range of talent as it serves the people's housing needs."

Michael Fleischer, Task Force member and Executive Director of the Thruway Authority, said: "The Thruway Authority is proud of its improving track record in utilizing Minority and/or MWBEs in the area of highway and bridge construction, as well as in the area of public finance. And while the Authority takes pride in its past success, it looks forward to achieving greater successes in the future."

Celia Gonzalez, Task Force member and Deputy Comptroller, Office of State Comptroller, said: "It is a new day in New York. The work of the taskforce will greatly increase the participation of M/WBEs in the lucrative areas of underwriting, financial and legal services. I commend my fellow taskforce members and Paul Williams for his visionary leadership."

Samuel Ramirez, Managing Director of Samuel A. Ramirez and Co., said: "Our firm is the oldest minority investment banking firm in the U.S., yet we had trouble doing business in New York. The Governor's creation of the MWBE Task Force made a difference, like night and day. Now mid-sized firms like ours have a real shot at doing business with the State."

J. Donald Rice, Chairman and CEO of Rice Financial Products, said: "The changes made by the MWBE Task Force opened the doors for Rice Financial Products, and gave us the ability to compete on a level playing field. Despite the economic downturn, we've been able to hire new employees, and fully half that total is as a result of business we've generated as an MWBE."

Gabriel Marous, Co-Founder of Marous and Marous, said: "I wasn't aware of the opportunities afforded MWBE firms until I attended a Bar Association event where Paul Williams spoke. He was quite forceful about wanting to see more diversity in the law firms doing business with the State. Our firm partnered with another small firm and acted as co-counsel on a deal. It got our firm's foot in the door, and put us in a much better position to compete for new business."

Bennie Hadnott, Managing Partner of TCBA Watson Rice, said: "Partnering with majority firms isn't always easy. However, the outreach provided by Gov. Paterson in creating the MWBE Task Force has been a big positive. It's helped to get firms like ours to the table, and that's made all the difference in the world. The goals articulated by the Task Force have created new opportunities for MWBE firms. Put simply, no goals, no opportunity."

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