California Black Owned Businesses Set to Access More State Gov’t Contracts

Jaivon Grant | California Black Media • January 9, 2023

L to R: Pat Fong Kushida, president and CEO Asian Pacific Chamber of Commerce, Timothy Alan Simon Esq. Chairman of the Californa African American Chamber of Commerce and Julian Cañete serves as the President and CEO of the California Hispanic Chambers of Commerce.

Black and other minority-owned small businesses in California have actively fought for decades for more inclusion in California state government contracting opportunities.

Their hard work and patience paid off in September last year, when Gov. Gavin Newsom signed Assembly Bill (AB) 2019 into law.

Authored by Assemblymember Cottie Petrie-Norris (D-Irvine), the law took effect on Jan. 1. It mandates that state departments and agencies commit to providing at least 25% of all procurement opportunities to small businesses. Additionally, the bill requires state departments and agencies ensure that minority-owned and women-owned businesses are included in the procurement process, when contracting opportunities are available.

“California has invested billions of dollars to help small businesses and entrepreneurs achieve their California Dream,” said Newsom when signing the bill September 2022. “These new laws build on our efforts to create a more inclusive economy with renewed opportunity for innovation and growth for the country’s largest small business community. I’m thankful for the Legislature’s leadership and support to help the backbone of our economy thrive.”

Newsom signed AB 2019 after it passed in the Assembly unanimously with a 74-0 vote and it passed in the Senate 34-0.

Small businesses employ nearly 7.2 million workers (or 48.8% of all employees in California).

According to AB 2019, more than 39% of California’s 4.1 million small businesses (1.6 million) are minority owned. The bill is projected to have a significant positive impact on the overall economic stability of the state by enhancing state agencies’ ability to support underserved businesses in state contracting and encouraging entrepreneurship.

“Billions of dollars are at stake in our state contracting process and when we make it fair for diverse entrepreneurs, the success of these small businessowners lift up communities all across our state,” said Petrie-Norris, who is Chair of the Assembly Select Committee on Small Business and Entrepreneurship. “This bill will not only keep the state accountable, but it would give businesses that face systemic barriers an opportunity to succeed, keep families fed, create jobs and vitalize their communities.”

A coalition of minority-owned business advocacy organizations recently produced and released a video emphasizing some of the benefits of working with the state government.

“There are a lot of times where you’re questioning ‘am I going to have enough work for my small company,’” minority business owner Gary Efhan, CEO of Qualis Telecom stated in the video. “Without support, it’s pretty hard, and I’ve seen a lot of people go out of business.”

“Supporting us -- and being in our communities --that will make a huge difference for sure,” Efhan added.

In the same video, CalAsian Chamber of Commerce President Pat Fong expressed that are many barriers to full participation for small businesses in California.

“Part of our goal with AB 2019 is to come up with an infrastructure that makes sense for small businesses,” Fong said. “There’s an understanding about what types of opportunities are available that are easy to access. How do we better connect California’s diverse businesses to those opportunities? I think that’s the challenge but also the opportunity.”

The California Hispanic Chambers of Commerce represents more than 815,000 Latino-owned business in California -- organizations that, in aggregate, contribute more than 7% to the United States’ GDP, the organization says.

“As proud co-sponsors of AB 2019, we are thankful that the bill is now signed by the Governor,” said Julian Canete, President of the California Hispanic Chambers of Commerce. “There are numerous and diverse small businesses who can provide services and products to the State and this bill ensures they at least have a fighting chance to be awarded a contract. Thank you to Assemblymember Petrie-Norris for her work on this bill.”

The bill has garnered strong support from the California Chamber of Commerce, Small Business Majority, the California African American Chamber of Commerce, the California State Controller, California Hispanic Chamber of Commerce, California Asian Pacific Chamber of Commerce, and the National Association of Women Business Owners.

This California Black Media report was supported in whole or in part by funding provided by the State of California, administered by the California State Library.

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