2024 MWBE Wrap-up
2024 was another dynamic year for Minority and Woman Business Enterprises (“MWBEs”) in New York, and for the MWBE Client Services team at Hancock Estabrook! We handled administrative appeals, facilitated corporate transactions and advised MWBEs as they navigated the regulatory, business and legal worlds of certification and utilization. This year alone, we represented or counseled over 80 MWBEs. While most of our clients sought assistance dealing with the New York State Division of Minority and Women Business Development (the “Division”), we also helped companies dealing with certification from the New York City Small Business Services, the NY/NJ Port Authority, and other certifying entities.
A major part of our work involved representing companies whose applications for certification had been denied by the Division. We advocated zealously for those companies whose applications had been denied by the Division. By showing the Division that these companies had been wrongfully denied and were prepared to go to a hearing or court to fight the issue, we were able to secure the certification of 28 companies through a settled resolution. We also secured stipulations permitting another eight clients to reapply for certification, giving them an opportunity to present additional information and documents demonstrating their eligibility for certification.
Unfortunately, not every case can be resolved short of a hearing or lawsuit. We represented clients in four administrative hearings this year, securing certification for our clients in two. We are currently awaiting a final order in the third and intend to file suit for judicial review in the fourth. We brought two suits against the Division in 2023-24, securing our client’s objectives in both cases. In the first matter, we negotiated a reversal of the Division’s denial of a client’s effort to appeal on untimeliness grounds. In the other lawsuit, we convinced the Division to recognize our client as a commodity supplier rather than a mere broker, resulting in significantly higher utilization credit for its contracting partners.
Through these efforts, we have advocated aggressively and successfully for common sense interpretations of Division regulations, fighting against unfair presumptions that women and minority owners are not sufficiently experienced or competent to make business decisions, or that they unduly rely on non-qualifying employees or others to run their companies, or that they do not control their companies based solely on technicalities in corporate governance documents.
Our representation was not limited to administrative litigation before the Division. We helped MWBE-certified companies with business and family succession planning, and negotiated buyouts of shareholders, business acquisitions, and contractual disputes. We also helped our clients with other business opportunities and contracts and assisted them with their legal issues as they expanded their work in public contracting.
Coming up in 2025
This year will be another important one for MWBEs as the legislation authorizing the State’s program is set to expire, and therefore must be renewed by July 1, 2025. The State has completed the 2024 MWBE Disparity Study that the Legislature will rely on in drafting the updated legislation. The Disparity Study is available here: https://www.esd.ny.gov/mwbe-disparity-studies.
It is important for women and minority businesspeople to be part of the conversation around any potential changes to the program. MWBEs should consider engaging with their elected representatives to demand that the State strengthen the application and administrative appeal processes to ensure that no eligible companies are denied certification due to minor technicalities. We urge all MWBEs to reach out to their New York State Assembly members and Senators and ask them to adopt strong procedures to ensure that agency errors or misunderstandings do not stand in the way of MWBEs receiving the full benefit of the renewed MWBE program.
As the year progresses, the team at Hancock Estabrook will continue to engage our clients and industry groups, and to urge the Division, and the Legislature to adopt common sense, impactful strategies to maintain a fair, transparent, and inclusive certification review and appeal process.
