The State of Minority- and Women- Owned ... - Cleveland.com

M/WBE Availability in the City of Cleveland’s Market Area
executed, the Custom Census is less likely to be tainted by the effects of past and present
discrimination than other methods. 210
The Custom Census method has seven steps. These are:
1. Create a database of representative and recent City of Cleveland contracts in
Construction, AE-CRS, Services, and Commodities;
2. Identify the City’s relevant geographic market from this database;
3. Identify the City’s relevant product market from this database;
4. Count all business establishments in the relevant market area;
5. Identify listed M/WBE establishments in the relevant market area;
6. Verify the ownership status of listed M/WBEs; and
7. Verify the ownership status of all other firms in the relevant market area.
Steps 1-3 were described in Chapter III. Steps 4-7 are described in more detail below. 211
B. Identifying Business Establishments in the Relevant Markets
M/WBE availability (unweighted) is defined as the number of M/WBEs divided by the total
number of business establishments in the City of Cleveland’s contracting market area—what we
will refer to as the Baseline Business Universe. 212 Determining the total number of business
establishments in the market area, however, is more straightforward than determining the number
of minority- or women-owned establishments in those markets. The latter task has three main
parts: (1) identify all listed M/WBEs in the relevant market; (2) verify the ownership status of
listed M/WBEs; and (3) estimate the number of unlisted M/WBEs in the relevant market. This
section describes how these tasks were accomplished for the City of Cleveland.
It is important to note that NERA’s availability analysis is free from variables tainted by
discrimination. Our approach recognizes that discrimination may impact many of the variables
that contribute to a firm’s success in obtaining work as a prime or a subcontractor. Factors such
as firm size, time in business, qualifications, and experience are all adversely affected by
discrimination if it is present in the market area. Despite the obvious relationship, some
commentators argue that disparities should only be assessed between firms with similar
“capacities.” 213 However, most courts have properly refused to make the results of discrimination
210 See Section B.5., below, for further discussion of this point.
211 For additional discussion of the Custom Census availability method and its advantages relative to other
availability estimation methods see Wainwright and Holt (2010, pp. 30-48).
212 To yield a percentage, the resulting figure is multiplied by 100.
213 See, e.g., La Noue (2006). Most of La Noue’s expert report in Gross Seed Company v. Nebraska Department of
Roads, No. 02-3016 (D. Neb. 2002), including his views on “capacity,” was rejected by the court on the basis
NERA Economic Consulting 83