Shelby County Schools revealed its first public look at a policy that will help the district hire more businesses owned by people of color and white women.

The plan comes about seven months after a study commissioned by the school board highlighted wide disparities. It found that one third of qualified local companies are owned by white women and people of color, but such businesses were awarded just 15 percent of the contracts for Shelby County Schools in the last five years.

The new proposal sets the groundwork for how to get contracts and expand the district’s business database, and it requires contractors to show “good faith efforts” to reach out to diverse businesses when searching for subcontractors.

Shelby County Schools hosted a networking event for business owners Thursday to explain the policy and invite businesses to participate. The school board first saw the proposal during a committee meeting earlier this month.

PHOTO: Laura Faith Kebede/Chalkbeat
Brian Stockton, the district’s chief of staff, speaks at Thursday’s event.

“This is not about compliance,” said Brian Stockton, the district’s chief of staff, to the crowd of about 150 business owners. “This is a program for people who have been locked out for a very long time.”

Shelby County Schools is Tennessee’s largest school district, one of the top five employers in Memphis, and oversees a budget in excess of $1 billion, about a third of which is used to pay contractors.

District leaders said they see equitable business as a way to combat the poverty that 60 percent of their students face, most of whom are students of color. If their parents and other adults can contribute more and benefit from the local economy, students will be less likely to come to school burdened by the effects of poverty.

The staff, policy, and practices that business owners say were once more inclusive largely disappeared during the tumultuous merger of city and county school systems in 2013.

“It was hard to get your name on a list to get business. … You see the same vendors over and over,” said Trina Williams.

She works for Cushion Employer Services, a consultant that helped mediate employer interviews for the district during the merger. Since then, the company, owned by people of color, has had a hard time getting its foot in the door.

“There wasn’t a forum before to connect,” Williams said. Thursday’s event “makes you feel more comfortable to approach [the district] rather than feel like you’re harassing them for information you need.”

Shelby County Schools will work with other agencies to approve what businesses qualify to bid on contracts. For example, the district will accept approval from agencies such as the City of Memphis, Memphis Light, Gas, and Water, or the Women Business Enterprise Council.

People of color and white woman would apply to be on the district’s database. They can also act as contractors who hire other approved businesses. Contractors seeking to hire diverse businesses would be responsible for reaching out to the businesses on the database.

If a business owner doesn’t meet the district’s goals for hiring for a project, they must show documentation that they tried to employ or contact diverse businesses, or face a $20,000 fine.

“We are committed to getting it right,” said board member Teresa Jones.

School board members are expected to approve the draft policy in the next few months. If approved, the program would last until October 2025. You can view a copy of the draft policy and the district’s proposed goals below. (Update, Aug. 29, 2018: The school board approved the policy.)

Goals for Shelby County Schools’ business diversity program

“Utilization by SCS” shows the percent of contract dollars Shelby County Schools spent with businesses owned by people of color and white women. The recommended goal is from the disparity study. Some of the district’s proposed goals exceed the recommended goals from the disparity study.