oversight

Advertising Expenditures in Black-Owned Media

Published by the Government Accountability Office on 1977-09-19.

Below is a raw (and likely hideous) rendition of the original report. (PDF)

                                    D'CUMENT RESU   (        )
03391   -   P2E   3   82 1   e   is±xt4e                a/       79
(Advertiaing Expenditures in Black-Owned Media]. LCD-77-448;
P-144618. September 19, 1977. 3 pp. + 10 enclosures (37 pp.).

Report to Rep. William L. Clay; by Werner Grosshans (for Fred J.
Shafer, Director, Logistics and Communicatioiis Div.).

Issue Area: Federal Procurement of Goods and Services (1900).
Contact: Logistics and Communications Div.
Budget Function: Miscellaneous: Financial Management and
    Information Systems (1002).
Organizaticn Ccncerned: Department of Dfense; Department of
    Transportation; Department of the Treasury; Postal Service;
    Department of Housing and Urban Development.
C-ngressional Relevance: Rep. William L. Clay.
Authority: HUD Handbook 2210.15. DOT Order 4000.7.

         A review of five Federal agencies provided data on
radio, television, newspaper, and magazine advertising services
purchased fcm outside sources and the amount of advertising
spent in black-owned enterprises. The agencies reviewed were
Defense, Housing and Urban Development, Postal Service,
TIrnspNrtation, and Treasury.   Findings/Conclusions: The data
provided by the agencies on  expenditures in black-owned media
enterprises were not audited for accuracy. total advertising
costs for the agencies were taken from a 1975 General Accounting
Office report. A precise relationship cannot be made between
black-ovned and tctal procurements because the total procurement
figures are for earlier years. Three of the agencies (Housing
and Urban Development, Transportation, and Treasury) appear to
have policies of giving special attention to minority
enterprises. The Department of Transportation's applicable
regulation states that this extra consideration may be extended
if, as a result, there is some increased cost to Department
programs. The approach of Defense and Postal Service is to make
advertising procurements based cn cost effectiveness without
regard to enterprise ownership. (W)
                                          RESTRICTED -     Not to be               tde .db   s1. .,ir
                     A)"~             ~Accounting Office exc        on the basil of spoie    pproal
           _____4e          .......     , by the Office of C  gressisr.   FAtlF.r.
                                           UNITED STAT      ENERAL ACCOUNTING OFFICE
                                                     WASHINGTON, D.C.    2n548
                                                                           s.


-4    LOGISTICS AND COMMUNICIMONTN
ads                  DIVISION                                           SEP      9 1977
           B-144618




           The Honorable William L. Clay
           House of Representatives

           Dear Mr. Clay:

                This is in response to your letter dated July 22, 1977,
           in which you asked us to compile the total current federal
           advertising budget, broken down by agencies, and the amount
           these monies spent in radio, television, newspaper, and      of
                                                                   magazine
           media. You also asked for the amount of advertising spent
           black-owned enterprises, broken down by agencies and media in
                                                                       modes.
                In a subsequent discussion with your staff, we agreed
           narrow the scope of our work in order to meet your urgent to
           ments for the inrformation.                                require-
                                       As we pointed out to you: staff, theLe
           is no consistent gcvernment-wide accounting for advertising
                                                                        costs.
           Also, there is no requirement that agencies identify advertising
           costs within their budgets, and no central location within
                                                                       the
           Government where such information can be obtained. Consequently,
           previous efforts to obtain total Covernment advertising
                                                                   costs have
           been time-consuming special studies.

               In order to narrow the scope of this effort, we agreed to
          include only five agencies in our review, to request that
          agencies provide us with expenditures in black-owned media these
          enterprises, and to report the agencies replies without
                                                                   audit-
          ing for accuracy.  To aid in identifying black-owned media,
          agencies were given lists showing such ownership, which your
          staff provided us. We also agreed to take total adveLtising
          costs for these five agencies from a previous General Accounting
          Office report (B-144618, October 6, 1975). Although a
                                                                  precise
          relationship between black-owned and total procurements
                                                                   cannot be
          made because the total procurement figures are for earlier
          we believe that this information is the most useful that    years,
                                                                    can be
          obtained within the timeframe of your request.


                                                                                             LCD-77-448
       We also agreed to ask te
  regarding procurement of       five agencies for their policies
                           advertising services from
  enterprises.                                       minority-owned
       The five agencies were selected
  having substantial advertising          from those identified as
  These agencies are: Defense,     expenditures  in
                                Housing and Urban our   1975 report.
                                                    Development,
  Postal Service, Transportation,
  have replied. however, the        and Treasury, All agencies
  has not yet been completed. Army  portion of the Defense reply
  forward the Army information As agreed with your staff, we will
  the cost information follows. when we receive it.    In summary,

              PADIO TELEVISION, NEWSPAPER, AND
          ADVERTISIiG SERVICES PURCHASED         MAGAZINE
                                         FROM OUTSIDE SOURCES
                       (IN THOUSANDS OF DOLLARS)

                                             Fiscal Year
                       1974           1975          197.        1977
                      actual    estimated          actual
                      (all)                                   estimated
   Aency                          (all)            (black-    (black-
                                                    _ownea)   owned)




 Defense            Breakdown
   (less. Army)                 Breakdown
                        not         not
                    available   available           570.2     1,307.0
sousing and
Urban
Development          3,150.0      6,008.0           362.7      164.5
Postal
Service             5,121.8     11,170.3             34.0          0
Transportation      1,156.8           823.4          81.2      150.2
Treasury            1,305.0      1,820.0          C           0
      Three agencies' (Housing
tion and Treasury) replies      and Urban Development, Transporta-
                            indicate
special attention to minority         they have policies of giving
enclosure 9, the Department     enterprises. As can be noted in
paragraph 5, states that     of  Transportation's Order, DOT 4000.7,
                          this extra consideration
                                                    may be extended
                                  2
"even if, as a result, there is some
programs." Defense and Postal Service,increased cost to Department
                                        on the other hand, replied
that their approach is to make advertising procurements
cost effectiveness, without regard to enterprise         based on
                                                  ownership.
      Enclosures 1 through 5 contain
information. Enclosures 6 through 10the detailed advertising costs
                                      contain each agencies' spec-
ific policies regarding procurement of service
                                                from minority enter-
prises, in the form received from the agencies.
                                                  Advertising costs
are reported for media time or space and for production.
costs are for items such as recording, filming,            Production
                                                 and other   prepare-
tion of advertising material required for advertising
media.                                                 in  a  given

     We trust this response satisfies your request.

                                     Sincereiv yours,




                                    Fred J       hafer
                                 /nl Direc t1r
Enclosures (10)
                                                                                     ENCLOSURE I
                                   DEPAP'MTE-   OF DErENSE (LESS
                                                                 AMY)
                                    __DETTST,c SERICES PRC:SSED
                                          FRo. OUTSIDE SOURCES
                                        (ilOUSAAS OF DOLLARS)


                                                        _   0SCAL YEAR
                                                                   1976 actual,7
                                                                 expenditures for          stated,
                       al 1974 actual,
                           expenditu       1975 estimated,                           expenditures for
                                      es   all expenditures        blackonedi
                                                                   black-owned
                                                                                           seck   es
                                                                                           services
   Production

   Time                                                                         ,
                                                                                            37.0
 Television:                                                              6.               255.
                                                                          62.5
   Production
   Lime                                                                         0          124.0
                                                                                00
News Papers:
  Production
  Space
                                                                         474                5.6
Uagazines:                                                                                 57.8

 Produc tion                                                             47.4

 Space                                                                9.0
                                                                                       250.5
                                                                    450.8              5;'6.
'otals:
 Total Production
                                                                                       417.1
Total    ime
   and Space
'and Tta.1
                       Note a
                       rard Tota    N      Note a                         4.
                                                                                      889.9
)t a - Department                                                 570.2
                  of                                                                 1307.0
                              'efense
           the other departments. data is not available in
                                         Total Defense           the same fornt
          media, such                                  advertising costs,            d
                            asdisplays give-away                           including all
              television are as                     items, drag racing




                                                            $53,05
                                 follows:    Fiscal yea- 1974           car, radio, and
          Fiscal year 1975                                    (actual) - $61,525,000;
                                (estimafe) - $53,052,000.
                                               DEPARTMENT OF HOUStNG
                                               AND URBAN DEVELOPMNT


                                          _VERTISING    eSERVICES PURCHASED
                                                     F
                                                     OUTSIDE   SO URCS



                                                                   FISCAL YEAR
                                                                            1976 actual,
                        1974 acual,
                                197,                                                       177 e-tja~~
                                               1975 estimated,
                                               19°75      esta           expenditures
                                                                          Lackoed for
                     al e xpenditures          allexpenditures                             expenditures
                                                                                             black-oed fr
                                               .. 'isr                              se
  Radio:                                                                                      services
    Production
                               23.0
                                                               0
    Time                                                                               0
                                      0                        0                                        0
                                                                                       0                0
  Television:
    Production                192.0                  112.0                             0
    Time                          0                                                                     0
                                                           0
 News Papers:
   Production
                              87.0                  269.0
   Spacem                                                                           0
                          2848.0                                                                    0
                                                  5627.0
Magazines:                                                                  362.7
                                                                                             164.5
  Production                      0                        0                       0                0
  Space
                         -_

Tots m::                                                                                         o
  Tot'. Production
                          302.0                   381.0
                                                                                0               U
  Total time         .
    and Space
                         2848.0
                                                    27.0
;rand Total                                                                362.7
                         3150.0                                                             164.5
                                                6008.0
                                                                           362.7
                                                                                            164.5
bNbL      II;
          £I I                                                           NILUUK       1.




                                     POSTAL SERVICE

                            ADVERTISING SERVICES PURCHASED
                                 FROM OUTSIDE SOURCES
                                (THOUSANDS OF DOLLARS)


                                               FISCAL YEAR
                                                        1976 actual,     1977 estimated,
                                                      expenditures for   expenditures for
                   1974 actual,     1975 estimated,     black-owned        black-owned
                 all expenditures   all expenditures       services          services

Radio:
  Production                0              136.5                0                 0

  Time                      0              112.2             34.0                 0

Television:
  Production          1034.7              1481.4                0                 0

  Time                 160.6              3475.7                0                 0

News Papers:
  Production           989.3              1824.2                0                 0

  Space               2852.5              2808.9                0                 0

Magazines:
  Production                0                  0                0                 0

  Space                 84.7              1331.4                0                 0

Totals:
  Total Production    2024.0              3442.1                0                 0

  Total time
    and Space         3097.8              7728.2             34.0                 0

Grand Total           5121.8            11170.3              34.0                 0
           bI~
                                          P~EPAR~TMENT OF TRAISPQRTT
                                                                    ION
                                        m VERVIS_       CERVIS PURC'¢SED
                                               FROM OUTSIDE SOURCES
                                             (TH .NC       DOLLARS)


                                                                    FISCAL, YEAR
                         1974 actual,                                      expenditures
                                                1975 estimated,                         for
                                                                             black-oed              expenditures
                      al l                                                                                        for
                      Radio:                                                                               c    e
                                                aUexpenditures '-oiwted
                                                                  tue
                                                                    ba                                black-owned
                                                                    _itures
                                                                      services                      ----
                                                                                                       ale_._e
    Production                                                                                                    _es
                                171.4                     145.9
    TIme                                                                              6.0
                                 38.6.0
  Tel evision:                                                                                      0     1.5
    Production
                               333.4                    293.8
    Time                                                                              40
                                533.
                                                                0
                                                                                          0             28.0
 News Papers:
   Production
                               21.9                      12.3
   Space                                                                                  0
                               54.8
                                                         25.8                             0
 Magazines:                                                                                     0             0
  Production
                           113.5                                                      0
  Space                                                 82.0
                                                                                      0
  Space                                                                               0
                               70.8                   263.6
                                                                                   71.2       .90.7
  Total Production        640.2                        34.0                        10.0                  0
  Total time
                                                                                   10.0                   0
    and Space
                           16.6
Grand Total                                         289.4
                                                                               71.2
                                                    Grand23.4
                                                               81.2 (Note a) 150.2
                                                                                     (Note a)
     :     exote
           All figures shown
                             for fiscal years
                                              1976 and 1977 are
                                                                 for U.S. Coast
                                                                                Guard
                                 DEPARTMENT O   THE TREASURY


                               ADVERTISING SERVICES PURChASED
                                    FROM OUTSIDE SOURCES
                                   (THOUSANDS OF DOLLARS)


                                                    FISCAL YEAR
                                                            1976 actual,     1977 estimated,
                                                          expenditures for   expenditures for
                   1974 actual,      1975 estimated,        black-owned        black-owned
                 all expenditures    all expenditures         services           services
Radir-
  Produrcion           143.0               158.0                  0

  Time                     0                 2.0                  0                  0
Television:
  Production          204.0                600.0                  0                  0
  Time                    0                 25.0                  0                  0
News Papers:
  Production          118.0                114.0                  0                  9
  Space               792.0                865.0                  0                  0
Magazines:
 Production            47,0                 56.0                  0                  0
  Space                 1.0                     0                 0                  0
Totals:
  Total Pioduction    512.0                928.0                  0                  0
 Total time
   and Space          793.0                892.0                  0                  0
Grand Total          1305.0               1820.0                  0                  0
                      OFFICE OF THE ASSISTANT
                                              SECRETAR'         OF DEFENSE
                                      WASHINGTON, D. C. 20301


      MANPOWER.
   RESERVE AFFAIRS
    AND LOGISTICS                                                            1 4   SEP   r7
(Military Personnel Policy)




          Mr. John Leitch
          General Accounting Office
          Room 5844
          441 G Street
          Washington, D.C.

          Dear Hr. Leitch:

               This letter is in response
                                            to your telephone request
          1977 for a formal statement                                    of 11 September
                                       of DoD policy governiing
                                                                 selection of media.
               The Department of Defense
                                          employs recruiting advertising
         the supply of military                                              to stimulate
                                 manpower. Since resources
         advertiser attempts to                               are liraited, each DoD
                                 obtain the
         ments at least cost. Therefore, required quantity and quality enlist-
         media mixes with the support        our advertising
                                        of their advertising media   planners develop
                                                              agencies to maximize
         market response per dollar
        ally evaluate all media      expended. DoD advertising
                                  on the basis of their            directors continu-
        audience and generate market                      ability to reach the    target
                                       response. Only the most
        media vehicles are selected                               cost effective
                                      for inclusion in the advertising
        Advertising media vehicles                                         program.
                                     are not chosen on the basis
        composition of their management                             of the racial
                                           or ownership.
             The advertising contracts
                                        of the Services ontain
        Armed Services Procurement                                the required
                                   Regulation clauses on equal
       affirmative action. Advertising                           opportunity and
       them in their dealings             contractors are required
                               with subcontractors. As               to abide by
       ment, the Department of                           in all areas of procure-
       minority businesses an Defense recognizes an obligation to provide
                               equal opportunity to compete
       tracts with the Services,                             directly for con-
                                  and to be considered fairly
       and suppliers.                                           as subcontractors

             If we can be of further
                                     assistance, please let
                                                            us know.

                                             S    cerely,



                                            A..  · Martin
                                            Director
                                            Accession and Retention
ENCLOSURE VII
                                                                                   ENCLOSURE VII   -
            °iVENT or




                             r                                                    2210.15




                         SMAfLL BUSIESS, PIiOflORTY A'ND
                               LOOR SURPLUS AREA
                              COTRACTmIG PROGRAM

                                               AUGUST 1976




                                                HUD STFF




                        A IIUD HANDIfBOOI:


                                             ADMINISTRATION
                                U. S. DEPARTMENT O HUSING AND URBAN DEVELOPIETt
                                                WASHINGTO,
                                                __ _         D. C. 0410
ACE: DISTRIBUTION:     -1., W2, W.3, W.1, c.4 R.1, R.2, R-3, R.2 R4,
                     t.4.1, R-.-2, R.S, R.5-1, R-S-2, 011
                                                                2, 0.1 5




                                TABLE OF CONTENT e


 Paragr.ph                                                      Page
        CHAPTER    ,   IRODJCTION TO THE SALL BUSINESS PROCRAM

 1.     Policy
                                                                   1
 2.     Purpose                                                    1
 3.     Scope                                                      1
 4.     Definitions                                                2
 5.     Authorities
                                                                   3
 6.     Implementation
                                                                   3
                  CHAPTER 2.    DUTIES AND RESPONSIBILITIES

 ;7_   Role of te Small Business Advisor and
          Specialist
                                                                 5
 d.    Role of the Minority and 8(a) Procurement
                                                                 6
          Program Coordinator
 9.    Role of the Equal Opportunity Liaison
                                                                 7
         Representative
10.    Coordination with Contrac:in. Officers
It.     'IlaisonDuties and Respcnsibilities of the              7
                                                                7
         SBA Representative

                   CHAPTER 3.     SMALL BUSINESS SET-ASIDES
12.    Purose
13.    Pre and Post Award 'Review Procedures
                                                               9
14.    Factors Considered for Small Business Set-
                                                              10
         Asides
15.    Determination of Small Business Status
                                                              11
16.    Certificate of ompetency R uirements
                                                              11
17.    Total, Partial and Combined Small Business--
                                                              16
         Labor Surplus Area Set-Asides
18.    Order of Precedence in Negotiating for Small
                                                              17
         Business and Labor Srplus Area Set-ALtdea




                                      -. h.     .        8/76
                               WUD-Wmh.,   .C
                                                                  ENCLOSURE V:



  2210.15




 Paragraph                                                 age

             CHAPTER 4.    CONTRACTING WITH THE SMALL BUSINESS
                           ADMINISTRATION UNDER SECTION 8(a) OF THE
                           SBA ACT
 19.    Purpose
                                                       19
 20.    Eligibility
                                                       19
 21.    Factors Considered in Placing an 8(a)
                                                       23
          Contract
 22.   Referral o Procurement Needs to SEA
                                                       23
 23.   Location of 8(a) Sources
                                                       24
 24.   Submission of Procurement Package to SEA
                                                       24
 25.   Contract Negotiation and Pricing
                                                       25
 26.   Bonding
                                                       27
 27.   Contract Administration
                                                       27
 28.   Regional 8(a) Procurement                       27
            CHAPTER 5.    MINORITY BUSINESS ENT RPRISE PROGRAM4

29. .Policy
30. Definition                                        29
31.                                                   29
     ImplementaLion
32. Counseling and Assistance                         29
                                                      29
33. Certification of Status as a Minority
                                                      30
       Business Enterprise


            CHAPTER 6.    SMALL BUSINESS, LBOR SLURPLUS AREA
                          AND MINORITY BUSINESS ENTERPRISE
                          SUBCONTRACTING PROGRAMS
34.    Policy
35.                                                   33
       Responsibilities
36.                                                   33
       Procedures
                                                      33
37.    Reports
                                                      33




8/76                               Li
                             UD.   ...   C.
ENCLOSURE VII                                                        ,             ENCLOSURE VII




                                                                         2210.15




                      CHAPTER 1.   INTRODUCTION TO THE SMALL BUSINESS PROGRAM


            1.    POLICY. It is the policy of the Department of HusiAng and
                  Urban Development to carry out, to the maximum extent, a
                  Small Business Program through the placement of a fair
                  portion of the Department's total procurement requirements
                  with small business concerns a required by the Federal
                  Procurement Regulations (41 CFR 1-1.702) and the Small Business
                  Act (15 U.S.C. 644) nd through the placement of selected
                  requirements with the Small Business Administration (SBA)
                  under Section 8(a) of the Small Bsiness Act (15 U.S.C. 637).

           2.    PURPOSE. The Small Business Program provides a channel to
                 Government contracting for small businesses, unable or
                 unlikely to get the opportunity to compete successfully for
                 such contracts. This is accomplished primarily through the
                 implementation in each Federal Agency of 1) the preferential
                 set-aside for small business and 2) the Small Busine!3 Act
                 Section 8(a) subcontract procedure. This Handbook is
                 intended to clarify the means that will be employed to promote
                 these programs and other related policies and procedures in
                 assisting and promoting small businesses.

           3.    SCOPE. This Handbook is applicable to the operations of
                 procuring activities within the Department and pertains'to
                 all HUD requirements for supplies, and services which shall be
                 obtained through HD procurement and contracting. This Handbook
                 is not applicable to a direct grant, loan or other assistance
                 to a State or local government, college or university or non-
                 profit organization. This Handbook is not applicable to
                 procurement tnder the acquired property program which may be
                 found in HD Handbook 4320.1, Property Disposition Contracting.
                 The contents of this Handbook will not be applicable to
                 emergency procurement in support of a Disaster Field Office's
                 temporary housing program for Presidentially-declared disaster
                 areas.

           4.    DEFINITIONS. The following definitions for the terms listed
                 below apply throughout this Handbook.

                 a.   Small Business Advisor. The HUD Small Business Advisor is
                      the Director, Office of Procurement and Contracts, who has
                      the overall Departmental responsibility for the establish-
                      ment and operation of the HUD Small Business Program.




     I.'                                    D                             .
                                          Asl.   D. C
                Sall-b. Business S.
         b.     Small Busine.
                                             The Small Business Specialist
               is the individual who     t.  The Small Business Specialist
                                      is appointed by the
               Procuring Activity who                      Head of the
               including construction procures supplies and services
                                       and who has the responsibility
               implement the requirements
                                            of the Small Business      to
                                                                  Program.
        c.     Small Buslnesa Concere
                                     . A small business
               business entity organized                   concern is any
                                           for profit which may
               individual, partnership,                         include an
              association or cooperativecorporation, joint venture,
              and operated, is not          which is independently
                                    dominant in the field          owned
              and can further qualify                       of operations
                                        by reason of ize and
              criteria as set forth                            other
                                     in the Feeral Procurement
              Regulations, 41 CFR
                                   1-1.7.
       d.     Minority and 8(a) Procureent
                                                rra- Coordinator.
              Minority Procurement Program                          The
              individual appointed           Coord
                                                 cator   is the
                                    by
              cooperate with and assisteach Primary Organization Head to
              as the program contact      the Sall Busines Specialist
                                       in all minority procurement
              general as well as procurements                      in
              Small Business Act (15            uner Section 8(a) of
                                              6
                                      U.S.C. 37(a)).                  the

       e.     HeadofProcrin Actv
              as used in this Handbook      "Head of Procuring Activity"
                                       has the following meaning:
              (a)  Director, 0ffice of
                                       Procurement and Contracts
                   Headquarters procurement;                       for HLD

             (b) The Assistant Reional
                                                            sforAdmis-
                       tration for Regional Ofice procur.ent;
             (C) The Director, Office
                                            of Proerty. DisDosition,
                      national contracts on                            for
                                             acquired properties;
            (d) The Directors, Area
                                           and Tnsuring Offices
                      decentralized procurement                   for
                                                 on acquired properties;
            (e) The Directors? Strategic
                     meqt in support of the     Storage CentersL for
                                              requirements            procure-
                     temporary housing,                    for disaster
                                         storage, maintenance,
               ... : transport;                                 repair and




8/76
                              Page 2
                              LUDWah., D. C
                                                                                   LNULUSURL VII·




                                                                       2210.15


                        (f) The Directors, Disaster Pield Operations,
                                                                       for
                            procure-ent Of upplies and services in
                                                                     support of
                            temporary housing for Presidentally-declared
                                                                           disaster
                            areas; and

                       (g)   The Director Office of Ho!sing Programs,
                                                                       for
                             contracts for the Consolidated Supply Program.
           5.    AUTHORITIES. The goals and objectives of
                                                           the Small Business
                 Program will be carried out in accordance
                                                           with the following
                 authorities:

                 a.   Federal Procurement Regulations (FPR) -
                                                              41 CFR Chapter
                      1-1.7;

                 h.   The HUD Procurement Regulations (HUDPR) -
                                                                41 CFR Chapter
                      24-1.7;

                c.    The Small.Business Act 15 U.S.C. 631 et.
                                                               seq.;
                d.Executive Order 11625 dated October 13,
                                                            1971.
          6. I2LEMENTATION. The Head of the Procuring
                                                          Activity shall
              select and appoint, as appropriate, Small
                                                         Business
              Specialists, Individuals designated as Small
             Specialists sa2                                  Business
                                be directly responsible to the appointing
             authority and threugh that authority to the
             Advisor. Each designee will ensure that       Sall Business
                                                        the Small Business
             Program of his procuring activity is accomplished
                                                                  with the
             highest degree of effectiveness, meeting
                                                       all the requirements
             of this Handbook and the AUTHORITIES set
                                                        forth above in
             paragraph 5. To the aximum extent practicable,
                                                                 Small
             Business Specialists should be selected
                                                      for their business
                acumen or related experience.




                                     PO    3                                8/76
                                      IUD-W., D. C.

-   - -   -e                                                                                        p_
      ENCL;SURE VII                                                                    ENCLOSURE VII




                                                                      2210.15



                     CHAPTER 5.   MINORITY BUSINESS ENTERPRISE PROCUREMENT PROGRAM


               29.    POLICY. Executive Order 11625, issued October 13, 1971 and
                      FPR Amendment 148 (6/18/75, 40 FR 25674) established the
                      requirement to increase minority business enterprise
                      participation in Federal procurement programs. It is the
                      Departmental policy, therefore, to implement Executive Order
                      11625 and FPR Amendment 148 b facilitating to the maximum
                      practicable extent participation of minority firms in HUD
                      procurements.

               30.    DEFINITION. "Minority business enterprise" means a business
                      entity at least 50% of which is owned by mincrity group
                      members, or in case of publicly owned businesses, at least 51Z
                      of the stock of which is owned by minority group members.
                      For the purpose of this definition, minority group members
                      shall include Negro/Black, Spanish-speaking American persons,
                      American-Orientals, A'erican-Indians, American-Eskimos and
                      Armerican-Aleuts.

               31.    I''.?L'.:TATIO:. S.al Business Specialists in conjunction
                      with Equal Opportunity liaison representatives shall take
                      steps to facilitate the instructing of minority individuals
                      and firms with respect to rocurement policies and rocedures,
                      and inform such individuals and firms concerning sub-
                      contracting opportunities.

              32.      COUNSELING AND ASSISTANCE.    Many minority professional,
                      consulting and .anem.e-.:    firms have difficulty in gaining
                      access to the Federal procurement system due to the Federal
                      agencies' general lack of knowiedge about the location and
                      capabilities of existiz 7.inority firms. In addition, such
                      firms are usually not aware of Federal procurement
                      opportunities an_, t .;,.c.,     are ncL as successful in
                      capturing Government contracts. Minority owned construction
                      firms which could provide repair and renovation of HUD
                      acquired properties and facilities or participate in
                      Emergency Rep-ir Program (ERP) or other construction work in
                      connection ith disaster temporary housing assistance are
                      relatively small and have difficulty gaining access to prime
                      contracts. Bonding requirements, cash flow problems and size
                      continue to limit minority construction firm participation in
                      the Federal contracting process. In order to provide adequate
                      counseling ard assistance, the Small Business Specialist will:




.;-                                       Page   29        -                    e/76
                                          nHUD-w., D. C.
ENCLOSURE VI                                                                  ENCLOSURE VII




           2210.15


                     a.   Maintain and utilize counseling aids prepared or obtained
                          by the HUD Office of Fair Housing and Equal Opportunity.

                     b.   Appiise all interested mirority firms of the sources of
                          procurement information and regulations.

                     c.   Refer interested minority firms to the cognizant SBA
                          regional and/or district offices for possible inclusion
                          in the SBA facilities inventory.

                     d.   Furnish all source lists and related forms and advise in
                          their preparation and transmittal to the appropriate
                          Departmental procuring activity.

                     e.   Solicit ffers fron the minority business enterprises on
                          the agency's source lists.

                     f.   Ensure that minority business enterprises will have an
                          equitable opportunity to compete for contracts,
                          particularly by arranging (i) solicitations, (4j) time
                          for the preparation of bids, (iii) quantities
                          (iv) specificat:ins, and (v) deliverv schedules, to
                          facilitate the participation of minority business
                          enterprises.

                     g.   Maintain records showing with respect to minority business
                          enterprises (i) concerns on source lists, (ii) concerns
                          solicited, and (iii) dollar value cf awards t such
                          concerns.

                     h.   In the case of construction contracting, coordinate
                          closely ith O>SE/Department of Cor-erce which funds
                          minority construction contractors :ssociations and can
                          locate qiualified minority construction firms for specific
                          procurements.

                     i.   Coordinate and cooperate with the Minority Business
                          Opportunity Committee of the Federal Executive Board.

               33.   CERTIFICATION OF STATUS AS A MINORITY B!:SINSS E.:.ERPRISE.
                     In accordance wits, HLUPR 24-1.715, the following procedures
                     shall be oLserved:

                     All procuring activities shall request all interested
                     contractors, bidders or offerors and sources utilized through
                     small purchase procedures to complete a certification as to
                     whether they are a mincrity business etiterprise as defined
                     under 41 CFR 1-1.715-1. Completion of this certificate is
                     not a condition of eligibility for contract award.



         8/76                               Page 30
                                          HUD-Wah.. D. C.
ENCLOSURE VII
                                                                                ENCLOSURE VI




                                                                 2210.15




                RFQ!IFB/RFP No.
                Purchase Order/Contract No.
                U.S. Department of Housing and Urban Development
                                                                   additional
                certification of status as a minority business
                                                                enterprise.
                Offerors, bidders or spiers are requested to
                                                                 complete,
                sgn and attach this pace, in single copy, to
                                                               any
                prc:csal or quote submitted under the solication bid,
                                                                   identified
                ejcve.  Completion of his certification is not a condition
                                                                              of.
                eligibility for contract award.

                 The Bidder/Offeror/Supplier certifies that he
                                                                is,_is not a
                mnorlity business enterprise which is defines
                                                               as
                at least 50 percent of which is owned by minority a business,
                                                                   group
                members or, in the case of publicly owned business,
                                                                     at
                5i1 percent of the stock of which is owned by minority least
                                                                        group
                members. For the purpose of this definition,
                                                               minority group
                menbers are Negroes, Spanish-speaking American
                                                                persons,
                American-Orientals, American-Indians, American
                                                                Eskimos, and
                A-erican Aleuts.

                (Nane and Title of Person Signing)

                Signature

            Date




                                    Pa .31                             876
                                   HUD-Wah..   . C.
                                                                2210.15


             CHAPTER 6.   SMALL BUSINESS, LABOR
                                                SURPLUS
                          MINORIry BUSINESS ENTERPRISE AREA, AND
                          PROGRAMS                      SUBCONTRACTING


      34.    POLICY. It is the policy
                                        of the Department to
             small business, labor-surplus                    assure that
             business enterprises           area concerns
                                  are afforded the maximumand minority
             for subcontracting under                       opportunities
            this chapter sets forth   prime  HLD contracts. In addition,
            administration of such policies and procedures governing the
                                    subcontracting opportunities
            required by FPR Sections                               as
                                      1-1.710-2, 1-1.805-2,
            respectively.                                    and 1-1.1310-1

      35.RESPONSIBILITIES     The Small Business Specialist
          for the review of prime
                                     contractors' subconcracting  is responsible
         required by the above                                        programs
                                   FPRs in order to determine
         ness with which each                                     the effective-
                                 contractor is carrying
         ment. After determining                            out the
                                      whether specific contractorsrequire-
         complied with any applicable                                   have
         the Small Business Specialist subcontracting program clauses,
        Officer such actions                may recommend to the
                                ri.may be necessary                 Contracting
                                                       to assure compliance.
  36. PROCEDURES. The
                          Small Business Specialist
        contracts containing                              shall identify
                                small
       minority business enterprisebusiness, labor-surplus area, or
       as specified by the                subcontracting
                              FPR. i.e., all contracts program clauses
       $500,000 and which,                                  which may exceed
                             in the opinion of the
       offer substantial subcontracting                 procuring activity,
       Business Specialist                    possibilities. The
                             will arrange for periodic               Small
      contractors' small business                            review of prime
      consultation with the             subcontracting programs
                                SA representative.                  after
      contractor is expected                             Each
                                  to develop policies and affected
      fit the particular situations                           proceddres to
                                          and requirements of
      subcontracting program.                                    his
                                    Procurement action records
     analyzed by the Small                                         shall be
     representative during Business Specialist and/or by the SBA
                               periodic reviews along
     contractor's policies,                                with the
                                 procedures, and other
     to his subcontracting                                matters related
                               program.
37.     REPORTS.  Contracting Officers
        assuring that the Small          shall be responsible
                                 Business Specialist           for
        reports required under                        receives any
                                subcontracting program
        Small Business Specialists                      clauses.
        reports on the opc:aLion    shall be responsible
                                                          for
                                  of an affecr~ contractor's developing




                                      P e 33          ·          8/76


                                       h.        D.   C
                          i~~~~~~~~~~~~~~Z·~~~~~~~~~~-.
                                                                            ENCLOSURE VII



   2210.15




           subcontracting program. This report shall be reviewed and
           concurred in by the SBA representative and the cognizant
           Contracting Officer. A copy of each such report sha'l be
           maintained in the active contract file and forwarded to .he
           Small Business Administiation.




                                                       Assistant Secyqary
                                                       for Adminis t  on




o hIL PIHU
       G OV.RNMT
           ePaI',                                 34
                ~r(QI)))tlO)~(I1L
   U~ tYIIIYIYTM~lf~O               HUD-Wa~~h..    . C
ENCLOSURE VIII
                                                                         ENCLOSURE VIII

                                       OfTES POSti




                                      *           *



                              ADMINISTRATION GROUP
                                   Washington, DC 20260

                                                                   September 2, 1977


 Mr. John Leitch
 U. S. General Accounting Office
 Logistics and Communications Division
 GAO Building, Room 5729
 441 G Street, N. W.
 Washington, D. C.   20548

 Dear Mr. Leitch:

                    Re: Use of Minori        Suppliers for Advertising Services

This responds to your request for: 1. a statement of policies and
                                                                  procedures
relating to procurement of advertising services from minority enterprises;
and, 2. a summary of Postal Service's recent experience in using
                                                                  minority
suppliers for advertising production service ,,nd media time/space.

POLICIES AND PROCEDURES

The policy of the U. S. Postal Service is to give minority owned enterprises
equal consideration to all other suppliers in the area of advertising
                                                                      services.
Such services fall into three major categories: advertising agency
                                                                   services,
which cover overall development of advertising plans and materials;
                                                                     special
technical services in the production area; and media services, which
                                                                      cover
advertising time and space purchased for the Postal Service o deliver
                                                                       its
commercial messages to the public.

Advertising Agency Services/Production Services

In the area of advertising agency services, the Postal Service selects
                                                                       its
agency by means of open' competition, following the standard procedures
established in the Postal Contracting Manual (Publication 41). The
advertising agency contract is awarded based n technical and price
                                                                     evalua-
tion of the competing agencies, without regard to minority ownership.

All Postal Service advetising is prepared and placed through our advertising
contractor. Once the advertising agency contract is established,
                                                                   subcontracts
which the advertising agency enters into on behalf of the U. S. Postal
Page 2
Mr. John Leitch
September 2, 1977




Service (for such technical services as recording, filming, etc. ) are
determined by competitive price bidding among technically qualified
supplier firms. Determination of technical competence is made without
regard to minority ownership.

Media Services

In the media serviL' area, the primary ob, {         is to achieve maximum
exposure of the advertising message for rrniL     f. cost. Selection of specific
media vehicles (i. e., specific newspapers, magazines, television and radio'
stations) is done so as to maximize national efficiencies against the pre-
determined target audience. This is done without regard to the ownership of
the media involved.

The target audiences for the various Postal Service advertising campaigns
differ depending on the specific product or service and who it appeals to.
Standard business analysis and market research techniques are employed to
determine which demographic population group(s) holds the maximum
potential for each program supported by advertising.

POSTAL SERVICE USE OF MINORITY OWNED MEDIA

The following table summarizes Postal Service's advertising spending in
recent fiscal years in minority-owned media.

                            Radio          TV   Newspapers      Magazines       Total

FY 1975                 $                         $18, 300          -       $18, 300
                                                     (Note a)
FY 1976 and             $34,000            -      $                         $34, 000
 Transition Quarter         (Note a)

FY 1977                 $              .         $    .                     $
l'o minority owned enterprises have been employed by the Postal Service or
annual advertising agency services. In the technical services/production

Note a:   GAO Note -- according to USPS, all of the $34,000 under radio costs
          was spent in black-owned media, and $11,500 of fhe $18,300 under
          newspaper costs was spent in black-owned media.
 Page 3
 Mr. John Leitch
 September 2, 1977




area we do not have a record of whether the firms
                                                    employed were minority-
owned since that has not been a selection criteria.

If you require further information, please let
                                               us know.

                                           Sincerely,



                                           T. R. Sharbaugh
                                           Manager
                                           Advertising Services Branch
                                           U. S. Postal Service
TRS:myi

cc Messrs. .:   Applegate
                AUllison
                Letts
                Taylor
          rr.       -f^;       nf    r:0:r

                                                      4400.46
                    iiice of   the   ScrUary          Anpendix
                      ieast !Ic, f                     12/13/76
                                                                      D)Ti   4).3   7
                                                                         3-26-75


     SBJCT: MIN6RITy            BUSINESS 'FNTERPRISE
                                                     PROGRAt


     1.        PURPo.cI. This order consolidates
               and procedural memoranda          previously issued
                                                                   policy
               standardize the Minority to update, reemphasize and
               and establish a          Business  nterprise (MBE) program
                               uniform reporting
                                                 system.
     2.     CANCPLLATIONS.   The following memoranda
            the ME-- program                         covering aspects
                             have                                        of
            extent they are still been incorporated in this Order
                                   effective and are                 to the
            order and cancelled.                     superseded by this
                                   The supporting documents
            certain of these                                  provided with
                              memoranda should
            purposes.                          be retained for reference

            a.     Memorandum of 7-24-69,
                                           from the Secretary
                  Administrators establishing                  to the
                  Department of Transportation the MIEL program in the
                                                  (DOT).
           b.     Memorandum of 7-24-69,
                                          from the Assistant
                  Administration to                           Secretary for
                                     the Administrators
                  for implementing the policy            providing  procedures
                  memorandum in                 established by the Secretary's
                                a. above.

          C.      Memorandum of 9-4-69,
                                        from the Under Secretary
                  Secretarial Officers,                           to
                                        Administrators, an-i
                  National Transportation                    Chairman,
                  affirmative action      Safety Board (NTSB)
                                     to increase DOT           covering
                  consultants.                       use of black

          d.      Memorandum of 2-4-70,
                                          from the Secretary
                  Officers and Administrators                  to Secretarial
                                                reemphasizinq the
                                                                    MBE program.
          e.      Memorandum of 11-10-70,
                  Secretarial Officers,     from the Under Secretary
                  NTSB, and the                                         to
                                Director,Administrators,
                                            Transportation the Chairman,
                  (TSC) reemphasizing                       Systems Center
                  responsibility in    the  MBE program, centralizing
                                    the Office of Installations
                 Logistics (TAD-60),                                and
                                      and requiring goals
       f.        Memorandum of 1-7-71,                       and  timetables.
                                         from the Director
                 and Logistics to                            of Installations
                                   Secretarial Officers,
                 and the Chairman,                         Administrators,
                                     "'IB, requiring
                 of black consultants.                 uarterly reports
                                                                           on use
=DITRIyION.     All Secretiria1
                All Operating Administrations
                                             Oficec
                                                                  I*Offic               A
                                                                    Installations
                                                                   and Loqistics
   ENCLOSURE 1A


..Pa(j    2                                          DOT 4000. 7
                                                           3-26-75


         g.    !cemorandum of 1-19-72, from the Director of Installations
              and Logistics to Secrctnridl     Officers, Ainistratcrs,
              ann  the Chairr.man, NTS3, remnuiring cquartc-ly reports on
              use of.hlacY consultants.

         h.   M}erorandum of 3-9-72, from te Under Secretary to
              Pdministrators reemnhasizing the MBE program, calling
              for membershin on Minority Business Opportunity
              Committees (MBOCs) and setting u a reporting program
              through the Secretarial Representatives.

         i.   Memorandum of 3-9-72, from the Under Secretary to
              Secretarial Renrosentatives providing for coordination
              of field ?MBF program.

         j.   Memorandum of 1-7-74, from the Assistant Secretary for
              Administration to Secretarial Representatives,
              Administrators, and the Director, TSC, requiring cocrdina-
              tion with the field offices of the Office of Minority
              Business Enterprise (OMlIE), Department of Commerce.

         AIT'.ORITY. E::ecutivc Order 11625 of 10-13-71, provides
         arrangements for developing and coordinating a national
         program for minority business enterprise (iBE).

 4.      BACKGROUND.  Executive Order 11625 continues and expands
         the nrogram established by Executive Order 11458 of 3-5-69,
         to assist in the development of minority business entr-
         prises.  The Executive Order assigns primary responsibility
         for the program to the Secretary of Commerce and authorizes
         him to develoo plans and program goals, establish regular
         Derformance monitoring and reporting systems, and evaluate
         the results. The Order requires the head of each Federal
         department or agency to furnish information, assistance,
         and reports to, and to cooperate with, the Secretary of
         Commerce. The Secretary of Commerce is required to consider
         reports from Federal departments and agencies and submit an
         annual report to the President not later than 120 days
         after the close of each fiscal year.

 5.      POLICY.   It is Denartment of Transoortation policy to
         support the minority business enterprise cDrgram actively
         even if, as a resLlt,    there is sme increased cost to
         Departmental programs.
     DOi    4000. 7
                                                                 hIa3c' 3
     3-26-75



6.         DISCUSSIO04.
           a.    Under the minority business entcr1prise proqjramn the
                 following elenents   receive   attention:   award of   procurc-
                ment contrac's.; award of concession contracts;
                financial, training and management assistance rograms;
                denosit of funds in minority banks; and any other
                actions t. at can be tak.en to improve the opportunity of
                minority enternrises to share ecquallv in the free
                enterprise system.

        b.      This nrogram requires the identification of contracts,
                 subcDntracts, concessions, bank deposits, and assistance
                programs hich can be awarded to or Derformed by
                minority enterprises. While the Department's major
                efforts continue to he aimed at Departmental objectives,
                we can and must afford some diversion of resources to
                social-economic rograms. The MIDE program is an area
                in which some minor additional costs of products or
                services procured can create substantial improvements
                                                                       in
                minority opportunities to share in the free enterprise
                system. Promotion of the Department's policy of support
                to minority business enternrise requires the ersonal
                commitment of each Administrator and Secretarial Officer
                suitably exoressed to responrsible officials in his
                organization and supported at all levels of management
                and performance.

       c.       A particularly difficult area for minority
                entrepreneurs is in the field of professional services
                where a track record of performance is one of the
                principal indices for selection of sources. An extra
                effort is reauired to seek out and use the services
                of minority consultants accounting firms, architect-
                engineer firms, and research and development firms.
                In these areas the requirements offices have a very
                strong influence on source selection and they should
                give affirmative consideration to the use of minority
                individuals and companies.
Page 4                                                DOT 4000. 7
                                                           3-26-75


7.     RESPO.¥SI BILTIES.S.

      a.    The Deputy Secretary is the Department of Transportation
            member of the Interagency Council for inority
            Enterprise and has over-all responsibility     Busincss
                                                       for the DOT
            MBE program.
      b.    The Assistant Secretary for Administration
            sibility for establishing and maintaining a has respon-
                                                         program to
            promote the policy stated in paragraph
                                                       . above.
      c.    The OST Director of nstallations and Logistics
                                                             has
            immediate responsibility for promotion and
            of the MBE program, development of necessaryimplementation
                                                          reporting
            systems, and providing support to the Deputy
            in the activities of the Interagency Council  Secretary
                                                          for Minority
            Business Enterprise. He will provide the necessary
            and attention to this effort. He will provide        focus
            representation on the several Task Forces or    DOT
                                                          Committees
            of the Interagency Council for ME.
      d.    Secretarial Officers and heads of operating
                                                        administra-
            tions have responsibility for effective implementation
            of the policy within their office or administration.

      e.     The head of each operating administration shall
                                                                designate
      -C     an official to have over-all responsibility
                                                           for promotion
            of the minority business enterprise program
                                                           in his
             administration. The official designated should
            organizationally situated that he can effectively   be so
             face with both procurement officials and requirementsinter-
            offices. Each administration will also designate
            each activity with contracting authority an           for
                                                           official to
            be responsible or promotion of the program
            contracts to MBL firms.                        to award
                                      This official should be capable
            of providing effective coordination between
            personnel and the various requirements        procurement
                                                    offices and will
            be responsible for ensuring that required reports
            submitted. The head of each operating administration  are
           will ensure that appropriate field offices
                                                         establish
           effective lines of counmunication with regional
                                                              and
            field offices of the Office of Minority Business
           prise, Department of Commerce, and that they         Enter-
                                                            are
           represented on and actively participate in
                                                        the
           of the Minority Business Opportunity Committees activities
           established in their areas.
 f.        The Assistant Secretary for Administration
           an official to per£orm the ~M3E coordinating will designate
                                                          function for
           OST. The Director, SC, will designate an
                                                        official to
           perform the corresponding function for TSC.activities.
     DOrT 400G. 7
      3-26-75                                                  ae


        g.    Secretarial Representatives will
                                                coordinate DOT
              activities in support of the
                                           2I3E program as they
              relate to the Regional Councils
                                               or the Federal
              Executive Boards and Associations.
                                                   This coordination
              will normally be effected through
              chairmen of the Field Coordination their positions as
                                                  Groups.
       h.     The Directors of Offices of Civil
                                                 Rights are responsible
              for active  romotion of the MBE program
              inclusion of MBE subcontracting          and for the
                                               efforts as a review
              factor in regular contr-act compliance
                                                     activities.
       i.     All employees in positions to
                                            make decisions on matters
              affected by the DOT policy on
              consideration is given to the N3E will ensure that full
                                            President's objectives.
8.     PROCEDURES.

       a.    Procurement

               1)    Sources.  Each procurement office    will maintain
                     its bidders mailing lists so
                                                   that   identified
                     minority business enterprises
                                                    are   clearly shown.
                     Invitations for bids or proposals
                                                          will be submitted
                     to identified minority firms.

             (2)    Screeningq.  All  rocurements in excess of $2,500,
                    will be screened for possible
                                                   award to  BE firms
                    under the   mall Business Administration
                                                              (SBA)
                    Section 8(a) program.   Those determined suitable
                    for such award will be   rocessed through the
                    appropriate SBA office.

             (3)    Prime Contractor Responsibilities.
                                                        The provisions
                    of FPR Subpart 1-1.13 Minority
                                                   Business Enterprise
                    will be carefully observed..

             (4)     Small Purchases.  In accordance with the provisions
                    of Federal   rocurement Regulations (FPR)
                     1-3.603-1 each DOT procurement             Section
                                                     office maintains
                    a small purchase source list
                                                  for repetitive pro-
                    curements.   The small business and MBE status
                    firms on such lists will be indicated            of
                                                            when such
                    status is known.   In order to ensure maximum
                    identification of MBE firms the
                                                      procurement office
                    shall'consult with its civil
                                                  rights office, the
                    SBA, local branches of the Office
                                                        of Minority
                    Business Enterprise, local Business
                                                          Development
                    Organizations (BDOs), and minority
                                                         organizations or
                    technical assistance groups.
                                                   MBE firms will be
                    given an opportunity to submit
                                                    quotations.
,lqoJ
                                                               DOT 4000. 7
                                                               I)'
                                                                     3-26-75
b.      Crants.   Procedures for implenmentation
        )n-clude provision                       of grants will
                           for an affirmative
        promote minority, business             action rogram to
        comparable rocedures       enterprise. Where
                               are not in effect       other
        requirements will                         the
                           be placed on the grantee: following
        (1)     GCneM2
               "Thle 9q'anntce aqces to use
               that minToaZ.y binecs         hiz best efoatt6 to enurte
                                          ent.piLe    l1lhaU
               maximumw opportuniy    to pahicipate i the hlatve -le
               of olt ct dfinanlced inl                      pfounnmacc
               fund povided wided          whole o in pa tC :th Fedeajr
                                   de this ag4eeCneJ.t."
     (2)       Ittiizatioi o     fjlority Suuilncs CCtause
               The "tititon o Mijtovity
               betow lhoael e inctudcd          Rine    Ce"        set Foth
              o' nopairt twith Fcdcat    .in at  colntacts,    inanced i     hlotc
              uwhich exceed 5,000 exceptund p'-ovided ud tis           aateemcnt,
              zubcontract6 thceudeA,         con.ttact whzich, inctudi
              side the Unlted S.tc4,      ace  to be pe&foimcd entieLcy at
                                        it poes,,           and Pueto Pco  ot-
              and con2tact o       Sevice which ae pe4zonat
                                                                  in natuAe.
            (a) It i6 the potic o
                that mi'o4it y busine,the Depatment o Talmpo4,tation
                maximum oppo/tulity to enteApie         h    have he
                of contJct t il-anlced    paticipate  in  the peao,,oncce
                                         n whote o in pt      uLith redtat
                6unld6.
           I6) The. ContAacto4 aqeez
                                        to ue h     6ezt efoad to aoayi
               out ithl6 poticy in the
               fult                      awaad o  hd    ubcontact. to the
                            etet conite nt tLLth the e6,icien
               od thi contAact. Az
                                       ued in thi conttact,
                                                                 pe omance
                    4l04tLity
                           buines ent                            the tem
                                           prvL.e" mean a buines,
                 tea6t 50 pccent o wlKiclt ib                        at
                 membeus o, in the case          owned by minority goup
                 at eeast 51. percent o o publicey owned busne6ez
                                        the
                 by mloity gtoup, membehu.        tock o06 wI-ich i owned
                 deZblitioni minoity gcup         Fok the    tpoze o6 ils
                 Apeaklbqg AmnLica        mcmbeu        ate Negqoe4, Spalis6h-
                                        pC)Leons, Ameican Oientate
                 IndDanz,   Amc icaji   ElimoL,                    , Anican
                                            anld Anicanl Aeut.
                tacto&6 may 'Acty on                               Con-
                contuRctou              tten ,tepczen tationz by
                       0        degatding                        zub-
                ejt JCe4ZC inl icu o0 thei     tat  aQ6minok2ty bineA
                                       a   ndeplendct vitioagat
                                                                    .
3-26-75


      (3)   The "Min(,i+ty 8e(4ine,6 SubcontActilng           Page 7
                                                     Ceauec" set ol.
            bcow ha'lA' be inctudcd jl a
            ctause 'equetcd b subpanqanphc;at.c     . wlich con.iA4n tIC
                                              (2) abovc, nld tdlich, in the
            Opointon o4 the glantce, ocR sub6aj.tiat
            posibl"e.                                    ubcot'Aactilqn

            (a)     The Contldctoi aqgeesto etabHish
                                                       and conduct a pgrm
                   whicllhci'e enabe ninority buAins
                   degiuled bi th ctasc                 eterptcAipe6C (a
                                    c    enttted "Utit-izatn od Miioui.ty
                   Buznes EntepwJe,z CauW
                   6ubcontzacto and uppe.Arc") wideur
                                                 to be con-sidecd dazy a
                                                      thz    contact. In
                   tbfu  connection te    Contactor 6hatl...
                     Vegqnate a eiai4on oicek
                     D1                          who
                     the Cortactor',4 minoity buaire wit ainite
                                                         enteApise p9ogam.
                   2 P)ovide adequate and tmely co6idcton
                     potcneiatitie o known minotity             of the
                     in at "make-ot-buy" deciions.    buziness  enterLpies4

                   3 EnuAre that known minotity busines
                                                              enterpties      tlce
                      have an quitabte oppo.rtunity to
                                                         compete foi ub-
                      cor'tact6, ptticuatty bu ao anging olicitatio,
                      6o the ppl.Aation o bid, quantities,                         time
                      cid detivery clledutesso a to                   peciications
                                                         acitlate the paticipa-
                     tion o minotity bu4inessenterp4ies
                                                               .
                  4 Maitain ecoud       howing (a) poceduAez which have
                     adopted to compey with the poicies                            oeen
                     cawuse, i1cludiilg the etabislument       et   oth     n   thiz
                                                            o a outce List
                     o6 minoity businets entetpizse,
                     minority business enterpeis on       (b)     vtatds to
                                                        the ouce tit,            and
                     Ic) peciic e66ort to identify and
                    to mrtty     businzez eterpW
                                                              ad       contact
                                                    ez.
                  5 Inctude the "Utitzation of6 inoity
                    piez Ct.aue" in ubcotAacts whlich Bu6ines EnteA-
                    minority buoines s eteArpze        oet  sub6tcutiat
                                                 subcontactig
                    oppotu,Lie4.
              6 Coopeate with the Contacting O6iceA
                and survey o the Contjtactor'4 minortyin any studies
                 entepies                               bu6inez6
                               , p4oceduez and pacticez that the
                 Contacting Odfice may fAom time
                                                      to time conduct.
              7 Submit peuiodic epo0t       o6 ubcontLAacting to knoo
                m'nority buzinez enterprize with
                                                        espect .to the
                tecooad6 hefee       t o in ubpalngqaph 4 above, in 6uch
                  oirnl and mrni;lc ad at 6uclh tncs
                                                      (not
                quatAety) a the CcttAacting 06ficet moec c,.c,: t:.;'
                                                          may ppecUbe.
   ENCLOSURE     X                                                                         ENCLOSURE
 Page 8                                                                                                X
                                                                           DOT   4000. 7
                                                                                 3-26-75

                     The. Ce.:tzctcoa ,itIl(.      ogqe.      t, iMlet   .il: ltany uib-
                     conJt!l.ct h eculdt idciclh       mlyl cxccrd $500, nrn p?,o.6onis
                     w7ci 6 t~Al¢COio.ln At6Ubtailutie('vq to thie. tallung        t. o tlib
                     ceausc,     .b4tlulg      ts. p';a:     l;, {),   and o nwLy tic
                     Cont~Aactl   9   O64LcCA o   te   i'Rme.   o) .ttch    nlbCOLtrectCt.iS
      c.    Professional     Services Contracts.                A   special
                                                                   shall         effort
            be mad% in all awards of professional services
            contracts with such firms as consultants,         type
                                                        architect-
            enrgineers, research and developnrint frms,
            etc., to seek out minority firms and includeaccountants,
                                                           such known
            firms in any solicitations for bids or proposals.
            record shall be made in the solicitation               A
                                                      file
            such case of the efforts made to locate minorityin  each
            and the results of solicitation from such           sources
                                                        firms.
      d.   Concession Contracts. A special effort shall
                                                          be made
           in all new or renewal contracts for operation
                                                          of
           cessions on DOT facilities or under DOT control con-
           cate minority concessionnaires. In appropriate to lo-
           award of concession contracts under the 8(a)      cases
                                                         procedure
           should be effected. Where 8(a) procedure
                                                      is not
           appropriate minority business enterprises
                                                      shall
           every opportunity to submit bids or proposals     be given
                                                          and  shall
           be considered for award. A record shall
                                                    be made in the
           solicitation file in each such case of the
                                                       efforts made
           to locate and award to minority business
                                                     enterprises.
     e.    Bank Deposits. The services of minority banks
                                                           shall be
           Utilized to the maximum extent for the performance
           official and quasi-official Departmental             of
                                                    banking needs.
           Where a minority bank is available and can
                                                      perform a
           required service such bank shall be used
           connection with appropriated funds. Wherefor  services in
                                                      such bank
           is available and can perform a required service
                                                             for non-
           appropriated funds the use of such bank shall
           encouraged by DOT officials having cognizance  be
           non-appropriated fund activity.                over the

9.   REPORTS.

     a.    Semi-Annual Rencrec
           11)   The head of each operating administration
                                                           and
                 Director, TSC, will submit smi-annual rnortr the
                 activities supporting the MBE program. These     on
                 reports need not include statistical data
                 contract awards covered by the Contract   on
                                                         Information
                 System (CIS) as provided in DOT 1340.5b
                                                         Contract
                 Information System of 1-12-73. The reports
                                                              should
ENCLOSURE IX                                                       ENCLOSURE IX


     DOT 40C0.7 Chg        1                                   Page 9
     6-17-75



                        include  nformation on developments or actions
                        taken which will have an imliact on the  3:BE
                        program.  Thiv should include as approprinte,
                        but not be restricted to:

                         (a)   Data on MBE contracting activities of, and
                               results achieved by grantee agencies;

                        (b)    Changes in concession statistics;

                        (c)    Subcontracting reported by prime contractors
                               under the provisions of Federal Procurement
                               Regulations (FPR) 1-!.1310-2b;

                        (d) Attendance or participation in seminars,
                            conferences, or workshops dealing with MBE;
                            and
                        (e)    Significant problems in general MBE program
                               efforts or in specific MBE contracts.
                  (2)   Negative reports should be submitted except in the
                        case of the St. Lawrence Seaway Development
                        Corporation and TSC whose activities offer little
                        potential for other than contract award actions
                        covered by the CIS or bank deposits covered by a
                        separate reporting system.

                  (3j   Secretarial Officers should advise of significant
                         IMBE developments in their areas of concern. They
                        need not submit negative reports.

                  (4)   Mid-year reports should be submitted to the OST
                        Director of Installations and Logistics by the end
                        of February.  In order to meet the deadline
                        established by Executive Order 11625 for the
                        annual report to the President, the report
                        submitted at the end of the year must be received
                        in OST by the end of July. This report will in-
                        clude forecast data for the next fiscal year
                        covering Sections 1, 2 and 3 of Department of
                        Commerce, Office of Minority Business Enterprise,
                        Form MBE-91 (Revs 4-75) Attachment 1.




               Vertical line denotes change.
    ENCLOSURE IX
                                                                          ENCLOSURE IX


      Page 10
                                                           DOT 400.7
                                                                3 26-75
         b.    Procurement Foreca!t List.
                                                  One
                              f -il~]: contracting of
               for promotion o-                           the principal
                                                       with the Federal tools
               Government is Section
               The Department awards 8(a) of the Sall Business Act.
                                         contracts to
               authority as provided in paragrph SBA under this
                                                         9.a. (2) above. The
             .SBA, in turn, awards
              firms. In addition to the-annualsource subcontracts to
                                                                          !-iE
                                                        statistical forecast
              on Form ISE-91, as provided
              cast of anticipated procurements   in 10.a.(4) above, a fore-
              under the Section 8(a)                  suitable for award
              procurement office will     program   will be made.
                                           review its program for Eac
              forthcoming fiscal year                                 the
             appropriate for award         and identify those procurements
                                        to SBA. By July 31 each
             administration, TSC, and
             Division, TAD-43,              the OST Procurement
             Installations and will      provide to the DirectorOperations
                                  Logistics a listing of              of
             procurements by procurement                       proposed
            year which are considered           office for the next fiscal
                                             suitable for award    under the
            Section 8(a) program.
            services by contract will   All offices obtaining
                                                                   goods or
            ment offices in identifyingcooperate ith their procure-
            award under the Section            procurements suitable
                                            (a)                          for
            awards to MBE contractors.           rrogram and in making
            listed as suitable for             The totals of procurements
                                        Section 8(a) award     will nt
            necessarily be the same
                                          as the totals reported
           Column (3) of Form MBE-91.                                for
           not be awarded to tMBE              Some suitable contracts
                                       firms and many    contracts which may
           will be awarded to MB3E
                                        firms
           be known to the procurement during the year will not
           year. The goals listed             office at the start of
                                                                          the
           be higher than the totalson Form -MBE-91 should normally
                                            of listed procurements
           submitted under this paragraph.

FOR THE SECRETARY OF TRANSPORTATIONI:




                                              William S. Heffelfinger
                                              Assistant Secretary
                                              Administration
ENCLOSURE IX                                                                 ENCLOSURE IX

             DOT 4000.7 Chg 1                                    Attaclhment I
             6-17-75                                             Page 1




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ENCLOSURE IX                                                                                                                                              ENCLOSURE IX

             VOT 409.7 Chg 1                                                                                                           Attachrcnt          I
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ENCLOSURE IX                                                                                                                                                               ENCLOSURE

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                                                                       ENCLOSURE     y




                                                                       4400.46




                                               NOT   I C


    Order 4400.46, Minority Blusiness Enterprise
                                                 Program, was inadvertently
   printed without Appendix 1, Order DOT 4000.7,
                                                 Minority Business Enterprise
   Program. Attached is a copy of Appendix
                                            1 which should be filed with
   Order 4400.46.




DISTHlBUTI3ON:            WiC-   3;   TAD-60 (INFO COP)
                                                           Initiated By:   AL$-l1O
ENCLOSUTRE X                                                                 ENCLOSURE X


                          OFFICE OF THE SECRETARY OF THE TREASURY
                                     WASHINGTON. D.C.   20220




                                                                SEP 7 1977
  MEMORANDUM TO:         Mr. Frank Hodge
                         General Accounting Office

         SUBJECT:        Minority Enterprise Report



       In respoise to your subject request of August 19, 1977, the
  Treasury's rsponse follows:

        1.     The Department had no expenditures f   advertising during
               FY 76 and will have none for FY 77 that are specifically
               identifiable as being procured from black-owned companies.
               The Treasury has little requirement for advertising other
               than the U. S. Savings Bonds Division and that which is
               used is usually donated by business firms, banks or the media.

        2.     With the assistance of the Office of Minority Business
               Enterprise (OMBE), we have developed on-going programs to
               assist minority firms in obtaining Treasury contracts.  These
               programs are outlined below:

                    a.    Development of Minority Contracting Training
                          and Reference Materials.

                    Since FY 76, we have been assisting our bureaus in
               developing their own training programs for their field
               personnel.  A significant aspect of the program is to focus
               attention on minority ontracting procedures and on locating
               potential requirements that are of interest to minority firms.

                    b.    Additional Requirements Identification.

                    We have taken positive steps to further minority
               procurement programs throughout Treasury by having our
               procurement staff visit our bureaus' headquarters and field
               procurement offices, in order to "sell the program" on a face-
               to-face basis. These visits provide opportunities to render
               assistance to our operating staffs in identifying potential
               minority procurement requirements.

                    c,    Procurement Management Reviev.

                  We have initiated a Staff Assistance Visit Program in
             which our procurement program personnel visit Treasury
ENCLOSURE X
                                                                          ENCLOSURE X




                                           -2-

              headquarters and field procurement
             overall procurement oFerations.      offices to review their
                                               One of the critical areas
             reviewed during the course of
                                            the visit is the effectiveness
             of the bureau4. minority contracting
                                                   program. Where
             strengthening may be needed,
                                           the review report provides
             appropriate recommendations.

                  d.   Pamphlet "Selling to the Department
                                                           of the
                       Treasury."

                   In order to assist minority firms
                                                       o better understand
              the procurement operations of
                                            Treasury, and also provide
             them with a source of contacts
                                             for selling their products
             or selvices, we have developed
                                             a pamphlet "Selling to the
             Department of the Treasury" (see
                                               attached).   Copies of the
             pamphlet have been widely distributed
             attending national Minority Business   to  OMBE, SBA, participants
                                                   Opportunity Committee
             Conferences, and numerous minority
                                                 firms throughout the country.
     Even though we have very little
                                      requirements in advertising ser,'ces
for the Office of the Secretary,
                                  we have created positive programs
further contracting with minority                                   to
                                   firms throughout the Department.
     If you will require more information,
                                           do not hesitate to contact us.




                                  Art iur D. Kallen
                                      Director
                       Office of Budget and Program Analysis

Attachment