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Tuesday, August 13, 2002 - Page updated at 12:00 AM

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Private jobs elude black contractors

Seattle Times staff reporter

Harold Wright is a no-nonsense man who learned the nuances of running his own electrical-contracting company from some of the biggest names in the business.

He is impatient with delays on job sites. Most whites wouldn't tolerate mistakes from an African-American contractor, he says, so why should he tolerate them from others. He knows his work has to be flawless.

In business for three decades, Wright, 63, survived exclusively on public-works contracts and mandatory set-asides.

As expected, his company, Wright Inc., has felt the impact of Initiative 200, which prohibited race and gender preferences in public hiring, contracts and school admissions. He is winning fewer bids, and his revenues have been sliced in half since the law went into effect in late 1998.

But the story of Wright's business contains a deeper question: Why in 30 years has he never been hired to help build a private office building, warehouse or retail complex?

It is a question that goes to the heart of how race plays in the construction industry, and offers no easy answers.

Thirty years after Wright and other black contractors blocked public-construction projects to protest the lack of diversity on job sites, government contracts no longer provide a steady stream of business for such firms.

Those in the industry say the end of preferential contracting is hitting African-American contractors like Wright the hardest because they have traditionally relied more heavily on public construction than Asian-, Hispanic- or women-owned firms.

Share has shrunk

The share of public-works contracts in Seattle awarded to minority- or women-owned firms has shrunk by more than one-quarter since voters ended racial and gender set-asides almost four years ago.

The proportion of work going to firms owned by Asian Americans, African Americans, Native Americans and white females all decreased, while work for Hispanic- firms increased slightly. African-American firms, which have traditionally accounted for the smallest percentage of contracts, received 1.1 percent last year, compared to 2.3 percent in 1998.

King County and the state Department of General Administration, which oversees many state construction contracts, also reported sharp drops overall in work for minority- and women-owned businesses.

Some of the decrease can be traced to pure economics. The collapse of the dot-com economy and sudden glut of office space shut down building projects across the region. Even large contractors are scrambling to get public work, and bidding on smaller jobs they wouldn't have considered a few years ago.

Since minority- and women-owned firms are often small businesses, they often can't compete for public-works projects strictly on price, and instead offer personalized service.

On public projects that don't mandate low bids, general contractors often don't make an extra effort for diversity, say many in the business. In a business where time is money and mistakes are costly, contractors pair up with companies they know and trust. And most of those companies are white-owned.

White owners privately complain that many minority contractors knew they were needed to fill a quota, and didn't always show up on time or finish their work properly.

In other cases, decades of set-asides created bad feelings toward women and people of color, said John Franklin, director of the city Department of Fleets and Facilities, who called such animosity toward minority- and women-owned businesses "an artifact of affirmative action."

And so public officials and civic activists are once again talking about how to increase participation in the construction industry — this time, without set-asides.

Just yesterday, the Seattle City Council approved the creation of a small-business center to help minority- and women-owned businesses win both public and private contracts.

The Pacific Legal Foundation, a Sacramento, Calif.-based public-interest law firm that supported I-200, has warned that the program may be illegal if aid is specifically targeted to minority- or women-owned businesses.

Trades once racially divided

In the late 1960's, integration of the building trades was a source of enormous racial tension in Seattle, sparking violence and counterprotests of thousands of angry whites.

In many ways, minority construction jobs were the prime focus of the civil-rights movement here, just as Little Rock, Ark., struggled with school integration and freedom marchers sought voting rights for blacks in the South.

Wright was present at the beginning of the Seattle protests.

Born and raised in Virginia outside Washington, D.C., Wright came to Seattle in the mid-1960s to work at Boeing after learning electrical work in the Marine Corps. He soon left Boeing and worked for a small Seattle firm.

At the time, the building trades were clearly divided by race. In 1969, there were 2,700 members of the International Brotherhood of Electrical Workers Local 46. Two were nonwhite, including Wright.

In the summer of 1969, protesters demanding greater diversity in the building trades shut down construction at the University of Washington, Seattle-Tacoma International Airport and Harborview Medical Center. As tensions mounted, demonstrators sometimes forced construction workers from their trucks and bulldozers at gunpoint.

After one police standoff at the UW ended peacefully, Wright remembers lifting a duffel bag so full of demonstrators' guns he thought the straps would tear.

But for Wright, the effort wasn't us-versus-them.

In the early 1970's he became a foreman at Cochran Electric, an established company whose owners told Wright he could maintain his activism with the condition that he would tell them when he expected to be arrested.

And when Wright wanted to start his own company, Bob Cochran taught him about running a business and lent him tools. "Harold has always been a good guy. We always got along," Cochran said recently.

Other industry leaders who met Wright also gave him advice, and he speaks fondly of them all.

But on the job site, frictions sometimes arose. On one public project in the 1980's, Wright said workers for the prime electrical contractor ribbed him about his beat-up vehicles.

"My vehicles weren't new. I couldn't afford new ones. They asked why I didn't get new equipment, and I got mad," he said. "We had those kind of conflicts."

The company, which does plenty of private-sector work, never asked Wright to work for them again.

Public-relations effort failed

Early in his career, Wright sought private-sector jobs. In the early 1980s, he hired a public-relations man to shop his services to such businesses as McDonald's, Burger King and Boeing. The campaign failed to produce a single job. After a year, he let the guy go.

In the mid-1990s, Microsoft expanded its Redmond campus. Cochran Electric was doing work there, and Wright called them several times to inquire about job possibilities. He was never asked to submit a bid.

Bob Cochran said that without the mandatory set-asides of government work, nobody at his company thought much about parceling work to minority- or women-owned firms. Instead, the company did the work itself.

"We weren't required to have blacks so we did the work ourselves. If Microsoft said you have to use women and blacks, we would have met the rules. But it wasn't an issue for us."

As the decades rolled by, Wright maintained his business on government work alone. "I stayed in the public, where the specifications called for minority people," he said. "I did OK. I'm still here."

For most of the 1990's, Wright billed about $1 million annually and employed as many as nine people. Last year, he took in about $400,000, and frequently did the work himself.

While the construction industry has always been cyclical, before I-200 "we didn't have to worry about it. The set-asides would come in because they had to. I'd put out five or six bids, and get one," he said. "Now, I get nothing."

Executives at contracting firms such as Hoffman Construction say they are sympathetic to the plight of minority- and women-owned business, but there's not much they can do besides placing bid announcements in minority newspapers and e-mailing firms on their database.

A Portland-based company, Hoffman, is the general contractor on the new City Hall, Justice Center and downtown library.

Hoffman is prevented from doing more than 20 percent of the work itself. The company must accept low bids on the rest. More than 100 companies are expected to take a share of the $63 million construction budget to build the Justice Center, which will house police headquarters.

Before I-200, subcontractors would be responsible for fulfilling mandatory minority set-asides, said Hoffman vice president Tom Peterson. Today, there is only a goal with no enforcement.

"Bottom line is we have to accept low bid. We can't say this person is going to do this work," he said.

But Hoffman has the ability to break up projects into smaller pieces. Instead of one concrete contract, for example, Hoffman can create several bid packages, increasing the likelihood that a minority- or women-owned firm would be low bidder.

And that's where personal relationships come in.

Several weeks ago, Peterson picked up the phone and called Fred Anderson to say a bid was coming up. Peterson knew Anderson, and knew his concrete firm could do the work.

Anderson, an African American who once played defensive end for the Seattle Seahawks, has made a point of trying to get to know the major players in the industry. In meetings he sometimes wears his Super Bowl ring — which he won while playing for the Pittsburgh Steelers — to spark conversation.

Anderson made a point of trying to forge a bond with Peterson, once saying that he worked for Hoffman in the off-season during the early days of his football career.

The connection paid off: Anderson's company, Leajak Concrete Construction, recently submitted the low bid and won a $299,000 contract on the Justice Center.

"Construction is a business of relationships," Anderson said. "Sometimes the big guys have to reach out to the small guys. But we don't want just public work. I want to go into the private sector so we're not always feeding on public opportunity."

But Anderson's experience isn't all that different from Wright's. In business for 10 years, Anderson said he has worked on only three private projects.

Lots of bid announcements

The fax machine in Wright's office constantly churns out bid announcements. Many of the projects are often out of his league or located in other states. But most public agencies require contractors to contact minority firms, and that explains the pile of discarded documents stacked in a corner.

Wright's office is located in a small house in Rainier Valley. Architectural drawings are laid out on a large table. It takes about four hours to figure out a bid and send it in. In mid-June, Wright submitted a plan to do electrical work on a city shelter and restroom. His bid, $92,205, was second-highest, and he didn't get the job.

He recently finished work on the Pioneer Square pergola, and is casting about for new jobs. He still is hopeful his friendships in the business will pay off.

Walle Ralkowski, a senior executive at a local construction firm, met Wright about a year ago through the Urban League of Metropolitan Seattle, and has tried to find him private-sector work. He can't explain why it's taken more than three decades.

"I don't have an answer. Here's a guy with 30-plus years, trained with some of the best in the business. The guy has the ability and knowledge and he's a man of his word," Ralkowski said. "Hopefully a few opportunities will come available that aren't tagged on a government program."

Wright is an elder in the business, said Anderson, and a symbol of how far minority contractors must go to be an established presence in the building trades.

"When things don't work for Harold, they are not working for any of us," he said.

Alex Fryer: 206-464-8124 or afryer@seattletimes.com.

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