How DASNY Continues to Change the Diversity Procurement Paradigm

With 75 years of service to New Yorkers, the Dormitory Authority of the State of New York (DASNY) has grown into one of the largest financiers and builders of social infrastructure facilities in the United States. The nation’s leading issuers of tax-exempt bonds and a major financier of capital infrastructure across New York State, DASNY provides financing and construction services to public and private colleges and universities, hospitals, state and local governments, and other not-for-profits.

A keynote of DASNY’s business model and culture is the engagement of Minority and Women-Business Enterprise (MWBE) and Service-Disabled Veteran-Owned Business (SDVOB).  DASNY sets participation goals for public clients and requires all contractors, consultants and vendors to use qualified MWBE and SDVOB firms for all procurement projects. The Opportunity Programs Group reviews every MWBE utilization plan to ensure MWBE participation on projects and reaches out to prime contractors who may need additional  MWBE firms to meet their goals. No contract can be awarded without an approved Utilization Plan, and no contract can be closed out with the approval of the Opportunities
Programs Group.

Leading the Industry to Push Utilization Past Construction

Historically, the focus on New York State’s diversity initiatives have been on the construction industry, but DASNY, who has executed more than $20 billion in transactions, saw an opportunity to engage the MWBE and SDVOB community in other market sectors. “DASNY thinks outside of construction,” said Michael M. Clay, the Senior Director, Procurement and Opportunity Programs Group at DASNY. “From architecture and engineering, to financial services, legal and risk management, we want to engage certified firms across all DASNY business units.”

The shift in focus began with a push for legislative change. Clay worked with partners in the public and private sector to include the financial and banking industry in Executive Law Article 15-A. The Emerging Investment Managers Bill (S.6888/A.9976) was passed in 2010 under Governor David Paterson, which addressed entities that were not executive agencies and controlled large pools of money for investment such as the Comptroller, the State Insurance Fund and the Deferred Compensation Board, among others. This legislation also provided emerging investment managers with the ability to invest with MWBE financial institutions and to adopt a strategy that motivates investments in underserved regions of the State.

DASNY also looked for creative ways to increase MWBE participation in non-traditional areas such as risk management. Because of their construction portfolio, DASNY needed to select a firm for their general liability insurance. An area that is traditionally dominated by larger and more established firms, DASNY wanted to get creative with the procurement to provide an entry point for certified firms. According to Clay, “We released a procurement where we required an MWBE broker to be the lead broker. Our goal was to engage a larger national firm to support the certified company. The outcome was a great success, and for the first time in DASNY’s history, an MWBE insurance broker is the lead broker for a general liability insurance procurement.”

Integrating Procurement and Diversity: The New Frontier for Contract Inclusion

Throughout its decades of operation, DASNY continues to be recognized for their innovative initiatives that have been strategically created to increase MWBE and SDVOB participation. From its award-winning Statewide Surety Bond Training Program to discretionary purchasing, DASNY recognizes the importance of thinking outside of the box. So, what’s ahead on the frontier of procurement?  Former DASNY President & CEO Dr. Gerrard Bushell, who recently left DASNY to take the position of Executive Chair at Carlyle Airports Group, decided to integrate the Procurement team and Opportunity Programs Group, by creating two co-leaders of Procurement: J. Matthew Moore, Director of Procurement, and Michael Clay, Senior Director of Procurement and Opportunity Programs.

“Procurement is the foundation of an organization,” said Dr. Bushell. “By creating institutional collaboration between our team of procurement and diversity professionals, we have streamlined the access certified firms will have to contract opportunities.” From staff meetings, to reviewing contracts that are ready to be released to bid or closed out, there is direct integration and collaboration between the team that works one-on-one with MWBEs and SDVOBs and the individuals at DASNY who select contractors.  DASNY advances a system that opens up communication and removes red-tape or misunderstandings that can occur in complex public sector procurements.

“As a co-leader of procurement, I work with Michael Clay and we both utilize  our expertise to create contracts that engage a diverse set of certified contractors/vendors, while still provide cost-effective and best in class services to our clients, said Matthew Moore. “Utilizing this paradigm, we learn  where the intersecting points of procurement are and that  sets a tone from top to bottom that our organization is committed to diversity at every level,” added Clay.