Rumble in O’Fallon Park: Chapter II

A threat to smear subcontractors names in the newspaper is the latest tactic the City of St. Louis is using to motivate subcontractors to employ more minority workers.

The threat came at an S.M. Wilson & Co. subcontractor meeting on the O'Fallon Park Recreation Center on April 19. According to people who attended the meeting, Michael Holmes, the executive director of a city government agency, the St. Louis Agency on Training and Employment (SLATE), said to the roomful of subcontractors that if they did not meet their workforce diversity goals, "you will be smeared in the media."

When S.M. Wilson signed a $17.4 million contract last June to build the recreation center, the company agreed that 31 percent of labor hours would come from minority and women workers. The project is roughly 25 percent complete and, according to sources, who prefer to remain anonymous, because they want to continue working in the city, S.M. Wilson is not on track to meet that goal. Scott Wilson, president of S.M. Wilson, declined to comment on this story.

The O'Fallon Park Recreation Center is the first major project public construction project for the city since the implementation of St. Louis City Ordinance 68412, which mandates that at least 25 percent of the labor hours on a public works contract shall be performed by minorities and five percent shall be performed by women. The same ordinance assigns assigns enforcement powers to SLATE.

A source familiar with the recreation center project described the 31 percent goal as "unrealistic," but there are signs that the workforce diversity goals for contractors working on publicly-funded jobs in the city could get even higher. St. Louis Public Schools last week announced a goal of 40 percent of labor hours on its capital improvement projects coming from minority and women workers.

In an April 6 email to subcontractors, S.M. Wilson job accountant Joyce Morgan labeled the April 19 meeting a "mandatory O'Fallon Park MBE participation meeting," but attendees said the second hour, at least, was devoted to workforce quotas. When subs, who had met their quotas and filled out all the necessary paperwork asked if they had to stay for that, they were told "yes."

One attendee at the April 19 subcontractors' meeting said that by letting Holmes threaten and berate subcontractors as a group, S.M. Wilson was essentially saying to the subs, "we're throwing you under the bus."

When CNR asked a representative of S.M. Wilson why they didn't just meet individually with subs, who were not meeting their workforce commitments, he said, "I will get back with you." He did not do so before publication time.

Marion Hayes, however, defended S.M. Wilson. Hayes, who is African-American, is president of BRK Electric, an electrical subcontractor on the O'Fallon Park Recreation Center.

"S.M. Wilson explained the rules at the pre-bid meeting a year ago March, and everyone had to submit a plan on how they were going to meet the workforce requirements for minorities and city residents before they signed a contract," he said.

Then S.M. Wilson had a subcontractors' meeting last November, "where they gave advice on how to meet the workforce goals and told everyone of resources to call on," he added.

"The guys who are crying now knew what they were getting into," Hayes said, with perhaps one difference, more scrutiny. The city is taking a firmer stand on diversity on the O'Fallon Park Recreation Center.

"I've been on other city jobs where the city comes out once to check records and says 'ok,' but there are too many eyes on this project for anyone to slip up. They are checking every month," he said.

A source familiar with the project said the while subcontractors did have to get workforce diversity plans approved before they could get a contract to work on the recreation center project, the economy has made it hard for some of them to meet the diversity goals in their workforce plans.

One attendee at the meeting said Holmes dismissed anyone who brought up the economy as someone who was just making excuses. He reportedly told subcontractors that the city does not care how the economy is affecting them, they still have to meet their workforce diversity goals. Holmes did not return telephone calls to his office.

Len Toenjes, president of the AGC of St. Louis and a member of SLATE's board of directors, said Holmes did not handle the meeting well, but also did not have any alternatives. The board of aldermen gave SLATE the responsibility to enforce diversity requirements, but did not provide funding for it, and Holmes can't use the agency's federal funding to enforce the ordinance, he said.

"Michael [Holmes] is under a lot of pressure. He is trying to figure out how to enforce the ordinance without any money, people, or time to do so," Toenjes said.

This isn't the first time subcontractors have run afoul of the St. Louis city's new diversity requirements. John J. Smith Masonry, the low bidder for the masonry portion of the recreation center project, reportedly withdrew after the city's compliance office refused to approve their joint venture agreement with Marvin Peebles Masonry, a city-certified minority business enterprise. S.M. Wilson then turned to Leonard Masonry to perform the masonry work.

Minority participation was a concern for community groups and African-American alderman from before the the job was awarded. The first time the project was bid, all the bids were thrown out because none of them came close to the aldermen's minority participation goals. The second time the project was bid, S.M. Wilson was the apparent low bidder, but their contract was held up until they agreed that minority-owned businesses would get at least 32 percent of the contract dollars, significantly more than the 25 percent required by the ordinance and bid documents.

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