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The DNC Still Has A Long Way To Go On Hiring Minority-Owned Businesses

A BuzzFeed News analysis shows 17.6% of DNC contract spending went to minority-owned businesses — including just 6.4% to black-owned businesses and 4.3% to Latino-owned businesses. The DNC says it's been making changes over the past year, and, in its own analysis, contended that 29% of contract spending went to diverse businesses.

Last updated on April 12, 2018, at 12:32 p.m. ET

Posted on April 12, 2018, at 10:36 a.m. ET

Tom Perez
Chip Somodevilla / Getty Images

Tom Perez

A year after Tom Perez and other Democratic National Committee leaders promised that diversity hiring would be a priority for the party moving forward, racial and ethnic minority-owned businesses still accounted for only 17.6% of the $17.5 million the party spent on consultant work, according to a BuzzFeed News analysis.

In an analysis of the DNC’s spending from March 2017 to February 2018, $3,076,569 in disbursements for telemarketing, direct mail, and consulting work went to minority-owned businesses.

The BuzzFeed News analysis of federal filings shows that over the past year 6.4% of money spent went to black-owned firms and spending on Latino-run firms was less — about 4.3%.

In recent months, Democrats across the country have declared that black people and especially black women are the “backbone” of the Democratic Party after the constituency helped push the party to wins in places once thought impenetrable, like Alabama — the kind of refrain that frustrates minority operatives who want the party to involve a more diverse set of people at the leadership and policy level.

In response to BuzzFeed News, DNC officials said that the committee has been making a wide variety of changes over the past year, some of which aren’t reflected by pure spending numbers in FEC filings. For instance, officials said that some contractor spending in the March 2017 to February 2018 FEC filings were servicing prior agreements made under previous DNC leadership.

"Democrats have won over the past year because we’ve invested in the women and people of color who form the backbone of our party. That commitment doesn’t end with one election or with one news cycle,” said DNC spokesperson Michael Tyler. “Although outside consulting contracts make up only 2% of our overall budget, we’re focused on making sure we realize that commitment in our contracting process. That’s why these efforts are now being led at a senior level by chief operating officer Laura Chambers, who has ended many previously existing contracts.”

Since new leadership has taken charge of the DNC, officials said, it's brought a lot of functions that were previously contracted out to be in house, bringing the DNC’s total spending on outside contracts down to 2% of overall spending. The officials also emphasized that the majority of the party’s spending is on staff salary and benefits, and that currently, staffers of color make up 43% of the DNC workforce and that 57% of senior leadership is female.

In response to BuzzFeed News, the DNC shared a different story of the numbers: Per its method, the party spent $16,065,116.94 on contracts in total, but — removing some nonvendor spending like postage — really spent $10,775,201.21 for the total spending on contracts by including building contracts, like security.

The DNC also include businesses owned by women as a separate category in their diversity statistics. (The BuzzFeed News analysis includes a number of businesses run by women of color and who have consulted for the DNC.) Using that methodology, the DNC reached a figure of $2,264,800.88 spent on minority- and women-owned businesses, including building security, to reach a total of $3,079,216.96 — or 29% minority- and women-owned businesses.

Last February, Tom Perez tweeted that the DNC needed a “top-to-bottom” evaluation of its existing contracts and procurement processes and that contracts should not be “auto-renewed,” in response to DeRay Mckesson asking what the committee’s plan for making sure its money was being directed toward consultants of color.

We need top-to-bottom eval of our existing contracts & procurement process. Contracts should reflect diversity of party, not be auto renewed https://t.co/GGiDkHP1Gb

The DNC has long maintained a lengthy “diversity supplier” list of firms approved to do business with the party where it encourages businesses to self-submit information to be considered for potential contracts. The list counts women, the LGBT community, Asians, Latinos, blacks, and people with disabilities under the same “minority” label, which some in the party have critiqued in the past.

The disparity of contracts awarded to minority firms has long been a sore spot between the national party and black and Latino strategists who feel like the party isn’t prioritizing their commitment to recruiting diverse consulting firms. In 2014, a report from PowerPAC+ found that only 1.7% of the $514 million the DNC had spent on consulting over two political cycles had gone to businesses that were minority owned.

A DNC official said that the committee has also begun a new contract-approval process that tracks all vendors with contracts of $5,000 and above by a breakdown of gender and racial diversity — a level of detail the DNC has not done in the past in tracking its contracting on diversity.

After that report, calls for the DNC to improve its numbers when it comes to diversity resulted in the committee hiring its first chief diversity officer, Greg Hinton, to ensure the party was meeting its goals in hiring diverse staff and in contracting, but the FEC records show that the DNC stopped paying Hinton for his work in November 2016.

DNC officials said Hinton’s duties had become part of the portfolio for the party’s chief operating officer, Laura Chambers.

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