Philadelphia Takes Action After Probe Into ‘Minority-Owned’ Contractor

By Kim Glovas

PHILADELPHIA (CBS) — Philadelphia’s inspector general is banning one contractor from doing business with the city for three years, removing a second from its list of minority contractors, and levying a huge fine after an investigation which the inspector general’s office says found fraud in representations as minority-owned business.

City inspector general Amy Kurland says William Betz Jr. Inc. and UGI HVAC Inc. falsified documents to make it appear that another company, JHS, was a minority-owned firm.

Kurland says Betz is being banned for three years from doing business with the city and UGI has to pay a $100,000 fine.

“We consider this a really important case, because one of the main goals of this administration is to expand opportunities for minority businesses and provide jobs,” Kurland told KYW Newsradio today, “and this kind of conduct really violates that main goal. Our investigations are ongoing and we anticipate that there will be more cases in the future.”

In addition, UGI must also increase its minority participation in city contracts from 25 percent to 50 percent. UGI has also entered into an agreement that they will institute policies so that this doesn’t happen again.

JHS, which according to the inspector general was being paid to be presented as a minority-owned business, had been providing equipment for home weatherizations funded by state and federal money.

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One Comment

  1. Paul says:

    I actually checked the current standing of minorities in Philadelphia recently. Caucasian was about 40% and African Americans were around 47%

  2. Is it still the 60's, can we move on? says:

    What constitutes a minority business? And can a non-manority business get a contract in phila? Who is the minority in philadelphia? Who is the Majority in phila?
    What about getting the best quality work? Does that mean anything?

    1. Bob Houston says:

      That means nothing

      1. noname says:

        just look at the contractor who won the bid to rebuild Osage Ave. Awarded because he won under a minority contract. Then look at the additional hardships the neighbors on Osage avenue had to deal once this contractor completed the job. inept. So i hope they will not only look at the criteria for minority qualification but the ability to perform on the contract. but i’m glad to hear that things are being audited. it’s not always a black and white issue. Women owned qualifies as a minority owned-don’t know that any women owned construction companies exist. what the original idea behind this was to loosen the grip on “politically connected” companies so that small business and upstart business that weren’t well know had a shot at these contracts. and also had the larger companies give minorities a chance at a job. like everything it all gets abused – it swings to the opposite end where contracts get awarded based soley on the owner being minority or the % of minority people working for the company and not on ability. Minority is supposed to be based on the number of people working in the particular field, not the number in the entire city. i think the whole thing reeks though. your performance history to bring a contract in on time, on budget and backed up with a guarantee that the work is done well should be the criteria now.

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