August 16, 2017

Mayor Emanuel Issues Executive Order to Require City's Largest Construction Projects Commit to Hiring Diverse Workforce

Developers Seeking Plan Development Zoning Approvals will be Required to Disclose Efforts to Hire Minorities and Women

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Mayor Rahm Emanuel and Chicago Department of Planning and Development Commissioner David Reifman today announced many of the city’s largest construction projects will now be required to report on their efforts to solicit and hire minority- and women-owned business (MBE/WBE). The action was taken through an executive order signed today by Mayor Emanuel.
 
“For too long many major development projects have reshaped our neighborhoods without employing the people who live in them,” Mayor Emanuel said. “This order will help ensure these major projects not only help to build Chicago, but also support the diverse mix of families that call it home.”
 
The executive order requires developers seeking Planned Development (PD) zoning approvals by the Chicago Plan Commission to submit signed affidavits about their efforts to promote and incorporate participation by certified MBE/WBE firms and plans for local hiring.
 
The affidavits are to be provided at three different stages during the development process:

  • Prior to Plan Commission consideration: The developer must identify all planned outreach efforts such as through community meetings, hiring fairs, direct marketing or other methods.
  • Prior to the issuance of building permits: The developer must submit records of all completed and future outreach efforts, along with responses from potential participants.
  • Prior to project completion: The developer must identify actual MBE/WBE participation and local hiring data for the project.

Failure to provide the affidavits may prevent the projects from receiving approval or being certified for occupancy by the Department of Buildings.
 
Previously, no MBE/WBE or local participation was required of developers seeking zoning approval who didn’t also seek other forms of City assistance, such as financing or land. PDs are a special zoning designation for projects that exceed certain size, height and density thresholds. Each project requires the review and approval of the Chicago Plan Commission and City Council.
 
In 2016, approved PDs accounted for $3.69 billion in construction costs, creating an estimated 18,000 jobs in the process, according to the Department of Planning and Development (DPD). DPD provides staff services and makes recommendations to the Plan Commission.
 
“From now on, in addition to looking at the physical aspects of new projects, the City will be reviewing who’s actually doing the work to build them,” DPD Commissioner David L. Reifman said. “The public should know which developers truly support participation by minorities, women and local residents.”
 
In addition to the Executive Order, the hiring initiative includes a Plan Commission resolution that requires DPD staff to monitor and report on each developer’s compliance. The data for each project will include total construction costs and jobs and the amounts allocated to MBE/WBE businesses, City of Chicago residents, and ward residents.
 
“These requirements are going to bring a new layer of scrutiny to the multiple ways that Plan Commissioners assess a project’s impact on a community,” Plan Commission Chairman Martin Cabrera said. “I applaud Mayor Emanuel for taking a bold step and being the first mayor of any major city to put forward an executive order to encourage developers to be more inclusive in their hiring of women and minorities for projects seeking zoning approval. Providing those jobs, especially to residents of the city’s underserved communities, will have a direct impact on local neighborhoods.”
 
"As a longstanding member of the Plan Commission I have seen many of these large projects and the huge impact they have on the city of Chicago and the communities they rise in," Ald. Walter Burnett said. "I applaud this move by the Mayor to ensure these large projects have an even greater community impact and employ a workforce that reflects the diversity of our great city."
 
The executive order and resolution are in addition to dozens of procurement improvements under Mayor Emanuel that seek to foster opportunities for all businesses and workers in the city. The improvements, which currently apply to city contracts, include:

  • Increasing MBE/WBE construction goals to 26 percent and 6 percent respectively.
  • Expanding bid preferences for city-based businesses that employ local residents, especially from socio-economically challenged neighborhoods.
  • Incentivizing contractor hiring of ex-offenders into apprenticeship training programs.
  • Adopting bid incentives for veteran-owned businesses.
  • Adding incentives to contractor hiring of Chicago public high school graduates.
  • Requiring city residents to work a minimum of 50 percent of a project’s total labor hours.
  • Creating the Small and Mid-Side Business Initiatives for projects valued under $3 million and between $3 million and $10 million, respectively.

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