A communication transmitted from Louis A. DePasquale, City Manager, relative to Awaiting Report Item Number 21-2, regarding the possibility of implementing a Sheltered Market Program, and Awaiting Report Item Number 21-4, regarding conducting a Spending Disparity Study on City Purchasing

Assistant City Solicitors Nancy E. Glowa Paul S. Kawai ANTI City Solicitor Keplin K. U. Allwaters Sean M. McKendry Arthur J. Goldberg Brian A. Schwartz Deputy City Solicitor Diane O. Pires CUTURED Megan B. Bayer Public Records Access Officer First Assistant City Solicitor CHICO TOTA Seah Levy CITY OF CAMBRIDGE Office of the City Solicitor 795 Massachusetts Avenue Cambridge, Massachusetts 02139 June 7, 2021 Louis A. DePasquale City Manager Cambridge City Hall 795 Massachusetts Avenue Cambridge, MA 02139 Re: Response to Awaiting Report No. 21-2: Re: Report on Providing a Report on the Possible Implementation of a Sheltered Market Program, and Response to Awaiting Report No. 21-4: Re: Report on Conducting a Spending Disparity Study on City Purchasing with Businesses Owned by Minorities, Women, Veterans, Disabled Persons, LGBTQ+ Individuals and Other Historically Disadvantaged Groups Dear Mr. DePasquale: INTRODUCTION This memorandum includes a response to Awaiting Report No. 21-2, which requests "It]hat the City Manager, City Solicitor, and Purchasing Department confer to provide a report on the possible implementation of a sheltered market program here in Cambridge." Additionally, this memorandum includes a response to Awaiting Report No. 21-4, which requests "It]hat the City Manager ... confer with the Purchasing Department, the Supplier Diversity Office, and other relevant City departments to conduct a spending disparity study on City purchasing with businesses owned by minorities, women, veterans, disabled persons, LGBTQ+ individuals, and other historically disadvantaged groups." In preparing this response, staff from the Law Department conferred with staff from the Finance, Budget, Purchasing and Community Development Departments and the Office of Equity and Inclusion. Regarding Awaiting Report No. 21-2, as will be discussed below, we recommend that the City, in determining whether a sheltered market program under G.L. c. 30B, § 18 can be implemented in Cambridge, conduct a disparity study to review and analyze whether there are This memorandum was prepared with assistance from the Purchasing Department, the Office of Equity and Inclusion and the Community Development Department. Facsimile [phone removed] Telephone [phone removed] TTY/TTD [phone removed]

present effects of past discrimination within the markets of business enterprises from whom the City procures services and supplies. The reason we are recommending the undertaking of a disparity study is that without an evidentiary basis establishing that the sheltered market program would remedy present effects of past discrimination (whether racial or gender based) within the aforementioned markets, such a sheltered market program could be subject to, and potentially invalidated by, an equal protection challenge brought pursuant to the Fourteenth Amendment to the United States Constitution and the Massachusetts Constitution. If it is determined that a basis exists for the City to implement a sheltered market program following a disparity study, the next step to implement such a program would be for the City to authorize its chief procurement officer (hereinafter, "Purchasing Agent") to establish such a program by: (1) a vote of a majority of the City Council; and (2) the approval of the City Manager. As to Awaiting Report No. 21-4, this memorandum sets forth recommendations regarding the release of a request for proposals ("RFP") for potential consultant teams to conduct a disparity study. Additionally, this Council Order Response includes information provided from the Community Development Department regarding several actions the City has recently taken and continues to take to assist disadvantaged business entities in Cambridge. DISCUSSION A. Conducting a Disparity Study as the First Step in Determining Whether a Sheltered Market Program can be Implemented in Cambridge? G.L. c. 30B, § 18(a) defines a "sheltered market program" as "a program under which certain contracts are designated by the chief procurement officer for procurement from one or more classes of disadvantaged vendors." The term "disadvantaged vendor" means a "minority business," "women-owned business" or "veteran-owned business" as defined by G.L. c. 7, S 40N. G.L. c. 30B, § 18(a). The term "minority" in the phrase "minority business" refers to "a person with a permanent residence in the United States who is American Indian, Black, Cape Verdean, Western Hemisphere Hispanic, Aleut, Eskimo, or Asian." Also, despite the language of G.L. c. 30B, § 18(a), the term "veteran-owned business" is not defined in G.L. c. 7, § 40N.3 As to the establishment of a sheltered market program, G.L. c. 30B, § 18(b) provides: When authorized by majority vote, a chief procurement officer may establish a sheltered market program in conformity with the requirements of this section. Such authorization may apply to a single contract or to any number or types of contracts, shall specify the class or classes of disadvantaged vendors to be included in the sheltered market program, and shall to the extent constitutionally 2 We have not found any guidance (e.g., a court decision or secondary source) discussing or analyzing what requirements, if any, must be followed in order to establish a sheltered market program under G.L. c. 30B, § 18 Additionally, we understand from the Office of the Inspector General of the Commonwealth that no municipality in Massachusetts, to date, has established a sheltered market program under the statute. 3 G.L. c. 7, § 40N was repealed in 2012. Despite this, its successor statute, G.L. c. 7C, § 6, contains the same definitions for "minority business" and "women-owned business." Additionally, like G.L. c. 7, § 40N, G.L. c. 7C, 8 6 does not define the term "veteran-owned business." Thus, G.L. c. 30B, § 18(a) has not yet been amended to reflect 2

required be based on findings that such program is a remedy for the present effects of past discrimination. The statute's only reference to actions to be taken before a "majority vote" may be taken to authorize a chief procurement officer to establish a sheltered market program is that said authorization "shall to the extent constitutionally required be based on findings that such program is a remedy for the present effects of past discrimination." G.L. c. 30B, § 18(b) does not define the phrase, and thus, the statute does not specify what actions need to be taken in order to establish such "findings." However, as G.L. c. 30B, § 18(b) allows a municipality to limit competition for government contracts based on different classes of businesses (through the establishment of a sheltered market program), the phrase "to the extent constitutionally required" in the statute likely means that the authorization of a sheltered market program must be based on findings which would support a conclusion that said program would not violate the equal protection requirements of the United States Constitution and Massachusetts Constitution. Courts in other jurisdictions have considered equal protection challenges to government programs that set aside contracts for disadvantaged minority business enterprises (often referred to as "set-aside programs" or "set-aside measures"). See, e.g., Eng'g Contractors Ass'n of S. Fla v. Metro. Dade Cty. ("Eng'g Contractors"), 122 F.3d 895, 901, 906 (11th Cir. 1997). A sheltered market program established by the City would, in effect, be a set-aside program. Accordingly, if a sheltered market program established by the City was subject to an equal protection challenge, a court would likely rely on caselaw analyzing equal protection challenges to set-aside measures in reviewing a challenge to the City's program. i. Standards Governing Race-Conscious Set-Aside Programs. Race is a suspect class under the Equal Protection Clause of the Fourteenth Amendment. Concrete Works of Colo., Inc. v. City of Denver ("Concrete"), 321 F.3d 950, 957 (10th Cir. 2003). In light of this, federal courts subject race-conscious set-aside programs to strict judicial scrutiny. Id. Race is also a suspect class under the equal protection provisions of the Massachusetts Constitution. Finch v. Comm. Health Ins. Conn. Auth., 459 Mass. 655, 662-63 (2011). Therefore, a Massachusetts court reviewing an equal protection challenge to a race- conscious sheltered market program established pursuant to G.L. c. 30B, § 18 would likely subject said program to strict judicial scrutiny. Brackett v. Civil Service Comm'n, 447 Mass. 233, 243 (2006). For a race-conscious set-aside program to satisfy strict judicial scrutiny, an enacting government entity must show that: (1) a compelling government interest exists to support the establishment of such a program; and (2) said program is "narrowly tailored" to achieve the compelling interest. Concrete, 321 F.3d at 957; Eng'g Contractors, 122 F.3d at 906. Although remedying the effects of general societal discrimination is not a compelling government interest in the context of race-conscious set-aside measures, a race-conscious set- aside program may satisfy the compelling government interest requirement if the measure remedies the effects of past or present racial discrimination. H.B. Rowe Co. v. Tippett ("Rowe"), 615 F.3d 233, 241 (4th Cir. 2010); Concrete, 321 F.3d 958; Eng'g Contractors, 122 F.3d at 906. To establish that a compelling government interest exists to support the enactment 3

of a race-conscious set-aside measure, the enacting government entity must: (1) identify that discrimination, public or private, with some specificity; and (2) have a strong basis in evidence for its conclusion that remedial action is necessary. Rowe, 615 F.3d at 241; Concrete, 321 F.3d at 958; Eng'g Contractors, 122 F.3d at 906. To satisfy these requirements, a government entity may present evidence of its own direct participation in racial discrimination or "passive participation" in a system of racial exclusion practiced by elements of a local private market. Concrete, 321 F.3d at 958; Eng'g Contractors, 122 F.3d at 907; Contractors Ass'n of E. Pennsylvania, Inc. v. City of Philadelphia ("Contractors Ass'n"), 6 F.3d 990, 1001-02 (3d Cir. 1993); Builders Ass'n of Greater Chicago v. City of Chicago ("Builders Ass'n"), 298 F. Supp. 2d 725, 728 (N.D. III. 2003). A government entity can demonstrate that it is a "passive participant" in a system of racial exclusion practiced by elements of a local private market by compiling evidence of marketplace discrimination and then linking the government entity's spending practices to the private discrimination. Concrete, 321 F.3d at 976.4 Additionally, federal courts have recognized that a government entity does not need to conclusively prove the existence of past or present racial discrimination but may satisfy the compelling government interest requirement for a challenged race-conscious set-aside measure through a combination of statistical evidence (e.g., a disparity study) and anecdotal evidence of private and public discrimination. Concrete, 321 F.3d at 958; Eng'g Contractors, 122 F.3d at 907. The Supreme Court has also noted: Where there is a significant statistical disparity between the number of qualified minority contractors willing and able to perform a particular service and the number of such contractors actually engaged by the locality or the locality's prime contractors, an inference of discriminatory exclusion could arise. City of Richmond v. J.A. Croson Co. ("Croson"), 488 U.S. at 509. Federal courts have declined to adopt a "categorical rule" that every case challenging a race-conscious set-aside program "must rise or fall entirely on the sufficiency of the numbers," and have noted that "anecdotal evidence might make the pivotal difference in some cases; indeed, in an exceptional case, we do not rule out the possibility that evidence not reinforced by statistical evidence, as such, will be enough." Eng'g Contractors, 122 F.3d at 926. In designing the parameters of a disparity study to: (1) identify racial discrimination with some specificity within the markets of business enterprises from whom the City procures 4 As an example, the Tenth Circuit, in a case concerning a federal program designed to award highway subcontracts to disadvantaged business enterprises, stated: It is reasonable to conclude that allocating more than 95% of all federal contracts to enterprises owned by non-minority persons, or more than 90% of federal transportation contracts to enterprises owned by non-minority males, is in and of itself a form of passive participation in discrimination that Congress is entitled to seek to avoid Adarand Constructors, Inc. v. Slater ("Adarand"), 228 F.3d 1147, 1181 (10th Cir. 2000). S Courts have also recognized that "strong evidence" of discrimination "is that 'approaching a prima facie case of a constitutional or statutory violation,' not irrefutable or definitive proof of discrimination." Concrete, 321 F.3d at 971 (quoting Croson, 488 U.S. at 500). 4

services and supplies; and (2) determine whether a strong basis in evidence exists for supporting the conclusion that remedial action is necessary, several factors should be considered in light of federal cases that have analyzed race-conscious set-aside programs: 1. Availability. A government entity enacting a race-conscious set-aside program is not limited to using considerations such as the actual number of businesses that bid on projects or how many businesses are registered or prequalified under state law. Northern Contracting, Inc. v. Illinois, 473 F.3d 715, 723 (7th Cir. 2007); Concrete, 321 F.3d at 983. Rather, the enacting government entity may use measures that cast a broad net to accurately identify the number of available qualified minority businesses. Northern Contracting, Inc., 473 F.3d at 723; Concrete, 321 F.3d at 983. 2. Geographic Market for Set-Aside Program. The local market for a race-conscious set-aside program is not necessarily limited to the geographic boarders of the enacting government entity. See, e.g., Concrete, 321 F.3d at 966, 994; Contractors Ass'n, 6 F.3d at 1006-09. Study Period. The minimum time period of study used by a disparity study needs to 3. be long enough in duration to provide a sufficiently large sample for statistical analysis. See, e.g., Rowe, 615 F.3d at 243-46, 254. However, if the data used by a disparity study dates back too far, a court may find such data outdated. See, e.g., Associated Gen. Contractors of Ohio, Inc.v. Drabik, 214 F.3d 730, 738-39 (6th Cir. 2000); Builders Ass'n, 298 F. Supp. 2d at 732-42. 4. Adoption of Disparity Study by Government Entity. In order for a court to conclude that a disparity study is established in evidence, a government entity enacting a race- conscious set-aside program should formally adopt the findings of said disparity study. Otherwise, a court may not give weight to the findings of the disparity study. W.H. Scott Const. Co. v. City of Jackson, 199 F.3d 206, 218-19 (5th Cir. 1999). In the event that the City desires to conduct a disparity study, the Purchasing Department will work with CDD, the Finance Department, the Office of Equity and Inclusion and the Law Department to develop an RFP for a potential consultant team to conduct a study that includes parameters which consider the above factors. As to the narrowly tailored element, the Supreme Court has identified several factors that courts are to consider in evaluating whether a race-conscious set-side program is narrowly tailored. Croson, 488 U.S. at 507-08. Those factors, in light of Croson and other subsequent federal caselaw, are discussed below: 1. Consideration of Race-Neutral Means to Increase Participation of Minority Business Enterprises. In the context of race-conscious set-aside measures, '[n]arrow tailoring does not require exhaustion of every conceivable race-neutral alternative,' but it does require serious, good faith consideration of workable race-neutral alternatives." Sherbrooke Turf, Inc. v. Minn. Dep't of Transp., 345 F.3d 964, 972 (8th Cir. 2003) (quoting Grutter v. Bollinger, 539 U.S. 306, 339 (2003)). 5

2. Flexibility. The Supreme Court has questioned whether a race-conscious set-aside program that uses fixed quotas would be constitutional. Croson, 488 U.S. at 507-08; see also Grutter, 539 U.S. at 334. The Supreme Court, however, has suggested that race- conscious set-aside measures that allow for waivers that treat business enterprises individually "are less problematic from an equal protection standpoint." Croson, 488 U.S. at 508. Further, in federal cases subsequent to Croson where race-conscious set- aside measures were held to be narrowly tailored, the fact that those measures allowed for waivers was a factor in those conclusions. See, e.g., Midwest Fence Corp. v. U.S. Dep't of Transp., 840 F.3d 932, 954-55 (7th Cir. 2016); Sherbrooke Turf, Inc., 345 F.3d at 972; Adarand, 228 F.2d at 1180-81. 3. Duration. The Supreme Court has questioned whether a race-conscious set-aside program that has an unlimited duration would be constitutional. Croson, 488 U.S. at 497- 98. Subsequent federal cases have considered whether race-conscious set-aside measures are limited in duration as a factor in the narrowly tailored analysis. Midwest Fence Corp., 840 F.3d at 942; Sherbrooke Turf, Inc., 345 F.3d at 971; Adarand, 228 F.3d at 1179. Other courts have explicitly stated that the narrowly tailored element requires race- conscious set-aside measures to include "adequate" durational limits. W. States Paving Co. v. Wash. State Dep't of Transp., 407 F.3d 983, 994 (9th Cir. 2005). 4. The Relationship of Numerical Goals to the Relevant Market. Another factor courts consider in determining whether a race-conscious set-aside measure is narrowly tailored is the relationship between the numerical goal for participation by minority business enterprises in the relevant market through the measure and the percentage of minority businesses enterprises in said market. Rowe, 615 F,3d at 252, 253. 5. The Impact on the Rights of Third Parties. In determining whether a race-conscious set- aside measure is narrowly tailored, courts also consider the impact that said measure will have on the rights of third parties. Eng'g Contractors, 122 F.3d at 927. Courts, however, have recognized that innocent parties will share the burden of a remedial race-conscious set-aside program, and that this fact alone is insufficient to warrant a conclusion that a program is not narrowly tailored. W. States Paving Co., 407 F.3d at 995; Adarand, 228 F.3d at 1183. 6. Over-Inclusiveness and Under-Inclusiveness of Race-Conscious Set-Aside Program. Another factor courts consider in determining whether a race-conscious set-aside measure is narrowly tailored is whether the measure is under-or over-inclusive. Adarand, 228 F.3d at 1177. Accordingly, if it is determined that a basis exists for the City to implement a race- conscious sheltered market program following a disparity study, the Law Department will so advise the City Manager and the City Council and will work with the Purchasing Department, CDD and the Office of Equity and Inclusion to develop the parameters of such a program in light of the above factors. 6

i. Standards Governing Gender-Conscious Set-Aside Programs. Federal courts have applied a lesser standard, intermediate scrutiny, to gender conscious set-aside programs that are challenged under the Equal Protection Clause of the Fourteenth Amendment. Rowe, 615 F.3d at 242; Concrete, 321 F.3d at 959. Gender, however, is a suspect class under the equal protection provisions of the Massachusetts Constitution. Finch, 459 Mass. at 665-66; Brackett, 447 Mass. at 246-47 2006). As the equal protection provisions of the Massachusetts Constitution impose a more demanding standard than that the Fourteenth Amendment for gender-conscious classifications, an equal protection challenge to a gender-conscious sheltered market program established by a Massachusetts municipality would likely be brought pursuant to the Massachusetts Constitution. Additionally, although we have not found any Massachusetts cases analyzing an equal protection challenge to a gender-conscious set-aside program, we believe Massachusetts courts, in such a circumstance, would apply the same factors and principles described in Section A.i, above, recognized by federal courts for the review of equal protection challenges to race-conscious set- aside measures. ili. Standards Governing Veteran-Conscious Set-Aside Programs. Veteran status is not a suspect class under the Fourteenth Amendment, Starr v. QuikTrip Corp., No. 14-CV-621-GKF-TLW, 2017 W 431804, * 3 (N.D. Okla. Feb. 1, 2017); Branch v. Du Bois, 418 F. Supp. 1128, 1130 (N.D. Ill. 1976), or the equal protection provisions of the Massachusetts Constitution. See Finch, 459 Mass. at 662-67 (identifying suspect classes). Additionally, programs providing preference to veterans over non-veterans have been upheld under the minimal rational basis review standard. Russell v. Hodges, 470 F.2d 212, 218 (2d Cir. 1972); Peterson v. City of New York, No. 97 CIV 4505(LMM), 1998 WL 247530, *3-6 (S.D.N.Y. May 14, 1998); Branch, 418 F. Supp. at 1130. Under a rational basis review, a classification will withstand an equal protection challenge as long as it is rationally related to a legitimate state interest and is neither arbitrary, unreasonable nor irrational. D'Angelo v. N.H. Sup. Ct., 740 F.3d 802, 806 (1st Cir. 2014). Additionally, under this standard, the government need not actually articulate at any time the Almon v. Reno, 192 F.3d 28, 31 (1st Cir. purpose or rationale supporting the classification. 1999). Rather, a classification must be upheld against an equal protection challenge if there is any reasonably conceivable set of facts that could provide a rational basis for the classification regardless of whether the basis has a foundation in the legislative record. Id. Further, affording preference to veterans is a legitimate state interest. Regan v. Taxation with Representation of Wash., 461 U.S. 540, 550-51 (1983); Peterson, 1998 WL 247530 at *6. iv. Recommended Next Immediate Steps. In light of the above, we believe the most prudent way to satisfy the "findings" requirement of G.L. c. 30B, § 18(b) for the establishment of a sheltered market program would be for the City to conduct a disparity study to review and analyze whether there are present effects of past discrimination which a sheltered market program would be intended to address. 7

Notably, although a disparity study is not explicitly required by G.L. c. 30B, § 18, such a study would likely provide information that would be helpful in determining whether a sheltered market program, in the context of one intended for "minority businesses" or "women-owned businesses," would serve a compelling government interest. Without an evidentiary basis establishing that a sheltered market program would remedy the present effects of past discrimination (whether racial or gender based) within the markets of business enterprises from whom the City procures services and supplies, which may be established by a disparity study, such a program could be subject to, and potentially invalidated by, an equal protection challenge brought pursuant to the Fourteenth Amendment and the Massachusetts Constitution. B. If it is Determined that a Basis Exists for the City to Implement a Sheltered Market Program Following a Disparity Study, the Next Step Would be for the City to Authorize the Purchasing Agent to Establish such a Program through Approval by the City Manager and an Authorizing Vote by a Majority of the City Council. As noted above, G.L. c. 30B, § 18(b) provides, in pertinent part: "When authorized by majority vote, a chief procurement officer may establish a sheltered market program in conformity with the requirements of this section." (Emphasis added.) G.L. c. 30B incorporates the definition of "majority vote" contained in G.L. c. 44, § 1 to define that term. G.L. c. 30B, § 2. G.L. c. 44, § 1 defines "majority vote," in the context of a city, as "the vote taken by yeas and nays of a majority ... of all the members of each branch of the city government where there are two branches, or of all the members where there is a single branch of the city government." Municipalities in Massachusetts have two "basic" branches, legislative and executive. See, e.g., Boston City Council v. Menino, No. CIV.A. 0-1267, 2000 WL 744356, *4 n. 5 (Mass. Super. Ct. May 9, 2000). The head of the "executive branch" of a municipal government is the "chief executive officer." See, e.g., Opinion of the Justices, 429 Mass. 1201, 1207 (1999). The "chief executive officer" of a municipal government with a Plan E charter is the city manager. See, e.g., Quinlan v. City of Cambridge, 320 Mass. 124, 126 (1946). Thus, the City's government, under its Plan E charter, has two branches; the legislative branch (which consists of the City Council) and the executive branch (which is headed by the City Manager). Accordingly, assuming that a disparity study could serve as a basis for the "findings" required under G.L. c. 30B, § 18(b) for the reasons stated in the previous section of this memorandum, the next step in implementing a sheltered market program would be for the City to "authorize" the Purchasing Agent to establish the program by both: (1) a vote of a majority of the City Council; and (2) the approval of the City Manager. C. Recommendations for the Release of an RFP for Potential Consultant Teams to Conduct a Disparity Study. Due to the size and nature of conducting a disparity study, City staff recommend hiring a consultant team to design and execute a disparity study that would examine three (3) to four (4) years of the City's contracting data. Reviewing data beyond that timeframe risks the possibility of data corruption in light of businesses that closed more than three (3) or four (4) years ago. Additionally, since over 8,500 purchase orders are issued by the Purchasing Department each fiscal year, this data should provide sufficient evidence for the basis of the disparity study. 8

Additionally, City staff recommend releasing an RFP for a consultant team to conduct the disparity study during the fall of fiscal year 2022 (i.e., the fall of 2021) in order to provide the City a reasonable amount of time to develop both an RFP and to develop a list of potential consultant team applicants to contact in connection with the RFP. City staff looked into the question of whether forming a collective disparity study with other potential municipal partners was a viable option. The benefit of partnering with other jurisdictions on the study is the creation of a more regional approach to the findings of the study. Since municipal contracts cannot designate a city-specific vendor, a regional approach could be more desirous and impactful in helping disadvantaged vendors. An additional benefit develop and complete the disparity study to support a sheltered market program as soon as possible, City staff recommend releasing the RFP for a disparity study to be conducted for Cambridge alone as early as the Fall of 2021. Also, as noted in Section A, above, G.L. c. 30B, § 18 specifically defines the classes of "disadvantaged vendors" on behalf of which sheltered market programs can be established as "minority businesses," "women-owned businesses" and "veteran-owned businesses." applicable statute defines the term "minority" in "minority owned business" as to "a person with a permanent residence in the United States who is American Indian, Black, Cape Verdean, Western Hemisphere Hispanic, Aleut, Eskimo, or Asian." In light of the current definitions applicable to G.L. c. 30B, § 18, the City likely would not be able to establish a sheltered market program to support disadvantaged businesses that do not fit within those definitions (e.g. businesses owned by disabled or LGBTQ+ individuals). We therefore do not believe a disparity study should focus on disadvantaged business entities that do not fit within the definitions applicable to G.L. c. 30B, § 18. If the City wishes to explore the possibility of providing support for disadvantaged business entities that do not fit within the definitions applicable to G.L. c. 30В, § 18, the Law Department, in conjunction with Purchasing, CDD and the Office of Equity and Inclusion, can research potential measures to aid such disadvantaged business entities. Performing such additional research, however, would likely delay the City in conducting a disparity study and ultimately establishing a sheltered market program (if a basis exists to implement such a program). Similarly, we also do not recommend including within the scope of an RFP for a potential consultant team to research possible measures to aid disadvantaged business entities that do not fall within the definitions applicable to G.L. c. 30B, § 18, because including such a task in the scope would likely delay the findings of a disparity study and ultimate establishment of a sheltered market program (again, if a basis exists to implement such a program). D. Actions the City has Recently Taken and Continues to take to Assist Disadvantaged Business Enterprises in Cambridge. A sheltered market program is only one tool for assisting disadvantaged (underutilized) businesses in Cambridge. While undertaking the RFP process and working with the chosen consultant team on a disparity study, Assistant City Manager for Community Development Iram 9

Farooq reports that City staff have taken and continue to take the following actions to assist disadvantaged business enterprises in Cambridge, including: • The development of potential sheltered program processes. • The creation of the Black, Indigenous, and People of Color ("BIPOC") Business Advisory Committee. This BIPOC Committee will be looking at a variety of issues facing small businesses, including procurement, access to capital, and networking opportunities. • Hosting the following workshops: • How to Become a Vendor - a workshop to learn how to become a vendor with the City and how to find current bids available to vendors; and • How to Respond to a City Quote or Bid - a workshop to learn how to look for, find and respond to solicitation of quotes or invitation for bids with the City. • Working with the Information Technology Department to increase internal data collection capacity for future purchasing to identify which goods and services, as well as construction projects are being fulfilled by disadvantaged vendors. • Expanding the City's vendor registry through the City's Business Certificate Form. • Marketing the Commonwealth of Massachusetts's Supplier Diversity Office certification workshops and training. • Increasing advertising directed at publications and organizations serving disadvantaged vendor pools. • Encouraging City employees to do proactive marketing and outreach to diverse vendors. • Promoting the City's recently updated Diversity Directory (20% increase in entries), which is intended to celebrate and highlight diverse independent and locally owned small businesses, entities, and sole proprietors whose places of business are in Cambridge. • City staff continue to promote the City's grant programs, which includes outreach to underserved populations. Over the course of the COVID-19 pandemic, City staff have instituted enhanced outreach to ensure that women and minority owned business enterprises (WMBEs) in Cambridge are being reached. To continue supporting Cambridge's businesses, especially our small, local businesses, the City, working with the Cambridge Redevelopment Authority, awarded $4.8 million in COVID-19 grants and loans to support small businesses facing multiple challenges. Funds were distributed via four (4) different programs involving $900,000 from the Mayor's Disaster Relief Fund, $1.5 Million from the Cambridge Redevelopment Authority's zero-interest loan program and $200,000 from grants from the Cambridge Redevelopment Authority, and a combined $2.2 million from Community Development block grant funds and Federal CARES Act funds administered through the City's Relief, Recovery and Winter COVID- 19 Grant Programs. The grant criteria prioritized businesses that have been more severely affected by the impact of the COVID-19 pandemic and ones that are women- and/or minority-owned. In total, the City received over 790 applications for these programs and provided over 560 grants and loans to assist Cambridge businesses, which included: • businesses on average receiving $10,000 in aid (over all rounds of grants and loan programs); • women and/or minority owned businesses on average receiving over $1,800 more in aid; and 10

• women, minority, or women and minority owned businesses made up more than 70% of the recipients of all such grant/loan programs. CONCLUSION For the reasons discussed above with respect to Awaiting Report No. 21-2, we recommend that the City, in order to determine whether a sheltered market program under G.L. c. 30B, § 18 can be implemented in Cambridge, first conduct a disparity study to review and analyze whether there are present effects of past discrimination for which such a program would be intended to address. If it is determined that a basis exists for the City to implement a sheltered market program following a disparity study, the next step to implement such a program would be for the City to authorize the Purchasing Agent to establish such a program by: (1) a vote of a majority of the City Council; and (2) the approval of the City Manager. As to Awaiting Report No. 21-4, City staff recommend that the City release an RFP for a consultant to conduct a disparity study as early as the fall of 2021. Additionally, while undertaking the RFP process and working with a selected consultant, City staff will continue engaging in various actions to assist disadvantaged business enterprises in Cambridge. Very truly yours, XX Nancy E. Glowa City Solicitor