Minority-owned companies scramble to share in stadium construction

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We now know that two new stadiums will be built in the Twin Cities: a Minnesota Twins ballpark in downtown Minneapolis, to be opened in 2010, and a football stadium on the University of Minnesota’s main campus, to be ready in the fall of 2009.

No general contractor has been selected for the $480 million, 42,000-seat Twins ballpark in the Warehouse District, or the $248.7 million, 50,000-seat Gopher football stadium. Construction on both projects is expected to begin next summer, with preliminary work to begin this fall.

“We have about $900 million of stadium construction,” says Ezell Jones of Premier Network Service Group. But how much of the almost $1 billion stadium-building pie will go to construction firms headed by women and persons of color? This question was the topic of a panel discussion on building stadiums held on the final day of the June 21-23 National Association of Minority Contractors (NAMC) conference at the Radisson Plaza Hotel in downtown Minneapolis.

Throw in the proposed Minnesota Vikings stadium in Anoka County and other related projects, including transportation, and an additional $1 billion worth of construction work is expected over the next 10 years — about $10 billion worth, Jones, who moderated the panel, estimates. “When there is any kind of construction, there is $1 to $5 more of other related construction,” he explains.

Major projects such as the Twins and Gophers stadium plans typically have minority company participation of 20 to 30 percent. “Whether it is 20 percent or 30 percent,” noted Jones, “that’s a large amount of business.”

One panelist, Turner Construction Company Senior Vice President Hilton Smith, pointed out, “Inclusion is the order of the day.” Smith, who has worked for 35 years at the Ohio-based firm that builds stadiums, along with Jones and Craig Taylor of the U of M, were the only persons of color on the panel. Jones suggested that minority firms must get to know “the ones that stir the drink, who will make the decisions on these types of projects.”

Throughout the hour-long discussion, both the university and an official from the Twins assured the audience, composed mostly of contractors of color, that minorities would be involved.

Taylor, who heads the U of M’s business and community economic development office, says he expects between 15 and 20 percent minority participation, as well as persons of color’s involvement in other facets of the Gopher stadium project. “We also are having conversations about pre-apprentice instruction training programs to make sure people of color in the trades and apprentice areas be involved,” he affirmed.

A competitive bidding process for selecting a general contractor and other building work will be conducted later this year. “You all will be informed about that in enough time,” Taylor pledged.

Twins Sports, Inc. President Jerry Bell says he expects minority-owned firms to help build the new Twins ballpark. “I think we are a year away in terms of construction,” he added.

Since Hennepin County is putting up the majority of the Twins ballpark’s construction cost, $350 million, and is responsible for site acquisition and infrastructure, the county board expects “an aggressive inclusion” of women and people of color, said Business and Finance Office Director David Lawless. He pointed out that the board last week passed a resolution requiring that minority-owned firms be involved in the construction process.

Taylor and Project Manager Sharon Banks are the two black individuals responsible for monitoring the Gopher stadium’s construction. “It’s my office’s responsibility to manage this process and to ensure that inclusion happens at all levels,” says Taylor. “Sharon is very capable to monitor the compliance process. We [persons of color] have to be involved at every level, from the very beginning to the very end.”

“We have been discussing this ever since the stadium was a twinkle in the eye,” adds Banks.

Though no general contractor has yet been selected, the U of M has hired Hines Interest to manage the stadium construction. The Gopher stadium project is divided into five parts; the first, involving environmental cleanup of the site, is expected to begin in December, David Spillman said. University officials want the site ready for construction “in about a year from now,” he noted.

Other sports building projects that Hines has managed, including a new ballpark in San Diego and Houston’s new pro basketball arena, have had up to 30 percent minority participation, added Spillman.

During the question-and-answer session, an individual asked the panel if a minority-owned firm could handle such a project — or two such projects in this case. Smith responded rhetorically, “Can a small general contractor be able to come up and take the prime general contractor? It may be very difficult.”

For minority- and women-owned firms, “joint venturing” — a smaller firm partnering with a larger one — “might be your best opportunity,” suggested Smith. “Joint venture started years ago, and it had to be nourished and adapted to where we are today. It is just what it is, but you have to be absolutely sure that everybody carries the load.”

Minority firms must be willing to partner with others, Jones believes. MA Mortenson Vice President Ken Sorenson agrees: “Get a hold of those that will be chosen to participate in this project, especially at the construction management and general contractor level,” he suggested.

MA Mortenson, which built Target Center and the Xcel Energy Center in St. Paul, is expected to bid for either or both stadium projects. Sorenson says his firm welcomes joint venturing. “It is not important that you never participated in a project in the past,” he added. “What is important is that you have core competence, you believe in it, and have a solid work ethic.”

“Early participation is always the best,” Bell continued as he encouraged the audience members to contact him immediately. “What we like to do is to fully understand your organization and its capabilities.”

Whenever a contract is awarded to a minority firm, it should be monitored, Smith warns. “We got to make sure that it is for $500,000 and not $50,000. That’s where the real monitoring comes in.”

Minority firms must “be able to do what you say you are going to do,” added Smith, “and then go fulfill the aims and goals of the marketplace and the community. Don’t be afraid to promote your successes. It has to be well known, and you have to put it out there in writing, on your website.”

Even though the Hennepin County Board passed the minority inclusion resolution, none of the board’s three appointees to the newly formed, five-person Ballpark Authority are persons of color; nor are the two appointees of Minnesota Gov. Tim Pawlenty. According to Lawless, the Authority will oversee construction and protect the public interest. “We felt that the ballpark needs to be owned by a public entity,” he explained.

Afterwards, Erroll T. Foster, who owns North Minneapolis-based Image Contractors, questioned the reality of minority involvement in both stadium projects. “If you are calling it a true joint venture, a lot of your subcontractors aren’t going to have the financing to do the project,” says Foster. “That’s where there is a big gap.”

Still, Foster said he learned a great deal from the panel discussion. “I feel that coming to this meeting, it is giving me the time frame and the opportunity to find out how to get involved. If I hadn’t been at this meeting, I would have found out about [the process] through the media during the second stage. I wouldn’t have been able to get involved in the preliminary stages, in which my work is most effective.”

Taylor advises all minority firms that “They can’t expect that the process is going to create a situation for them to get involved. They need to come to the table prepared, and then we can start to negotiate around the differences to begin to make it work.”

“This is the time, before anything is carved in stone that you should have your input,” concluded Jones.

Any minority firm interested in participating in the stadium projects should contact the U of M’s Sharon Banks (612-624-0530) and/or Twins Sports President Jerry Bell (612-375-1366).

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