With the aid of no public oversight, this blog on MWBE covers some of the entities that benefit from public programming designed to serve the overall public good in the Memphis Tomorrow public-private complex. The blog comes at a time of the Coronavirus when public programming is on the upswing.
Based on our recent EDGE survey, fueled by excessive incentives, local MWBE programming benefits mostly highly reputable, established and some seemingly affluent companies while forwarding a culture of runaway elitism. This finding makes MWBE programming with regard to excessive PILOTs a scam. In fact, most of the companies that generated more than $1M in MWBE receipts gathered in the survey, appear too large to qualify as a locally owned small business (LOSB).
These highly established, reputable and locally operated entities are companies that large corporations would look to locally trade with regardless of any local incentive programming. Some of the companies appear to be based outside of Shelby County while others carry no MWBE or LOSB designation that can be found. So why underwrite the purchase orders of global corporations through excessive incentives under the heading of MWBE and economic development?
In local legislative proceedings, oversight to determine whether the local economy is really benefitting from MWBE programming, just does not occur. There are never any deep dives into the data or legislative discussions of the companies generating significant MWBE receipts with most of the top receipt generators needing no special consideration at all.
This occurs as legislators fail to ask investigative questions while diving into MWBE LOSB status or asking how startups are benefitting from MWBE. Memphis has long needed more small business establishments which startups would fuel. And to make matters worse, there is no public lobbying support, on this front, from the likes of the Epicenter.
So who are some of the top companies that benefit from MWBE programming?
The Top MWBE Companies
The above table has been adjusted from the previous blog based on further research and reclassification. The below amounts, of the covered companies, only include companies that generated greater than $1M in EDGE MWBE recorded receipts included in the above $79M based on the last compliance report issued by PILOT companies.
Nike never has issued an MWBE EDGE compliance report as of the date of this survey. And finally, the below does not include all MWBE receipts the companies may be locally receiving as this just involves a sampling of EDGE. Here are the companies from the EDGE survey:
KBG Technologies (WBE) – $12,059,663
KBG Technologies is the only woman-owned, full-service specialty chemistry provider for pulp and paper. Starting in 1993, Kathy Buckman Gibson worked her way up in the ranks of her father’s company to serve as Chairman of the Board of Bulab Holdings and Chief Operating Officer of Buckman International. In 2017, Gibson launched KGB Technologies and today benefits from significant MWBE transactions from International Paper
Fayette Janitorial (WBE) – $6,038,941
Fayette Janitorial, a 15 year old company, incorporated in Somerville, TN. with a corporate website and a Memphis website and a local address at 5100 Poplar. Fayette appears to have a national footprint with several notable, mostly food processing clients referenced on their corporate website while generating significant MWBE transactions with Smucker and Solae.
R&R Plumbing (WBE) – $5,601,599
R&R Plumbing is a 30 year old WBE company based in Collierville while generating significant MWBE transactions from Amazon. A company website was not found.
Image Environmental (WBE) – $5,338,431
Image Environmental is a 12 year old WBE company based in Memphis, TN. and has generated significant MWBE receipts from Valero.
American Electrical Contractors (WBE) – $5,218,306
American Electrical Contractors is a 44 year old WBE company that has generated significant MWBE receipts from TAG Trucking, Solae, JM Smucker and Ebfrost.
GCM Inc. (WBE) – $4,567,88
GCM is a 17 year old WBE concrete construction company that has generated significant MWBE receipts from Amazon.
ServiceMaster Facilities (MBE) – $4,433,276
Separate from ServiceMaster Holdings, ServiceMaster Facilities is a 15 year old janitorial MBE company servicing 10 states while generating significant MWBE receipts from International Paper and Technicolor.
Signet (WBE) – $3,429,492
Signet is a 44 year old promotional marketing WBE company that generates significant MWBE transactions from ServiceMaster and International Paper
Airfield Inc (WBE) – $2,630,231
Airfield is a 19 year old electrical contracting WBE company that has generated significant MWBE transactions with TAG Truck Enterprises.
W.A. Soefker (Vendor) – $2,498,745
W.A. Soefker is a 77 year old mechanical contracting company that has generated significant MWBE transactions from TAG Truck Enterprises.
C-1 Inc. (MBE) – $2,060,682
C-1 Inc is a 21 year old MBE construction company that generated significant MWBE transactions from Amazon.
Provide Staffing (WBE) – $2,056,978
Provide Staffing is a 40+ year old WBE warehouse staffing company that has generated significant MWBE transactions from Impact Innovations.
Prestigious Placement (MBE) – $1,919,347
Prestigious Placement is a 9 year old MBE staffing company that has generated significant MWBE transactions from Technicolor.
Southern Sales (MBE) – $1,562,379
Southern Sales is a 29 year old MBE electrical supply distributor that has generated significant MWBE transactions from Amazon. A website could not be found for Southern Sales.
1Link Technology (WBE) – $1,480,309
1Link Technology is a 3 year old WBE technology staffing company that appears to be headquartered in Monroe, Louisiana. 1Link promotes itself as being one of the 500 fastest growing companies in America. 1Link has generated significant MWBE transactions from International Paper and Technicolor.
Artizan Constructors (MBE) – $1,155,843
Artizan Constructors is a 20 year old MBE construction firm that has generated significant MWBE receipts from TAG Trucking Enterprises.
Bright Construction (Vendor) – $1,089,525
Bright Construction, unrelated to Al Bright, is a 57 year old local construction company that helped Kemmons Wilson build the first Holiday Inn. Bright Construction has generated significant MWBE receipts from JM Smucker.
APG Office (WBE) – $1,000,330
APG Office is a 51 year old WBE interior office design company based in Cincinnati, OH. With a local Memphis office, APG has generated significant MWBE receipts from ServiceMaster Holdings and Enoble.
Conclusion
Who knows what’s next with the Coronavirus. But one thing is for sure, the local taxpayer, in a Memphis Community in need, will be carrying forward $120M in annually recurring tax incentives. If Memphis is to move forward from the Coronavirus, a new culture of govermental oversight is needed where none of the public-private complex has historically existed.
Its clear that the historic top beneficiaries of public MWBE programming are well established and long thriving companies. In the future, MWBE programming should demand LOSB and Startup status while reducing local incentives by 60% for the overall good and allowing companies to buy into reformed MWBE programming.
But even with reforms, to be effective, public programming requires governmental oversight; something that seems foreign in a Memphis community in need….