Helping Small Business Compete for Contract Opportunities
The state of Texas currently has more than 1,225 infrastructure related contracts underway worth approximately $10.6 billion. Ranking fourth in the State behind Austin, Fort Worth and Houston; San Antonio currently has let approximately 82 transportation related contracts, worth more than $475 million.
OSDBU would like to ensure that the small business community is adequately prepared to compete for these opportunities. In partnership with the Texas Department of Transportation (TXDOT), Bexar County SMWBE/DBE Program, San Antonio International Airport, City of San Antonio Capital Projects, and the Metropolitan Transit Authority; OSDBU strategically planned to offer the Bonding Education Program (BEP) in the San Antonio Region. In order to do so, the Gulf Region Small Business Transportation Resource Center (SBTRC) offered training and capacity building resources through the BEP.
Participants Increase Bond Readiness
The San Antonio BEP workshop component comprised of 8 weeks of bonding operational improvement training courses. Following the workshops, the bond readiness component offered participants one-one-one assistance through the SBTRC in an effort to assist them with acquiring bonding for the first time or increasing their current bonding capacity. With 16 contractors participating in this San Antonio BEP series, stakeholder, Bexar County representative Renee Watson, Manager, Bexar County Small, Women and Minority Business Enterprise (SWMBE) program, deemed the workshop component of the BEP a success.
On March 26, 2013, participant in the San Antonio BEP, George Zurita shares his experience in the program with the San Antonio Express News:
Previously Mr. Zurito, former employee of Zachry Construction Corp., could not obtain a line of credit or a loan for his company, Z&L Concrete Contractors. “Here I was — a concrete contractor, and I couldn't even buy concrete,” he said. But Zurita knocked on doors and established relationships with suppliers and vendors. Soon he was able to buy a concrete mixer truck. “I was able to get established little by little,” Zurita said. He said his business as a subcontractor was “great” until December, when the company from which he got 90 percent of his business, Ballenger Construction Co., filed for Chapter 11 bankruptcy protection.
Recently, Zurita took a big step toward expanding his business when he completed the BEP offered by the USDOT in Bexar County, TX. With the help of the program, he obtained bonding for the first time for $500,000.
This bond enabled Zurita to bid on his first job with TxDOT for structural concrete work last week. He placed fourth out of 12 bidders.
Bidding on the job “felt great,” Zurita said. “Never before in the history of my business was I able to bid as a general contractor. Although I didn't win the job, I was happy to know the process of what it takes to be able to bid on your own.”
Another participant in the BEP, Patrick McMullen, CEO of MGS Construction in San Antonio, a commercial builder, said he went into the county's basic program “with zero bonding.” “We had a $50,000 line of credit, so we were pretty cash-strapped,” he said. “We were running a construction company off our four credit cards.” But as a result of making changes following the basic program, McMullen was able to boost the company's line of credit to $150,000. After the second program on bonding, “that's where the skies opened up, because we went from $150,000 to $1 million line of credit,” McMullen said.
Mr. McMullen said that the courses helped him understand how insurance companies, bonding companies and bankers would evaluate his company.
That information helped him and his partner develop better financial processes. “Once those were in place, it was a matter of getting two years of profitability,” McMullen said.
Pictured: Gulf Region SBTRC 2013 San Antonio (Bexar County), Texas; US DOT Bonding Education Program (BEP) Participants, Stakeholders, and Gulf Region SBTRC Project Director, Tony Arps at the BEP workshop completion ceremony held on March 5, 2013.