The Board of Alders Finance Committee on Monday advanced a resolution for a diversity initiative aimed to boost participation of women and minority-owned (WMO) businesses in the city’s financial dealings.
The resolution came to the committee at the behest of Controller Daryl Jones, whose position in the Elicker administration puts him in charge of the city’s funds and accounts, including capital borrowing, bond sales and management of pension funds. When Jones assumed the position six years ago — under then-Mayor Toni Harp — his office conducted an internal review of its financial partnerships and found that representation of WMO firms in Elm City was virtually nonexistent from 2000 to 2014. Over the past six years, Jones’ office has brought the number to 50 percent of all financial partners. Monday’s resolution, he said, constituted an effort to increase accountability by requiring the administration to report those figures to the Board of Alders on a yearly basis.
“The Board of Alders — who represent the people — should be aware of what type of financing deals we do [and] who participates in that,” Jones said. “This is something that can organically grow where we’re not only focused on firms participating, but we’re also focused on exposing this to our younger children.”
Jones has focused on bolstering inclusion specifically among underwriters — financial institutions that assume investment risks by guaranteeing payment in the case of a financial loss. In New Haven, 22 underwriting firms are responsible for selling municipal bonds, 11 of which have female or minority leadership. Getting to that number, Jones said, was not difficult — rather, it was the result of a deliberate attempt to increase representation within the existing selection framework.
The city’s Department of Finance employs financial advisors tasked with soliciting companies to carry out municipal financial transactions. That process begins, Jones said, with the creation of a pool of potential firms who present to city officials. Officials evaluate these prospects based on their track records in the region and nation, and the resulting group runs the gamut from small local firms to large enterprises like Morgan Stanley.
For example, the majority women-owned Stern Brothers provided underwriting services to the Elm City this past summer. This partnership, Jones told the News, was one among many success stories — WMO businesses have significantly outperformed other firms, he said. In some situations, he continued, these businesses have even oversold city bonds, driving down the interest rate and allowing for remarketing.
As of now, the 50 percent WMO standard is an internal one, Jones said. But he hopes that, in the future, the Board of Alders will codify a standard for financial partners similar to existing provisions surrounding representation in city construction contracts. Jones noted that the issue is particularly important in the financial sphere, given how consistent those transactions are in comparison to their relatively infrequent construction counterparts.
Several alders on Monday indicated that they would be interested in a more robust legislative program. Ward 25 Alder and Finance Vice Chair Adam Marchand floated the idea of a required threshold, while Ward 23 Alder and Board President Tyisha Walker-Myers suggested that a biannual report would better serve to keep the issue of financial diversity at the forefront of New Haveners’ minds.
“So often we hear about how important it is to have diversity in places,” Walker-Myers said on Monday. “I think this is a very important place to have it — when we’re talking about our finances and talking about bonding.”
She went on to question how to better highlight the accomplishments of women and minorities in finance beyond passing Monday’s resolution. Jones offered two suggestions: aiming to expose New Haven’s children to the financial world via internships and advocating for investment firms to open offices in the Elm City. Several alders also noted that the initiative will serve as a signaling mechanism, letting WMO firms know that New Haven is open for business.
Jones first assumed the controller position in Feb. 2014.
Mackenzie Hawkins | firstname.lastname@example.org