HomeMy WebLinkAboutMINUTES - 08171993 - 1.47 / `47
TO: BOARD OF SUPERVISORSsE- c
� of Contra
FROM: WARREN E. RUPF, Sheriff-Coroner
Costa
County
DATE: r2 couKr �P�
July 28, 1993
SUBJECT: CONTRACT WITH PACIFIC BELL FOR INMATE TELEPHONE SERVICE
SPECIFIC REQUEST(S)OR RECOMMENDATION(S)&BACKGROUND AND JUSTIFICATION
I . RECOMMENDED ACTION
Approve and authorize the She"riff-Coroner or designee to execute
on behalf of the Inmate Welfare Fund, a five-year contract,
effective July 1, 1993, with Pacific Bell fora tiered group rate
commission on all inmate telephones located within the Detention
Facilities .
II . FINANCIAL IMPACT:
During the life of the contract, Pacific Bell estimates that the
commissions earned from the inmate telephone system will increase .
from approximately $300,000 to $350,000 annually.
III . REASONS FOR RECOMMENDATION/BACKGROUND:
Penal Code Section 4,025 permits the Sheriff to expend funds
deposited into the Inmate Welfare Fund solely for the benefit,
education and welfare of the inmates .. An itemized report of
the expenditures is submitted annually to the Board of Supervisors .
Typical expenditures include contracts for services with Friends
Outside and the Council of Churches of Contra and for a Director
of Inmate Services. The Inmate Welfare Fund also provides money
to indigent inmates for public transportation upon their release,
books and reading materials for the inmate libraries as well as
recreational and educational equipment for use by the inmates .
CONTINUED ON ATTACHMENT: YES SIGNATURE:
RECOMMENDATION OF COUNTY ADMINISTRATOR RECOMMENDATION OF BOARD COMMITTEE
APPROVE OTHER
SIGNATURE (S):
ACTION OF BOARD ON AUG 1 17 APPROVED AS RECOMMENDED OTHER
VOTE OF SUPERVISORS
I HEREBY CERTIFY THAT THIS IS A TRUE
UNANIMOUS(ABSENT AND CORRECT COPY OF AN ACTION TAKEN
AYES: NOES: AND ENTERED ON THE MINUTES OF THE BOARD
ABSENT: ABSTAIN: OF SUPERVISORS ON THE DATE SHOWN.
Sheriff AUG 17 1993
cc: CAO - George Roemer ATTESTED
CAO Emma Euevor PHIL BATCHELOR,CLERK OF THE BOARD OF
Auditor-Controller SUPERVISORS AND COUNTY ADMINISTRATOR
Pacific Bell via Sheriff-Coroner
M382BY DEPUTY
(10/88)
1 �7
Virginia F.Tormey-Lawson,CPCU Pacific Telesis Center PACIFIC&V TELESIS,
Director-Risk Management 130 Kearny Street,Suite 3474 Group
San Francisco,California 94108-4819
(415)394-3085
Fax No.:(415)391-8132
June 28, 1993
CONTRA COSTA COUNTY SHERRIFFS OFFICE
ATTN.PETER CHRISTIANSEN
1000 WARD STREET
MARTINEZ CA 94553
REF: PACIFIC BELL PROPOSAL FOR
INMATES TELEPHONE SERVICE
GENTLEMEN:
THIS IS TO CERTIFY THAT PACIFIC BELL HAS QUALIFIED AS A SELF-INSURER
UNDER THE LAWS OF THE STATE OF CALIFORNIA WITH RESPECT TO WORKERS
COMPENSATION. OUR IDENTIFICATION NUMBER FOR THIS PURPOSE IS 2-0054-03.
IN ADDITION,PACIFIC BELL IS SELF-INSURED FOR ALL GENERAL AND AUTO
LIABILITIES,INCLUDING BODILY INJURY AND PROPERTY DAMAGE.
PLEASE ACCEPT THIS LETTER AS EVIDENCE OF SUCH SELF-INSURANCE IN AN
AMOUNT SUFFICIENT TO MEET YOUR REQUIREMENTS UNDER THE TERMS OF THE
AGREEMENT WITH PACIFIC BELL.
SINCERELY,
VIRG NIA F.TORMEY-LAWSON,CPCU
DIRECTOR -RISK MANAGEMENT
cc: Jim Sailor-Pacific Bell
Tel# (800)870-9096
Fat# (510)7120
LTR #: 285
Public Communications-Sales PAC I F I C=;BELL
24801 Huntwood Avenue
Hayward,California 94544 A Pacific Telesis Company
July 9, 1993
Contra Costa County
Attention: Peter Christiansen
Director of Inmate Programs and Services
1000 Ward Street
Martinez, California 94553
Dear Peter,
Per our last meeting please find enclosed a copy of the
current Space Use Agreement, new Agreement with schedules and
a copy of the M/WBE-DVBE report requested by Contra Costa
County. This is the same M/WBE-DVBE report Pacific is
required to provide to the CPUC on an annual basis.
I trust that these enclosures will meet with your approval .
Please feel free to contact me should you have any questions
or concerns.
Sincerely,
KC Sh lly
Account Executive
510-784-3632
cc: B. Mulgrew, B. Davis
JLL-02-1993 09:19 FROM TO HAYWARD P.02
SPACE OSE AGREEMENT FOR PUBLIC TELEPHONES RD016(419%
TRiS AGREEMENT is entered into by and between mr: Peter C ri *ixrnseo___ doing business as
ma—ralta Dinyppp d " gsiness Owner"or"Owner")
and:PACIFIC ELL,38 Bea Cour#, an Ramon, allfornia 94883("Pacificic")�e purpose of establishing the terms
and conditions under which Pacific may place additional puptic telephones or retain its existing public telephones on
Owner's premises. The Agreement is as follows: ;
t.'TfRtp$ti AGREE tM1�N1,'r and oreemnttinuing o and t shall be In imIuding nitia��f three At the end oars f his
on �9r/ttA
Initial term, this Agreement shall be automatically exighdad for an additional peter odeqqual to the length of the
Initial term,unless prior to the end of the Initial tern el er party notifies the other,in writing,of Its Intent not to
extend this Agreement.
2.RiGHT TO USE SPACE.Business Owner hereby confirm",and agrees that Pacific may retain Its public telephones
at the locations where they are presently situated,and Ov4eragrees to allow Pacific to Install such additional public
telephones on Owner's premises as Pacific and OwnC may agree upon from time to time. All terms of this
Agreement shall apply to any additional public tele ones. All public telephone equipment shall remain the
property of Pacific. Owner represents to Pacific that I has the authority to enter into this Agreement and that
execution of this Agreement will not place Owner in b ch of any pre-existing contracts Owner may have with
respect to pay phone service on its premises. {
3.COMPENSATION SCHEDULE, For so long as Business Owner complies with the terms and conditions set fortis
in this Agreement,Pacific will pay to Owner,for each of Pacific's public telephones located on Owner's premises,
the compensation described In Exhibit A,attached hereto and made a part hered,
4.BUSINESS OWNER'S WARRANTY AS TO MHOMOM UMBER OF PHONES. Owner shall not be required to
maintain or Install only Pacific's public telephones on i)tner's premises,except that Business Owner aggroes to
allow Pacificto maintain a minimum of�Pacific publib telephones on its premises located throughoutthe State
of California. This minimum represents 80%of such P. clfic telephones installed at the time of this Agreement.
Notwithstanding the foregoing,where Owner has fours Is or less,Owner shall always have the right to place one
non-Pacific set.So long as Owner maintains this minim Owner shall have the right to remove Individual Pacific
telephones on thirty (30) days prior notice; provl , however, that Owner shall reimburse Pacific for its
engineering,construction,and related costs of installin nd removing the telephones and associated equipment
If Owner removes a public telephone within twelve(1 � ,months after Its installation. This reimbursement shall
be in addition to any other remedies Pacific may have ,br breach of this agreement.
5.ELECTRICITY.At Pacific's request.Owner at its expcn ej shall fumish uninterupted 110-volt AC electricity to the
paint of connection on the public telephone equipmon.i Such electricity shall be furnished for the operation of
lights,tan,lighted signs or similar electrical devices ud with the public telephone equipment.
6.REMOVAL EXPENSE. At the time any public telephones are removed,Pacific at its expense shall remove the
public telephones and enclosure unless Owner's obliga'on under section 4 above to reimburse Pacific for such
expenses applies. Owner at its expense shall remo bumper posts and other fixtures associated with the
telephone, and make safe the site(s). Pacific accepts o liability for holes placed In wails, pillars or floors or
defacement of same on Owner's premises when such were necessary for installation or removal of the public
telephones or resulted from vandalism.
7.ADVERTISING,SIGNS AND USE OF TELEPHONES. Owner shall not use the public telephone equipment in the
conduct of its business nor use the public telephone nurlper(s)in Its advertising.No advertisement orattachment
of any type not authorized in writing by Pacific shall(Dbbieaa affixed to or used on or In connection with the public
telephone or its enclosure.
6,CONFIDENTIALITY OF INFORMATION. Owner shall k' p confidential and use only for confirming Pacific's
performance under this Agreement any technical,busin ss,revenue or usage Information disclosed to Owner by
Pacific,except the message and total revenue summaryrovided to Owner along with its compensation payment
successors and assigns.
9.ASSIGNMENT. This Agreement shall inure to the benefi of and be binding upon the parties hereto,their heirs,
i0 REGULATORY OVERSIGHT.The parties hereto aggroe that is Agreement shall be governed by all applicable tariffs
of Pacific on file with the California Public Uti ities Commission (Including applicable tariffs limiting Pacific's
liability for interruption of service),and shall be subjectto such changes or modifications as may be required or
authorized by any regulatory commission In the exercisf of its lawful jurisdiction and any modification,revision,
renewal or extension of this Agreement shall so stater Pacific declares that the filing of the Agreement herein
with the Public Utilities Commission of California pursuant to the procedural requirements of General Order 96
Is not to be construed as a public offering by Pacific of the services or facilities herein above referred to.
11.,ATTORNEY'S FEES. if either party commences an actio against the other party to enforce the provisions of this
'Agreement,the prevailing party shall be entitled to recc#er from the losing party reasonable attorneys'fees and
'costs of salt. \\'�'''��)
EXECUTED this _3 day ol�.� nC 18
PACIFIC BELL
Stpnad,re:Pd le
F'SpnaturTe
Named p,„ KC Shelly
----�-
Title: .__..�.., �i Tula:
Account Executive
conuct'amptxme ll.OmpAcmrao? 415-095-55113
Numbor: Pok rekphon0 Number,
Fed Tax 1.0.I
or$6 t y
PACIFIC$W me compensation end en nmicae to:
(address) (ctp code?
AMONO MESISCOMPANY 1!1111/ PACIFIC13BELL.
TOTAL P.02
SPACE USE AGREEMENT FOR PUBLIC TELEPHONES
THIS AGREEMENT IS ENTERED INTO BY AND BETWEEN CONTRA COSTA
COUNTY DOING BUSINESS AS CONTRA COSTA COUNTY INMATE WELFARE
FUND ("Business Owner" or "Owner") and PACIFIC BELL, 39 Beta
Court, San Ramon, California 94583 ("Pacific") for the
purpose of establishing the terms and conditions under which
Pacific may place additional pubic telephones or retain its
existing public telephones on Owner's premises. This
Agreement supersedes the current Space Use Agreement for
Public Telephones between the parties, effective January 1 ,
1991. The Agreement is as follows:
1. TERM OF AGREEMENT. This Agreement shall be in effect for
an initial term of five (5) years commencing on July 1,
1993 and continuing to and including June 30, 1998 . At
the end of this initial term, this Agreement shall be
automatically extended for an additional period equal to
the length of the initial term, unless prior to the end of
the initial term either party notifies the other, in
writing, of its intent not to extend this Agreement.
2. RIGHT TO USE SPACE. Business Owner hereby confirms and
agrees that Pacific may retain its public telephones at
the locations where they are presently situated, and Owner
agrees to allow Pacific to install such additional public
telephones on Owner ' s premises as Pacific and Owner may
agree upon from time to time. All terms of this
Agreement shall apply to any additional public telephones.
All public telephone equipment shall remain the property
of Pacific. Owner represents to Pacific that it has the
authority to enter into this Agreement, and that execution
of this Agreement will not place Owner in breach of any
pre-existing contracts Owner may have with respect to pay
phone service on its premises .
3. COMPENSATION SCHEDULE. For so long as Business Owner
complies with the terms and conditions set forth in this
Agreement, Pacific will pay to Owner , for each of
Pacific ' s public telephones located on Owner' s premises ,
the compensation described in Exhibit A, attached hereto
and made part hereof.
4. BUSINESSS OWNER' S WARRANTY AS TO MINIMUM NUMBER OF PHONES.
Owner shall not be required to maintain or install only
Pacific 's public telephones on Owner' s premises, except that
Business Owner agrees to allow Pacific to maintain a minimum
of 223 Pacific public telephones on its premises located
throughout the State of California. This minimum represents
80% of such Pacific telephones installed at the time of this
Agreement. Notwithstanding the foregoing, where Owner has
four sets or less, Owner shall always have the right to
place one non-Pacific set. So long as Owner maintains this
minimum, Owner shall have the right to remove individual
Pacific telephones on thirty (30) days prior notice;
provided, however, that Owner shall reimburse Pacific for its
engineering, construction, and related costs of installing
and removing the telephones and associated equipment if Owner
removes a public telephone within twelve (12) months after
its installation. This reimbursement shall be in addition to
any other remedies Pacific may have for breach of this
Agreement.
5. ELECTRICITY. At Pacific' s request, Owner at its expense
shall furnish uninterrupted 110-void AC electricity to the
point of connection on the public telephone equipment.
Such electricity shall be furnished for the operation of
light, fan, lighted signs or similar electrical devices
and used with the public telephone equipment.
6. REMOVAL EXPENSE. At the time any public telephones are
removed, Pacific at its expense shall remove the public
telephones and enclosure unless Owner' s obligation under
section 4 above to reimburse Pacific for such expenses
applies. Owner at its expense shall remove bumper posts
and other fixtures associated with the telephone, and make
safe the site (s) . Pacific accepts no liability for holes
placed in walls , pillars , or floors or defacement of same
on Owner ' s premises when such were necessary for
installation or removal of the public telephones or
resulted from vandalism.
12. INTRALATA TRAFFIC. County agrees that Pacific shall
carry all intraLATA traffic generated by Pacific' s pay
phones until the effective date of the removal of LATA
boundaries pursuant to the anticipated order of the
California Public Utilities Commission in the
Implementation Rate Design proceeding, I. 87-11-033
( "removal of LATA boundaries) . If subsequent to the
removal of LATA bounderies County receives an offer from
another carrier during the term of this Agreement for
carriage of intraLata traffic, County shall give Pacific
an opportunity to match such offer.If Pacific matches
any such competitive offer received by County, Pacific
shall remain the default carrierof intra-Lata traffic.
EXECUTED this day of 19_
BUSINESS OWNER PACIFIC BELL
Signature: Signature:
Printed Name: Printed Name:
Title: Title.:
Contact Telephone: Contact Telephone:
Number: Number:
Fed Tax I.D.# Fed Tax I.D.
t SS # SS #
Pacific Shall mail compensation and all notices to:
(Address) (Zip)
EXHIBIT A
PACIFIC BELL ,INMATE TELEPHONE COMMISSION PLAN
Pacific Bell 's Length of Contract 5 Years
Year Schedule A Schedule B
223 phones* 279 phones**
1993 26% 265%
1994 335% 33%
1995 35% 37%
1996 36% 38%
1997 37% 395%
Schedule B shall become effective upon execution of the
Agreement:
Schedule A shall become the effective rate upon 10 days
written notice to County in the event any of the following
occur:
(1) the total number of stations, for all County Inmate
Facilities covered under this Agreement falls below 223
stations or (2) a jail closes and the total revenue usage
generated by all the pay phones in the aggregate ,
falls more than 20% below current levels , based on a rolling
average revenue for the previous months .
Or Below
** And Above
Revenue and Commission estimates are based on 1992 'usage.
i 1" c
Vacbrell Public ' Ielephone Service-
Compensation Rate Sc' hedule
In accordance wir-111, the Fublic Tele-hone Ser:ice
Azretmenl. Pacinc ill Shall '2v 'he �USLIIIeSS Owner
c0mvensallon bas-es or, billable Zrross revenue for rhe
2 MlloWjr.2 call tyres Corn Vjere6 within the same r;?ce
Area:
707 916 Cash P3iQ' (?.mount of L:niteu -States
Coins Cotlectea)
Chico Calling Carus
11 Collect Calls
916 m Third
Sacramento
The comrtr�,:ation is caSe,3 on U�'le ccfflecztontnrer-2i
510
San
and magi cover more trap one month's usage. 1"Xclucelz
415 -70 f-rom tke comoensarion are all
Francisco accilcable zZx-�Ls
Stockton .1 .lee 7
c---lls to toil n-umicers. and (--PT—'C
408 9 , surae it;,. GrouL Azz--urit cr 415-OV15-571S
eie ror.e u rn'c
8 2oq 4
.Monterey 408 Fresno
6,19
San
x-
Luis 805 esi t:
01spo
ILI
805
818 213 310
,---Los, A-nples
k if
L-7
6 19
Jj e 'u.Y A
San Die-go
S c,
a e
SG
PA F R E 1-1.
ilA PACIFICIT-E.I.ESIS COMPANY1 1111911 ll I
BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA
Order Instituting Investigation into)
the policies, practices, procedures )
and costs of women and minority ) I.90-02-044
business enterprise programs ) (Filed February 23, 1990)
established under General Order 156 )
for the year 1991, and related )
matters. )
PACIFIC BELL (U 1001 C)
M/WBE-DVBE ANNUAL REPORT. PLAN AND
COST EXHIBIT
MARCH 1, 1993
M/WBE-DVBE ANNUAL REPORT
AND PLAN ,
PACIFIC BELL
M/WBE-DVBE OPERATIONS DISTRICT
MARCH 1, 1993
TABLE OF CONTENTS
Page
I. INTRODUCTION. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1
II. ANNUAL REPORT (General Order 156, Section 9) . . . . . . . . . . . . . .2
A. Description of Program Activities. . . . . . . . . . . . . . . . . . . . . .2
General Order 156, Section 9.1.1
1. Internal Program Activities. . . . . . . . . . . . . . . . . . . . . . . . .2
a. Employee Education. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2
b. Vice President Coordinator Meetings. . . . . . . . . . . . .2
c. Subcontracting Training. . . . . . . . . . . . . . . . . . . . . . . . .3
d. Employee Recognition. . . . . . . . . . . . . . . . . . . . . . . . . . . .4
e. Quality Partners Program. . . . . . . . . . . . . . . . . . . . . . . .4
f. Coverage of Results with officers. . . . . . . . . . . . .- .5
g. Supplier Resource Team. .. . . . . . . . . . . . . . . . . . . . . . . .5
h. Disabled Veteran Business Advisory council. . . . . 06
i. Internal Program Improvements. . . . . . . . . . . . . . . . . . .7
j . M/WBE Supplier Verification. . . . . . . . . . . . . . . . . . . . .9
k. Publications. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .9
2. External Program Activities. . . . . . . . . . . . . . . . . . . . . . . .12
a. Meetings, Conferences and Trade Fairs. . . . . . . . . .12
b. Memberships. . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .17
c. Awards Received by Pacific Bell. . . . . . . . . . . . . . . .17
d. Asian Community Meetings/RACR/NAACP/Diversity
Task Force. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .18
e. Emerging Business Enterprise Commission. . . . . . . .20
f. Subcontracting. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .20
g. Clearinghouse Advisory Board. . . . . . . . . . . . . . . . . . .21
h. Toll-Free Supplier Referral Line. . . . . . . . . . . . . . .21
i. Advertising. . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . .21
J . Supplier Resource Team. . . . . . . . . . . . . . . . . . . . . . . . .22
k. Development. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .22
1. Loan Fund. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .23
B. A Summary of Purchases. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .25
General Order 156, Section 9.1.2
C. Program Expenses. . . . o - o . . . o . . . . . . . . . . . . . . . . . o . . . . . . . . .27
General Order 156, Section 9.1.3
D. Description of Progress Toward Goals. . . . . . . . . . . . . . . . . .28
General Order 156, Section 9.1.4
E. Summary of Subcontracting Utilization. . . . . . . . . . . . . . . . o30
General Order 156, Section 9.1.5
F. Supplier Complaints. . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . .31
General Order 156, Section 9.1.6
G. Exclusions. . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . .33
General Order 156, Section 9.1.7
H. Recruitment of Suppliers in Areas of Low Utilization. .34
General Order 156, Section 9.1.8
I. Justification of Excluded Areas. . . . . . . : . . . . . . . . . . . . . . .37
General Order 156, Section 9.1.9
III. INTRODUCTION. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - -38
IV. ANNUAL PLAN (General Order 156, Section 10) . . . . . . . . . . . . . .39
A. Goals. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ...39
General Order 156, Section 10.1.1
B. Description of Program Activities Planned for 1993. . . .41
General Order 156, Section 10.1.2
1. Internal Program Activities. . . . . . . . . . . . . . . . . . . . . . . .42
a. Employee Education. . . . . . . . . . . . . . . . . . . . . . . . . . . . .42
b. Publications. . . . . . . . . . . . . . . . . . . . . . . . . . o — o . . . .42
c. Employee Recognition. . . . . . . . . . . . . . . . . . . . . . . . . . .42
d. Vice President Coordinator Meetings. . . . . . — o —42
e. Coverage of Results With Officers. . . . . oo — . . .43
f. Disabled Veteran Business Advisory Council. . . . .43
g. CPUC Clearinghouse. . . . . . . . . . . . . . . . . . . . . . . . . . . . .43
h. OSMB Certification. . . . . . . . . . . . . . . . . . . . . . . . . . . . .43
i. Supplier Resource Team. . . . . . . . o — o . . . . . . . - -44
2. External Program Activities. . . . . . . . . . . . . . . . . . . . . —45
a. Meetings, Conferences and Trade Fairs. . . . . . . . . .45
b. Memberships. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .45
c. Asian Community Meetings/HACR/NAACP/Diversity
Task Force. . . . . o . o . . . . — oo . 000 . o . . . . . . . - - -
.45
d. General Order 156 Advisory Board. . . . . . . . . . . . . . .46
e. Advertising. . . . . . . . . . . . . . . o — o . . . . . . . . . . . . . . . .46
f. Orientation. . . . . . . o . . o . . 00 . . . . o . . . o . . . o — . . . . .46
g. Development. . . . . . — . . . . . . . . . . . . . . . . . . . . . . . . . .47
h. Loan Fund. . . . . oo — . . . . . . . . . . . . . . . . . . . . . . . . . . . .47
C. Plans for Recruiting Suppliers in Categories
Where Utilization is LOW. . . . — oo . . . . . . . . . oo — o . . . . . . .48
General Order 156, Section 10.1.3
D. Plans for Recruiting Suppliers in Excluded Areas. . . . —49
General Order 156, Section 10.1.4
E. Subcontracting Plans. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
General Order 156, Section 10.1.5
I. INTRODUCTION.
This filing, in compliance with the requirements of
California Public Utilities Commission (CPUC) General Order
156, includes an Annual Report and Plan of Pacific Bell's
Minority/Women Business Enterprise (M/WBE'j and its Disabled
Veteran Business Enterprise (DVBE) program activities. The
Annual Report describes Pacific Bell's program activities
and results for the period January 1 through December 31,
1992. The Plan outlines Pacific Bell's M/WBE program
objectives for 1993, and M/WBE numerical purchasing goals
for 1993, 1995, and 1997.
-1-
II. ANNUAL REPORT
General Order 156, Section 9
A. Description of M/WBE and DVBE Program Activities
General Order 156, Section 9.1.1
Pacific Bell is committed to provide I&BEs and DVBEs
with the opportunity to compete for Pacific Bell's
contracting and subcontracting business. The internal
and external program activities described below were
conducted by Pacific Bell in 1992 to help increase its
utilization of M/WBEs and DVBEs.
1. Internal Proqram Activities
a. Employee Education
The Employee Education Program is administered by
Pacific Bell's M/WBE-DVBE Operations District. In
1991, Pacific Bell reorganized its internal
business structure in order to meet the rapidly
evolving changes in customer needs, technology,
public policy and competitive conditions. This
restructure also required the M/WBE-DVBE staff to
be responsive to the needs of the newly configured
business units. In 1992, in response to requests
from our internal clients, several analytical
reporting formats were developed and introduced to
the business units. The new formats were met with
great enthusiasm and interest. The new tools allow
the employees to analyze their group's spending
patterns, provide status on the progress being
made toward goals and reveal purchasing areas that
offer opportunities for improved M/WBE and DVBE
utilization.
b. Vice President Coordinator Meetings
Each Vice President at Pacific Bell has appointed
a manager to work with the M/WBE-DVBE Operations
District staff to assure full implementation of
the M/WBE and DVBE programs within his/her
organization. These managers are referred to as
"V.P. Coordinators". ' The V.P. Coordinators
monitor M/WBE and DVBE utilization within their
departments, identify areas of opportunity and
help educate, motivate and recognize employee
utilization of M/WBEs and DVBEs.
-2-
While the M/WBE-DVBE Operations District staff
holds frequent informal meetings with individual
V.P., Coordinators, it also held three formal
meetings with the entire V.P. Coordinator network.
During these sessions, the coordinators were
trained on report database acces#, report
analysis, organizational M/WBE goal setting for
1993, M/WBE and DVBE supplier sourcing and a
review of new legislation and its impact on our
program.
c. Subcontracting Training
In 1992, the M/WBE-DVBE Operations District staff
conducted training sessions for employees
responsible for contracting and purchasing. we
continued to stress the importance of
subcontracting to the end users of the products
and services purchased from major prime
suppliers. This additional step, of reaching out,
to the users of products/services, was designed to
demonstrate to these employees how they can use
the M/WBE subcontracting program to increase
Pacific Bell's M/WBE utilization.
The M/WBE-DVBE Operations District staff continued
to publish and distribute to key managers, a
status report containing the names of prime
suppliers who have submitted a plan to utilize
M/WBE subcontractors. This report also contained
the prime suppliers' 1992 M/WBE goals and their
actual results. The report encouraged employees
to enlist the support of their management team
when discussing M/WBE subcontracting goals with
prime suppliers. This report also encouraged the
managers to contact the suppliers that have not
yet agreed to utilize M/WBE subcontractors.
The M/WBE-DVBE Operations District staff ensured
compliance with Pacific Bell's M/WBE
subcontracting program guidelines by establishing
detailed methods and procedures for auditing prime
suppliers' results and monitoring Pacific Bell's
requests for proposal/requests for quotation, and
resulting contracts.
-3-
d. Employee Recognition
Throughout the year the M/WBE-DVBE Operations
staff maintained an informal recognition process
and issued certificates of appreciation to
employees for their efforts to fVrther the spirit
and intent of our M/WBE program. The employee's
supervisors were asked to include this recognition
in the employee's personnel file.
On April 8, 1992, the Ninth Annual M/WBE
Recognition Awards Presentation was held to
formally honor Pacific Bell employees for their
innovative approaches to increasing opportunities
for M/WBE suppliers. Pacific Bell President and
CEO Phil Quigley, addressed the audience and
presented the awards. Twenty-five employee teams
were honored at this event for making significant
contributions toward reaching their M/WBE goals,
either by increasing the number of M/WBE suppliers
they worked with, or by increasing the percentage
of dollars spent with M/WBEs. In addition, 15
employees received Special/Honorary Recognition
Awards for aggressive leadership in promoting
M/WBE utilization.
e. Quality Partners Program
Pacific Bell believes that superior quality
performance will be achieved by collaborating more
closely with its suppliers and by clearly sharing
information and expectations. Pacific Bell's
Quality Partners Program formally commends a
supplier's overall quality when quality pervades
all aspects of the business relationship. Through
the Quality Partners Program, Pacific Bell
communicates to its suppliers that the quality of
their internal processes, as well as performance
results, are critical. In 1992, Pacific Bell
recognized 18 M/WBEs for their quality
contributions.
In 1992, the Quality Partners Program was upgraded
to include M/WBE participation as another criteria
for supplier recognition. This strategic upgrade
reinforces the significance of the M/WBE program
to our prime supplier community.
_4_
f. Coverage Of Results With Officers
The M/WBE-DVBE Operations District staff informed
the Pacific Bell officers, at least monthly, of
the current M/WBE performance of each officer's
organization and the company's overall progress
toward achieving its M/WBE goals'. In February,
1992, correspondence was sent to the officers
providing 1991 year-end M/WBE performance
analysis. In May 1992, the officers received
correspondence detailing first quarter
performance. In July 1992, correspondence was
sent to the officers who constitute the Pacific
Bell Public Policy Committee. The purpose was to
provide a mid-yea= M/WBE purchasing performance
status report. In December 1992, the officers
received their 1993 goal recommendations.
g. Supplier Resource Team
Throughout 1992 each Supplier Resource Team member
provided valuable assistance to their respective
work groups. This assistance took the form of:
advice and counsel, locating viable M/WBE
suppliers for upcoming bids, interfacing with the
M/WBEs prior to their involvement with supplier
managers and fielding innumerable calls from
prospective M/WBEs seeking specific opportunity
information. The Supplier Resource Team was also
responsible for planning and coordinating Pacific
Bell's involvement in external outreach events.
Members of the Resource Team gave three formal
presentations to the following groups:
o A procurement workshop targeted to small
businesses, sponsored by the City of Oakland
Office of Economic Development and Employment;
Grant Thornton, San Francisco/Oakland Minority
Business Development Center; and the East Bay
Small Business Development Center.
o A small business workshop sponsored by the
Sonoma County Economic Development Board,
Pacific Gas & Electric and Pacific Bell.
o A procurement forum organized by Dr. Phillip
Chen of the Asian Business Association.
-5-
h. Disabled Veteran Business Advisory Council
In June, 1992, General Order 156 was amended by
CPUC Decision 92-06-030. Included in this
revision to the General Order was the requirement
for the utilities to include Disabled Veteran
Business Enterprises (DVBE) in their purchasing
programs. In support of this new program, the
M/WBE-DVBE Operations staff established an
internal DVBE Advisory. Council to develop and
implement an effective DVBE program for Pacific
Bell. The Council's members include C. Ikami,
Director, M/WBE-DVBE program,
R. Lowe, Director, Information Systems
Contracting, F. Murphy, Senior Contract Manager,
N. Stephenson, M/WBE-DVBE Program Manager,
D. Williams, M/WBE Strategic Business Development
and 0. Borjon, DVBE Program Administrator.
The Council met three times in 1992 and was
successful in developing a charter. The Council
is charged with:
o implementing G.O. 156 requirements in a way that
demonstrates Pacific Bell's commitment to the
program.
o developing and implementing a company-wide
program to improve Pacific Bell's present and
future utilization of Disabled Veteran-Owned
Businesses.
o developing meaningful short and long-term
utilization strategies and performance goals for
all departments with purchasing responsibility.
o reviewing existing purchasing opportunities
against the DVBE database for possible
utilization matches.
o conducting strategic benchmarking with other
utilities and corporations to ensure the best
practices are included in Pacific Bell's
program.
-6-
In August 1992, as a result of the Council's
expertise, broad knowledge base and commitment to
establishing strong business relationships with
DVBEs, a qualified DVBE was identified and
selected to assist Pacific Bell with the training
of personnel in the event of a work stoppage.
While the work stoppage never odcurred, the DVBE
successfully completed much of the start up work
associated with the project. This exposure
allowed the DVBZ an opportunity to participate in
other direct competitive business opportunities
with Pacific Bell. In addition, the DVBE's
networking contacts were broadened with other
prime suppliers resulting in the selection of the
DVBE for a subcontracting award for Pacific Bell
business.
i. Internal Progrann Improvements
In 1992, Pacific Bell made the following
improvements in the administration of the
M/WBE-DVBE program:
(1) Management of the program was further
enhanced by holding regular, integrated team
meetings. These status and strategy meetings
include Steve Welch, V.P. Shared Services,
the M/WBE-DVBE Operations Staff, Contracting
and Supplier Management executives and M/WBE
Supplier Resource Team members. The focus of
these meetings -was on the performance of the
top MBE suppliers, the status of contract
opportunities for MBEs and overall MBE and
WBE purchasing status.
(2) Full implementation of the on-line M/WBE
results tracking database that provides
individual organization's access to M/WBE
results was completed in second quarter,
1992.
(3) M/WBE-DVBE staff members and company software
developers designed *a system improvement to
the M/WBE Accounting and Procurement
databases. This system enhancement will
allow Pacific Bell to accurately track and
report the utilization of verified suppliers.
In addition, this enhancement will identify
those utilized M/WBE or DVBE suppliers who
still need to be verified by either the CPUC
Clearinghouse or the Office of Small and .
Minority Business.
(4) In second quarter 1992, the M/WBE-DVBE staff
began a monthly distribution of a "Key Items"
report to employees. The report provides a
one-page summary of significant factors that
impacted the current month's results.
-7-
(5) The M/WBE-DVBE staff met with members of the
Accounting, Systems and Purchasing districts
to incorporate DVBE information tracking and
reporting into all of the existing M/WBE
tracking reports. Full implementation will be
completed in second quarter 1993.
(6) The M/WBE-DVBE staff and Pacific Bell's Legal
Department revised the contracting language
to include the DVBE requirement. In
addition, updates are occurring to the
subcontracting language included in our.
contracts for purposes of committing the
prime suppliers to DVBE performance goals.
Full implementation will be completed in
first quarter, 1993.
(7) A database of certified DVBEs by
product/service offering, geographical region
and alphabetical listing was developed and
distributed to all key M/WBE-DVBE contacts
within Pacific Bell.
(8) The Resource Team instituted a new method of
soliciting external stakeholders for the
identification of viable suppliers. When the
Resource Team becomes aware of an upcoming
bid opportunity they send pertinent criteria
information to various community based
organizations via facsimile. The expectation
is that the Resource Team will receive
feedback from the organization of a known
supplier in that particular product/service
area. Since this practice has been in
effect, four responses have been received,
one of the suppliers identified met the
criteria and was included in the opportunity
to bid.
(9) In 1992 the M/WBE-DVBE staff initiated a
study of Pacific Bell's bill payment
intervals. A survey was sent to a random
sampling of our suppliers in order to obtain
their input. Of those surveyed, 78.4%
indicated that our payment intervals either
met or exceeded their expectations; 84.4%
indicated that it was the- same or faster than
their other customers.
-8-
As a result of this study, two process
improvement initiatives were adopted. First,
the automated invoicing system was updated to
be able to correct inaccurate tax
calculations rather than reject the entire
document and create unnecessary delays.
Second, when late supplier 'payments occur, an
analysis is conducted to establish the root
cause of the problem. Whether the problem
stems from an internal organizational failure
or a supplier's accounting inefficiency,
supplier managers work with the parties ,
involved to improve the invoicing and/or
payment methods.
J . M/WBE Supplier Verification
The M/WBE verification process requires extensive
documentation on the inner workings of the M/WBE.
business. M/WBEs often perceive these
requirements as intrusive and onerous and
discourage bonafide M/WBE suppliers from seeking
verification status. In response, Pacific Bell
has aggressively campaigned to ensure that the
maximum amount of M/WBE expenditures and number of
M/WBE suppliers are verified by the CPUC
Clearinghouse. Through end of year, 1992, 33% of
the M/WBE suppliers that Pacific Bell did business
with were verified while 86% percent of the
dollars in the M/WBE purchasing base was
verified. The M/WBE-DVBE Operations District
staff continued to submit M/WBE subcontractors to
the Clearinghouse for verification.
Pacific Bell strongly supports, and urges the CPUC
staff to adopt, reciprocal verification against
universal standards throughout the state. This
program enhancement would go a long way to ease
the administrative burden currently shouldered by
the M/WBE suppliers, lessen the ratepayer's
overall cost of the program and ensure the
utility's M/WBE expenditures are with bonafide
M/WBE suppliers.
k. Publications
M/WBE-DVBE Operations' staff members implemented
the 1992 media plan for internal communications.
The staff utilized the company .newspaper
Connections to communicate key messages.
Connections is distributed weekly throughout the
company. On a quarterly basis, Connections
publishes an article entitled, "Team Report.„ The
report contains key indicators - of the company's
financial performance, customer satisfaction
levels and M/WBE results.
-9-
(1) On March 9, 1992, an article was published
entitled "Contract smooths cable purchasing
process". The article announced the award of
a 5-year, $300 million contract with an MBE
to provide 100$ of outside plant cable. The
contract was the largest single commitment
Pacific Bell had ever made *ith a minority
supplier. The deal represented an estimated
$10. million in savings over the five years.
(2) On April 27, 1992, ,the annual M/WBE
Recognition Event article appeared. The
article,' "Top M/WBE users honored", further
recognized the individuals and/or teams who
increased the use of M/WBE suppliers and who
successfully developed superior supplier
relationships, both internal and external to
Pacific Bell.
(3) On September 28, 1992, a community service
article was printed, "California Hispanic
Chambers of Commerce awards Pacific Bell".
Pacific Bell was honored as the 1992
Corporation of the Year by the San Francisco
chapter of the Hispanic Chamber. The award
was received in recognition for Pacific
Bell's outstanding support of the Chamber's
statewide convention. Pacific Bell developed
and distributed invitations, handled
registration and provided an 800 number using
Pacific Bell Call Management.
(4) On October 5, 1992, an article appeared which
described the close business relationship
Pacific Bell shares with minority
communities. The article detailed Pacific
Bell's community involvement through its
purchasing, language assistance and corporate
giving programs.
Individual organizations throughout Pacific Bell
published newsletters for the purpose of
communicating program developments. Two of the
more active publications are: Information Systems
Contracting District M/WBE Newsletter and M WBE
News for the General Contracting and Supplier
Quality Management District. These newsletters
were issued quarterly and contained quantitative
as well as qualitative progress reports. They
were also used to provide peer recognition and
motivation for continued success.
-10-
In addition, the M/WBE-DVBE Operations staff
produced the following publications:
(1) Steps Bulletin
The Steps Bulletin_ is a spepial report issued
by the M/WBE-DVBE Operations District
whenever newsworthy events or developments
requiring immediate action occur with respect
to M/WBE purchasing activities. This report
is distributed to suppliers to explain policy
changes, statistics, and other important
information. Steps Bulletins #9 was
developed and distributed in 1992. This
issue focused on our 1991 results by
product/service category and identified
potential procurement opportunity areas for
1992.
(2) M/WBE Orientation Package
An M/WBE Supplier Orientation Package was
developed for Pacific Bell by a bay area
Minority Woman-Owned business. The package
was created to assist M/WBE suppliers through
the process of marketing to a large
corporation. It addresses the questions most
frequently asked by M/WBE suppliers about
Pacific Bell's procurement process. The
package was distributed throughout the year
at the trade fairs and conferences we
participated in. There are plans to update
the package in 1993 with updated M/WBE
information and a new section which focuses
on the DVBE supplier community.
-11-
2. External Program Activities
a. Meetings, Conferences and Trade Fairs
Throughout 19'92, Pacific Bell supported a wide
variety of conferences and trade fairs for the
distinct purpose of identifying 'M/WBEs for
specific procurement opportunities. In support of
this strategy Pacific Bell produced a six minute
video entitled "Big Business Doing Business With
Small Business". The video tells the positive
story of a minority supplier that provides
customized preparation and delivery of plastic
insulated cable to Pacific Bell. The video shows
how this supplier works with Pacific Bell using
Quality Management concepts. It is being shown to
external groups who are interested in Pacific
Bell's program and to internal audiences to
promote the M/WBE and DVBE programs. Some
specific examples of the events Pacific Bell
supported are as follows:
(1) March 18, 1992
Procurement Workshop for Small Business
This procurement workshop targeted to small
business was sponsored by the City of Oakland
Office of Economic Development and
Employment; Grant Thornton, San
Francisco/Oakland Minority Business
Development Center; and the East Bay Small
Business Development Center. This was the
first time Pacific Bell had participated in
this event. The workshop attracted 40
suppliers.
(2) March 27, 1992
Prospering as a Small Fish in a Big Pond
Workshop
This event was sponsored by the Sonoma County
Economic Development Board, Pacific Gas &
Electric and Pacific Bell. Pacific Bell
presented information pertaining to the
toll-free supplier referral line, the
registration process and effective marketing
tips .to an audience of 160 suppliers.
-12-
(3) March 27, 1992
Joint Conference 56th Access Meeting
Pacific Bell supplier managers were available .
to the 200 suppliers who attended this
event. The event, specifically designed to
offer networking opportunities for the M/WBEs
and major corporations who participated, was
considered a resounding success.
(4) April 9, 1992
Pasadena Chamber of Commerce Trade Fair.
This well-organized, high energy trade fair
provided an opportunity for the small
businesses in attendance to meet one-on-one
with a supplier manager from the
participating corporations. The small
businesses could use their time with the
supplier -manager to market their company,
learn more about the corporation's purchasing
process or however they decided was the best
use of the time. The small businesses felt
this outreach approach was very valuable.
(5) May 9, 1992
Asian Business Association Procurement Panel
A member of Pacific Bell's Resource Team
participated in this event targeted to
Asian-owned businesses in California
interested in doing business with the
utilities. The manager provided the audience
with insights on Pacific Bell's procurement
process in general with some specific
information on a recent contract award for
architectural services.
(6) May 19, 1992
Northern California Purchasing Council
Breakfast and Symposium, on Minority
Purchasing Issues
A member of Pacific Bell's Resource Team and
a supplier manager were active participants
in a group discussion on the topic of
practical approaches to reducing the barriers
to minority purchasing. This event offered
the Pacific Bell representatives with the
opportunity to network with both the MBEs and
the corporations in attendance.
-13-
(7) May 21, 1992
Women Construction Owners and Executives 4th
Annual Conference and Awards Banquet
Pacific Bell organized and participated in a
public utilities procurement opportunities
panel at this event. A representative from
Pacific Bell's Real Estate Management and
M/WBE-DVBE staff provided information on what
and how we purchase and they were also
available to answer questions from the
audience. Citizens Utilities Company of
California, Pacific Gas & Electric Company
and Roseville Telephone Company also
participated in the program.
(8) August 19, 1992
Northern California Purchasing Council
Minority Business opportunity Day and Trade
Fair
The exhibit booths were organized by the type
of purchasing done by the participating
corporation. This approach facilitated the
MBEs ability to effectively market their
product/service offering to the appropriate
corporation. There were exhibitors from the
high-tech, construction/facilities
development and professional services area.
Pacific Bell was represented by supplier
managers in each of the categories.
(9) August 26-29, 1992
California Hispanic Chambers of Commerce 1992
Convention
Pacific Bell was a platinum level sponsor of
this event. Pacific Bell was well
represented throughout the entire event by
employees from the Hispanic/Asian Market
Group, Consumer Affairs, Product and
Technology Support, Legal and the Shared
Services organization.
-14-
(10) September 10, 1992_
San Francisco Regional 10th Annual Awards
Ceremony
This event was held in observance of the
tenth annual Minority Enterrpprise Development
Week. The purpose of the gent was to
recognize and praise outstanding minority
business men and women who have become
successful business persons. The theme of
the event was "Minority Business Development
Challenges, Strength and Growth". A Pacific
.Bell Resource Team member was a participant
on the coordinating committee and hosted 4
MBE suppliers at the event.
(11) September 24, 1992
San Diego Minority Supplier Development
Council
Pacific Bell supported this event by donating
promotional gifts to be distributed at the
annual Operation Opportunity Procurement
Conference. The event, attended by over 100
small, minority businesses from the San Diego
area provided a gateway for these suppliers
to discuss business opportunities with
government, state, local and prime contractor
representatives.
(12) October 7, 1992
8th Annual Minority Enterprise Development
Conference
Pacific Bell was a bronze level supporter and
an exhibitor at this event. Employees from
Pacific Bell's Sacramento North Business Unit
and the Hispanic/Asian Market Group joined a
Resource Team member in staffing the
exhibition booth. Suppliers attending the
event were provided with a list of current
purchasing opportunities and access to the
toll free 800 supplier referral line.
-15-
(13) October 13, 1992
National Communications Forum 192
The Vice-President of Pacific Bell's Shared
Services organization addressed an audience
of corporate executives frog companies
throughout the United State's. The
presentation focused on the critical factors
that need to be in place when designing and
implementing a minority, women and disabled
veteran business enterprise program. A
self-assessment questionnaire developed..by
the M/WBE-DVBE Operations staff was
introduced to the audience as a useful tool
for determining the development phase or the
maturity level of their respective programs.
The questionnaire contained 25 questions with
a scoring chart to indicate whether the
program being assessed was "introductory",
"emerging", "advanced" or "world-class". The
entire presentation, including the
questionnaire, was well received by those in
attendance.
(14) November 9, 1992.
Managing Your Contract: Financing Strategies
for Small Business Doing Business with Big
Business
Pacific Bell and the San Jose Development
Corporation co-sponsored this business
seminar that was open to small, minority,
women and disabled veteran-owned business
enterprises. Forty-five small businesses
attended the seminar. Total Quality
Management concepts, information on
traditional/non-traditional banking,
government financing and leads on no-cost or
low-cost resources that are available to help
find and secure money was provided.
-16-
b. Memberships
Representatives of Pacific Bell's Procurement and
Real Estate departments served in various
capacities with numerous external M/WBE
organizations. These organizations included:
(1) Inland Empire Purchasing Council
(2) Joint Conference, Inc.
(3) Minority Business' Development Agency
(4) Minority Business Opportunity Committee
(5) Northern California Regional Purchasing
Council
(6) Orange County Purchasing Council
(7) Sacramento Regional Purchasing Council
(8) San Diego Minority Supplier Development
Council
(9) Southern California Regional Purchasing
Councils, Inc.
External Affairs staff representatives also served
in various capacities with numerous external M/WBE
organizations. These organizations included:
(1) Asian Business Association
(2) Association of Black Women Entrepreneurs
(3) Black Business Association
(4) Black Chambers of Commerce
(5) California Hispanic Chambers of Commerce
(6) Contra Costa Black Chamber of Commerce
(7) Latin Business Association
(8) National Association of Women Business Owners
(9) National Center for American Indian
Enterprise Development
c. Awards Received By Pacific Bell
Pacific Bell received one award in 1992:
(1) October, 1992
Bronze Underwriter of the 1992 Sacramento
Minority Enterprise Development Week
Conference
Pacific Bell received this award in
recognition of the outstanding corporate
support it provided to the 1992 Sacramento
Minority Enterprise Development Week
Conference.
-17-
d. Asian Community Meetings/HACR/NAACP/Diversity
Task Force
(1) Asian Community Meetings
Formal and informal meeting were held with
the Asian members of the Diversity Task Force
and other community based organizations to
discuss Pacific Bell's M/WBE purchasing
program.
(2) HACR
Pacific Bell and HACR (Hispanic Association
on Corporate Responsibility) signed a three
year economic development agreement of mutual
cooperation in 1987. In 1990, this agreement
was extended for an additional three years by
Pacific Bell and HACR. This extension
reaffirms the commitment of Pacific Bell and .
HACR to continue to work cooperatively.
The agreement establishes regular meetings
during which Pacific Bell and HACR assess
progress and explore issues of common
interest. It is expected to continue to
result in measurable benefits for Pacific
Bell and the California Hispanic community.
A committee of representatives from Pacific
Bell and HACR met to review progress and
discuss the commitments made in the renewed
agreement. Committee members include the
Vice President of Corporate Communications
and Regulatory Relations, the President of
HACR, California representatives of the HACR
organizations and other California-based
Hispanic organizations who participated in
the initial agreement.
Purchasing information and an analysis of
product/service spending were presented to
the committee on May 12, 1992. The
quantitative results Pacific Bell presented
to HACR are audited annually by a third party
monitoring consultant.
-18-
(3) NAACP
On July 6, 1984, Pacific Bell and the
National Association for the Advancement of
Colored People (NAACP) signed a "Statement of
Mutual Cooperation," the first entered into
by the NAACP and the telecolmmunications
industry. The economic development agreement
of mutual cooperation reaffirms Pacific
Bell's commitment to equal opportunity and
pledges its cooperation in seeking increased
purchasing from, and training and mutual
business benefits for, all minorities.
On June 19, 1992, company representatives met
with the NAACP to assess progress and develop
areas of priority for the coming year. In
addition, areas of mutual concern were
identified where concerted efforts are needed
in order to achieve our common goals.
In October, 1992, the NAACP Economic
Development Program conducted a Signatory
Networking Seminar in Ft. Lauderdale,
Florida. Pacific Bell was invited, as a
signatory with an exemplary program, to make
a presentation on our M/WBE program. The
NAACP planned to make the information we
presented available to current and future
signatory companies in their efforts to
implement effective programs.
(4) Diversity Task Force
In February, 1990 Pacific Bell convened a
group of 18 recognized California community
and business leaders to advise Pacific Bell
on how to increase M/WBE purchasing, value
diversity in the workplace and use
telecommunications to positively address
community issues.
In 1992, the Diversity Task Force issued its
final report which included the company's
responses. The M/WBE subcommittee of the
Task Force developed 31 recommendations they
believed would improve the effectiveness of
Pacific Bell's program.
In response, Pacific Bell has developed an
action. plan to address each one of the
recommendations. Listed below are a few of
the insightful recommendations put forth by
the Task Force:
(a) Develop a revised mission for the M/WBE
program that better defines what Pacific
Bell plans to accomplish as the program
matures
-19-
(b) Provide Total Quality Management
information to all M/WBEs.
(c) Include quantitative and qualitative
goals when defining M/WBE. program success
in the 190s
(d) Increase the availabilipy of relevant
information to help M/DBEs assess the
potential of pursuing opportunities with
Pacific Bell
(e) Increase contract managers' capability to
work with small M/WBEs by helping those
managers better understand the needs of
small business.
e. Emerging Business Enterprise Commission
On January 14, 1992, Assembly Member Gwen Moore
introduced House Resolution Number 30 relative to
the Assembly Commission on Emerging Business
Enterprise Procurement. The Commission was
created to assist the Assembly in developing
strategies to achieve the procurement goals
specified in existing law. The Commission is
composed of 15 members appointed by the Speaker of
the Assembly. They represent the banking,
finance, public utility, manufacturing, government
and emerging business enterprise communities. The
Commission will report its findings and
recommendations to the Assembly Committee on
Utilities and Commerce. Pacific Bell's
Vice-President of Shared Services, Steve Welch is
an active member of the Commission and presides
over the utility subcommittee.
f. Subcontracting
Pacific Bell continued to conduct officer level
meetings with major suppliers to discuss Pacific
Bell's M/WBE subcontracting program and to obtain
their commitment to increase their utilization of
M/WBEs.
Pacific Bell also worked directly with many of the
prime suppliers' M/WBE coordinators to assist in
the development of their M/WBE programs. In
addition, Pacific Bell worked with other utilities
and Regional Bell Operating Companies to support
their newly developed subcontracting programs.
-20-
g. Clearinghouse Advisory Board
California Public Utilities Commission General
Order 156 ordered the creation of a Clearinghouse
Advisory Board (CAB) . The CAB was composed of
utility and M/WBE community representatives
responsible for establishing a M/WBE verification
clearinghouse and database. The CAB, having
completed its mission, has been dissolved.
Commission Decision 92-06-030 has made provision
for a General Order 156 Advisory Board.
h. Toll-Free Supplier Referral Line
In 1992, an automatic response unit was installed
on the "800" line. The system provides
prospective suppliers with current information on
purchasing opportunities. and instructions on how
to transfer from the automated system to someone
able to provide additional information. The
system also generates supplier registration forms
on demand so that interested suppliers can become
a part of Pacific Bell's supplier database.
A detailed script was drafted for the M/WBE-DVBE
staff members to use when answering caller's
questions about Pacific Bell's purchasing
opportunities. This process is continually being
reviewed and upgraded based on suggestions
received from internal and external clients. In
1992, the system processed approximately 5,800
calls.
i. Advertising
In 1992, Pacific Bell advertised in 4 minority
publications. The current advertisement is far
more specific than previous advertisements in
describing the company's purchasing needs. The
toll-free supplier referral telephone number
continues to be a part of the ad.
Pacific Bell also placed a full page advertisement
in the July 28 edition of Challenge News, a trade
paper for Disabled Veteran Business Enterprises.
The ad was placed in support of the annual
Disabled Veteran National Convention held in Reno,
Nevada on August 2, 1992.
-21-
j . Supplier Resource Team
The Supplier Resource Team (described in Section
II, A, 1, g of this report) , represented Pacific
Bell in the community. Pacific Bell's business
relationships extend to a range of community,
technical, trade, and M/WBE advocacy groups.
Through these associations, the Supplier Resource
Managers:
(1) Explained how to engage in Pacific Bell's
business processes;
(2) Hosted or attended conferences and trade
fairs to describe the quotation process and
provide specific contract opportunity
information to potential M/WBE suppliers;
(3) Solicited assistance in identifying M/WBE
suppliers for underutilized purchasing areas;
(4) Assisted current M/WBE suppliers to increase
their volume. of business, where opportunities.
existed;
(5) Encouraged M/WBE suppliers to pursue
subcontracting opportunities through Pacific
Bell's prime suppliers.
Additionally, Resource Managers utilized both
internal company databases of M/WBE suppliers and
the Clearinghouse database of verified M/WBE
suppliers when looking for potential suppliers.
k. Development
(1) In 1992, Pacific Bell extended an invitation
to AT&T and the Southern California Gas
Company to join us in sponsoring the
Entrepreneurial Studies Center at The John E.
Anderson Graduate School of Management at the
University of California at Los Angeles.
This certificate program, "Management
Development for Entrepreneurs" provides the
participating minority and women
entrepreneurs with information they could
utilize to strengthen their management skills
and to be better prepared to do business with
large corporations.
The course began on October 8, 1992 with 25
students and will conclude in February,
1993. Drawing on material covered in seminar
sessions, participants set goals for business
improvement projects most beneficial to their
respective companies. All participants
receive assistance in, implementing their
projects from MBA students assigned
specifically to work with them.
-22-
(2) Pacific Bell's Contracting and Supplier .
Management group jointly ventured with the
University of California, Berkeley,
University Extension, to provide a
certificate program in Applied Total Quality
Management. A total of 33 eTaployees with
contracting responsibilities within Pacific
Bell, as well as some of their suppliers
participated in the program. of the total
number of suppliers who participated, 8 were
MBE and 3 were WBE suppliers. We anticipate,
this program will both increase our
capabilities to work with small businesses
and share Total Quality Management concepts
with suppliers.
(3) on November 9, 1992, Pacific Bell and the San
Jose Business Development Center co-sponsored
a Financial Strategies seminar. The seminar
was conducted in Milpitas, California and
attracted 45 small business participants. An
audit of the seminar revealed that the
information provided was valuable and
immediately applicable to the participants'
day-to-day operations. As a result,
additional developmental programs will be
offered in 1993.
1. Loan Fund
In 1990, Pacific Bell invested $500,000, over 2
years, in the Business Consortium Fund (BCF) . The
BCF is a fund that provides loans to minority
businesses at the prevailing prime interest rate.
The BCF was created in 1984 by the National
Minority Supplier Development Council (NMSDC) , an
organization that works with, and provides support
to, minority businesses. The fund was created to
help overcome the difficulty many minority
businesses experience in obtaining working capital
through traditional lending sources.
Two-year loans of $50,000 to $250,000 are
available to minority suppliers certified by the
NMSDC or its member purchasing councils. In
addition, minority suppliers must have a contract
or purchase order from a corporate member of the
NMSDC to be eligible. BCF loans provide minority
businesses with the opportunity to grow and to
create new jobs.
-23-
To date, Pacific Bell's suppliers have not been
successful in securing business loans through this
process. As a result, Pacific Bell met with
representatives from the supplier community, the
funding corporations and the 3 California banks
participating in the program, to dentify issues
_ which may be contributing to the 'tack of
participation on the part of California suppliers.
Pacific Bell recognizes the significant challenges
that M/WBE and DVBEs face when seeking capital
financing. Pacific Bell is committed to continue
to pursue innovative ideas that can increase the .
financial opportunities for suppliers who have a
contract with us.
-24-
B. A Summary Of Purchases.
General Order 156, Section 9.1.2
1. M/WBE Purchasing Overview
In 1992, Pacific Bell purchased goods and services
totaling $319.7 million from minori`Ly-owned firms
(MBE) and $178.2 million from woman-owned firms
(WBE) . These purchases are 13.76% MBE and 7.67% WBE
of the company's total expenditures of $2.32 billion.
Direct and subcontracting M/WBE payments are as. .
follows:
MBE $ MBE % WBE $ WBE %
Direct $282.8M 12.2% $149.9M 6.5%
Subcontracting 36.9M 1.6$ 28.3M 1.2%
Total $319.7M 13.8% $178.2M 7.7%
The $497.9 million (21.43%) M/WBE purchases were an
increase of 12% over the $443.7 million (20.55%) in
1991.
Throughout 1992, subcontracting continued to
contribute toward M/WBE goals, especially in areas
where there are no M/WBEs available or where sole
source purchasing was the only available
alternative. Because Pacific Bell wanted to
emphasize progress in each area of purchasing and the
importance of the subcontracting program, it did not
exclude any product or service category from its 1992
purchasing base.
However, it should be noted that Pacific Bell's
results would have been higher if it had taken
exclusions. If adjusted for the exclusion of central
office equipment, switching systems and building
lease payments, Pacific Bell's 1992 M/WBE results
would have been 22.56% as compared to the unadjusted
results of 21.42%.
1992 M/WBE Results
With Exclusions
MBE 14.49%
WBE 8.07%
M/WBE 22.56%
-25-
2. M/WBE Percent Utilization Trend
A comparison of the percent of total purchases
spent with M/WBE suppliers from year-end 1987 to
1992 is displayed on Table I. The six-year chart
shows a growth of 150% on the percenta7es or an
increase of $298.5 million directed to M/WBEs.
3. Breakdown of M/WBE Purchases
Table II summarizes Pacific Bell's 1992 M/WBE
direct purchasing by ethnic and gender
classifications. Subcontracting is summarized by
gender classification. Table III is a more
detailed summary of purchases, including a
breakdown by ethnicity, in each of Pacific Bell's
major product and service categories of
telecommunications, non-telecommunications and
professional services.
4. DVBE Purchasing Overview
In June, 1992, General Order 156 was amended to
include the utilization of Disabled Veteran
Business Enterprises in the utility's purchasing
programs. While the Commission scheduled workshops
to resolve several critical DVBE program
implementation issues, Pacific Bell proceeded to
make provisions for the necessary internal support
systems that would be required to implement a
quality DVBE program.
Table IV summarizes Pacific Bell's 1992 purchases
with DVBEs. While we experienced a slow start,
with DVBE expenditures totaling $10,900, we believe
we have taken the preparation time needed to ensure
DVBEs are brought into Pacific Bell's purchasing
program in a way that is mutually beneficial.
5. Impact of Verification
Table V details Pacific Bell's 1992 M/WBE and DVBE
verification status. While we are pleased with our
progress to date, much more remains to be done to
further improve our verification rate. We will
continue to work towards a 100% verified supplier
base. Due to the introduction of new suppliers and
the time it takes to complete the verification
process we anticipate this will be a tremendous
challenge. However, Pacific Bell is committed to
continuing to dedicate the necessary resources to
the verification effort so as to maintain the
highest integrity of our 1993, end of year M/WBE
results.
-26-
a�
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Table II
PACIFIC BELL
1992 SUMMARY OF PROCUREMENT
ETHNIC GROUP PURCHASES %OFT&AL '
POLYNESIAN 540.792 0.02%
Male 514.998 0.02%
Female 26,394 0.00%
FILIPINO 2.182,129 0.09%
Male 1.270.927 0.05%
Female 911.2D2 0.04%
HISPANIC 141.878.799 6.11%
Male 82,249.336 3.54%
Female 59.629.462 2.57%
BLACK 86.742.529 3.73%
Male 81.207.436 3.50%
Female 5,535,093 0.24%
ASIAN 38.074.032 1.64%
Male 20,262,095 0.8796
Female 17.811.937 0.77%
NATIVE AMERICAN 5.705,060 0.25%
Male 3,266,293 0.14%
Female 2,436,767 0.10%
MULTI ETHNIC 7,640,556 0.W%
Male 4.657.248 0.20%
Female 2,983,308 0.13%
GRAND TOTAL DIRECT 432,626,243 18.62%
MBETOTAL 319,663.766 13.76%
DIRECT 282,763.897 12.17%
Male 193,429,734 8.33%
Female 89,394.162 344
SUBCONTRACTING 36.899,869 1.59%
WBE TOTAL 178,200,465 7.67%
DIRECT 149,862,346 6.45%
SUBCONTRACTING 28,338,119 1.22%
TOTAL CO 2,323,316,618 21.43%
PURCHASE$
SUM92;
-26B-
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-26F-
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C. M/WBE Program Expenses
General Order 156. Section 7.1.3
Total 1992 M/WBE Program expenses were $1.3 million. Below is the breakdown
of Pacific Bell's 1992 M/WBE Program Expenses.
M/WBE Program Expenses
($000s)
A B C D E F G
Internal External Central
Program Program Clearinghouse Complaints Admin Total
1 Wages $669.1
2 Other Employee Exp. $8.5
3 Program Expenses' $131.7
4 Reporting Expenses $36.0
5 Training $42.8
6 Consultants" $431.1
7 Other. $0.0
8 Total $1319.2
' Includes Advertising
" Includes Clearinghouse
Of the amount paid to consultants, $423,800 was paid directly to Cordoba
Corporation as Pacific Bell's share of the costs for the operation of the M/WBE
Clearinghouse. This amount represents 32% of the total program expenses.
—27—
M/WBE Program Expense-Macdraw
D. Description of Progress Toward Goals
General order 156, Section 9.1.4
1. How Pacific Bell Fared In Meeting/Exceeding 1992 Goals
Pacific Bell exceeded its internal program goals to
utilize 18.0$ M/WBE suppliers in 1992. The breakdown of
actual performance versus goals is shown below:
1992 Performance 1992 Goal $ Above Goal
MBE 13.8% 13.0% 6%
WBE 7.7% 5.0% 54$.
Total 21.4% 18.0% 19%
2. Areas of Focus for Continuous Improvement
As shown above, Pacific Bell exceeded its goal of 18.0% .
by 19%. In addition, Pacific Bell made significant
progress in the minority spending area with an increase
of 22% over 1991 performance, while maintaining a solid
WBE performance.
Table VI summarizes 1992 actual performance versus the
goals set in each product/service category. Since there
is a limitation to its reliability, this information
should be viewed as a diagnostic indicator, and not as
conclusive in nature. The limitation lies in the
current methodology used to capture product/service
purchasing data.
Each supplier utilized by Pacific Bell, M/WBE or
non-M/WBE, is asked to submit a single "primary" product
or service category which would best characterize the
goods or services their firm supplies. Subsequently,
when any purchase is made from the supplier, regardless
of the type of product or service, the dollars spent are
attributed to that "primary" product/service category.
Because many suppliers provide a variety of products and
services, many of which are often outside the specific
"primary" product/service category, the accuracy of the
detailed purchasing information diminishes, along with
the ability to draw strict conclusions from the
information.
-28-
Based on our available data, .61% ($1.4 billion) of our
total purchases were for telecommunications products and
services. The telecommunications area consists of
highly technical and very specialized products. and
services. Of the $1.4 billion dollar total, 23% ($327
million) was spent with M/WBEs, an 8% Increase over
1991. We feel this represents significant progress
since historically, few M/WBEs existed in the
telecommunications category. This was due to, among
other things, the high start-up costs and embedded
proprietary, technical information associated with doing
business in this area.
We have made considerable progress in introducing M/WBEs
into the telecommunications product provisioning stream
especially in the areas of cable and outside plant
products and services. However, the majority of the
telecommunications products can only be purchased from a
few prime suppliers having the manufacturing, systems
integration, or other technical expertise required.
Therefore, in those areas, the subcontracting program
and supplier development plans have become critical.
The non-telecommunications category accounts for 25% of
Pacific Bell's total purchases. M/WBE results in the
non-telecommunications category fell short of the goal
by 17%. The goal that was established for this category
was ambitiously set at a level well above our overall
M/WBE goal of 18%.
The professional services category accounted for 14% of
Pacific Bell's 1992 total purchases. Expenditures in
this category increased by 8% year-over-year and the
M/WBE performance as a percent of total purchases also
increased by 11.5%.
The pie chart on page 29B displays the proportional
spending within product and services areas for M/WBE
purchases as well as total purchases.
-29-
Table VI
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-29A-
PACIFIC BELL 1992 TOTAL SPENDING
WITHIN MAJOR PRODUCT/SERVICE AREAS
Non Telecommunications 25%
Professional Services U%
Telecommunications 61%
PACIFIC BELL 1992 M/WBE SPENDING
WITHIN MAJOR PRODUCT/SERVICE AREAS
Non-Telecommunications 25%
Professional Services 9%
Telecommunications 66%
Mcncn
—29B—
E. Summary Of Subcontracting Utilization
General Order 156, Section 9.1.5
1. M/WBE Subcontracting Results
Through the company's M/WBE subcontracting program,
Pacific Bell indirectly purchased 21:81% ($65.2
million) of its total purchases from M/WBEs. The
number of prime suppliers participating in the
program increased from 404 at the beginning-of the.
year to a total of 466 by year end.
2. Description Of M/WBE and DVBE Subcontracting Program
Progress
Prime suppliers are instituting M/WBE programs within
their companies and demonstrating good-faith efforts
to utilize M/WBEs in their day-to-day purchasing
activities. During discussions regarding M/WBE
subcontracting requirements, Pacific Bell encouraged
prime suppliers to supplement those activities with
other efforts to promote and utilize M/WBEs (e.g. ,
establishing M/WBE value-added resellers or
distributorships) .
Pacific Bell included the disabled veteran business
enterprise utilization requirements in a major
network modernization project. The prime suppliers
participating in this large volume, highly visible
project are expected to commit to very aggressive
M/WBE and DVBE utilization goals.
-30-
F. Supplier Complaints
General Order 156, Section 9.1.6
Pacific Bell has instituted a "Total Quality Management"
process (TQM) in its overall businesses processes.
Management of the M/WBE-DVBE supplier. complaint process
is an area which lends itself to qualiti improvement
initiatives.
Pacific Bell's supplier complaint process now includes a
method in which we analyze the concerns raised by our
M/WBE-DVBE suppliers to determine if existing business
practices and/or procedures are contributing to these
issues. We then work with the specific organizations to
solve the "root cause" of the supplier's concerns.
Our goal in using the TQM process is to reduce the
number of supplier complaints, but more importantly, we
are focused on developing process improvements to ensure
that our business practices more effectively meet the
needs of Pacific Bell and our suppliers.
Throughout the year, we received 10 supplier
complaints. The following is a summary of the
complaints and their resolutions:
1. Four suppliers were referred to the M/WBE-DVBE
Operations staff with concerns about Pacific Bell's
new method for procuring temporary services in the
information services area. The suppliers felt that
the change resulted in the loss of contracts for many
existing suppliers.
Representatives from Pacific Bell met one-on-one with
these suppliers to provide the business rationale for
the change. While ultimately, some suppliers did
lose contracts, they were provided the opportunity to
complete projects that were already in progress.
2. An outside plant construction supplier complained
that the termination of his contract with Pacific
Bell was racially based. Representatives of Pacific
Bell held several meetings with the supplier to
review performance and quality defects which led to
the termination of the contract.
Mutually agreed upon action plans were developed to
improve the supplier's service levels on the projects
that were already. in progress. The plans were not
successfully implemented and ultimately, the contract
was terminated. However, if the supplier can
demonstrate improved service quality they may have
the opportunity to bid on future projects.
-31-
3. A minority-owned coin telephone service provider
wrote a letter expressing concern about not being
allowed to participate as a subcontractor to Pacific
Bell on a State of California project. The supplier
felt that this could affect future bid opportunities.
Pacific Bell wrote to the supplier explaining why it
had not been selected for this particular job. The
company was assured that this decision would not
adversely affect future business opportunities with
Pacific Bell.
4. The M/WBE-DVBE Operations staff received a call from
Assemblywoman Gwen Moore's office regarding a
complaint from a minority-owned computer systems
supplier. The supplier believed they were not able
to secure a contract with Pacific Bell because they
were not verified by the CPUC Clearinghouse.
Pacific Bell responded directly to the supplier
stating that we encourage all of our M/WBE suppliers
to comply with the verification process. However,
Pacific Bell does not have a policy of doing business
only with verified M/WBEs. Instead, suppliers are
evaluated based on best overall value criteria.
5. A computer hardware reseller wrote a letter
concerning Pacific Bell's competitive bid process.
Representatives from Pacific Bell met with the
supplier to explain the internal practices and
procedures for procuring computer hardware. The
supplier currently has a contract with Pacific Bell.
6. A minority-owned .direct mail service subcontractor
wrote a letter complaining about the timeliness of
the prime supplier's payments. The MBE supplier
requested the assistance of the M/WBE-DVBE staff to
improve the payment schedule between the prime and
the subcontractor. Pacific Bell agreed to address
the MBE's concerns with the prime supplier. As a
result, the prime supplier agreed to improve the
timeliness of their payments to the subcontractor.
7. A woman-owned fleet maintenance supplier wrote a
letter stating that she was experiencing difficulties
with Pacific Bell's contracting processes that were
affecting her ability to compete for our business.
Representatives from Pacific Bell met with the
supplier to discuss these issues. It was determined
that additional investigation was required which did
not allow for closure of this complaint in 1992. The
supplier agreed to provide additional information to
assist in the evaluation of the issues being raised.
-32-
G. Exclusions
General Order 156, Section 9.1.7
Pacific Bell excluded the following payments from its
purchasing base for the purpose of calculating 1992
results:
M
1.- Payments to other utilities. This category of
exclusions includes payments to AT&T and other
interexchange carriers for-InterLATA services.
Payments to AT&T for telecommunications products are
included in Pacific Bell's purchasing base.
2. Payments to government agencies, for example,
franchise tax fees.
3. Payments to affiliates. Pacific Bell encourages all
of the Pacific Telesis affiliates to establish a
subcontracting program.
For purposes of this report, Pacific Bell chose not
to exclude product/service categories where no M/WBE
firms were available or where sole-source procurement
was the only available procurement method. Pacific
Bell believes that comparative analysis of utilities'
M/WBE purchasing results can only be fairly done on a
"without exclusions" basis.
-33-
H. Recruitment of M/WBEs and DVBEs in Areas of Low
Utilization
General Order 156, Section 9.1.8
Pacific Bell did not exclude any product/service
category from its purchasing base other than payments to
other utilities, franchise taxes, and payments to
affiliates.
1. Programs Implemented To Help Increase M/WBE and DVBE
Utilization
Pacific Bell undertook a variety of special efforts
to increase its utilization of M/WBEs and DVBEs. For
example:
a. Supplier Resource Team Outreach
A tracking mechanism was developed for measuring
the successes of M/WBEs that the Resource Team
identified for specific contract opportunities.
The Resource Team tracked the top 100 MBE
suppliers to ensure increased utilization. This
strategy of close monitoring and scrutinization
accounted for $290 million in awards to M/WBEs.
A member of the Resource Team also led the
Advisory Steering Team (AST) which is an oversight
group for the Procurement group's effort to target
specific market opportunities for prospective
suppliers. In 1992, the AST approved 5 proposals
valued at $31 million. Significant activity was
generated for M/WBEs in the information services
arena, specifically in the mainframe, software and
PC applications. A Value Added Reseller
relationship was also established with a minority
supplier and one of Pacific Bell's prime
suppliers. This relationship will have multi-year
impacts on the purchasing of transmission
equipment.
b. Subcontracting
Pacific Bell's M/WBE-DVBE Operations District
staff continued to meet with officers, or their
designees, in the high-technology companies with
which Pacific Bell does business, to ensure their
understanding of the subcontracting program and to
obtain their commitment to utilize M/WBEs and
DVBEs.
Pacific Bell held a meeting with one of its major
prime suppliers of switching and central office
equipment to inform them of the DVBE requirement
and gain their commitment to participate in a DVBE
subcontracting program.
-34-
c. California Minority Counsel Program
Pacific Bell's Legal Department is a founding
participant in this program. The purpose of the
program is to increase opportunities for minority
lawyers in the assignment of corlorate legal
work. . As a participant, the Legal Department has
committed to:
(1) Establish ongoing business relationships with
minority-owned law firms other than those the
Company currently employs as outside counsel.
(2) Encourage all, law firms providing outside
counsel services to Pacific Bell to:
(a) Increase the recruitment, hiring,
retention, and advancement to partnership
of minorities within the firm;
(b) Assign minority lawyers within the firm
to handle Pacific Bell matters; and
(c) Expand existing and establish new joint
ventures or other formal associations
with minority-owned law firms on Pacific
Bell legal matters calling for this type
of relationship.
(3) Attempt to make a periodic assessment of the
performance of outside counsel in utilizing
minority lawyers.
-35-
d. Minority Financial Institution Program (MFIP)
Pacific Bell pursues business relationships with
minority and women-owned financial institutions
through its Minority Financial Institution
Program. Financial institutions include banks,
savings .and loans, thrifts and cAedit unions.
Such business relationships may encompass
borrowing, deposit processing and investments to
the extent minority financial institutions can
provide the required services at competitive
prices.
Where we stand:
o Pacific Bell has placed Time Certificates of
Deposit (TCDs) in the amount of $90 thousand,
each with 22 ethnic minority-owned financial
institutions in California.
o Pacific Bell has borrowed in excess of $12
million from ethnic minority-owned banks in
California.
o A total of 25 Pacific Bell Public Offices,out
of 48 statewide, now deposit with ethnic
minority-owned banks. This represents over
$800 million in funds deposited annually.
-36-
I. Justification of Excluded Areas
General Order 156, Section 9.1.9
Pacific Bell did not exclude any product/service
categories from its purchasing base, other than payments
to other utilities, government agencie., and affiliates,
all of which are permissible exclusions under General
Order 156 (see page 33) . Pacific Bell recommends that
comparative analysis of utilities' M/WBE purchasing
results only be done on a "without exclusions"basis.
-37-
III. INTRODUCTION
As a result of a two year external review of Pacific Bell's
M/WBE purchasing program, Pacific Bell has adopted a
mission statement that we believe advances our program into
the next generation.
The mission of Pacific Bell's 1993 M/WBE-DVBE program is as
follows:
Pacific Bell will promote, increase and improve the quality
of the overall participation of minority, women and
disabled veteran-owned business enterprises in our
purchasing and contractual business.
Pacific Bell's economic success, in an increasingly
competitive marketplace, is tied to its ability to meet the
telecommunications needs of California's diverse customer
base. Providing opportunities for minority, women and
disabled veteran-owned businesses makes good business sense
and contributes to a robust California economy.
Pacific Bell is focusing on the development of mutually
beneficial, long-term relationships with our suppliers.
-38-
IV. ANNUAL PLAN FOR 1993
General Order 156, Section 10
A. Goals
General Order 156, Section 10.1.1
1. Short-Term, Mid-Term And Long-Term doals Set By Malor
Product/Service Category
Table VII contains Pacific Bell's five-year goals and
1992 results by major product/service categories.
The goals have been established with the intent to
increase our business placement with women and
minority firms where there is current
under-utilization. In those categories where our
1992 performance exceeds the 1993 goals of 5.0%
non-minority women business or 15.0% minority
business, our 1992 goals will remain the same. We
intend to sustain the progress we have already made. .
In addition, we recognize the need to exceed our
goals for some products and services, if we are to
reach our company-wide goals.
2. Overall Program Goals
The following are Pacific Bell's minimum overall
program goals for 1993, 1995, and 1997: .
Short-Term Mid-Term Long-Term
1993 1995 1997
MBE 15.0% 15.0% 15.0%
MBE Male 11.2% 11.2% 11.2%
MBE Female 3.8% 3.8% 3.8%
WBE 5.0% 5.0$ 5.0%
Total 20.0% 20.0% 20.0%
Pacific Bell has established these goals, in
accordance with General Order 156, as minimum levels
of. participation. Pacific Bell is committed to the
M/WBE program, therefore, Pacific Bell will make
every effort to meet or exceed these goals.
Pacific Bell faces a challenge in meeting the 1993
MBE goal of 15%. A key component of this challenge
is the fact that Pacific Bell spends a great deal of
its procurement dollars on sophisticated
telecommunications products; a category where there
are a very limited number of qualified M/WBE
suppliers.
Pacific Bell does not expect any problem in meeting
or exceeding the WBE goal of 5% in 1993.
-39-
3. DVBE Program Goal
General Order 156 does not mandate a numeric DVBE
goal for the utilities. However, each utility is
required to establish an annual goal of increasing
DVBE procurement. In 1997 numericaj goals will
become effective.
-40-
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-40A-
B. Description of Program Activities Planned for 1993
General Order 156, Section 10.1.2
Throughout 1993, Pacific Bell will be implementing
strategic internal and external improvement plans in
support of the following key corporate,,strategies:
o empowering the Business Units to increase their
expenditures with M/WBE and DVBE suppliers.
o institutionalizing Subcontracting with the Business
Units as a strategic tool for increasing the
utilization of minority, women and disabled
veteran-owned businesses
o finding qualified minority, women and disabled
veteran-owned business enterprises through targeted
outreach
o assisting the minority, women and disabled
veteran-owned businesses in understanding and
evaluating their own business needs and capability to
do business with Pacific Bell
o enhancing the ability of, established minority, women
and disabled veteran business enterprises to grow and
successfully pursue specific business opportunities
o providing clear and consistent internal and external
communications about the procurement process
o continuously improving the overall procurement
process to meet Pacific Bell's needs and to enhance
minority, women and disabled veteran-owned business
opportunities
o systematically utilizing the Total Quality Management
process to identify and prioritize business processes
which have dysfunctional impacts on small businesses
o initiating joint quality improvement efforts that
allow the minority, women and disabled veteran-owned
business enterprises to improve their business
processes
o encouraging our prime suppliers to increase the
participation of minority, women and disabled
veteran-owned business enterprises.
-41-
1. Internal Program Activities
a. Employee Education
The 1993 Employee Education Program will focus on
assisting Pacific Bell's regional and statewide
business units to further develoV their M/WBE and
DVBE programs. The M/WBE-DVBE staff will also
continue to communicate Pacific Bell's program
guidelines, standards and procedures to enable the
business units to adhere to established
procurement standards. Full implementation of
these guidelines will serve to ensure the
consistent quality of M/WBE results and establish
DVBE results across business unit boundaries.
b. Publications
The M/WBE-DVBE Operations District staff will
continue to publish articles about our program in .
Connections, the company newspaper, which is
distributed to all employees throughout Pacific
Bell.
c. Employee Recognition
The M/WBE-DVBE Operations will continue its
informal recognition program by issuing
certificates of appreciation to employees who
contribute to the success of the M/WBE and DVBE
program.
The Tenth Annual M/WBE Recognition Awards
Presentation will be held on March 2, 1993.
Awards will be presented to those employees who
used innovative approaches to increase
opportunities for M/WBE suppliers throughout the
company. In addition to presenting awards for
increased M/WBE results, 15 special recognition
awards will be presented to individual employees
or teams nominated by their peers and selected by
an Award Review Committee. Award winners are
selected, based on the tangible results achieved
and how well they were able to advance the spirit
and intent of Pacific Bell's M/WBE program.
d. Vice President Coordinator Meetings
The M/WBE-DVBE Operations District staff will
continue to sponsor V.P. Coordinator Training
Sessions in the individual business units. In
addition, meetings will be held to discuss the
revision of the current M/WBE Coordinator
Reference Guide to incorporate DVBEs into the
program and to share successful approaches in
developing opportunities for M/WBEs and DVBEs.
There will be two V.P. Coordinator meetings
scheduled in 1993.
-42-
e. Coverage of Results With Officers
The M/WBE-DVBE Operations District staff will
continue to share M/WBE and DVBE results with all
officers on a regular basis. In addition,
officers will continue to meet op a periodic basis
to review M/WBE and DVVBE performance results and
provide direction for the program.
f. Disabled Veteran Business Advisory Council
Throughout 1993, the DVBE Advisory Council will
meet quarterly to review, monitor and update the
established goals and objectives to ensure they
reflect current demands. Every effort will be
made to develop reasonable and attainable goals
based on the availability of qualified DVBEs and
Pacific Bell's contracting and purchasing needs.
In concert with our M/WBE strategy, Pacific Bell
will assess and implement, when appropriate,
developmental opportunities that could increase
the DVBE's ability to competitively participate in
Pacific Bell's procurement process.
g. CPUC Clearinghouse
As the Clearinghouse verifies the M/WBE status of
suppliers, Pacific Bell will continue to
incorporate the Clearinghouse vendor database into
its process for seeking and utilizing M/WBE
suppliers.. The Clearinghouse's verification of
suppliers will be a key element in Pacific Bell's
ongoing efforts to ensure that only bonafide
M/WBEs are utilized.
h. OSMB Certification
In order for a disabled veteran business to be
included in the Disabled Veteran Business
Enterprise program, it must be certified by the
California State Office of Small and Minority
Business (OSMB) . The OSMB certifies that a
disabled veteran business is owned and operated by
a veteran of the United States military, naval or
air service with a service connected disability.
On a monthly basis, Pacific Bell will call upon
the OSMB to obtain a current listing of certified
Disabled Veteran Business Enterprises. The
M/WBE-DVBE staff will incorporate the newly
certified DVBEs into the Pacific Bell database and
distribute it internally to the key employees
responsible for procurement in the company.
-43-
i. Supplier Resource Team
The Supplier Resource Team, a group of four
managers in the Contracting and Supplier
Management group, represent all of the company's
centralized contracting disciplipes. These
Resource Managers work with Contract
Administrators and Supplier Managers to identify,
track and match M/WBE and DVBE suppliers to
specific contracting opportunities. With product
knowledge and opportunity information in hand,
Resource Managers will.first work to create and
develop long term partnerships with those M/WBE
and DVBE suppliers that currently provide products
and services to- Pacific Bell. This will be done
as a way to grow Pacific Bell's purchasing with
M/WBE and DVBE suppliers. Second, the Resource
Team's external focus will be to identify
qualified suppliers for contract opportunities in
the product and service categories where Pacific
Bell's results are not meeting its goals.'
-44-
2. External Program Activities
a. Meetings, Conferences and Trade Fairs
In 1993, Pacific Bell will continue to work with
key organizations to identify M/1
.JBE and DVBE
suppliers who provide products and services in
areas of low utilization.
b. Memberships
Pacific Bell's M/WBE Supplier Resource Team and
employees from the Real Estate Management group
will represent Pacific Bell in many of the
regional purchasing councils and organizations
throughout California.
Pacific Bell's External Affairs Department will
continue to maintain liaisons. with several
organizations through Area Managers and its Key
Contact Manager (RCM) program. The KCM program
recruits Pacific Bell managers to serve as
representatives to local community organizations.
c. Asian Community Meetings/HACR/NAACP/Diversity
Task Force
1. Asian Community Meetings
Annual meetings are planned, one each in
northern and southern California. We will
meet with the Asian members of the Diversity
Task Force as well as Asian community leaders
who have a stake in M/WBE issues. In these
meetings Pacific Bell will review purchasing
results and request that the stakeholders
advise us on future strategies.
2. HACR
The extension of the HACR economic development
agreement reaffirms the commitment of Pacific
Bell and representatives from the HACR
organization to continue to work cooperatively
to improve understanding and strengthen
relationships between the Company, HACR and
the California Hispanic community.
In 1993, this effort is expected to continue
to result in measurable benefit for Pacific
Bell and the California Hispanic community in
all of the areas identified in the agreement.
-45-
3. NAACP
The NAACP maintains well over 50 economic
development agreements of mutual cooperation
with major corporations throughout the
nation. Pacific Bell, in cog
peration with the
NAACP, will continue to respond to the needs
of this community.
4. Diversity Task Force
In 1993, Pacific Bell will be implementing an
action plan that addresses the recommendations
put forth in the Diversity Task Force's final
report. While progress reports will be issued
to the M/WBE subcommittee members on a
quarterly basis, a formal interactive meeting
with the subcommittee is scheduled for June,
1993.
d. General Order 156 Advisory Board
California Public Utilities Commission Decision
92-06-030 ordered that the Commission staff
consult with a General Order 156 Advisory Board to
seek advice on matters relating to the General
Order. Pacific Bell will participate, on a
voluntary basis, along with the attending
utilities and designated representatives from the
M/WBE and DVBE communities.
e. Advertising
In 1993, Pacific Bell will develop a new
advertisement for placement in industry trade and
other publications. The advertisement will list
the purchasing categories offering the greatest
opportunity for success in 1993. The Toll-Free
Supplier Referral telephone number will be
included in the advertisement so the potential
supplier(s) are able to reach the appropriate
supplier manager to learn more about specific
purchasing opportunities.
f. Orientation
Pacific Bell plans to conduct a series of informal
workshops describing, in detail, the attributes of
the products and services it purchases. The
workshop will also introduce M/WBE and DVBE
suppliers to the appropriate purchasing employees
and will acquaint them with Pacific Bell's
purchasing standards and requirements.
-46-
g. Development
Pacific Bell will continue to identify factors
which are critical to' the .successful growth of
M/WBEs and DVBEs and assess the feasibility of
providing appropriate skills tra}ning or other
assistance. The backbone of ouiJ strategy will be
teaming with Business Development Centers
throughout the state to conduct seminars
comparable to the financial strategies seminar
held in 1992. . The business units and corporate
support groups will be involved in the
orchestration of these seminars.
h. Loan Fund
Pacific Bell recognizes the need to improve M/WBE
and DVBE's access to capital and is committed to
seek innovative ways to remove this barrier to
increased participation in 1993. Included in this
effort will be an assessment of the effectiveness
of the Business Consortium Fund for Pacific Bell's
suppliers. In addition, other working capital
alternatives will be investigated to assist
Pacific Bell's M/WBE and DVBE suppliers.
-47-
C. Plans for Recruiting M/WBEs and DVBEs Where Utilization
Is Low
General Order 156, Section 10.1.3
In 1993, Pacific Bell. will continue' to strengthen its
M/WBE and establish its DVBE performance by focusing on
underutilized areas. Specifically, Pacific Bell will
utilize the Supplier Resource Team to identify contract
opportunities companywide and match them to potential
suppliers. Pacific Bell will place increased emphasis
on both subcontracting and the development of
collaborative business arrangements between Pacific.
Bell, M/WBE or DVBE suppliers and non-M/WBE suppliers.
These arrangements will require careful planning and may
involve some degree of technical assistance extended to
the M/WBE and DVBE suppliers.
-48-
D. Plans For Recruiting M/WBE and DVBE Suppliers In
Excluded Areas
General Order 156, Section 10..1.4
Pacific Bell does not exclude any product/service
category from its purchasing base, other than payments
to other utilities, government agencieb, and affiliates,
all of which are permissible exclusions under General
Order 156.
-49-
E. Subcontracting Plans
General Order 156, Section 10.1.5
In 1993, Pacific Bell plans to undertake the following
activities to actively encourage prime suppliers to
increase utilization of M/WBEs and DVB;s:
I. Target specific prime suppliers to assure they
increase their subcontracting performance.
2. Monitor actual performance against contract goals to
assure compliance.
3. Provide quarterly reports to officers on
subcontracting results and obtain their assistance,
when necessary, to improve the prime suppliers'
subcontracting performance.
4. Continue expanding the network of internal M/WBE and
DVBE subject matter experts to communicate to
employees and prime suppliers the value that M/WBE
subcontracting contributes to the achievement of
Pacific Bell's M/WBE goals.
5. Publish articles internally and externally about
successful M/WBE and DVBE subcontracting situations.
6. Continue working with prime suppliers to help assure
that each subcontractor's M/WBE or. DVBE status is
verified through the .Clearinghouse or the OSMB..
7. Share the names of the prime suppliers participating
in Pacific Bell's Subcontracting program with M/WBEs
and DVBEs to increase their marketing opportunities.
S. Share the names of M/WBEs and DVBEs listed in
Pacific Bell's supplier database with the prime
contractors to expand the prime's source pool of
available M/WBE and DVBE suppliers.
9. Continue working with the Regional Bell Operating
Companies (RBOCs) to encourage the development of
subcontracting programs with the major prime
suppliers the RBOCs and Pacific Bell have in common.
10. Implement a communication plan designed to inform
the prime supplier community of Pacific Bell's
commitment to the DVBE program and in turn obtain a
commitment from the primes to include DVBE suppliers
in their subcontracting plans.
-50-
CERTIFICATE OF SERVICE
I, Alex Kositsy, certify that the following: is true and
correct: `
I am a citizen of the United States, State of California,
am over eighteen years of age, and am not a party to the within
cause.
My business address is 140 New Montgomery Street, San
Francisco, California 94105
On March 1, 1993, I served the attached M/WBE-DVBE Annual
Report to all respondents in 011. 90-02-044 by placing true
copies thereof in envelopes addressed to the respondents as
follows:
Jack A. Socha, Esq. Charles Lewis, Esq.
SOUTHWEST GAS CORPORATION PACIFIC GAS & ELECTRIC CO.
5241 Spring Mountain Rd. 77 Beale Street
Las Vegas, NV 89102 San Francisco, CA 94106
Michael E. Hurst, Esq. Elaine Lustig, Esq.
AT&T COMMUNICATIONS OF GTE CALIFORNIA INCORPORATED
CALIFORNIA, INC. One GTE Place, RC 3300
795 Folsom St. , Rm 670 Thousand Oaks, CA 91362-3811
San Francisco, CA 94107
Robert L. Gnaizda Robert J. Gloistein, Esq.
PUBLIC ADVOCATES INC. ORRICK, HERRINGTON & SUTCLIFFE
1535 Mission Street Old Federal Reserve Bank Building
San Francisco, CA 94103 400 Sansome Street
San Francisco, CA 94111
Gene E. Rodriguez, Esq. Ann Pongracz, Esq.
SOUTHERN CALIFORNIA EDISON CO. US SPRINT COMMUNICATIONS COMPANY
2244- Walnut Grove, Rm. 320 LIMITED PARTNERSHIP
Rosemead, CA 91770 1850 Gateway Drive,. 7th Floor
San Mateo, CA 94404-2467
Vicki L. Thompson, Esq. David L. Huard/Judith L. Young
SAN DIEGO GAS & ELECTRIC CO. Attorneys at Law.
110 West "A" St. , 9th Flr. SOUTHERN CALIFORNIA GAS COMPANY
San Diego, CA 92101 633 W. Fifth Street, Suite 5400
Los Angeles, CA 90071-2006
E. Garth Black, Esq. Charles Turner
Attorney for ROSEVILLE Representative for
TELEPHONE COMPANY Alltel-CP NATIONAL CORPORATION
COOPER, WHITE• & COOPER 2121 N. California Blvd.
201 California St. , 15th Flr. Suite 400
San Francisco, CA 94111 Walnut Creek, CA 94596
-2-
Joan N. Kerr, Esq. Mark Brown, Esq.
PACIFIC BELL MCI TELECOMMTUNICATIONS CORPORATION ,
2600 Camino Ramon 201 Spear Street, 9th Floor
Room 2W856 San Francisco, CA 94105
San Ramon, CA 94583
R. Gerald Metz, Jr. David M. Norris, Esq.
President SIERRA PACIFIC POWER COMPANY
SDV/AMERICA CONSULTING P.O. Boa 10100
& COMMODITIES Reno, NV 89520
P.O. Boz 1127
San Ramon, CA 94583
ALJ Robert L. Ramsey Philip Bremond
CALIFORNIA PUBLIC UTILITIES CALIFORNIA PUBLIC UTILITIES
COMMISSION COMMISSION
505 Van Ness, Rm 5042 505 Van Ness, Rm 5-F
San Francisco, CA 94102 San Francisco, CA 94102
Ellen Deutsch James C. Paine
Attorney for Attorney for PACIFIC POWER
CITIZENS UTILITIES COMPANY & LIGHT COMPANY
OF CALIFORNIA STOEL RIVES BOLEY JONES & GREY
P.O. Boa 496020 900 SW Fifth, Suite 2300
Redding, CA 96049-6020 Portland, OR 97204-1268
John Lopez
President
ASSOCIATION OF SERVICE DISABLED
VETERANS
P.O. Box 2312
Stanford, CA 94305
Which envelopes, with postage thereon fully prepaid, I then sealed
and deposited in a mailbox regularly maintained by the United
States Government in the City and County of San Francisco, State
of California.
Executed this 1st day of March, 1993, at San Francisco,
California.
PACIFIC BELL
140 New Montgomery Street
San Francisco, ' CA 94105
By: ✓ "�-L
Alex KositskA