RLA Helps Compton Firm Land Contract : Business: $7-million deal with three phone companies is a lifesaver for minority-owned contractor.
A few months ago, the Alameda Group, a Compton-based minority contractor that once had a sound business assembling sections of jet airliner frames, was down to rewiring electric motors for elevator shafts, oil-well pumps and escalators.
“We were about to fold,” company President Vernal Claiborne said Thursday, until a deal that could generate up to $7 million in two years came through with three telecommunications giants--A T& T, Pacific Bell and GTE-California.
On Thursday, officials of RLA’s new leadership team touted the agreement at their first news conference. The deal calls for Claiborne’s employees to assemble remote maintenance testing units, solid-state protectors and coiled copper wire for use in switching offices.
The deal represents an “innovative collaboration” between major corporations and small minority-owned businesses, the type that the post-riot revitalization agency is seeking to generate in neglected neighborhoods across Los Angeles, said RLA President Linda Griego.
“This is a prime example of what we are trying to do now with RLA, and that is to maintain and expand small minority-owned businesses and to do that with the help of larger companies,” added RLA board Chairman Lodwrick M. Cook, chief executive officer of Arco.
However, the agreement also makes abundantly clear just how difficult it is to lure new business to small, inner-city firms.
All parties at the news conference were quick to acknowledge that the decision by the phone firms to enter into a partnership with a minority-owned Los Angeles County contractor came about only because of the persistence of RLA board member Patricia M. Eckert, who also happens to be a member of the state Public Utilities Commission, which regulates Pacific Bell and GTE-California.
“I had to kick tail to get the (utilities) to do this,” she acknowledged after the news conference. “As a regulator, they tend to be a little more open to your ideas, if you know what I mean.”
The deal helps Pacific Bell and GTE-California meet state-mandated goals that 15% of their contracts with outside vendors go to minority-owned businesses. Minority contractors generally do not have similar leverage because most major companies not regulated as utilities do not have to meet such mandates.
Eckert said that shortly after RLA was formed in the wake of the 1992 riots, then-RLA Chairman Peter Ueberroth urged each of the agency’s 80 board members to use their influence to arrange at least one deal to bring new business to impoverished neighborhoods. Eckert said she proceeded to lobby with executives of the telecommunications companies to set up a partnership with a minority-owned Los Angeles business.
The companies agreed and Alameda, based in an industrial park at the Lynwood-Compton city line, was selected from among more than 100 women- and minority-run businesses that applied, officials said.
Representatives of the phone firms stressed that they undertook the partnership because it appears profitable. “This is simply something that makes a lot of sense and has a good feeling to it,” said Pacific Bell Vice President of External Affairs E.H. (Gene) Sherman.
Claiborne, whose work force has fallen to as low as 13 from a peak of 105, said five employees earning from $7 to $15 an hour have begun assembling A T& T components into the products for sale to Pacific Bell and GTE-California. He said he hopes to increase sales over time in order to hire more workers to supplement his aerospace assembly business, which has started to stabilize in recent weeks.
“This,” he said, “will help us start back up and revitalize the community.”
Claiborne, an African American who lives in Torrance, said most of his mainly Latino 25-member work force resides within five miles of the firm’s headquarters.
