Waste of the Day: NY Contracts Are Intentionally Expensive

Topline: A transportation agency run by the states of New York and New Jersey is paying minority-owned businesses 10% more to do the same work as other vendors, an illegal move the conservative nonprofit America First Legal alleges in a new complaint.

Port Authority of New York and New Jersey illegally reverse-discriminating

Key facts: The Port Authority of New York and New Jersey spends over $9 billion a year overseeing bridges, tunnels and airports in and around New York City, and in 2021 it set a goal to award 20% of its contracts to minority-owned businesses. The agency’s supplier diversity webpage explains that, to meet this goal, some contracts will be offered to minority-owned businesses even if another company is willing to take the job for 10% less money.

The nonprofit filed a civil rights complaint with the U.S. Department of Transportation, the Environmental Protection Agency, and the Office of Management and Budget, alleging the practice violates Title VI, a law banning recipients of federal money from discriminating based on race, the New York Post reported.

The DOT has given $3.6 billion to the Port Authority since 2008, and the EPA awarded a $451 million grant last year.

“This means that for every million dollars on a contract bid, the Port Authority will pay up to an extra $100,000 to engage in race-based discrimination,” the complaint says. “In addition to being wasteful of taxpayer and ratepayer resources, it is illegal and simply un-American.”

The complaint also calls out the Port Authority’s Diversity Management portal, which offers mentorship programs and skills training only for minority-owned businesses.

What the Port Authority could lose

The nonprofit also points out that the billions of dollars in federal funding could be at risk if the Port Authority is found to have ignored anti-discrimination laws and President Donald Trump’s executive orders ending DEI programs.

Background: The Port Authority spent just under $2 billion on payroll in 2024, with 14,298 employees who outearned New York Gov. Kathy Hochul’s salary of $250,000. Police Sergeant Melvin Cruz earned almost $280,000 in overtime alone, bringing his total pay to $475,599, according to payroll records obtained by OpenTheBooks.com.

Search all federal, state and local salaries and vendor spending with the world’s largest government spending database at OpenTheBooks.com. 

Summary: Regardless of the politics surrounding the Port Authority’s purchasing decisions, taxpayer funds should always be spent with low prices and quality of service as the top priorities. 

The #WasteOfTheDay is brought to you by the forensic auditors at OpenTheBooks.com.

This article was originally published by RealClearInvestigations and made available via RealClearWire.