×

First-of-a-kind law would help gay businesses

Nikki Barua runs BeyondCurious, a 3-year-old company that provides consulting services aimed at speeding up clients' innovation. The Los Angeles business employs about 50 people. Revenue is somewhere between $5 million and $10 million, but Barua hopes to "grow our revenues by another 20 to 30 percent."

A first-of-its-kind law that would affect firms owned by members of California's lesbian, gay, bisexual and transgender community could help.

BeyondCurious is an LGBT-owned business, and that could help it compete against larger, well-established competitors bidding for certain work from the state, but only if Gov. Jerry Brown signs a new law sitting on his desk.

The California legislature last month passed AB 1678, a bill that would require companies making at least $25 million a year and regulated by the state's Public Utilities Commission to give LGBT businesses the same consideration in bidding for contracts currently given to businesses owned by minorities, women or disabled veterans. It's believed to be the first such bill in the nation.

Read MoreCalifornia economy standing up to nature's wrath

To qualify, businesses would have to prove they are 51 percent owned by lesbian, gay, bisexual or transgender individuals, or, if publicly traded, at least 51 percent of shares must be owned by LGBT individuals.

"I think it's long overdue," said Ken McNeely, president of AT&T California. His firm would be subject to the new law, but McNeely said that wouldn't be a problem. "Here in California, about 45 to 50 percent of all our expenditures go to disadvantaged or underrepresented businesses, which totals about $2 billion," he said.

"It's not about getting special or preferred treatment, it's about winning on merit. What this bill fundamentally does is it allows a variety of businesses to bring their capabilities, and from the perspective of large corporations, it allows them to get access to tremendous talent that they might not have seen before." -Nikki Barua, CEO, BeyondCurious

It's unclear how many businesses in California may be LGBT-owned, but the total may be considerable.

"If you look at the 3 million small businesses that are in California, then the generally accepted statistic is about 6 percent of the population self-identifies as LGBT, we're talking about 180,000 to 200,000 small businesses that could be impacted by this legislation," said Justin Nelson of the National Gay & Lesbian Chamber of Commerce. His organization has worked closely with companies and legislators to push for the new law.

Read MoreThese states are at the biggest risk of disaster

But are LGBT businesses truly disadvantaged?

"We don't know until they're able to stand up and be counted," said AT&T California's McNeely. If the law is signed by the governor, LGBT-owned firms would have to register through the utilities commission and be vetted.

"We rely on that investigation," said McNeely, "and then we do our own due diligence, of course."

Marchers carry a rainbow flag in the LA Pride Parade on June 8, 2014 in West Hollywood, Calif.
Getty Images
Marchers carry a rainbow flag in the LA Pride Parade on June 8, 2014 in West Hollywood, Calif.

Contracts would go to a variety of projects at AT&T California, from building cell sites to administrative services. Companies get no tax break or other financial advantage for hiring LGBT firms, and McNeely said he wouldn't necessarily be willing to pay more for their services.

"We're always trying to look for the best suppliers at the best pricing," he said, but added that he sees the proposed law potentially helping on costs by increasing the number of vendors that firms like AT&T California are focused on.

Read MoreCalifornia governor signs historic ride-sharing legislation

Brown has until Sept. 30 to decide the fate of the legislation. Barua of BeyondCurious said the law has the support of companies large and small.

"It's not about getting special or preferred treatment, it's about winning on merit," she said. "What this bill fundamentally does is it allows a variety of businesses to bring their capabilities, and from the perspective of large corporations, it allows them to get access to tremendous talent that they might not have seen before."