PORTLAND, Ore. (AP) — The City of Portland said Wednesday it will fine the owners of a painting contractor $20,000, saying they created a “front company” in order to qualify as a woman-owned business.
The city is accusing the business, Portland Coatings, of receiving over $1 million in contracts while falsely claiming to be owned by a woman.
Portland began investigating Terezia Nyland and her husband, Michael, in 2017 after an unspecified tip to the city’s ombudsman office, The Oregonian/OregonLive reported.
The city said Portland Coatings’ address is actually the loading dock for a business Michael Nyland owns, Williamsen & Bleid. In addition to the $20,000 fine, the city suspended the Nylands’ eligibility to do business for the city for three years.
The Nylands’ lawyer said Tuesday they plan to challenge the city’s findings.
“Terezia Nyland is, and has always been, Portland Coatings’ majority shareholder and chief executive,” attorney Matthew Colley wrote in an email. “She and her husband have done nothing wrong, and they will be vindicated in the appeals process.”
This is the first time Portland enforced a 2015 state law that gives the city the authority to investigate whether businesses qualify for public contracts that give preference to “disadvantaged businesses.” That category includes businesses owned by people who are Blacks, Hispanic, Native American, women and others who have historically had less access to lucrative government contracts.
Last month, a city audit that found Portland’s efforts to reduce disparities in city construction contracting had some effect, “but they also suffered from design flaws and mismanagement, and were vulnerable to gamesmanship.”