The U.S. Department of Transportation has set new rules that require greater accountability from state and local transportation agencies for including disadvantaged businesses (DBE) in their spending plans. Those that fail to meet established goals for DBE participation will be required to evaluate why the goals were not met and offer a plan to help meet the goal in the future.
The rule requires state and local agencies to create a plan for improving the use of small businesses, including DBEs. It adds provisions to ensure that prime contractors fulfill commitments to use DBE subcontractors. State and local agencies will be required to monitor each contract to make sure prime contractors are fulfilling their obligations and do not dismiss DBE subcontractors without good cause.
It reduces burdens on small businesses seeking DBE certification in more than one state. All states will be required to accept DBE certifications obtained in other states, unless the state finds good cause not to accept it.
The rule also adjusts the personal net worth limit for DBE owners for inflation from the present $750,000 to $1.32 million. The current limit was set in 1989.
The DOT anticipates making parallel changes in its regulation for airport concession DBEs as well.