USDOT Cracking Down on DBE Fraud
WINTER 2015
Denver RTD’s Phillip Washington Achieves Mega-Success Business in the Age of Social Media Honoring the Legacy of Herman J. Russell Sr. New Blessings, Old Curses: DBE Final Rule (Part 1)
Interested in Doing Business With U.S. DOT? The South Atlantic Region SBTRC Can Help You
The South Atlantic Region Small Business Transportation Resource Center serves as the OSDBU regional office, working closely with prime and subcontractors, as well as state and local transportation agencies located in the four-state region of Kentucky, North Carolina, Virginia and West Virginia.
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Short-Term Lending Program (STLP) - provides certified DBEs and
other certified small businesses with short-term working capital at competitive interest rates for DOT or DOT-funded contracts and subcontracts
South Atlantic Region U.S. DOT - Small Business Transportation Resource Center 114 W. Parrish Street Durham, NC 27701 Phone: (919) 956-2341 Fax: (919) 688-7668 Email: kgantt@ncimed.org Website: www.ncimed.org A program of the U.S. Department of Transportation and NCIMED
Contents FEATURES
12 18 20 22 29 33
Phillip Washington, Denver Regional Transportation District JCDecaux and Interactive Airport Advertising Model Collaboration USDOT Cracks Down on DBE Fraud
AMAC Pushes Inclusion for PFC-Funded Projets Honoring the Legacy of Herman J. Russell Sr. ACCA’s National Training Institute
DEPARTMENTS 4 Publisher’s Page 6 Business Development I: Tax Tips 7 Business Development II: 3 Marketing Truths 9 DBELO Spotlight: ALDOT’s Clarence Hampton, Esq. 28 Business Development III: Long-term Business Success TRANSPORTATION TRENDS: AVIATION, CIVIL/HIGHWAY AND TRANSIT 32 Financial Strategies and Tax Tips 38 Business in the Social Media Age
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FROM THE PUBLISHER
The Unmatched Power of Building Relationships The ability to build and maintain successful relationships is a skill that can turbo-charge business growth and create new opportunities that an entrepreneur working alone would probably never experience. More often than not, new opportunities arise from the synergistic effects that occur when two people come together to collaborate and brainstorm on ways to better serve customer needs and create solutions to problems in the marketplace. Relationships come in a variety of ways in business. All entrepreneurs have relationships with their employees, business partners, business associates, competitors, investors, personal friends and family. However, the successful entrepreneur places a high priority on maximizing these relationships. How, you ask? It comes by having a genuine interest in the welfare of others and their needs, by offering value, and by trusting and expecting to receive something of value in return. This may come in the form of information, ideas, referrals and potentially profitable business opportunities. Building relationships is not always easy and can be particularly difficult for DBE firms. DBE contract goals, good faith efforts, and subcontracting/subtenant components can place DBEs in direct competition in a zero-sum game of ‘if you win, I lose.’ The result of this reality often leads to DBEs focusing more on getting a piece of the pie, rather that creatively and strategically thinking about how to get a whole pie, since there are many “pies” available in today’s marketplace. This issue of American DBE is dedicated to business owners striving to create and sustain relationships that can lead to greater amounts of success within and outside the DBE program. In this issue, we highlight one of the greatest entrepreneurs in American history; Herman J. Russell Sr. The late Mr. Russell broke through segregation to launch a business empire in Atlanta, Georgia by serving as a shining example of the power of building relationships.
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This issue also profiles two DBE firms that are leveraging the benefits of relationship building to grow successful enterprises in the airport and highway contracting industry. This magazine also highlights the work of Phil Washington, chair of the American Public Transportation Association (APTA) and CEO/General Manager of the Regional Transportation District (RTD) in Denver, Colorado. Washington has built a successful career in the public transit industry through leveraging positive relationships with co-workers, employees, stakeholders and DBE firms to demonstrate the opportunities for mutual benefit through creatively working together. As always, this issue of American DBE also shares great business development articles and industry updates that will help businesses succeed in 2015. I hope you enjoy.
Shelton A. Russell, Publisher
Subscribe to In-Depth Industry Coverage Subscribe Online at www.AmericanDBE.com Call Today! 919-234-6429 www.americandbe.com
Winter 2015 Volume 2, Issue 4 Publisher: Shelton A. Russell Managing Editors: PR PROS, LLC Creative Director: William Cash
Because “That’s The Way We’ve Always Done It” Doesn’t Work Anymore.
Digital Media: Premier Web Design Solutions Editorial: Janet W. Christy David L. Fitts Jr. Jovan Goldstein, CPA Franklin Lee, Esq. Jess McLamb Reginald Randolph Philip Russell Jordan Taylor UNC-CH Heelprint Communications Headquarters: 514 Daniels Street, #186 Raleigh, NC 27605 Web site: www.AmericanDBE.com Social Media:
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American DBE Magazine is the premier industry resource for individuals and stakePost Tweet Publish Email Connect Blog Link Pin Hangout Share—REPEAT— holders who work within the federal Disadvantaged Business Enterprises program PublicRelationsCopywritingSocialMediaManagementCrisisCommunicationsMediaCoachingBrandEnhancementM administration. American DBE Magazine is published quarterly and distributed in all 50 Blog Link Pin Hangout Share—REPEAT—Post Tweet Publish Email Connect Bl Post Tweet Publish Email Connect states—plus Puerto Rico and the U.S. Virgin Islands—to DBE program administrators, business owners, and professionals in the Aviation, Highway Construction, and Public Transit industries. Subscriptions: American DBE Magazine is published quarterly in Fall, Winter, Spring and Summer editions. The annual subscription rate is $19.99 including online editions, special industry reports, and four issues; single copy list price is $5.99 plus postage originating from Raleigh, North Carolina.
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Business Development start-up retirement savings plan for small employers not currently sponsoring a retirement plan. • Simplified Employee Pension (SEP) plans allow employers to set aside money in retirement accounts for themselves 1. Make sure you have W-9 forms for all vendors who proand their employees. A SEP does not have the start-up and vided services to your business. This is not just the traditional operating costs of a conventional retirement plan and allows subcontracted labor, but may include businesses that provided for a contribution of up to 25 percent of each employee’s pay. marketing services, repairs and mainA business of any size, even self-emtenance, janitorial services, legal and ployed, can establish a SEP. accounting services, etc. The W-9 form • A 401(k) plan allows employees to will give you all the information you contribute a portion of their wages plus will need to create Form 1099-MISC. In employer contributions to individual general, 1099 forms are required to be investment accounts. For more details sent to any vendor that you paid $600 or and options, go to http://www.irs. more for services or rents (cumulative gov/Retirement-Plans/Plan-Sponsor/ for the year) that is not incorporated. Types-of-Retirement-Plans-1. 1099 forms must be mailed to your 5. Review your list of fixed assets. vendors by January 31, 2015. Be sure to write off any assets that are Note: Be very careful about properly no longer in use. Don’t forget that you classifying people who provide services are required to file a business property Photo: Derek Hatfield; Shutterstock to your business. If you control when tax listing in most counties by January they work, how they work, and you give 31, 2015. President of Roper Bookkeeping in Raleigh, NC them the tools to work – they are W-2 6. Take advantage of automated employees, NOT 1099 contractors! accounting programs and add-ons to track your financials. The 2. Make sure all fourth quarter and year-end payroll more data you track, the easier (and less costly) it will be to forms are filed: 941 and 940 forms (IRS), state annual withfile your taxes at year-end. In addition, you can make better fiholding reconciliation, state unemployment forms, and W-2 nancial decisions when you have accurate, up-to-date financial forms. W-2 forms are due to employees no later than January data. Be sure to keep personal and business finances separated! 31, 2015. 7. If you are using your personal car for business purposes, 3. You don’t want to purchase assets for your business unbe sure to track your business mileage. You can write off the less you have the cash flow and a demonstrated need for them. mileage as a business expense in one of two ways: However, when you purchase machinery, computers, software, • Mileage rate method: For 2014, the IRS mileage rate is furniture, vehicles, etc., you may be eligible to take a Section $.56 per mile. To determine the amount of your deduction, 179 deduction. Section 179 of the IRS tax code allows busimultiply the business miles driven by the mileage rate. nesses to deduct the full purchase price of qualifying equip• Percentage of cost method: Calculate the percentage of ment and/or software purchased or financed in a single year business miles to total miles for the year. To determine the (rather than depreciating over several years) if it is purchased amount of your vehicle deduction, multiply the total costs for and put into use during that year. That means if you buy (or your vehicle (gas, oil, repairs, etc.) by this percentage. lease) a piece of qualifying equipment, you can deduct the full 8. Be sure to separate business meals and entertainment purchase price from your gross income. The 2014 deduction from other expenses when recording your travel costs. While limit has dropped to $25,000. The Senate Finance Committee hotels and transportation are 100% deductible, meals and client has approved a bill to extend this to $500,000 for 2014 and entertainment are only 50% deductible. Also note that client 2015, but it has not yet been passed by the full Congress. and employee gifts must be limited to $25 per person per year. 4. Do you have a retirement plan for your business? If Other good resources: not, now is the time to contact a retirement plan specialist to http://www.newkirk.com/pdf_forms/low_review.pdf set one up. Some options include: http://www.irs.gov/Businesses/Small-Businesses-&-Self-Em• A SIMPLE IRA plan (Savings Incentive Match PLan for ployed/Deducting-Business-Expenses Employees) allows employees and employers to contribute to traditional IRAs set up for employees. It is ideally suited as a
For most small businesses it means tax time is here again. Are you ready? Here are some tips and reminders that can help:
8 Tips to Prepare Your Business for Tax Season
By Jess McLamb
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Business Development
“The definition of insanity is doing the same thing over and over again and expecting different results.” That’s a phrase attributed to Albert Einstein many years ago. Here’s a modification of that phrase that applies to many Small Business Owners: The definition of frustration is repeatedly doing marketing activities that bring little or no result. Sadly, many Small Business Owners do not understand that marketing is personalized – to their products/services and to their Customers/Clients. Following are three excerpts (Actions) from my book 101 Winning Marketing Actions for Small Businesses that will help you minimize your frustration and avoid getting caught in the insanity of marketing.
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PRODUCE REVENUE By Janet W. Christy
1) Recognize that being a Small Business, Woman/ Minority/Veteran Owned or a Disadvantaged Business is a Marketing angle and not the foundation of your business or the basis of your marketing plan. Your Small Business classification or Ownership status can open doors, give you a competitive advantage and help you gain access to opportunities or resources, but it will not get you business. Your best approach is usually “My business can provide you quality (your product or service here). We can also help you meet your goals for the use of Small, Woman / Minority/Veteran Owned or Disadvantaged Business.” If you lead with your Small or Ownership (DBE, MBE, WBE) status instead of your product/service, then it may appear that you expect to make the sale or get the contract solely based on your disadvantaged status or that you feel entitled to it. Although being a Small, Woman/Minority/Veteran-Owned or Disadvantaged Business often increases your opportunities and your odds, it is not the most important factor to a Prospect. You still must meet their need. It is important to understand all your possible marketing angles. List the assets and unique qualities of your business so that you can begin looking for those other angles. Here are some examples to help you get started:
• • • • • • • •
Delivery Services In-Home/In-Office Service Bonded “X” Years of Experience Multiple Locations Professional License or Certification Guarantee Recognized Expert (author, speaker, board/committee member, etc.)
Now list your specific Top 10 business assets and unique qualities. Once you have listed these, you can use them to help you with the next two Actions. 2) Know who your Customers/Clients are. In doing research for organizations and centers that deal with small business development, I always talk with local bankers about the obstacles for Small, Minority/Woman-Owned and Disadvantaged Businesses. Almost every one of them tells me that the biggest obstacle for obtaining loans and to being successful is that the business owners do not know who their Customers/Clients are (or will be). They further share that when most loan seekers are asked who their customers are, they start their answer with “all” or “any” and follow with a very general category. Here are some examples: • • • •
Janet W. Christy is a marketing consultant to Small Businesses, especially DBEs, MBEs and WBEs. She is the author of two business books 101 Winning Marketing Actions for Small Businesses and Capitalizing On Being Woman Owned. Her consulting firm, Leverage & Development, LLC, (www.leverageanddevelopment.com) has been operating since January 2003. She can be contacted at janet@leverageanddevelopment.com.
All women Any teenager Any business owners All dog owners
According to the bankers, it is very common for the response to this critical question to be “Anybody” or “Everybody.” How simple marketing would be if this was true. But anybody or everybody is not an accurate representation of your actual customers/clients. continued on page 34
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DBE PowerPlayers
DBE Liaison Officer Spotlight:
ness Element, and the DBE Supportive Services Programs. Hampton’s current focus is on several major initiatives ALDOT is advancing in the department. First, ALDOT is nearing completion of an organizational transformation that will consolidate nine former transportation divisions into five different regions. This initiative has changed the management structure of the organization, causing Hampton’s bureau to re-align itself with the new management structure. Second, the Bureau is in the midst of implementing the new DBE Final Rule recently issued by USDOT. Hampton’s team is working with Unified Certification Program partners and A gentleman and a scholar is an appropriate description for stakeholders to ensure that Alabama is compliant with the Clarence Hampton, Bureau Chief for the Alabama Departnew regulation and implements the new policies and procement of Transportation (ALDOT) Bureau of Compliance dures as quickly as possible. and Business Opportunities (Bureau). Hampton carries Finally, the Bureau is working to establish a Workforce himself with the style and manner of a southern gentleman, Development Direct Intern Program for ALDOT. The although he was born and raised in the Washington, DC area. program will provide internship opportunities in technical, His classy yet relaxed demeanor puts others at ease as he skilled craft, and information technology positions in order to strives to improve the lives of residents of Alabama and create increase employment opportunities for underutilized populabusiness opportunities for DBE firms. tions in ALDOT employment. Hampton hopes this program Hampton has worked at ALDOT for 15 years, starting as an will increase the pipeline of potential ALDOT employees Equal Opportunity Officer in 1999 after a previous eight-year from underutilized groups. career in the Alabama Office of the Attorney General. Over In addition to the challenges of leading a full civil rights the years Hampton has moved through the ranks of the civil team of professionals, Hampton is also completing a term as rights unit to assume the role of Bureau Chief in March 2013. chairman of the Southern Transportation Hampton began his career in the civil Civil Rights Executive Council (STrights arena after earning his bachelor’s CREC). The council consists of the civil degree in Urban Affairs from the Univerrights directors of eight southern states sity of Michigan, and later his law degree that include Kentucky, Tennessee, North from the University of Baltimore. Prior to Carolina, South Carolina, Georgia, Alajoining ALDOT, Hampton worked as an bama, Florida, and Mississippi. The counEqual Opportunity Office at the Maryland cil of civil rights directors of these states Department of Transportation and as the plan the bi-annual Civil Rights Training Director of Personnel and Management Symposium and also meet quarterly with Development at the New Jersey Transit FHWA representatives to discuss current Authority. Hampton has also served as initiatives coming from FHWA Headquaran adjunct professor of Business Law at ters. Hampton will conclude his term as Alabama State University and Auburn chairman at the 2015 STCREC Training University. He also instructed Business Law Symposium scheduled for August 3-6, and Administrative Law courses for over 16 2015, in Orlando, Florida. years at Troy State University. Hampton’s words of wisdom for other In his current role, Hampton has respon- Mr. Clarence Hampton, Esq. civil rights professionals are to, “remain sibility for all of ALDOT’s Civil Rights and flexible in your areas of endeavor.” He encourages fellow pracAffirmative Action Programs including Contractor Complititioners to stay open to new opportunities given the wide ance, Title VI, On-the-Job Training, Americans with Disabilivariety of skill sets and expertise needed as a civil rights and ties (ADA), Equal Employment Opportunity/Affirmative compliance professional. After beginning his career focusAction, Youth Transportation & Workforce Development, ing on equal employment opportunity, Hampton’s flexibility and all aspects of the Disadvantaged Business Enterprise has allowed him to become a multi-dimensional civil rights (DBE) program. As a part of the DBE program, ALDOT also manages the state’s Unified Certification Program, Small Busi- professional in all areas of affirmative action programs.
Clarence Hampton Alabama Department of Transportation
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DBE PowerPlayers
The Frederick Douglass Bridge project is part of the larger Anacostia Waterfront Initiative that will utilize services from local businesses such as VJS-TC. Photo Caption: (rendering of bridge) – Courtesy of District Department of Transportation
R
elationships are to an entrepreneur, what water is to a human being; a necessity for survival. Therefore business owners who are better at developing, maintaining and growing powerful relationships tend to have more success in business. This is a concept Valerie J. Southern has mastered and built her company upon over the past 16 years. Valerie J. Southern - Transportation Consultant LLC (VJS-TC) began operations in 1998 in Issaquah, Washington, just east of Seattle; and then relocated to Fairfax, Virginia in 2009. Since the beginning, Southern has used the power of relationships to build a successful consulting practice. Valerie J. Southern - Transportation Consultant, LLC is a multi-faceted consulting and engineering company that provides transportation planning and traffic engineering services
and serving as the Manager of Transportation Planning for the King County Department of Transportation in the state of Washington. “I had been in progressively responsible, upwardly mobile
The Power of Relationships Valerie J. Southern-Transportation Consultant, LLC to federal, state, regional, county, local/tribal governments positions during my 15-year career... I just looked at my and to private sector planning and engineering firms. portfolio and said ‘you know I need to have a different experiPrior to launching VJS-TC, Southern ence and contribute in a different way, and built a successful transportation career learn as a professional in a different way.’ in the government sector. Southern has a I was thinking at the time that I have a lot master’s degree in Public Administration to offer to the private sector and perhaps I from Harvard University and a master’s should put my own shingle out and offer degree in Urban and Regional Planning the resources that I have, as well as attract from the University of Rhode Island. She folks like Gary Norris to my practice and also has 30 years of experience in managjust experience the industry in a different ing public transportation systems and way,” Southern said. programs nationwide. Her previous roles Her strategy for success has involved include serving as the Deputy Secretary building powerful internal and external Owner Valerie J. Southern and Gary A, Norris, PE, for Transportation Planning and Capital relationships that have developed the senior traffic engineer, of VJS-TC. Programming at the Commonwealth of expertise to provide excellent services to Massachusetts; serving as an Expert Consultant for the Fedclients, and the opportunity to demonstrate superior value in eral Highway Administration; serving as the Deputy Director the marketplace. of Policy, Governor’s Office, for the State of Rhode Island; A key component of her internal relationships is demonstrated by her long-standing right-hand man Gary A. Norris, PE, a senior traffic engineer who relocated his services with Southern to the East Coast when she moved the company 10
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from Washington State in order to be closer to family. “Gary has been with me since around 2000. When I decided to move the company to the East Coast, I knew most of my 22 employees would not be interested in moving, but Gary did have an interest in relocating to the East Coast and we are now reconstituting the company here in the Washington, DC area.” This partnership between Southern and Norris has generated recent success in helping VJS-TC win a contract with CH2MHill on the Anacostia Waterfront Initiative (AWI) in Washington, DC. Southern said: “I had a chance to work with Linda Fennell, Program Manager of the District Department of Transportation Business Opportunity and Workforce Development Center and she personally introduced me to Craig Lenhart,
DBE Program Experts-All Phases, All Modes 25 Years of continuous quality service
Program Manager of the AWI at CH2MHill. Gary also had a relationship with Ron Paananen, Deputy Program Manager of CH2MHill dating back to our work in Washington State. So through these two relationships, we were able to share our capabilities and expertise and won our first contract. Our first job was to put together the traffic signalization and ITS technical requirements for the design-build specifications for Segment 1 of the South Capitol Street Project. We then won a second opportunity to complete 30 percent lighting design plans on the Segment 3 of the South Capitol Street Project.” CH2MHill’s Lenhart said, “Valerie J. Southern Transportation’s lighting experts were a perfect fit for our design team. They were able to take the project vision established by the client and deliver on the design goals for Phase II of the South Capitol Street Corridor Project.” “It’s all about relationships,” said Southern. “The largest requirement for being a successful DBE is that you have to network. You have to establish strong relationships with the people who have these visions and are responsible for administering and implementing them.” continued on page 35
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D E N V E R’ S P H I L L I P WA S H I N G TO N ACHIEVES MEGA-SUCCESS I N T R A N S P O R TAT I O N
Mr. Phillip Washington
commutes to work everyday using public transportation. “It’s the best thing going,” said Washington, General Manager and CEO of the Denver Regional Transportation District (RTD). “I hate driving,” he added. Washington explained that he is leading by example, using the region’s transit and light rail systems daily to showcase the organization’s public transportation product. He said his daily commute allows him extra time to read, take a nap, or meet new people. “It’s all about using your own product,” he said. Washington grew up in urban south-side Chicago housing projects and was reliant on public transportation throughout his childhood. He said his familiarity with the importance of transportation helped him value its impact on citizens and businesses that develop infrastructure for its residents. Washington said as a youth, he remembers not seeing minority contractors participating in the development projects that affected his community, and that led to the passion he now has for his work
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and commitment to helping DBEs successfully participate on jobs. He said: “Growing up in an urban environment and being dependent upon transit to get from Point A to Point B, and understanding the value of public transportation; understanding the economic onset of having public transportation in terms of having jobs, going to school; disabled folks getting around. That experience with public transportation--to include building things in my community--in an urban environment and oftentimes not seeing minority contractors led me to the passion I have now for small and minority-owned business inclusion.” Washington’s career is a notable crescendo of major accomplishments identified both by personal achievement and by supporting and propelling the success of others. He spent more than two decades in the military, retiring as a decorated active-duty U.S. Army soldier, having attained the rank of Command Sergeant Major (E-9); the highest non-commissioned officer rank an enlisted person can achieve. Washington said that
Phillip Washington, General Manager and CEO of Denver Regional Transportation District
define success “byI seeing other
various aspects of his overseas military experience fuels the work he does now, including a reemphasis on infrastructure projects and nation-building. Over the past 15 years, he has transitioned into increasingly higher levels of supervision and management within the transportation industry. In August 2014, Washington was elected chair of the American Public Transportation Association (APTA). He was awarded a White House Transportation Innovators Champion of Change award and in 2013 was named APTA’s Outstanding Public Transportation Manager in North America. He also serves as a member of COMTO (Conference Of Minority Transportation Official) and the Transportation Research Board executive committee. Washington said, “I define success by seeing other people around me doing well. If other people around me are doing well and being professionally developed, and if other people around me are not afraid to come to me with their issues, then that is success in my mind. I think the minute people stop coming to you with their problems, that’s the minute you become less successful and less trustworthy.” Washington said he is equally passionate about DBE success as a result of not seeing a large number of minority contractors contributing to his community as a child and young adult. Regarding DBE participation and contract awards, he said, “I’m going to insist on the attainment of goals.” He noted that simply relying on DBE good faith efforts was not sufficient. Washington stated that in addition to outreach, there must also be consistent technical outreach. He stated: You must have people on the team who are technically proficient to advocate for DBEs; who are proficient with estimating and scheduling. One of the things that DBEs lack and really need help with is estimating. When you bid on the job and you are 50 percent over the cost, or the internal estimate of the agency, then that tells me that you don’t know how to estimate. Now, you’re 50 percent over, when the internal estimate is unveiled; everyone else is in the ballpark. In some cases, there is an entitlement mentality with regard to DBE participation. There is a mentality out there that says, I may not have to do the hard work of estimating and scheduling, and I’m still entitled to get the job or subcontract. You’ve got to be in the ballpark. You’ve got to be within 10 percent for me to even think about it… This is real life. Washington also emphasized the importance of managing expectations. “Everybody isn’t getting a contract,” he said.
“You must perform. There are far too many cases of DBEs and primes that don’t perform. DBEs—their bread and butter is quality work. If they don’t do a good job, it’s hard to recover. DBEs must perform. There is no excuse for not performing.” He said unfortunately, even isolated cases of poor DBE performance cast a negative opinion on the agencies and programs that advocate for DBE participation. Washington said the best-case scenario is when DBEs become prime contractors on projects. In addition, he’s also working to increase participation and involvement by DBEs in APTA; not only by becoming members, but also taking on leadership roles in the organization. A flagship program for RTD under Washington’s leadership is FasTracks; one of the largest transit expansion programs in the country. The FasTracks program is developing 122 miles of new commuter rail and light rail, 18 miles of bus rapid transit service, adding 21,000 new parking spaces and redeveloping Union Station into a multimodal transportation hub to create vibrant, mixed-use transit-oriented communities. The West Line (W Line), RTD’s first FasTracks-funded rail line, opened in 2013, eight months ahead of schedule and within its adopted budget--adding 12 miles of light rail for an RTD system-wide total of 47 rail miles. FasTracks has invested $5 billion across the region. Washington also was instrumental in creating and developing the RTD & Community Workforce Initiative Now (WIN) program, a collaborative workforce partnership that creates career pathway opportunities on transportation infrastructure, design and construction-related projects for unemployed and underemployed residents of regional communities in the Denver area. The inspiration was derived from his childhood. “Seeing people building infrastructure in my community that did not look like me” is what motivated him to launch the program. The idea behind the WIN program is to communicate with people who live in the community where infrastructure is being built, and say, ‘We want you to help build your own community.’ Washington said that part of the process is to put WIN goals on the projects, in the contracts, in the RFP and require the primes to meet that goal, just like they meet DBE goals. “When you bring folks on to build infrastructure, or to operate and maintain infrastructure in the communities where
people around me doing well.
”
by Jordan Taylor
continued
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they live, there is a different pride factor in that infrastructure as they build it up,” he said. Embedded in the WIN process is the ability to track progress in specific zip codes where the program has been implemented. “There is a direct correlation between jobs and the impact on the community in those areas, and we’re tracking those [crime rates, home ownership and education levels],” Washington said. “I want to be able to go to the Department of Justice--or even the local police department--and say, ‘We have laid this program down in this zip code, and guess what, I need some grant money to keep this program going because the crime rate has decreased by X percent in this particular zip code. And that’s the inspiration behind the WIN program, in summary.’” According to Washington, FasTracks DBE participation has been tremendously successful. He said: “We have met all of our goals on FasTracks on every project; not just met them, we’ve exceeded them. This has not been easy. We have had some bumps in the road too; we’ve had some failures out there. The various pillars: Outreach. Technical outreach. Compliance. Aggressive goal-setting. Advocacy. All of those things have worked very well for us. There’s some advocating that must go on. It must start at the top. If there is no advocating by the CEO, then your program is not going to succeed.” In public and private settings, Washington touts the five “mega trends” that he believes will fundamentally shift the way business is done in the transportation industry: 1. Technology innovation 2. Changing customer demographics and lifestyles 3. Shifting workforce demographics 4. Evolving environments for financial resources 5. Increasing expectations for improved safety and security As a result, DBEs can strategically position themselves to take advantage of growing opportunities for business develop-
ment. He said that small businesses and DBEs have to understand the environment that will be in existence over the next 5 to 10 years in transportation. “DBEs have to understand where they fit in. Public-Private Partnerships (P3 delivery model) are the trend. One of the questions will be who takes on what level of risk. The small business or DBE must understand that there may be some risk in a project that they have to take on,” Washington said. A new regional Business Resource Management office was opened to assist DBEs and SBEs in reaching higher levels of business development and contracting success. The BRM also coordinates DBE/SBE project outreach for FasTracks and other RTD projects. In a statement, the BRM office highlighted distinct efforts that set it apart from other business assistance programs, including: working directly within the Civil Rights Division’s mission to “level the playing field;” targeting work with RTD contracts; focusing on increasing a company’s DBE/SBE capacity; using project management practices to help small businesses troubleshoot problems as they arise; and working with companies that have an expressed desire to grow and succeed. Washington said: “DBE participation is a must. A lot of these projects are in urban environments. No more can we practice the idea of tearing down communities and displacing communities of color, creating gentrification, and celebrating. We must—as public entities—make sure that there is involvement by DBEs. We have to show what the impact will be and what the impact is in the urban areas and communities of color; whether it’s jobs or DBE participation. We have to show the economic benefit of the communities where we’re building in; and make sure that people who live in these communities are helping to build the infrastructure that we are implementing and constructing.”
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As owners of Disadvantaged Business Enterprises have counted their blessings this holiday season, many
have exhaled a sigh of relief at key provisions of USDOT’s recently issued and long-awaited Final Rule, “Disadvantaged Business Enterprise: Program Implementation Modifications.” Others have lamented the lost opportunity the new rule represents in its failure to address long-standing ambiguities and inequities in the basic presumptions underlying the meaning of “economic disadvantage.” Effective November 3, 2014, the new agency guidance for 49 CFR Part 26 is a mixed bag of long-desired administrative fixes to certification standards, procedures, and personal net worth (“PNW”) forms, data collection requirements, clarifications regarding goal setting and good faith efforts, general program administration matters, and disappointing failures to provide much needed clarity and common sense guidance to state recipients on the determination of economic disadvantage. This article is the first in a series of articles that summarizes and critiques various aspects of the 180-page DBE Program Final Rule of 2014. As a recent Office of Inspector General Audit Report emphatically underscored, the fair and consistent administration of DBE certification standards has been undermined by poor guidance and inadequate oversight of state recipients by USDOT. Left largely to their own devices, state recipients of USDOT funds have been quite challenged in balancing presumptions of economic disadvantage (based upon arcane PNW calculations), against rebuttal evidence of the lack of economic disadvantage that is suggested by vague and subjective USDOT guidance. The OIG report found many errors and inconsistencies in the manner in which state recipients were calculating PNW for DBE certification applicants. As a result, firms that were not eligible for the presumption of economic disadvantage may have been certified as DBEs, and
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firms whose owners were below the PNW cap and eligible for the presumption may have been improperly denied certification. Through such widespread inconsistencies, the integrity of the program may have been placed in jeopardy. Prior USDOT guidance regarding determinations of “economic disadvantage” referenced language in 49 CFR § 26.67 (b)(2) that states, in pertinent part, that while the PNW cap of $1.32 million is intended to prevent DBE certification to persons that could “reasonably have been regarded as having accumulated wealth too substantial to need the program’s assistance,” there may also be instances where an individual’s personal net worth is below $1.32 million that may properly be regarded as not being economically disadvantaged.Former USDOT guidance further stated that “in determining whether an individual is economically disadvantaged, a recipient is entitled to not only look at the individual’s PNW but also at his or her overall economic situation to make a reasonable determination of whether the individual is fairly regarded as being economically disadvantaged.” This phrase, “fairly regarded as being economically disadvantaged,” is so vague and circular as to cause all sorts cerof mischief in the cer tification process. Adding insult to injury, the prior USDOT guidance then stated that although an individual’s personal net worth may be below $1.32 million, “the person’s assets (e.g., a very expensive house, a yacht, extensive real or personal property holding) may lead to a conclusion that he or she is not economically disadvantaged. The recipient can rebut the individual’s presumption of economic disadvantage under these circumstances, as provided in Sec. 26.67(b)(2).” This “guidance” obviously begs the question: How expensive is a “very expensive house?” How big does a boat have to be before it becomes a “yacht” worthy of Thurston and Lovey Howell? At what point does a person cross the line from dabbling in passive income from owning a few rental properties into becoming a real estate magnate? In the final analysis, at what point does an individual cease to be “economically disadvantaged” as compared to who else or what else?
This woefully inadequate guidance has invited very subjective determinations based upon a recipient’s own personal views about the size of a house, the affordability of a certain model of a car, and the number of furs and diamond pendants that a so-called wealthy person would own. The greatest danger in using such subjective standards is that they will inevitably lead to widely varying and inconsistent results in economic disadvantage determinations based upon personal life experiences and views. More importantly, such subjective standards will make a complete mockery of the presumption of economic disadvantage status, as there is nothing to prevent the DBE Certification Committee members from arbitrarily deciding that if they personally could not afford to live in a big house and to buy the possessions of the DBE firm owner, that owner must not be economically disadvantaged and must be too wealthy for the program. In our view, rebuttals of this legal presumption should be based upon probative evidence that addresses relative economic disadvantage of one business owner as compared to another non-disadvantaged business owner with whom he or she competes; not upon some subjective opinion about the “richness” of someone’s personal belongings. Consider the following: Warren Buffet has a personal net worth near $46 billion. Nearly everyone in the country would be considered “economically disadvantaged” as compared to him. Yet, he lives in a house in Omaha that he purchased in 1958 for $31,500, and he drives a 7-year-old Cadillac. Meanwhile, as the recent sub-prime mortgage crisis and its high home foreclosure rates made quite clear, thousands of low and middle income individuals (some of whom were
unemployed) managed to own multimillion-dollar mansions despite being quite economically disadvantaged (and in the worst cases, in bankruptcy). Moreover, homeless people have been known to live out of the back seat of a Mercedes Benz. Based solely upon such stereotypes relating to personal possessions, the bankrupt homeowner and the homeless person would be considered too wealthy to be economically disadvantaged, while Warren Buffet might have a real shot at being certified as a DBE owner. Our point here is that by placing too much emphasis on the subjective and on popular stereotypes about the trappings and possessions of wealth, it is quite easy to come to the wrong conclusion about the relative “economic disadvantage” that is truly meaningful to a remedial program of this type. The new DBE Program Final Rule presented an excellent opportunity for introducing some much needed clarity and objectivity on this issue. Sadly, however, the new Final Rule merely parrots the same prior examples provided by USDOT of what it considers to be relevant evidence for rebuttal purposes. In the next part of this series of articles on the new Final Rule, we will advance several alternative industry-based objective criteria for determining economic disadvantage that we suggest for the consideration of USDOT and state recipients. 1 The DBE Program Final Rule was issued on September 25, 2014 at 79 FR 59566. 2 The USDOT Office of Inspector General Audit Report (issued April 23, 2013)
severely criticized the lack of oversight, training, and guidance provided by USDOT to recipient states regarding instructions to DBE firms regarding certification and PNW forms and subsequent evaluation of completed forms by recipient states.
Subscribe to Franklin Lee, a partner in the Baltimore-based law firm of Tydings & Rosenberg LLP, represents DBE firms in certification applications and appeals. In addition, he counsels state and local governments in the establishment of economically inclusive contracting policies, and urban economic development strategies. As former Chief Counsel to the Minority Business Enterprise Legal Defense & Education Fund (“MBELDEF”), he frequently defended the DBE Program on behalf of minority-owned firms against constitutional legal challenges, and advised USDOT regarding post-Adarand reforms to the DBE Program. Mr. Lee can be reached at flee@tydingslaw.com.
In-Depth Industry Coverage Subscribe Online at www.AmericanDBE.com www.americandbe.com
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Interactive Airport Advertising JCDecaux and Interactive Airport JCDecaux advertising display at Ronald Reagan Washington National Airport
“The only place opportunity cannot be found is in a closed-minded person,” is a quote by Bo Bennett, a successful entrepreneur and the author of the book “Year to Success.” Thankfully, the opposite of this thought is also true. An openminded person can find opportunities where they currently do not exist, especially when two open-minded people come together for a common goal. The latter statement reflects the story of two solid business people seeking opportunities in the airport advertising industry six years ago. Carolyn Sawyer, President/CEO of Interactive Airport Advertising, a subsidiary of The Tom Sawyer Company, has always been open to new opportunities for her ACDBE-certified communications company started in 1996. Likewise, Bernard Parisot, President/Co-CEO of JCDecaux North America, was seeking ACDBE partners to help enhance their airport advertising business in the United States. Neither knew the other, but agreed to meet over a cup of coffee and form a business relationship with a handshake. 18
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Sawyer has never forgotten how, “Bernard flew down from New York one morning to meet with me in Washington D.C. We hit it off right away. We had a great conversation and both believed that we could work together.” When the two met, JCDecaux was the incumbent, pursuing additional ACDBE partners for Reagan National and Dulles International Airports. JCDecaux is the worldwide leader in outdoor advertising and airport advertising, and currently has advertising concessions in 148 airports located in 19 countries. Parisot said: “I have been in the airport advertising business since 2002, when we acquired a company that had multiple contracts at U.S. airports. At the time, we were not familiar with the ACDBE participation program. But I looked at what the spirit of the program was and I found that it was a very commendable intention, which was to have companies like mine mentor smaller companies/DBEs and help them grow and acquire expertise in an area which they could not get into on their own, because the contracts where they would be invited to participate would be too big for them on their own.” Parisot’s instincts were right. While TSC’s experience did not include selling advertising in airports, the award-winning communications company had over a decade of experience in the mass media industry. The company’s team had complementary skills well-suited for success in this related sector. In addition to her entrepreneurial experience, Sawyer spent 16 years in the
Open to Endless Possibilities Advertising Build Mutually Beneficial Relationship By American DBE Magazine Staff Writers media, on the front lines as a television network correspondent and news anchor. Parisot said: “When I met with Carolyn the first time... she was very eager to diversify, and she found that this wasn’t so far from what she had done that she couldn’t learn to do it. She knew that if she dedicated herself to it really well, that she would be able to achieve results. So we have made an agreement and we have provided her with support, with training, and today she is in charge of selling advertising in four of our airports; and there will probably be more, and she is doing a very good job.” Sawyer’s leadership of Interactive Airport Advertising has helped JCDecaux to grow its clientele not only at Reagan Nation and Dulles International, but Baltimore/Washington International, and Miami--the largest International Airport in the United States. The company continues to explore additional opportunities in the aviation industry and believes the airport advertising niche is one they can simultaneously grow. TSC is a certified DBE firm in 40 states and is active in networking through industry organizations like the Airport Minority Advisory Council (AMAC) to build relationships and stay abreast of upcoming trends. Sawyer’s vision has evolved over the last 19 years, but her long-term goals have remained consistent--to build excellent, sustainable lines of business. Despite life’s hectic pace, this author of two books still loves to travel in pursuit of lifelong learning and reads tons of books. Her advice to other DBEs reflects her beliefs. Sawyer said: “You have to remain open to any and every possibility; explore the opportunity. If I think back to when the company started and our very first client… if we were still doing what we did back then in today’s Information Age, we would be out of business. What has kept us in business is our willingness to be open to the possibilities. Who knew our dynamics sales team would daily place international clients and brands in halls, on digital walls and baggage claim columns in the nation’s leading airports? It came from remaining open.”
Top to bottom: Carolyn Sawyer, President/CEO of Interactive Advertising Bernard Parisot, President/Co-CEO JCDecaux North America Ronald Reagan National Airport
www.interactiveairportadvertising.com (888) 729-9373
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USDOT Cracks Down Fraudulent actions of various types occur every year and affect countless businesses and individuals on a daily basis. Unfortunately, the federal government, specifically the United States Department of Transportation (USDOT), is not immune to these acts. Defrauding the government, according to justice.gov, is defined in simple terms: “To conspire to defraud the United States means primarily to cheat the Government out of property or money, but it also means to interfere with or obstruct one of its lawful governmental functions by deceit, craft or trickery, or at least by means that are dishonest.” The USDOT is beginning to crack down on fraud within its Disadvantaged Business Enterprise (DBE) program. According to the United States Attorney’s Office—Western District of North Carolina—wrongful acts of this kind were discovered in North Carolina. Boggs Paving Inc. (Boggs Paving) is at the center of a federal case with USDOT. Carl Andrew Boggs III, of Waxhaw, N.C., pleaded guilty to one count of conspiracy to defraud the USDOT and one count of money laundering conspiracy in U.S. District Court. Boggs, president and part-owner of the company, used his Monroe, N.C.-based company to obtain government-funded construction contracts by misrepresentation and misusing a DBE. By definition, DBEs are for-profit small businesses that are presumably socially and economically disadvantaged. The owners, who are mainly minorities and women, own at least 51 percent interest of their companies and control management and daily business operations. DBE categorization is not limited to minorities, but also includes other individuals who qualify as socially and economically disadvantaged, on a case-by-case basis. DBE fraud usually refers to major companies or prime contractors exploiting DBE status for financial gain. In the case involving Boggs, the story is complex. In a press release about the case, Anne M. Tompkins, U.S. Attorney for the Western District of North Carolina, stated: “Cheating to obtain publicly-funded construction contracts enriched Boggs Paving and its owners and undermined the goal of the DBE program, which helps small and minority-owned businesses thrive by ensuring their ability to work on federal construction and transportation projects.” The DBE pro-
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on DBE Fraud by David L. Fitts Jr.
gram is designed to increase the participation of DBEs and small business enterprises (SBEs) in federally-funded public construction and transportation-related projects. In order to obtain the contracts Boggs wanted, he joined forces with Wingate, N.C.-based Styx Cuthbertson Trucking Company Inc. (Styx), a road construction hauler and a certified DBE and SBE. The costly battle began when Boggs’ company won the bid for a contract with the North Carolina Department of Transportation. NCDOT contracted Monroe Bypass Constructors, a joint venture of Boggs Paving; North Charleston, S.C.-based United Infrastructure Group; Lake City, Fla.-based Anderson Columbia Co.; and lead design firm, Baltimorebased Rummel, Klepper & Kahl, to build the estimated $700 million Monroe Bypass/Connector, a 19.7-mile toll road. The contract called for a toll road to be built that would span from U.S. Highway 74 near Interstate 485 in Mecklenburg County to U.S. Highway 74 between the towns of Wingate and Marshville in Union County. The contract with the joint venture was for $308.3 million and was awarded in 2011. Boggs Paving, the only
company of the joint venture involved in the federal case according to Monroe city officials, had been known for their lower bids and having a good reputation working with the state. Of course, reputation alone was not enough to guarantee that the company would be able to bid on the project. In order to not be disqualified from bidding, companies had to agree to work with a DBE or SBE which would get a share of the work. From 2003-2013, according to documents filed on the case and statements made in court, Boggs, Boggs Paving and the other defendants admitted to falsely certifying that a DBE or an SBE would perform and be paid for their work on the project. Boggs Paving and Styx had worked together for more than a decade. Boggs Paving and John Cuthbertson, chief executive of Styx, set up bank accounts in Cuthbertson’s name. However, the accounts actually funneled funds directly back to Boggs Paving. Boggs’ company also placed magnetic decals with “Styx” signage on its trucks, covering the “Boggs” logo. This action reportedly was done to dupe the federal government into believing Cuthbertson’s company was doing work specified on various contracts. Cuthbertson was paid kickbacks to participate in the fraudulent scheme utilizing his company’s name only, allowing his company’s DBE status to be used by Boggs. According to court records and a press release, from June 2004 to July 2013, Boggs Paving was the prime contractor on 35 federallyfunded contracts, and was a subcontractor for two additional contracts worth more than $87.6 million. The company claimed DBE credits of approximately $3.7 million on these contracts for payments purportedly made to Cuthbertson’s company. In reality, Styx only received payments of approximately $375,432 for actual work. While Styx’s owner agreed to partake in the misdeeds willingly, his association with the fraudulent activity may cause residual harm to the DBE program. “DBE fraud harms the integrity of the DBE program and law-abiding
Photo: Paul Matthew Photography; Shutterstock
contractors, including many small businesses, by defeating efforts to ensure a level playing field in which all firms can compete fairly for contracts,” said Marlies Gonzalez, Regional Special Agent-in-Charge of the U.S. Department of Transportation, Office of Inspector General. Whether Cuthbertson or Boggs knew it or not, their fraudulent actions created a ripple effect that has raised questions about the DBE program and hindered efforts by NCDOT to ensure timely completion of the Monroe Bypass/Connector. Currently, the court case is still pending, and construction has been put on hold due to unrelated environmental issues. It is undetermined whether or not Boggs Paving will be allowed to continue their work once the issues are resolved. Thus far, Boggs Paving has been paid 20 percent of the 2011 contract although construction has been blocked by the environmental lawsuit since 2012. As of August 2014, the state had paid the joint venture $47 million to “compensate the firms for mobilizing for construction without having to do any work,” according to reports in the Charlotte Observer, a daily newspaper that initially covered the story. Both Boggs’ and Cuthbertson’s companies have been banned from bidding on any future federal projects. Styx, has been removed from the bypass project and is no longer listed as a certified DBE on NCDOT’s list of certified firms. Styx is still listed as an SBE. By September 2014, all eight defendants: Cuthbertson, Boggs, four of Boggs’ executives, Boggs Paving and Styx had pled guilty for their actions. Currently, all are awaiting sentencing. In August, the Office of Inspector General issued the following statement: “As a result of Cuthbertson’s plea, the United States will file a motion to dismiss all charges against Styx.” As of October 2014, with construction being blocked and sentencing still pending, the NCDOT has yet to decide the future of the bypass project. According to public information, Boggs was released on bond and will David L. Fitts Jr. be sentenced by the Court at a later date. The conspiracy to defraud USDOT charge carries a maximum of five years in prison and $250,000 fine. The money laundering conspiracy charge carries a maximum of 20 years in prison and a $500,000 fine or twice the value of the property involved in the transaction.
The conspiracy to defraud USDOT charge carries a maximum of five years in prison and $250,000 fine.
Aviation
AMAC Continues Push for DBE Opportunities in PFC-Funded Projects By American DBE Magazine Staff Writers
T
he Airport Minority Advisory Council (AMAC) is a trade association with the mission of increasing employment and business contracting diversity in the airport industry. To this end, a significant issue facing the organization is the ongoing discussion in Washington, DC on the best way to fund airport improvements in the muchneeded Federal Aviation Administration (FAA) reauthorization legislation expected to take center stage in 2015. A major component of the legislation must address how to fund airport improvements at major U.S. airports, and stakeholders on this issue are primarily divided on the issue. One on side of the issue is the airline industry consisting of the major airline companies such as Delta Air Lines, Southwest Airlines, American Airlines and others. Their belief is that the current system of funding airport improvements through a mixture of funding from the federal government in the form of Airport Improvement Program (AIP) grants, and funding from the collection of Passenger Facility Charges (PFCs) is the way to go in the future. AIP grants are awarded by the FAA from federal transportation funds, while PFCs are fees collected by airports of up to $4.50 on each passenger enplanement at their facility. The airline industry is represented by the Airlines for America (A4A) trade association. A4A stands firmly behind the position that PFCs should not be increased in the reauthorization bill. In June 2014, Julie Pinkerton, Senior Vice President for Legislative and Regulatory Policy testified before the House Transportation and Infrastructure Commit-
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tee’s Subcommittee on Aviation. Pinkerton said: “The current system is working and airport funding projects that are based on need are being met with existing resources across the country… Raising the PFC cap will dampen demand, hurt travel and tourism, and could imperil air service to small communities…There is no current or foreseeable crisis in airport funding – we urge members of Congress to stick to the winning formula in place and reject further tax hikes on airlines and their customers.” On the other side of this important issue is the airport industry, which consists of the physical airport facilities such as John F. Kennedy International Airport in New York, or Los Angeles International Airport and others. Airports assert that the current funding system is insufficient to meet delinquent and growing airport improvement needs. Airports are advocating for an increase in allowable PFCs that they are allowed to charge customers, and believe that an increase in PFCs will allow them to fund their own improvements and greatly reduce their need to receive AIP funding from the government. However, any increase to the current PFCs would have to be approved by Congress in the reauthorization legislation. The airport industry is represented by the Airports Council International – North America (ACI-NA) trade association.
ACI has published a position statement supporting an increase in PFCs to restore the purchasing power of the funding and to allow airports more flexibility in funding airport improvements. The statement explained: “Restoring the purchasing power of the PFC as well as giving airports more freedom to manage their own PFC programs to meet individual airport needs is one of ACI-NA’s top priorities… There have been no adjustments to the PFC program since 2000, diminishing the real purchasing power of PFCs. When adjusted for inflation, the $4.50 in 2000 is the equivalent of $2.45 today.” The U.S. Congress will ultimately decide the future direction of airport funding as they wrangle over a reauthorization bill for the Federal Aviation Administration (FAA). The current bill expires in September 2015, and all parties involved are in agreement that the new bill should not only renew existing levels of funding, but also create a means to address the significant deficit in funding for airport improvement needs. The Obama Administration has supported an increase in PFCs primarily as a means to create additional funding for airport improvements while reducing the amount of AIP grant funding provided to airports from the federal government. However, as discussions continue between the airlines, airports and federal government, DBE firms are threatened by an outcome that could impact their ability to participate in improvement projects at major U.S. airports. This is due to neither side embracing the need to include DBE program provisions in the legislation allowing an increase in PFCs. Currently, although PFCs play a role, most airport improvement projects are funded by AIP grant funding from the FAA. AIP funding is used to finance improvements such as runway & taxiway improvements, airport lighting, airport signage, environmental studies and planning studies. Projects funded using AIP grants must include DBE program provisions ensuring disadvantaged firms have the opportunity to participate in these projects. In contrast, airport improvements
made with funds collected from PFCs are not required to include DBE provisions. Any initiatives to include diverse companies in PFC-funded projects are left to the individual airport’s governing authority. AMAC President Shelby Scales is leading the charge to shed light on this issue with legislators, government officials and DBE program stakeholders. She said: “AMAC is advocating three primary positions on the airport funding issue and the FAA Reauthorization Bill. First, AMAC opposes cuts to the AIP; second, AMAC supports increases to PFCs; however third, we believe PFC increases must be tied to the expansion of M/W/DBE requirements to PFC funding streams to offset any potential AIP cuts.” ACI-NA, the primary group supporting the PFC increase, recognizes this challenge for disadvantaged businesses and affirmed its support and City of Cleveland Director of Port Control Ricky D. Smith discusses the potential impact of an commitment to DBEs increase to PFCs with Miguel Southwell, Aviation in a statement released General Manager of the Hartsfield-Jackson Atlanta International Airport and other airport directors at by the organization. However, ACI-NA says the 2014 AMAC Business Opportunity Conference in Denver, CO. it “does not support the application of federal DBE mandates for PFCs user fees.” Instead the organization advocates that airports use state, county or community DBE contracting programs for projects funded by PFCs. Although ACI-NA’s statement falls short of AMAC’s ultimate goal of having the federal DBE program connected to PFC-funded improvements, it does address their primary concern as described in a statement from the organization. “AMAC’s chief concern is a level playing field for minority and women owned businesses – and that goal requires robust minority and women business programs regardless of whether the programs are federal or local in nature.”
Civil/Highway
Surety Bonding: the DBE Ticket to
P3 Opportunities Surety bonding is seen by many DBEs firms as a barrier to participating in large transportation projects, such as PublicPrivate Partnerships. This belief is especially true for less experienced firms that are unfamiliar with surety bonding and the important role it can play in developing a viable construction business. However, successful firms are aware that surety bonding represents a high-powered tool in the toolbox of a successful contracting business that can help a firm better manage its business operation and open up opportunities on the large projects being let by government agencies. In fact, bonding is often not an option, but a requirement for DBEs performing trades such as concrete, drainage, water & sewer, and asphalt paving. Public-Private Partnerships (P3s) are contractual agreements formed between a public agency and a private sector entity that allow for greater private sector participation in the delivery and financing of transportation projects. In these arrangements, the private company assumes the role of the government entity for the financing, construction, maintenance and operation of a transportation facility. In return for taking on this responsibility, the private company earns revenue (and hopefully a profit) from the transportation facility by way of toll fees, government payments and/or subconcessionaire payments. P3 projects offer a significant opportunity for DBEs due to their large size and wide variety of tasks required to complete the project. In addition, the Federal Highway Administration is encouraging states to consider the use Niveen Kattan of P3 projects to encourage creativity, innovation and the private funding of transportation infrastructure projects. Therefore the prevalence of P3 projects is expected to increase in the future. Currently
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there are 21 new build facility projects that are P3 concessions in the U.S., with more in the planning stages. The 21 projects range in size from $127 million for the Teodoro Moscoso Bridge in Puerto Rico, to $2.6 billion for the IH 635 project in Florida. Opportunities on these and newly developed P3 projects is a trend DBEs should be aware of moving forward. However, whether a project is a P3 or simply a large government project, the risks are often high for the prime contractor selected to build the project due to the size, complexity and project schedule requirements. Therefore, the vast majority of primes require that subcontractors performing significant scopes of work provide bonding to minimize their risk. Additionally, a prime contractor’s bonding company will often require the prime to hire only bonded subcontractors for certain scopes of work on large projects as a part of their bonding agreement. Niveen Kattan, president of Atlantic Contracting Company, a DBE concrete contractor in Greensboro, NC has been successful as both a prime and subcontractor on roadway projects. Kattan said that bonding is required on nearly all of her company’s jobs on highway construction projects. “Being able to get bonded, being a bondable company, really allowed us to have the opportunity to bid on jobs. Without the bonding, we could not even get prequalified to be considered for many jobs,” Kattan said. Successful and experienced DBEs realize that bonding can be a competitive advantage and differentiator for companies in competition for large projects. Many of these projects are P3s or design/build jobs where price is a major factor, but not the only factor, in the selection process. Therefore prime con-
tractors are more likely to choose subcontractors based on the best overall value, considering price along with factors such as experience, track record and bonding capacity. Joe Lewis, principal of Business Transformation Group (BTG) in Virginia, provides supportive services to many DBEs seeking opportunity on large transportation contracts. Lewis sees a positive benefit for DBEs that get bonded. Lewis said, “Having bonding is an investment in the business, so the benefits are long term. The benefits include having a better marketing position over competitors who don’t have a bond, learning financial discipline which allows for a better run business, and improved perspective in the marketplace about your business operations.”
partnership with the U.S. Department of Transportation, the SFAA also sponsored the first DBE/MBE/SBE Surety Summit in September 2014. The summit assembled business owners, prime contractors, bonding companies, and government agencies to discuss strategies to increase bonding opportunities for DBE/MBE/SBE firms and expose the challenges these firms face when seeking bonding. Joanne Brooks, Esq., Vice President & Counsel of SFAA said the following about the Summit:
Kattan believes that the benefits of having bonding far outweigh the challenges involved in completing the bonding application process and working with a bonding company. “It is a little bit of a big brother relationship,” she said. “They always have their “For the first time, the SFAA eyes on you, and every time brought all the stakeholders to you want to do something you The SFAA is actively reaching out to DBE have to somewhat mention it to firms to provide education and assistance the table to assure alignment and support for our mission to your silent partner; things like increase the pool of qualified, ‘we are thinking about buying a sustainable DBE, MBE and SBE contractors who are bondable. big piece of equipment; or we took some money out so don’t get mad.’ But it’s a constant communication that acts sort of like a We are changing the conversation and perception of bonding. financial advisor with regards to letting you know, ‘if you do this, Bonding should be viewed not as a hurdle but as an empowerment tool. The Summit audience consisted of the underwriters this is what it will do to your bonding capacity.’” who write DBE, MBE and SBE contractors, as well as agents and The Surety & Fidelity Association of America (SFAA) is leaders of other associations with whom we partner and share actively reaching out to DBE firms to provide education and a common mission. I believe we are making significant strides assistance to help DBEs better navigate the surety bonding pro- in removing negative perceptions that some diverse firms have cess and increase their success in securing bonds. In addition continued on page 26 to serving as co-sponsor of the Bonding Education Program in American DBE
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continued from page 25 about the surety bonding industry.” The Bonding Education Program has provided training and assistance to hundreds of firms seeking surety bonding to help the growth their company. BEP courses are coordinated by the USDOT’s Office of Small Business Development Regional
Small Business Transportation Resource Centers (SBTRCs). The BEP offers a 6 to 8-week development course that provides education and hands-on technical assistance to firms seeking to apply for surety bonding. Firms interested in learning more about the BEP can visit www.dot.gov/osdbu/SBTRCs. DBEs seeking to pursue surety bonding for the first time may want to take heed to the advice Lewis offers to the many DBE firms counseled by BTG. Lewis said, “Be sure all the owners’ (of the business) personal financial status is strong; no bad debt, good prospects for business and an understanding of how to manage cash flow.
Distinguished Panelists representing major prime contractors and minority enterprises discussed the benefits of surety bonding at the SFAA Surety Summit.
GOETHALS BRIDGE — CONSTRUCTION PARTNERING OPPORTUNITIES Partnering Opportunities
The Goethals Bridge Replacement Project is a design-build project for the Port Authority of New York & New Jersey (the Authority). The project will replace the existing Goethals Bridge which spans the Arthur Kill River on I-278 connecting Elizabeth, New Jersey and Staten Island, New York. Kiewit-Weeks-Massman, AJV (KWM) has been selected by the Authority to design and build the new Goethals Bridge.
Travis Spur Rail Bridge Replacement Anti-Climb Fence on New Bridge Shared Use Path Furnish Work Platforms for Stay Cable Installation on Tower Permanent Concrete Traffic Barriers PPC Bridge Deck Overlay Right of Way Security Fence Galv Steel Tube Rail on Concrete Barrier Galv Steel Pedestrian Railing on Shared Use Path of New Bridge Landscaping/Seeding Under Ground Fire Stand Pipe Misc. Metals Supply
If your DBE firm would like to apply to participate, please use our website as a resource, www.goethals-kwm.com. Diversity Contract Manager, 470 Chestnut Ridge Road, Woodcliff Lake, NJ 07677 (201) 571-2571 KWMdivcontracting@kwmjv.com Kiewit-Weeks-Massman, AJV is An Equal Opportunity Employer
Colette Holt
& Associates YOUR EXPERT ON AFFIRMATIVE ACTION AND CONTRACT COMPLIANCE
Colette Holt & Associates Attorney at Law
• Disparity and Availability Studies • Review, Design and Implementation of Disadvantaged/Minority/Women/Small /Local Business Programs • Litigation and Expert Witness Services • Contracting Fraud Detection and Evaluation • Community Benefits Agreements and Project Labor Agreements • Trainings and Presentations
3350 Brunell Drive Oakland, CA 94602 Telephone - (773)-255-6844 Email - colette.holt@mwbelaw.com www.mwbelaw.com http://twitter.com/mwbelaw
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HMSHost and Chip Joyner team up to bring The Real Chow Baby to Hartsfield-Jackson Atlanta International Airport. A staple of the Atlanta restaurant scene since 2005, The Real Chow Baby partners with HMSHost to open its first concourse location at the world’s biggest airport. “HMSHost is a great company to work with. They were a mentor of mine for a number of years while I was coming up in the restaurant business. HMSHost has really been a fantastic partner,” says Chow Baby co-owner Chip Joyner. The Real Chow Baby offers a hearty menu of farm-fresh produce, meats and seasonal fish, sizzled in zesty Asian-inspired sauces. For more information, contact busdev@hmshost.com. The Real Chow Baby co-owner Chip Joyner
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HMSHost is the recipient of six Airport Revenue News Awards for Outstanding Food & Beverage Operator. 5/15/13 1:38 PM
Business Development
GETTING STARTED:
Structuring Your Business for Long-Term Success Provided by Reginald R. Randolph, a financial advisor with One Source Financial Partners, LLC who represents MassMutual and other companies; courtesy of Massachusetts Mutual Life Insurance Company (MassMutual) You’ve hung up your shingle and brought in your first client. Whether your business is landscape design, catering or computer consulting, you’ve now become a sole proprietor. It’s a very simple proposition that requires no extra paperwork and carries no upfront expenses. But it comes with some significant drawbacks once a business starts growing. “Unfortunately, a lot of business owners are so intent on growing their business that they don’t do the long-term planning that they should,” says Richard Martin, director for the Center for Business Analysis at Massachusetts Mutual Life Insurance Company. Too often, he says, they overlook both the need for liability protection and the importance of business structure when it comes time to sell the company. A sole proprietorship draws no distinctions between the business and the owner. Taxes from business income and expenses flow directly through to the individual. So does liability, exposing the sole proprietor’s personal assets to any lawsuits that may be filed. That means a business accident— damage done while catering an event, for example—can threaten not only the business but also the family bank account. It’s important to select the business entity that offers the right degree protection without overcomplicating operations. Which entity a business owner chooses should depend on longterm business goals, tax considerations and likely exit strategy. DiSH, a small retail food business that provides gourmet prepared meals for home consumption, operates as a limited liability company. Co-owner Stacey Quinn says she carefully reviewed the business’s structure last year before purchasing a 50% share of the Andover, Mass., company. While tax liabilities pass directly to the owners, both Quinn and her partner can shield their personal assets from potential claims against the business. And, says Quinn, if she and her partner ever decide to stop marketing meals, “we’d still have an entity to sell.” Formation of an LLC requires drafting of an operating agreement and notification to the state. Yet it remains a rela-
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tively simple structure, which is exactly what the DiSH partners wanted. “It isn’t complicated, and it keeps our costs down in terms of accounting and record keeping,” says Quinn. Becoming an S corporation adds a layer of complexity, since it requires a board of trustees, regular meetings and minutes. While S-corps are often taxed on a pass-through basis like a partnership, this business entity can offer a growing company some meaningful tax advantages. There are, for example, significant savings on payroll taxes, since Social Security and Medicare taxes are paid only on that portion of S-corp profits deemed to be wages. S-corps also have the ability to offer some limited employee benefits, such as retirement plans. Companies looking to raise capital may want to consider the C corporation, a structure that allows for different categories of shareholder. It is favored by venture capitalists, who like to hold preferred stock. A C-corp can also provide key employees with attractive fringe benefits, ranging from retirement plans and health insurance to deferred compensation. Many owners, however, don’t consider the ramifications of being a C-corp.. For example, C-corp profits are taxed twice—once at the corporate level and again when individual shareholders receive them as distributed dividends. This double taxation problem becomes even more significant when a business is sold, greatly reducing the after tax-proceeds of the transaction. One answer to the problem might be to convert to an S-corp before selling. That approach, however, requires long-term planning, since such a conversion must be in effect for 10 years in order to get the full benefits of the favorable S-corp tax treatment. By considering the advantages and disadvantages of different entities when setting up the business, owners can address tax considerations, liability concerns, shareholder needs and the eventual exit and succession of the business. The result: A lot of problems may be avoided. The information provided is not written or intended as specific tax or legal advice and may not be relied on for purposes of avoiding any Federal tax penalties. MassMutual, its employees and representatives are not authorized to give tax or legal advice. Individuals are encouraged to seek advice from their own tax or legal counsel. © 2014 Massachusetts Mutual Life Insurance Company, Springfield, MA 01111-0001 CRN201504-170776
Reginald R. Randolph
T
he National Association of Minority Contractors (NAMC) recently lost a Hall of Fame member as well as one of 12 men who were inaugural members of the organization. Herman J. Russell Sr. passed away on November 15, 2014, but his influence, example and legacy will live on forever. Those who knew him agree that “game-changer” is an appropriate description for the impact of H.J. Russell on the minority contracting industry. Russell not only built the largest minority construction business in history, he also leveraged his success to develop a conglomerate enterprise that made him a business giant. He was a trailblazer in minority business, overcoming all obstacles due to his race, background, and a speech impediment that he managed throughout his life. Russell’s autobiography, “Building Atlanta – How I Broke Through Segregation to Launch a Business Empire,” chronicles the life of a man who employed a remarkable work ethic, vision and determination to build a mega-business enterprise and to become a civic leader, civil rights champion, philanthropist and statesman. He was a trusted advisor, financier and confidant for many fellow entrepreneurs, politicians and business leaders, both in Atlanta and on a national level. Art Queen, President/CEO of Ebony Glass and Mirror Company, also a fellow NAMC Hall of Famer and past NAMC National President reflected on Russell’s influence and said: “In Atlanta, no if ands or buts about it, he was a leader that gave everybody an example of something to try to be, something to shoot for; including me when I relocated to Atlanta in 1985 from Washington, DC. Herman was one of the people I was trying to emulate, trying to be like. He definitely inspired me. One of my company’s first jobs at the (Atlanta) airport, as a matter of fact, was with Herman’s company, on a Delta Air Cargo project. His son Mike, who is now the CEO, was just a rookie coming out of college in Virginia and was a project engineer on that project… Mr. Russell helped a lot of people and he was a smart man.” Russell’s companies have made an indelible impact on the transportation industry through his construction and project management work in airport facilities in locations such as Atlanta, Dallas and Raleigh, NC. In addition, the Russell family owns Concessions International, one of the largest airport concessions companies in America, with over 50 concessions concepts operating in airports across the country.
Gloria Shealey, National President of NAMC knew Russell for many years. She first met Russell during her career in corporate banking as Russell played a significant role in the Atlanta banking industry serving on the board and investing
NAMC Honors the Legacy of Herman J. Russell Sr. in banking institutions. She later reconnected with Russell in the construction industry years later, as President/CEO of The Daniele Company, a construction management and general contracting firm based in Durham, NC. Shealey said: “I met Herman several times, years ago when I was a banker; we played tennis at his house and he loved to beat me - he was so competitive. Years later I ran into him again, but also got to meet his son Michael as a result of NAMC and had an opportunity to partner with H.J. Russell & Company at North Carolina Central University on the Latham Parking Deck and Retail Bookstore project. That was a significant project because it was the first 100 percent African American team for a CM Project in North Carolina. That was kind of neat.” Russell was well known for providing opportunities to a large number of minority construction companies. Linda Washington, Interim President/CEO of the Conference of Minority Transportation Officials (COMTO) remarked on Russell’s willingness to give back and said, “H.J. Russell lived the COMTO mission and goals. He was an avid supporter of small business and grew his own small business into a megaenterprise. He had a keen business sense and used what he learned and achieved to help other small businesses and individuals. He was the consummate giver.” Achieving Russell’s level of success cannot be reduced to one single trait. However, if there is one trait that set him apart from other business owners, it was his willingness and ability to build excellent relationships. The degree of Russell’s success across all three of his major industries—construction, real estate development and airport concessions—can be directly traced back to his professional relationships with business partners marked by equality, integrity, trust. Russell always brought his fair share to the table and then leveraged it with others to accelerate business growth. Without this trait, while it is clear that he would have been a very successful entrepreneur, he would not have achieved the level of wealth, growth and success that places him among the greatest micontinued on page 35 American DBE
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PROUD TO GIVE BUSINESSES A LIFT CATS is proud to provide opportunities for businesses to create local jobs through the advancement of transit projects. CATS also seeks to create an environment that gives small and socially or economically challenged local businesses the opportunity to compete for publicly funded contracts by participating in the Small Business Opportunity (SBO) and the Disadvantaged Business Enterprise (DBE) Programs. On the LYNX Blue Line project, for example, CATS spent $42.9 million with 38 DBE firms to build the new light rail system. As the major provider of public transportation to Charlotte and the surrounding region, CATS relies on the communities we serve to build and operate the service every day. By working together on these new opportunities, we can all keep our communities moving in the right direction. For more information, visit ridetransit.org.
Financial Strategies for Your Business: Six Tax Tips Year-end tax planning is especially challenging this year because Congress has yet to act on a host of tax breaks that expired at the end of 2013. Some of these tax breaks may be retroactively reinstated and extended, but Congress may not decide the fate of these tax breaks until the very end of this year (and, possibly, not until next year). For businesses, tax breaks that expired at the end of last year and may be retroactively reinstated and extended include: 50% bonus first year depreciation for most new machinery, equipment and software; the $500,000 annual expensing limitation; the research tax credit; and the 15-year write-off for qualified leasehold improvements, qualified restaurant buildings and improvements and qualified retail improvements. Here are six tips that can help your company save on taxes: Equipment Purchases
Businesses should buy machinery and equipment before year end and, under the generally applicable “half-year convention,” thereby secure a half-year’s worth of depreciation deductions for the first ownership year. Property
Although the business property expensing option is greatly reduced in 2014 (unless legislation changes this option for 2014), don’t neglect to make expenditures that qualify for this option. For tax years beginning in 2014, the expensing limit is $25,000, and the investment-based reduction in the dollar limitation starts to take effect when property placed in service in the tax year exceeds $200,000. Businesses may be able to take advantage of the “de minimis safe harbor election” (also known as the book-tax conformity election) to expense the costs of inexpensive assets and materials and supplies, assuming the costs don’t have to be capitalized under the Code Sec. 263A uniform capitalization (UNICAP) rules. To qualify for the election, the cost of a unit-of-property can’t exceed $5,000 if the taxpayer has an applicable financial statement (AFS; e.g., a certified audited financial statement along with an independent CPA’s report). If there’s no AFS, the cost of a unit of property can’t exceed $500. Where the UNICAP rules aren’t an issue, purchase such qualifying items before the end of 2014. Tax Income
To reduce 2014 taxable income, consider deferring a debtcancellation event until 2015. To reduce 2014 taxable income, 32
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consider disposing of a passive activity in 2014 if doing so will allow you to deduct suspended passive activity losses. Deductions
If your business qualifies for the domestic production activities deduction for its 2014 tax year, consider whether the 50%-of-W-2 wages limitation on that deduction applies. If it does, consider ways to increase 2014 W-2 income, e.g., by bonuses to owner/shareholders whose compensation is allocable to domestic production gross receipts. Note that the limitation applies to amounts paid with respect to employment in calendar year 2014, even if the business has a fiscal year. Corporations
If you own an interest in a partnership or S corporation you may need to increase your basis in the entity so you can deduct a loss from it for this year. Corporations should consider accelerating income from 2015 to 2014 where doing so will prevent the corporation from moving into a higher bracket next year. Conversely, it should consider deferring income until 2015 where doing so will prevent the corporation from moving into a higher bracket this year. A corporation should consider deferring income until next year if doing so will preserve the corporation’s qualification for the small corporation alternative minimum tax (AMT) exemption for 2014. Note that there is never a reason to accelerate income for purposes of the small corporation AMT exemption, because if a corporation doesn’t qualify for the exemption for any given tax year, it will not qualify for the exemption for any later tax year. A corporation (other than a “large” corporation) that anticipates a small net operating loss (NOL) for 2014 (and substantial net income in 2015) may find it worthwhile to accelerate just enough of its 2015 income (or to defer just enough of its 2014 deductions) to create a small amount of net income for 2014. This will permit the corporation to base its 2015 estimated tax installments on the relatively small amount of income shown on its 2014 return, rather than having to pay estimated taxes based on 100% of its much larger 2015 taxable income. Jovan Goldstein, CPA Managing Partner JTGoldstein Accountants and Business Advisors
National Training Institute Reaches Highest Numbers in Decades
contracting practices within the public and private sectors. The organization was started as the brainchild of four practitioners (Kerry Kirkland, Robert Harrison, Lynn Miller and Luis Molina) in Philadelphia. The founders’ idea was to foster a national organization that would provide training, standardization of By American DBE Magazine Staff Writers practice, networking, and support to the many affirmative action, contract compliance, equal employment, It’s a rare occasion for and human rights workers across the country. Since its formaM/W/DBE program tion, ACCA has trained thousands of practitioners in the administrators to have the administration and implementation of diversity and inclusion opportunity to sharpen their programs. skills and network with peers “Engaging New Changes through Education and Compliin an environment free from ance” was the theme of the 2014 Institute. This theme recogserving the needs of business nized the ever-changing reality facing practitioners seeking to owners seeking contracting administer effective programs in the government and private opportunities. However, the sector related to diversity and inclusion. ACCA board memIndustry experts lead National Training American Contract Compliber Justin Talbot Stern believes that this theme was timely Institute Courses ance Association’s (ACCA) given the current changes occurring in programs across the annual National Training Institute is built exactly for this country. Stern said, “This is not an industry that stands still. purpose. ACCA’s mission is “to deliver ongoing compreWhether it be the challenges driven by new federal, state or hensive training and certification to practitioners working local regulations, economic impact of program budgets on within the fields of Affirmative Action, Contract Compliance, our minority/woman/small/veteran business communities Minority/Women/Disadvantaged/Small/Emerging Busiacross the country, or recent litigations, it is absolutely necesness Enterprise, Labor Compliance, Economic & Business sary for practitioners to stay current with their knowledge Development, and Equal Employment Opportunity.” True and skills. to its mission, the ACCA’s 2014 National Training Institute In addition to receiving training from experienced industry (Institute) provided training to over 350 practitioners at the practitioners at the annual Institute, participants can gain annual event held September 2-7, 2014, in San Jose, California. Continuing Education Units/Credits through the Morgan ACCA was founded in 1986 as a nonprofit national orgaState University Center for Continuing and Professional nization dedicated to ensuring equitable employment and Studies, and can eventually attain a professional certification as a Certified Compliance Administrator (CCA) or a Master Compliance Administrator (MCA). Achieving the CCA designation takes at least two years to complete and requires 42 continuing education training hours. The MCA designation takes at least two additional years after completion of the CCA and a total of 84 continuing education training hours. Each annual Institute offers continued on page 34
2014 NTI participants earned the largest number of CCA certifications in over a decade.
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ACCA continued from page 33 a wide variety of general and concurrent sessions, allowing participants to complete 21 hours of continuing education training hours. Courses cover topics that include areas such as program fraud, legal updates, program administration, certification, compliance, and business development strategies.
Project Manager leads field trip for ACCA participants on the BART transit project in San Jose, CA.
A total of 67 practitioners completed the 42 required hours to receive their CCA designation and 23 additional practitioners completed the 84 hours required for the MCA designation at the 2014 Institute. ACCA has also added a program called the Executive Leadership Institute that allows practitioners who have achieved the MCA to continue their education and improve their leadership skills. Twelve MCAs completed the Executive Leadership Institute this year. ACCA general counsel Colette Holt thinks having clear-cut Marketing continued from page 7 It is vital to know who your Customers/Clients are so that you do not waste your time and money targeting people who are not your Customers/Clients; and so that you can convince lenders that you will be profitable. In order to know if someone is actually a likely Customer/ Client you must understand their buying criteria. This involves things like: needs, desires, willingness to pay, likelihood to act, obstacles to purchasing/using. It takes research to learn these things. But research beats wasted time, money and opportunities every time. 3) Understand that what you sell or provide is not what is important to your Prospect or Customer/Client.
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training standards is important for practitioners. Holt said, “It is critical that professionals in our industry receive academic level instruction to ensure understanding of the complex legal and regulatory standards for contracting affirmative action programs and how to implement best practices to achieve our ultimate objective of reducing barriers to full and fair contracting opportunities for everyone.” Practitioners participating in the Institute also had the opportunity to learn about innovative best practices during an onsite tour of the $800 million Bay Area Rapid Transit System Silicone Valley Extension Project currently under construction in the San Jose area. Project managers from the Skanska, Shimmick & Herzog Joint Venture Team led a full bus load of professionals on a multi-site visit of the large light rail project and discussed their efforts in maximizing opportunities for the participation of disadvantaged business enterprises and workforce participation of women and minority workers. Tammie Hall, Senior Regional Supplier Diversity Manager for Lend Lease in Durham, NC achieved the designation of Certified Compliance Administrator at the 2014 event. Hall said, “CCA certification is an acknowledgement of continued learning in the diversity profession. It certainly identifies to employers that you have achieved a high level of competency in the MWBE/DBE profession. Plus, the opportunity to network and exchange information provides valuable credibility to managing effective programs. Next for me is achieving the MCA certification.” ACCA has already started planning for the 2015 National Training Institute scheduled for August 25-30, 2015, at the West Palm Beach Marriott Hotel in West Palm Beach Florida. More information about the next event can be found on ACCA’s website at www.accaweb.org. What is important to Customers, Clients and Prospects is what you can do for them: • What problem can you solve? • What need can you meet? • What difficulty can you help them avoid? • What is their pain and how can you alleviate it? • How can you help them increase revenue? • How can you help them decrease expense, frustration or delay? • How can you make their job/life easier? • Can you reduce a cost? If so, can you document that reduction? List the things you can do for your Prospects and Clients/ Customers. Be sure you can identify it as a solution to a problem, answer to a need, avoidance of a difficulty, reduction of a cost, etc. If you cannot identify it in this manner, you are probably not really addressing something that is important to them. That means they will not likely become a Customer/Client.
Russell continued from page 29 nority entrepreneurs of all time. Shealey said: “The thing that really stood out for me is that this (construction) business, while it is about sticks and bricks, it’s really about relationships. Herman understood that and knew how to leverage that well. If there is a model of how to do business, building the right relationships for the right reason—that also makes good business sense—is something that he was expert at doing, and part of what really leveraged his success. “ The legacy of Russell’s impact will last for generations, as he stands as one of the greatest minority entrepreneurs of all time; and evidence of the ability for minority businesses to succeed in the American business landscape. Shealey calls leaders like Russell “eagles” based on their ability to lift others during their flight. Shealey said: “I think of them as being the eagles, and soaring to move beyond pursuit, winning and executing, to excelling and being able to excel at a level of scale, scope and size that allows them to not only compete with the large firms but to be able to put their wings around smaller diverse companies to see them grow. They (H.J. Russell & Company) have a couple counterparts that came up in similar times; companies like Smoot Construction, that have been able to rise to the stature, and to the level, of what I like to call the eagles.”
NAMC is immensely proud of the life, career and success of their Hall of Fame member Herman J. Russell Sr., and in his honor NAMC National, the Hall of Fame and the NAMC Atlanta Chapter will donate $5,000 to his charity, the H.J. Russell Foundation.
VJS-TC continued from page 11 Southern has continued her goal of growing the business on the East Coast by currently maintaining DBE certifications in seven states on the East Coast ranging from Rhode Island down to Virginia. This expansive coverage recently helped VJS-TC win its first contract with the Virginia Department of Transportation as a sub-consultant to another DBE firm on a three-year location and design contract awarded through VDOT’s Small Business Enterprise Program. VJS-TC plans to continue its growth strategy, with the goal of tripling contract revenue over the next two years. However, Southern knows reaching that goal is not a singular effort. She believes perseverance and the power of creating mutually beneficial relationships will take her company there.
Calendar of Events National 8(a) Association 2015 Winter Conference February 3-4, Orlando, FL www.national8aassociation.org/conference
Conference of Minority Transportation Officials (COMTO) Celebrating Women Who Move the Nation Awards March 11, 2015, Washington, DC www.comto.org
United States Department of Transportation (USDOT) 2015 DOT Civil Rights Virtual Symposium February 3-5, 2015 www.civilrights.dot.gov/
National Minority Supplier Development Council (NMSDC) 2015 Leadership Awards May 20, 2015, New York, NY www.nmsdc.org/2015-leadership-awards/
National Association of Minority Contractors (NAMC) Mid-Winter Board Meeting & Strategic Planning Session February 4-6, 2015, New Orleans, LA www.namcnational.org
Women’s Business Enterprise National Council (WBENC) 2015 National Conference & Business Fair June 23-25, 2015, Austin, TX www.conf.wbenc.org
National Association of Women in Construction (NAWIC) Women in Construction Week 2015 March 1-7, 2015 www.nawic.org/nawic/WIC_Week_2015.asp
American Contract Compliance Association (ACCA) 2015 ACCA National Training Institute August 25-30, 2015, West Palm Beach, FL www.accaweb.org
Airport Minority Advisory Council (AMAC) Leadership Summit and East Regional Forum March TBD www.amac-org.com
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Proterra Inc. (Proterra) has established a Disadvantaged Business Enterprise (DBE) Program in accordance with 49 CFR Part 26. For the purpose of the DEB Program, Proterra proposes to set PUBLIC NOTICE its overall goal utilizing all information available to it, including information available in Proterra’s area Proterra Inc. (Proterra) has established a Disadvantaged Business Enterprise (DBE) Program in of manufaturing operation and comments received from the public in response to this notice. accordance with 49 CFR Part 26. For the purpose of this DBE Program, Proterra proposes to set its overall goal utilizing all information available to it, including information available in Proterra’s area of manufacturing operation nd 5% comments received from the public in response to this notice. Proterra has set a goal aof participation in DOT-assisted contracts FY2014-2015. This pro-
posed and itsorationale are available for public inspection during Proterra goal has set a goal f 5% participation in DOT-‐assisted contracts FY2014-‐2015. This regular proposed business hours Monday goal and its Friday, rationale are available public inspection during regular business hours Monday through 8:00 a.m. tofor 5:00 p.m. at Proterra’s office, 1 Whitlee Court, Greenville, SC 29607 through Friday, 8:00 a.m. to 5:00 p.m. at Proterra’s office, 1 Whitlee Court, Greenville, SC 29607 for for 30 days following the date of this notice. Proterra and DOT will accept comments on the goal for 30 days following the date of this notice. Proterra and DOT will accept comments on the goal for 45 45 date of Tthis notice. The goaldmay be adjusted depending comments received. days days from tfrom he date the of this notice. he goal may be adjusted epending upon comments received. upon Comments may may be addressed to: Comments be addressed to: Proterra Inc. Attn: DBE Liaison Officer 1 Whitlee Court Greenville, SC 29607 Proterra Inc. Attn: And to: DBE Liaison Officer Whitlee Court 1 Department of Transportation Greenville, SC 29607 Office of the Secretary of Civil Rights 1200 New Jersey Avenue, S.E. Washington, DC 20590
And to:
Department of Transportation Office of the Secretary of Civil Rights 1200 New jersey Avenue, S.E. Washington, DC 20590
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Business in the Social Media Age The Internet is a business platform unlike any other. From product sites to social networks, the opportunities for businesses to embrace this new era are vast and ever-changing; and this evolution is providing both an opportunity and a challenge to business owners. Today’s business industry is transitioning away from longer research processes toward gaining instant feedback. Reflected in this trend is a growing reliance on social media. The use of social media is increasing within business fields. Social media marketing can act as both an advertising platform to promote your brand as well as a tool for businesses to gain valuable insight in real time, processing feedback as soon as consumers provide it. Business purchasers spend more than 73 percent of work-related media consumption on online platforms, and more than 80 percent of businessto-business (B2B) buyers spend their time researching online. These statistics are evidence that social media provides businesses with an interactive way to have messages and content discovered. Distributing content via social media differs from traditional distribution channels because the content is sharable. It is a way for consumers to interact with the brand, to develop a relationship and spread the word. This aspect of social media proves itself to be crucial because marketers need to distribute content to everywhere potential prospects are looking—and now that place is online. From Facebook to Twitter and Instagram to Pinterest, social media platforms vary in what they do best for your business. Facebook and Twitter are outlined below for their strengths, but they are never your only options. Consider and research what each social medium can offer, and select your platforms based on what they can do best for you. Having a Facebook page for your company is an effective and immediate way to interact with targeted consumers. Facebook as a social medium emphasizes engagement and interaction with your network of current and potential consumers. If companies are not regularly publishing dynamic content that involves the consumer, then the company will face difficulties in keeping consumers interested. Facebook 38
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is a powerful tool, but simply posting content is not enough. Research intriguing and timely stories that interest your target audience and post that content as well. This will set you apart from your competitors by putting your brand in the mind of the consumer in a way that they value and remember. Twitter is a quick engagement with online consumers, allowing a business to keep in contact with followers by sharing ideas, articles or simple updates to keep the business on the forefront of consumers’ minds. With your Twitter account, your company can publicly interact with consumers, businesses, and public figures that promote similar ideals as your brand. Twitter is also a powerful platform to run company promotions, direct people to your website through embedded links, and respond to customer feedback. The impressions and connections that you make successfully engage consumers in the brand. Twitter allows the brand to pepper consumers with that information quickly and effectively. Once you decide which social media platforms are best for your company, it’s important to determine the voice you want your company to have on social media. Look at your business from the perspective of your target audience. Will they respond to a professional tone or a conversational tone? Whichever you choose, consistency in all messages and across all platforms is key to success. Using this voice strategically and regularly will also show your audience that you are engaged in the wider community. However, be careful not to post too often, as that can be viewed as annoying and off-putting. Aim to post at least a few times a week, but no more than three times per day. Use your social media voice to make connections and interact with other brands that share your ideals. Openly communicate, share or retweet their messages and post replies. Growing a network over social media can increase the reach your pages have. Just as important is interaction with your consumers. If they post on your page or tweet at you, be sure to respond quickly and appropriately. Having a strong social media presence can easily translate into a growing and reliable consumer base that will stay with your brand and share it with others. The world of social media is wide open for possibilities and creative methods for businesses to interact with consumers. In such a rapidly changing space, keeping your brand active is undeniably important. So explore, create and engage, and allow your company to utilize the social media sphere to your professional advantage. Contributed by: Heelprint Communications StudentRun Creative Agency at UNC-Chapel Hill