BUSINESS DEVELOPMENT
Important Updates on DBE, SBA, AND M/WBE Programs By Colette Holt, J.D. and Joanne Lubart, J.D., Colette Holt & Associates
Colette Holt, J.D.
Joanne Lubart, J.D.
In recent months, there has been a flurry of activity related to DBE and/or M/WBE programs. This article discusses amendments and guidance as well as three recent lawsuits that need to be closely watched.
U.S. Department of Transportation Disadvantaged Business Enterprise Program Inflation Adjustment to the Size Limits for Certified DBEs Effective January 13, 2021, two changes were made to the U.S. Department of Transportation’s DBE Program size standards. • The statutory gross receipts cap for certified DBEs mandated in 49 C.F.R. §26.65 is adjusted for inflation from $23.98M to $26.29M. If a firm’s gross receipts averaged over the firm’s prior three fiscal years exceed $26.29M, then it exceeds the small business size limit for participation in work funded by the Federal Highway Administration and the Federal Transit Administration. The DBE Program requires that the cap be adjusted on an inflationary basis, and future adjusted amounts will be published on the DOT website. A DBE must still meet the size standard appropriate to the type(s) of work it seeks to perform on DOT assisted contracts. The rule is not applicable to airport concession DBEs under 49 C.F.R. Part 23.
• The statutory gross receipts cap no longer applies to eligibility determinations for projects funded by the Federal Aviation Administration. DBE firms working on these projects must only meet the size standard(s) appropriate to the type(s) of work based solely on the applicable NAICS code(s) size standard(s).
Official DOT Guidance On limiting dbe and acdbe certification for non-transportation industry businesses On September 1, 2020, the DOT issued new guidance in the form of an official Questionand-Answer concerning DBE and ACDBE certification for non-transportation industry businesses. DBE and ACDBE certification should be limited to firms that intend to seek construction and non-construction work on DOT assisted contracts (including suppliers to airport concessionaires). DOT funding recipients are directed to emphasize this information to applicant firms as well as to state and local agencies and are authorized to
/ spring 2021
43
