Primer: Disadvantaged Business Enterprise Program
Most airports have a program for providing contracting and subcontracting opportunities to small businesses owned by disadvantaged individuals, including minorities and women. The program, called the Disadvantaged Business Enterprise (DBE) Program, was created by the Department of Transportation (DOT).
Background
In 1983, Congress enacted the first DBE provision requiring DOT to ensure that at least 10% of the funds authorized for the highway and transit financial assistance programs be expended with DBEs. In 1987, Congress re-authorized and amended the statutory DBE program and added women to as an eligible group.
Objectives
The intent of the DBE program is to remedy past and current discrimination against disadvantaged enterprises, ensure a level playing field, and foster equal opportunity for DOT-assisted contracts.
From sky to ground: a joint effort
The three primary DOT agencies involved are:
- Federal Highway Administration
- Federal Transit Administration
- Federal Aviation Administration
The DOT DBE program is carried out by state and local transportation agencies. In addition, the FAA also maintains a separate DBE program for concessions in airports.
Regulations
The DBE regulations require state and local transportation agencies that receive DOT financial assistance to establish narrowly-tailored goals for the participation of disadvantaged business enterprises and to certify the eligibility of DBE firms to participate in the contracts.
These agencies establish contract-specific subcontracting goals, which may vary from the approved overall DBE goal; however, at the end of the year, the amount of contract/subcontract awards to DBEs should be consistent with the overall goal.
Participation requirements
In order for small disadvantaged firms to participate in the DOT-assisted contracts of state and local transportation agencies, they must apply for and receive certification as a DBE. To be certified as a DBE, a firm must be a small business that is owned and controlled by socially and economically disadvantaged individuals.
Stakeholder meetings
Usually on the fourth Thursday of every month, the FAA holds a meeting of stakeholders (airports, concessionaires, contractors, DBE representatives, FAA, DOT, etc.) to discuss ongoing matters concerning FAA’s disadvantaged business enterprise program.
Helpful sources
- Western States Paving Co., Inc. v. Washington State Department of Transportation, 9th Cir., February 9, 2005
- Northern Contracting, Inc., v. State of Illinois, 7th Cir., January 8, 2007
Compiled by James Briggs, Jr. (jbriggs@aci-na.org),
Assistant General Counsel, Legal Affairs