The Transportation Equity Act for the 21st Century (TEA-21) was enacted June 9, 1998 as Public Law 105-178. TEA-21 authorizes the Federal surface transportation programs for highways, highway safety, and transit for the 6-year period 1998-2003. Section 1101(b) of the act (Disadvantaged Business Enterprises) states except to the extent that the Secretary determines otherwise, not less than 10% of the amounts made available for any program under Titles I, III, and V of this act shall be expended with small business concerns owned and controlled by socially and economically disadvantaged individuals.

The integrity of DOT's Disadvantaged Business Enterprise program depends to a large extent upon the establishment of systematic procedures to ensure that only bona fide disadvantaged business firms are certified to participate in DOT federally assisted programs. The DOT Disadvantaged Business Enterprise Regulations 49 CFR 23 and 49 CFR 26 places primary responsibility for the certification process upon the State Transportation Agencies. While the regulations do not prescribe beyond the Schedule A and B forms the specific procedure to be used in certifying firms, the intent of 49 CFR Parts 23 and 26 is clearly to ensure that only bona fide disadvantaged firms are certified.

[TABLE OF CONTENTS]

DOCR DBE Customer Service Standards

Our Commitments to You...

• We will acknowledge receipts of appeals filed in writing to this office within 4 business days.
• We will process certification appeals and issue decisions within 90 days of receipt of complete appeal packages.
• We will offer at least 3 workshops each year on certification procedures to recipients of DOT financial assistance.
• We will offer at least 3 workshops each year to individuals and businesses on DBE eligibility criteria and grounds for denial of certification appeal rights.
• We will provide regulatory and DBE eligibility criteria for certification as a DBE through our Web page.

Report to Our Customers

As a result of the Department of Transportation's new Disadvantaged Business Enterprise Regulations (49 CFR Parts 23 and 26, published February 2, 1999 and effective March 4, 1999), the Departmental Office of Civil Rights (DOCR) revised its customer service standards to realistically reflect the time required of civil rights staff to process certification appeals and issue decisions. Our standard processing time of 60 days established in FY 1996 changed in FY 1999 to a standard processing time of 180 days. However, DOCR has established as a goal, a processing time of 90-120 days from the date of receipt of records.

DOCR is an active participant in the Department's Disadvantaged Business Enterprisesprogram and continues to work with the Office of Small and Disadvantaged Business Utilization (OSDBU) to offer workshops around the country on certification procedures to recipients of DOT financial assistance and to individuals and businesses on DBE eligibility criteria and denial of certification appeal rights.

Improving Customer Service

DOCR has made some important changes in the day-to-day management of its DBE Certification Appeals program, changes that are intended to make the program more responsive to the needs of its customers.

• Third-Party Challenges: With the issuance of the Department of Transportation's new DBE regulations on February 2, 1999, the Department will no longer process third-party challenges. Third-party challenges to DBE certification are now processed by each recipient/State DOT. This change allows more time for the processing of DBE appeals, which should result in a reduction of case processing timeframes.

• DBE Appeals Tracking System: DOCR made investments to enhance its current DBE appeals tracking system. Enhancements to the system will improve the tracking and monitoring of the progress of each appeal from receipt to final agency decision.

[TABLE OF CONTENTS]

DBE Eligibility

In general, to be eligible for the DBE program, persons must own 51% or more of a "small business," establish that they are disadvantaged within the meaning of DOT regulations, and prove they control their business. The following general guidelines, taken in part from the applicable regulation (49 CFR Part 26), will help business owners determine whether they are eligible for the DBE program:

Eligibility Guidelines (in general):

• Ownership - Your business must be 51% owned by a socially and economically disadvantaged individual(s).

• "Disadvantaged" - You may be eligible if you are a member of a group of persons the Department considers as disadvantaged. The Department presumes certain groups are disadvantaged, including women, Black Americans, Hispanic Americans, Native Americans, Asian-Pacific Americans, Subcontinent Asian-Pacific Americans, or other minorities found to be disadvantaged by the U.S. Small Business Administration (SBA). Persons who are not members of one of the above groups and own and control their business may also be eligible if they establish their "social" and "economic" disadvantage. The Department notes, for example, that people with disabilities have disproportionately low incomes and high rates of unemployment, and that many may be socially and economically disadvantaged. A determination of whether an individual with a disability meets DBE eligibility criteria is made on a case-by-case basis. More information on how social and economic disadvantage is determined can be found in Appendix E to 49 CFR 26 49 CFR Part 26.

• Business Size Determination - A firm (including its affiliates) must be a small business as defined by SBA standards. It must not have annual gross receipts over $17.42 million in the previous three fiscal years. This threshold is periodically adjusted for inflation.

• Personal Net Worth - Only disadvantaged persons having a personal net worth (PNW) of less than $750,000 can be considered as a potential qualified DBE. (This does not apply to FAA concessionaires).

• Independence - The business must not be tied to another firm in such a way as to compromise its independence and control.

• Control - A disadvantaged owner seeking certification must demonstrate "real and substantial" control over the business as well as an overall understanding of, and managerial and technical competence and experience directly related to the type of business in which the firm is engaged.

• Burden of Proof Allocation - Applicants carry the initial burden of proof regarding their eligibility.

Additional program requirements and certification procedures are found in the statute 49 CFR Part 26. Specific information can also be found in the Frequently Asked Questions section regarding Disadvantaged Enterprise Eligibility or within the Department of Transportation's Office of Small and Disadvantaged Business Utilization.

[TABLE OF CONTENTS]

File an Appeal

How to file an appeal after being denied DBE certification by a DOT Recipient:

To file a DBE certification appeal, firms should send a letter to the U.S. Department of Transportation within 90 days from the date of denial by a DOT recipient. The appeal should at a minimum include information and arguments concerning why the recipient's decision should be reversed, a copy of the denial letter, and any additional information you believe to be pertinent to the appeal. Firms must provide the name(s) and address(es) of any DOT recipient the firm is currently certified with; or who has rejected its application for certification; or removed the firm's eligibility within one year prior to the date of the appeal. All appeals should be submitted to:

[TABLE OF CONTENTS]

Appeal Process

Under 49 CFR Section 26.89 the Departmental Office of Civil Rights is responsible for processing all appeals of denial of DBE certification. This CFR Section specifies our procedures as follows:

Initial Processing

1. Upon receipt of a written appeal, DOCR will review the incoming correspondence to determine whether the appeal was filed within 90 days from the date of denial or if an extension is warranted.

2. If the appeal is filed within 90 days, the DOCR will write to the appellant acknowledging receipt of the appeal.

3. At the same time, the DOCR will request in writing that the recipient who denied the certification provide copies of all documentation (including hearing transcripts, interviews, applications, etc.) used in making the determination not to certify the appellant.

Review of Documentation and Decision

4. The DOCR will review the information submitted by the recipient to determine whether the eligibility standards are in accordance with 49 CFR Part 26, Subpart C.

5. Only the information originally available to the recipient will be considered during the appeal. If any additional information or recent change of circumstances is reported, the potential DBE will be advised to reapply to the recipient, or the information will be referred to the recipient for review and consideration.

6. After reviewing the documentation, the DOCR will render one of the following decisions:

1. The DBE is certified (overturning the denial by the recipient); or
2. The DBE is not eligible to be certified, and is denied eligibility to participate in the program (upholding the decision of the recipient); or
3. The case is remanded to the recipient for additional information and/or instruction.



7. The DOCR will inform both the recipient and the appellant of the results of its decision. DOCR will also notify the Directors of Civil Rights in the Department's Operating Administrations (for example, the Federal Highway Administration, Federal Transit Administration, etc.) and the Director, Office of Small and Disadvantaged Business Utilization (OSDBU) of the Department's decision. The Directors of Civil Rights will ensure that appropriate field personnel are made aware of the decisions that would affect the program in their area.

[TABLE OF CONTENTS]

Role of Other Departmental Personnel

If the information available to the DOCR suggests fraud or other criminal violations in connection with the Department's DBE program, the case will be referred to the Department's Office of the Inspector General for investigation.

The Office of General Counsel, specifically the Office of the Assistant General Counsel for Regulation and Enforcement (C-50), will be consulted in cases that involve interpretation of DOT regulations; the Office of the Assistant General Counsel for Environmental, Civil Rights; and General Law (C-10) for legal guidance; and the Office of the Assistant General Counsel for Litigation (C-30) for legal sufficiency.

Any office (other than the DOCR) that receives a certification appeal should forward it to the Office of Civil Rights, S-33, Room 5414, for appropriate action.

Occasionally, Operating Administrations' Civil Rights staff will be asked to facilitate the process by providing information or conducting investigations.

[TABLE OF CONTENTS]

DBE Contact Information
Department	Address	Contact Number
External Policy and Program Development Division (EP&PD;) Departmental Office of Civil Rights	400 7th Street, SW Room 5414 Washington DC 20590	Phone: (202) 366-4070 Fax: (202) 366-7717 TTY/TDD: (202) 366-9696
Office of Small and Disadvantaged Business Utilization (S-40) Department of Transportation	400 7th Street, SW Room 9414 Washington, DC 20590	Phone: (800) 532-1169 (202) 366-1930 Fax: (202) 366-7538 TTY/TDD: Federal Relay Service
Office of Civil Rights (HCR-1) Federal Highway Administration	400 7th Street, SW Room 4132 Washington, DC 20590	Phone: (202) 366-6753 Fax: (202) 366-1599 TTY/TDD: (202) 366-5751
Office of Civil Rights (TCR-1) Federal Transit Administration	400 7th Street, SW Room 9102 Washington, DC 20590	Phone: (202) 366-4018 Fax: (202) 366-3475 TTY/TDD: Federal Relay Service
Office of Civil Rights Federal Aviation Administration Send Email	External Programs Team ACR-4 800 Independence Ave SW Room 1030 Washington, DC 20591	Phone: (202) 267-3270 Fax: (202) 267-5565 TTY/TDD: Federal Relay Service
Federal Relay Service	TTY: (800) 877-8339 Voice/Hearing: (800) 877-8339 VCO: (800) 877-6280 Speech-to-Speech: (877) 877-8982

[TABLE OF CONTENTS]

Customer Service Feedback

To report satisfaction or dissatisfaction or make suggestions on DOCR's DBE Certification Appeals services, contact the External Policy and Program Development Division (EP&PD;) at:

U.S. Department of Transportation
Departmental Office of Civil Rights
External Policy and Program Development Division (S-33)
400 7th Street, SW, Room 5414
Washington DC 20590
Phone: 202-366-4070     TTY: 202-366-9696
Fax: 202-366-7717

[TABLE OF CONTENTS]

DBE Library

Final Agency Decisions on DBE Certification Appeals

DBE Certification Appeals Program Brochure   HTML   DOC   PDF

United States Codes

49 USC 47113, Minority and Disadvantaged Business Participation
Each agency is required to expend a certain percentage of amounts available within a fiscal year with small and disadvantaged businesses.

Codes of Federal Regulations

13 CFR 121, Small Business Size Regulations
These regulations govern qualifications for small businesses.

49 CFR 21, Nondiscrimination in Federally-Assisted Programs of Department of Transportation — Effectuation of Title VI of the Civil Rights Act of 1964
No person in the United States shall, on the grounds of race, color, or national origin, be excluded from participation in, be denied the benefits of, or be otherwise subjected to discrimination under any program or activity receiving Federal financial assistance from the Department of Transportation.

49 CFR 23, Disadvantaged Business Enterprise Program in Airport Improvements
This regulation governs the involvement of Disadvantaged Business in airport improvement projects.

49 CFR 26, Participation by Disadvantaged Business Enterprises
This regulation is designed to create a level playing field on which DBEs can compete. It covers nondiscrimination in the award and administration of DOT-assisted contracts in the Department's highway, transit, and airport financial assistance programs.

Public Laws

PL 104-121, Small Business Regulatory Enforcement and Fairness Act
This act is designed to simplify, develop, and enforce the Federal regulations pertaining to small businesses.

PL 107-100, Small Business Act
This act dictates the actions that each Federal agency must take in order to aid and assist small businesses.

Related Websites:

Department of Transportation Disability Resource Center

Department of Transportation Office of Small and Disadvantaged Business Utilization

Small Business Administration

[TABLE OF CONTENTS]

NOTE: Some documents may require a special program for viewing. Click below to download any of these programs for free:

DOC Documents     PPT Documents     PDF Documents