Office of Civil Rights News
The Disadvantaged Business Enterprise (DBE) program is a critical part of ensuring Minnesota has a broad and diverse base of contractors and subcontractors working on federally funded Minnesota Department of Transportation projects. On Oct. 3, the U.S. Department of Transportation announced significant changes to the DBE program and removed race- and gender-based presumptions that have helped small businesses qualify as DBEs since 1983.
In order to comply with this new federal mandate, more than 1,300 businesses in Minnesota will need to be reevaluated and recertified by the Minnesota Unified Certification Program (MnUCP). We recognize the extraordinary burden this places on contractors, consultant partners, and staff at the agencies who participate in the MnUCP. According to the federal rule, MnDOT cannot set DBE goals on contracts or count DBE participation towards its annual goal until the MnUCP completes this process.
MnDOT is taking the following actions to comply with this change and ensure federal funds are not put at risk:
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For contracts already approved and executed, MnDOT will not remove the DBE goals, but also will not count participation until the recertification process is completed. Once the recertification is complete, MnDOT will resume counting participation. MnDOT understands that this interim period may make it difficult for contractors and consultants to achieve their DBE commitments, so contracts will be cleared on a good faith efforts basis as appropriate. Please note that the DBE Description of Work and Field Monitoring Report (Exhibit A) commits the responder to using the specified DBEs to perform work or supply materials. This commitment is binding on the responder unless the responder requests and is granted prior written approval from MnDOT Office of Civil Rights. MnDOT strongly urges prime contractors to follow through on DBE commitments.
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For contracts already awarded before October 3 but not yet approved/executed, MnDOT will not remove the DBE goals, but also will not count participation until the recertification process is completed. Once the recertification is completed, MnDOT will resume counting participation. MnDOT understands that this “interim” period may make it difficult for contractors and consultants to achieve their DBE commitments, so contracts will be cleared on a good faith efforts basis as appropriate. Again, the Exhibit A commits the responder to using the specified DBEs to perform work or supply materials. This commitment is binding unless the responder requests and is granted prior written approval from MnDOT OCR.
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For new contracts advertised/posted after October 3, MnDOT will not set numeric goals and will post addenda to remove goals from contracts posted on or after that date. MnDOT anticipates using a new “DBE Neutral” special provision, replacing what was previously called the “Race/Gender Neutral” special provision.
It is important to note that the DBE program has not been eliminated and that certain obligations remain, such as prompt payment requirements and DBE substitution requirements. This change does not affect on-the-job training requirements, tribal requirements, or workforce goals. This change also does not affect Targeted Group Business goals on projects without federal funding.
The MnUCP is committed to completing its review process as quickly as reasonably feasible. MnDOT will continue to review this direction from the federal government and assess options we have to successfully deliver a multimodal transportation system that maximizes the health of people, the environment, and our economy. Thank you for your continued support of small and disadvantaged businesses.
Sincerely,
Sean Skibbie
Director, Office of Civil Rights
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