Long-Awaited DBE Rule Revisions Announced

What happened: The U.S. Department of Transportation (U.S. DOT) April 9 revised its rule implementing the Disadvantaged Business Enterprise (DBE) program, after reviewing comments from ARTBA and about 400 other entities who responded to the Notice of Proposed Rulemaking published in July 2022. The rulemaking addressed more than 40 aspects of the longstanding program. ARTBA has a summary of key revisions, which take effect May 9.

Why it matters: Originally, U.S. DOT planned to impose a 50 percent cap on the total allowable credit for a prime contractor’s expenditures with DBE suppliers to meet a contract goal. ARTBA strongly opposed this policy change, as it lacked supporting data and would disrupt business plans for many existing DBE firms. Ultimately, the agency did not make this change in the DBE rule, specifically citing comments from ARTBA and the Kentucky Association of Highway Contractors, among others. Also, in a January meeting, ARTBA and leaders of the Associated Pennsylvania Constructors spoke at length about this issue with the White House Office of Management and Budget as it reviewed U.S. DOT’s draft changes.

ARTBA expressly supported proposed program improvements which the Department adopted, such as better state DBE directories and increased flexibility for meeting goals on design-build projects. Other changes include addition of a DBE “distributor” category, increase of the personal net worth cap, and further streamlining interstate certifications.

What’s next: ARTBA will arrange educational opportunities for members on the rule changes over the coming months. The contacts are Rich Juliano or Prianka Sharma.