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DBE Program Plan

As a recipient of federal-aid highway and federal transit funds authorized under numerous acts (most recently the FAST Act), ODOT is required to comply with DOT's DBE regulations. As a Federal Highway Administration (FHWA) primary recipient and a Federal Transit Administration (FTA) recipient receiving more than $250,000 in FTA funds in a federal fiscal year, ODOT must also have a DBE program, a signed and dated DBE policy statement, a DBE liaison officer, and prompt payment mechanisms, among other requirements. ODOT's DBE program objectives mirror those of the U.S. Department of Transportation. ODOT's DBE policy statement is available at the beginning of its DBE Program Plan, which sets out the mechanisms ODOT uses to ensure compliance with DOT's DBE regulations.

Director's Letter of Commitment / Policy Statement

Read this Section

The Ohio Department of Transportation (ODOT) has established a Disadvantaged Business Enterprise (DBE) Program in full accordance with regulations of the United States Department of Transportation (USDOT), 49 CFR Part 26. ODOT receives Federal financial assistance from USDOT, and as a condition of receiving this assistance, ODOT has signed an assurance that it will fully comply with 49 CFR Part 26.

It is the policy of ODOT to ensure DBEs, as defined in 49 CFR Part 26, have an equal opportunity to receive and participate in USDOT-assisted contracts and procurement activities. It is also our policy, our practice, and our privilege to:

  1. Ensure nondiscrimination in the award and administration of USDOT-assisted contracts and procurement activities;
  2. Create a level playing field on which DBEs can compete fairly for USDOT-assisted contracts and procurement activities;
  3. Ensure that the DBE Program is narrowly tailored in accordance with applicable law;
  4. Ensure that only firms that meet 49 CFR Part 26 eligibility standards are permitted to participate as DBEs;
  5. Help remove barriers to the participation of DBEs in USDOT-assisted contracts and procurement activities;
  6. Promote the use of DBEs in all types of Federally-assisted contracts and procurement activities ODOT conducts;
  7. Assist the development of firms that can compete successfully in the marketplace outside the DBE Program; and
  8. To provide appropriate flexibility to recipients of Federal financial assistance in establishing and providing opportunities for DBEs.

The Director of ODOT is responsible for the implementation of the DBE program. The Director has designated the Administrator of the Office of Business & Economic Opportunity (OBEO), Deborah Green, as the DBE Liaison Officer (DBELO). In that capacity, and as the Administrator of OBEO, the DBELO is responsible for administering all aspects of the ODOT DBE Program and ensuring ODOT complies fully with all provisions of 49 CFR Part 26. Implementation of the DBE program is given the same priority as complying with all other legal obligations incurred by ODOT in its financial assistance agreements with USDOT. As with all things at ODOT, the DBE Program will be a model of excellence in government.

ODOT has disseminated this policy statement to the federal operating administrations and all the components of our organization. This policy will be disseminated in all subsequent agreements between ODOT and all firms/organizations, doing business with ODOT.

(signed)

Jack Marchbanks, Ph.D.
Director

November 10, 2020

Subpart A - General Requirements

Section 26.1 Objectives

It is the policy of ODOT to ensure DBEs, as defined in 49 CFR Part 26, have an equal opportunity to receive and participate in USDOT-assisted contracts and procurement activities. As the main objectives of the DBE program, it is also our policy, our practice, and our privilege to:

  1. Ensure nondiscrimination in the award and administration of USDOT-assisted contracts and procurement activities;
  2. Create a level playing field on which DBEs can compete fairly for USDOT-assisted contracts and procurement activities;
  3. Ensure that the DBE Program is narrowly tailored in accordance with applicable law;
  4. Ensure that only firms that meet 49 CFR Part 26 eligibility standards are permitted to participate as DBEs;
  5. Help remove barriers to the participation of DBEs in USDOT-assisted contracts and procurement activities;
  6. Promote the use of DBEs in all types of Federally-assisted contracts and procurement activities ODOT conducts;
  7. Assist the development of firms that can compete successfully in the marketplace outside the DBE Program; and
  8. To provide appropriate flexibility to recipients of Federal financial assistance in establishing and providing opportunities for DBEs.

ODOT uses and tracks race-neutral and race-conscious means to meet recommended DBE goals on projects funded in whole or in part by USDOT funds. Contract goals are set for suitable USDOT-assisted construction, consulting, procurement, and service contracts or grants with subcontracting opportunities.

Section 26.3 Applicability

As a recipient of federal funds, ODOT is required to administer a DBE Program in compliance with all laws, regulations, executive orders and guidance. The Division of Opportunity, Diversity, and Inclusion (ODI), Office of Business & Economic Opportunity (OBEO) is responsible for the DBE Program within ODOT.

Section 26.5 Definitions

Affiliation has the same meaning the term has in the Small Business Administration (SBA) regulations, 13 CFR part 121.

  1. Except as otherwise provided in 13 CFR part 121, concerns are affiliates of each other when, either directly or indirectly:
    1. One concern controls or has the power to control the other; or
    2. A third party or parties controls or has the power to control both; or
    3. An identity of interest between or among parties exists such that affiliation may be found.
  2. In determining whether affiliation exists, it is necessary to consider all appropriate factors, including common ownership, common management, and contractual relationships. Affiliates must be considered together in determining whether a concern meets small business size criteria and the statutory cap on the participation of firms in the DBE program.

Alaska Native means a citizen of the United States who is a person of one-fourth degree or more Alaskan Indian (including Tsimshian Indians not enrolled in the Metlakatla Indian Community), Eskimo, or Aleut blood, or a combination of those bloodlines. The term includes, in the absence of proof of a minimum blood quantum, any citizen whom a Native village or Native group regards as an Alaska Native if their father or mother is regarded as an Alaska Native.

Alaska Native Corporation (ANC) means any Regional Corporation, Village Corporation, Urban Corporation, or Group Corporation organized under the laws of the State of Alaska in accordance with the Alaska Native Claims Settlement Act, as amended (43 U.S.C. 1601, et seq.).

Assets mean all the property of a person available for paying debts or for distribution, including one's respective share of jointly held assets. This includes, but is not limited to, cash on hand and in banks, savings accounts, IRA or other retirement accounts, accounts receivable, life insurance, stocks and bonds, real estate, and personal property.

Business, business concern or business enterprise means an entity organized for profit with a place of business located in the United States, and which operates primarily within the United States or which makes a significant contribution to the United States economy through payment of taxes or use of American products, materials, or labor.

C&MS means the latest version of ODOT’s Construction and Material Specifications, available online at https://www.transportation.ohio.gov/wps/portal/gov/odot/working/publications/spec-book.

Compliance means that ODOT and its subrecipients have correctly implemented the requirements of 49 CFR Part 26.

Contingent Liability means a liability that depends on the occurrence of a future and uncertain event. This includes, but is not limited to, guaranty for debts owed by the applicant concern, legal claims and judgments, and provisions for federal income tax.

Contract means a legally binding relationship obligating a seller to furnish supplies or services (including, but not limited to, construction and professional services) and the buyer to pay for them. In the context of ODOT’s DBE program, a lease is considered to be a contract.

Contractor means one who participates, through a contract or subcontract (at any tier), in a USDOT-assisted highway, transit, or airport program.

Days mean calendar days. In computing any period of time described in ODOT’s DBE program, the day from which the period begins to run is not counted, and when the last day of the period is a Saturday, Sunday, or Federal holiday, the period extends to the next day that is not a Saturday, Sunday, or Federal holiday. Similarly, in circumstances where ODOT’s offices are closed for all or part of the last day, the period extends to the next day on which the agency is open.

Department or ODOT means the Ohio Department of Transportation.

Director means the Director of ODOT or his/her designee.

Disadvantaged business enterprise or DBE means a for-profit small business concern—

  1. That is at least 51 percent owned by one or more individuals who are both socially and economically disadvantaged or, in the case of a corporation, in which 51 percent of the stock is owned by one or more such individuals; and
  2. Whose management and daily business operations are controlled by one or more of the socially and economically disadvantaged individuals who own it.

EDGE means the Encouraging Diversity, Growth, and Equity Business Assistance Program created pursuant to section 123.152 of the Revised Code.

Good faith efforts mean efforts to achieve a DBE goal or other requirement of 49 CFR Part 26 and/or ODOT’s DBE Program which, by their scope, intensity, and appropriateness to the objective, can reasonably be expected to fulfill the program requirement.

Home state means the state in which a DBE firm or applicant for DBE certification maintains its principal place of business.

Immediate family member means father, mother, husband, wife, son, daughter, brother, sister, grandfather, grandmother, father-in-law, mother-in-law, sister-in-law, brother-in-law, and domestic partner and civil unions recognized under State law.

Indian tribe means any Indian tribe, band, nation, or other organized group or community of Indians, including any ANC, which is recognized as eligible for the special programs and services provided by the United States to Indians because of their status as Indians, or is recognized as such by the State in which the tribe, band, nation, group, or community resides. See definition of “tribally-owned concern” in this section.

Joint venture means an association of a DBE firm and one or more other firms to carry out a single, for-profit business enterprise, for which the parties combine their property, capital, efforts, skills and knowledge, and in which the DBE is responsible for a distinct, clearly defined portion of the work of the contract and whose share in the capital contribution, control, management, risks, and profits of the joint venture are commensurate with its ownership interest.

Liabilities mean financial or pecuniary obligations. This includes, but is not limited to, accounts payable, notes payable to bank or others, installment accounts, mortgages on real estate, and unpaid taxes.

Native Hawaiian means any individual whose ancestors were natives, prior to 1778, of the area which now comprises the State of Hawaii.

Native Hawaiian Organization means any community service organization serving Native Hawaiians in the State of Hawaii which is a not-for-profit organization chartered by the State of Hawaii, is controlled by Native Hawaiians, and whose business activities will principally benefit such Native Hawaiians.

Noncompliance means that ODOT and its subrecipients have not correctly implemented the requirements of 49 CFR Part 26.

Ohio Rail Development Commission is a subrecipient of ODOT.

Operating Administration or OA means any of the following parts of USDOT: the Federal Aviation Administration (FAA), Federal Highway Administration (FHWA), and Federal Transit Administration (FTA). The “Administrator” of an operating administration includes his or her designees.

ORC is Ohio Revised Code, a revision and consolidation into general provisions, titles, chapters, and sections of all statutes of a permanent and general nature of the State of Ohio.

Personal net worth means the net value of the assets of an individual remaining after total liabilities are deducted. An individual's personal net worth does not include: The individual's ownership interest in an applicant or participating DBE firm; or the individual's equity in his or her primary place of residence. An individual's personal net worth includes only his or her own share of assets held jointly or as community property with the individual's spouse.

Primary industry classification means the most current North American Industry Classification System (NAICS) designation which best describes the primary business of a firm. The NAICS is described in the North American Industry Classification Manual—United States, which is available on the Internet at the U.S. Census Bureau Web site: http://www.census.gov/eos/www/naics/.

Primary recipient means ODOT.

Principal place of business means the business location where the individuals who manage the firm's day-to-day operations spend most working hours. If the offices from which management is directed and where the business records are kept are in different locations, the recipient will determine the principal place of business.

Program means any undertaking on ODOT’s part to use USDOT financial assistance, authorized by the laws to which 49 CFR Part 26 applies.

Race-conscious measure or program is one that is focused specifically on assisting only DBEs, including women-owned DBEs.

Race-neutral measure or program is one that is, or can be, used to assist all small businesses. In the context of ODOT’s DBE Program, race-neutral includes gender-neutrality.

Recipient is ODOT and any of its subrecipients, public or private, to which USDOT financial assistance is extended, through the programs of the FAA, FHWA, or FTA, or who have applied for such assistance.

Secretary means the Secretary of Transportation or his/her designee.

Set-aside means a contracting practice restricting eligibility for the competitive award of a contract solely to DBE firms.

Small Business Administration or SBA means the United States Small Business Administration.

SBA certified firm refers to firms that have a current, valid certification from or recognized by the SBA under the 8(a) BD or SDB programs.

Small business concern means, with respect to firms seeking to participate as DBEs in USDOT-assisted contracts, a small business concern as defined pursuant to section 3 of the Small Business Act and Small Business Administration regulations implementing it (13 CFR part 121) that also does not exceed the cap on average annual gross receipts specified in §26.65(b).

Socially and economically disadvantaged individual means any individual who is a citizen (or lawfully admitted permanent resident) of the United States and who has been subjected to racial or ethnic prejudice or cultural bias within American society because of his or her identity as a member of groups and without regard to his or her individual qualities. The social disadvantage must stem from circumstances beyond the individual's control.

  1. Any individual who the Ohio Unified Certification Program finds to be a socially and economically disadvantaged individual on a case-by-case basis. An individual must demonstrate that he or she has held himself or herself out, as a member of a designated group if the Ohio Unified Certification Program requires it.
  2. Any individual in the following groups, members of which are rebuttably presumed to be socially and economically disadvantaged:
    1. “Black Americans,” which includes persons having origins in any of the Black racial groups of Africa;
    2. “Hispanic Americans,” which includes persons of Mexican, Puerto Rican, Cuban, Dominican, Central or South American, or other Spanish or Portuguese culture or origin, regardless of race;
    3. “Native Americans,” which includes persons who are enrolled members of a federally or State recognized Indian tribe, Alaska Natives, or Native Hawaiians;
    4. “Asian-Pacific Americans,” which includes persons whose origins are from Japan, China, Taiwan, Korea, Burma (Myanmar), Vietnam, Laos, Cambodia (Kampuchea), Thailand, Malaysia, Indonesia, the Philippines, Brunei, Samoa, Guam, the U.S. Trust Territories of the Pacific Islands (Republic of Palau), Republic of the Northern Marianas Islands, Samoa, Macao, Fiji, Tonga, Kiribati, Tuvalu, Nauru, Federated States of Micronesia, or Hong Kong;
    5. “Subcontinent Asian Americans,” which includes persons whose origins are from India, Pakistan, Bangladesh, Bhutan, the Maldives Islands, Nepal or Sri Lanka;
    6. Women;
    7. Any additional groups whose members are designated as socially and economically disadvantaged by the SBA, at such time as the SBA designation becomes effective.
  3. Being born in a particular country does not, standing alone, mean that a person is necessarily a member of one of the groups listed in this definition.

Spouse means a married person, including a person in a domestic partnership or a civil union recognized under State law.

Transit vehicle manufacturer means any manufacturer whose primary business purpose is to manufacture vehicles specifically built for public mass transportation. Such vehicles include, but are not limited to: Buses, rail cars, trolleys, ferries, and vehicles manufactured specifically for paratransit purposes. Producers of vehicles that receive post-production alterations or retrofitting to be used for public transportation purposes (e.g., so-called cutaway vehicles, vans customized for service to people with disabilities) are also considered transit vehicle manufacturers. Businesses that manufacture, mass-produce, or distribute vehicles solely for personal use and for sale “off the lot” are not considered transit vehicle manufacturers.

Tribally-owned concern means any concern at least 51 percent owned by an Indian tribe as defined in this section.

USDOT means the U.S. Department of Transportation, including the Office of the Secretary, the Federal Highway Administration (FHWA), the Federal Transit Administration (FTA), and the Federal Aviation Administration (FAA).

USDOT-assisted contract means any contract between ODOT or its subrecipient and a contractor (at any tier) funded in whole or in part with USDOT financial assistance, including letters of credit or loan guarantees, except a contract solely for the purchase of land.

Section 26.7 Non-discrimination Requirements

ODOT will never exclude any person from participation in, deny any person the benefits of, or otherwise discriminate against anyone in connection with the award and performance of any contract or procurement activity covered by 49 CFR Part 26 on the basis of race, color, sex, or national origin.

In administering its DBE program, ODOT will not, directly or through contractual or other arrangements, use criteria or methods of administration that have the effect of defeating or substantially impairing accomplishment of the objectives of the DBE program with respect to individuals of a particular race, color, sex, or national origin.

Section 26.11 Record Keeping Requirements

  1. ODOT reports DBE participation using the USDOT Form, “Uniform Report of DBE Commitments/Awards and Payments” (Exhibit A) on a semi-annual basis on June 1 and December 1.
  2. ODOT continues to provide data about its DBE program to USDOT as directed by USDOT operating administrations.
  3. ODOT maintains a bidder’s list.
    1. The purpose of the ODOT bidder’s list is to provide ODOT as accurate data as possible about the universe of DBE and non-DBE contractors and subcontractors who seek to work on its Federally-assisted contracts (and the Federally-assisted contracts of its subrecipients) for use in helping ODOT set its overall goals. The Division of Construction Management maintains the list under its Office of Contract Sales and Estimating. The list is available at NEED LINK.
    2. ODOT bidder’s list contains the following information:
      1. Firm Name;
      2. Firm Address;
      3. Whether the Firm is listed in the Ohio Unified DBE Directory;
      4. Year the Firm was established;
      5. Annual gross receipts of the Firm listed by gross receipts bracket.
    3. ODOT compiles the information for its bidder’s list via several different data sources.
      1. Prequalified contractors: All prequalified contractors will receive an email annually and their data (i.e., name, address, DBE/non-DBE status, age (i.e., the year the firm was established), and annual gross receipts) will be included in the updated list.

        Survey text description: As part of ODOT's ongoing commitment to achieve a successful Disadvantaged Business Enterprise Program and to fulfill the requirements of 49 CFR Part 26.11 ODOT will be sending out an annual "Bidders List" survey. The survey is short but vital for proper information gathering and determining the Departments DBE goals.

        Please fill out the attached questions and reply within 7 days of receipt.

        -----------------

        The same email would go out annually as the Office of Contract Sales does when seeking input from contractors such as C92s, Contracts and awards to name a few.

        Survey will be sent annually by October 1st to have it ready to publish online by December 1st. This will be done every calendar year just to be more consistent and set contractor expectations. It also makes it easier than to try and align with the goal setting process so every year the list will be up to date.

        1. If a prequalified contractor does not respond to an email, then additional efforts including phone contact will be made. Attempts will be made to collect information from non-responsive contractors to ensure we have the most accurate picture to formulate the single bidders list.
        2. If it is clear that a contractor no longer exists as a legal entity, they will be removed from the bidders list. This is a manual effort and includes checking the Secretary of State’s website, Google searches and telephone calls if we do not have a solid email address.
        3. As long as some information is obtained from a viable company, it will be included to the greatest extent possible on the bidders list.
      2. Subcontracting data provided by prime contractors will be incorporated. Prime contractors are required to submit a Request to Sublet/C92/SiteXchange file. Subcontractors are not permitted to work on the project until they are approved. Subcontract information is loaded into SiteManager and one of the datasets used to create the list to survey.
      3. DBE Commitment data: Data from DBEs being used both for goal and not for goal will be used.
      4. Plan-holders: The Office of Contracts and Estimating collects information from any person interested in any project as well as those who officially want placed on the plan-holders list, they are also asked to disclose if they intend to bid as a prime or subcontractor. Data will be gathered from any entity wishing to be placed on the Plan-holders list.
      5. Bidders list compiled by Local Programs: The Office of Local Programs has established its own SOP for collecting a bidders list of contractors bidding and working on Local highway projects that receive federal funding. That Office will provide their data (contractors that submitted bids on local-let projects and DBE firms included on their utilization plans) to the Office of Contract Sales and Estimating to be incorporated in Department’s bidders list. Every time the bidders list is refreshed data will be collected from the LPA group.
    4. Process: Once all data sources are assembled, the Office of Contract Sales and Estimating will review and survey the identified businesses as needed to gather average gross receipts range and date the company was established. Companies with no email address on record will be called to obtain survey data for incorporation. The average gross receipts range is specified by the Code of Federal Regulations as follows:
      1. Between $1 Million and < $5 Million
      2. Between $5 Million and < $10 Million
      3. Between $10 Million and < $15 Million
      4. More than $15 Million
    5. Posting of Data: Once surveys are complete and all data is received, the final data will be compiled and posted to the ODOT website on the above link and updated annually.
    6. Annual Survey: The Department will annually survey via email all entities it has used on the previous year’s bidders list. For any new entity the Department becomes aware of, the same above procedures will be used to gather their data and incorporation into the bidders list.
  4. ODOT maintains records documenting a firm’s compliance with the requirements of 49 CFR Part 26. ODOT will retain, indefinitely, application packages for each certified DBE, including Annual No Changes Declarations; changes submitted by the firm; and onsite review documentation. Other records will be retained for three years or by ODOT’s record retention laws, whichever is longer.1 ODOT stores this information in hard-copy and electronic format which is only accessible to authorized ODOT personnel in order to maintain confidentiality.
  5. ODOT submits the UCP report required under 49 CFR Part 26.11(e) to USDOT’s Office of Civil Rights by January 1 of each year.

1 ODOT’s records retention schedule for such files is four years.

Section 26.13 Assurances

  1. Federal Financial Assistance Agreement
    Each financial assistance agreement ODOT signs with a USDOT operating administration (or a primary recipient) includes the following assurance:

    The recipient shall not discriminate on the basis of race, color, national origin, or sex in the award and performance of any USDOT assisted contract or in the administration of its DBE Program or the requirements of 49 CFR Part 26. The recipient shall take all necessary and reasonable steps under 49 CFR Part 26 to ensure nondiscrimination in the award and administration of USDOT assisted contracts. The recipient’s DBE Program as required by 49 CFR Part 26 and as approved by USDOT, is incorporated by reference in this agreement. Upon notification to the recipient of its failure to carry out of its approved program, the Department may impose sanctions as provided for under 49 CFR Part 26 and may, in appropriate cases, refer the matter for enforcement under 18 U.S.C. 1001 and/or the Program Fraud Civil Remedies Act of 1986 (31 U.S.C. 3801 et seq.).

  2. Contract Clause – Non Discrimination
    The following clause is placed in every USDOT-assisted contract and subcontract:

    The contractor, sub-recipient, or subcontractor shall not discriminate on the basis of race, color, national origin, or sex in the performance of this contract. The contractor shall carry out applicable requirements of 49 CFR Part 26 in the award and administration of USDOT assisted contracts. Failure by the contractor to carry out these requirements is a material breach of this contract, which may result in the termination of this contract or such other remedy as the recipient deems appropriate, which may include, but is not limited to: (1) withholding monthly progress payments; (2) assessing sanctions; (3) liquidated damages; and/or (4) disqualifying the contractor from future bidding as non-responsible.

    ODOT ensures compliance with this section through the applicable quality assurance review and/or pre-award concurrence process.

    ODOT affirms that a contractor’s failure to comply with any provisions of the DBE regulations will be considered a material contract breach. This is non-negotiable. Sanctions can include letters of reprimand, withholding of estimates, and other remedies such as suspension, revocations, and debarment.


Subpart B – Administrative Requirements

Section 26.21 DBE Program

As a direct recipient of Federal funds, grants, and/or assistance, ODOT works to ensure compliance with 49 CFR Part 26. Any and all subrecipients of said Federal funds, grants, and/or assistance must comply with ODOT’s DBE Plan. Subrecipients cannot have a plan independent from ODOT’s plan.

ODOT’s DBE Plan is updated and approved by USDOT operating administrations when there have been significant changes to the current approved plan.

Section 26.23 Policy Statement

ODOT’s DBE Policy Statement is elaborated on the first page of this program.

Section 26.25 DBE Liaison Officer (DBELO)

The following individual has been designated as ODOT’s DBELO:

Deborah Green
Administrator
Office of Business & Economic Opportunity
Division of Opportunity, Diversity, and Inclusion
Ohio Department of Transportation
1980 W. Broad Street, MS 3270
Columbus, OH 43223
Telephone: (614) 466-7699
Email: Deborah.Green@dot.ohio.gov

The Director of ODOT is responsible for the implementation of the DBE program. The DBELO has direct and independent access to the Director concerning any and all DBE program matters. An organizational chart displaying the Division of Opportunity, Diversity, & Inclusion (ODI), the DBELO’s position in the organization and link to the Director, and the official acknowledgement letters to both FHWA and FTA are found in Exhibit B.

The DBELO, or her designee, is responsible for administering the development, implementation, and monitoring of all aspects of the ODOT DBE Program and ensuring ODOT complies fully with all provisions of 49 CFR Part 26. Implementation of the DBE program is given the same priority as complying with all other legal obligations incurred by ODOT in its financial assistance agreements with the USDOT. The DBELO’s duties and responsibilities include the following:

  1. Gathers and reports statistical data and other information as required by USDOT;
  2. Reviews third-party contracts and purchase requisitions for compliance with this program;
  3. Works with all departments to set overall annual goals;
  4. Ensures the bid notices and request for proposals are available to DBEs in a timely manner;
  5. Identifies contracts and procurements so that DBE goals are included in solicitations (both race-neutral methods and contract specific goal attainment); identifies ways to improve progress and monitors results;
  6. Analyzes ODOT’s progress toward goal attainment and identifies ways to improve progress;
  7. Advises the Director on DBE matters and achievements;
  8. Participates with assistant legal counsel and project personnel to determine contractor compliance with good faith efforts but is not involved with the administrative reconsideration;
  9. Manages written consent of terminations and/or replacements of DBEs on federally-funded projects;
  10. Provides DBEs with information and assistance in preparing bids, obtaining bonding and insurance;
  11. Plans and participates in DBE training seminars;
  12. Certifies DBEs according to the criteria set by USDOT and acts as liaison to the Uniform Certification Program (UCP) in Ohio;
  13. Provides outreach to DBEs and community organizations to advise them of opportunities;
  14. Maintains ODOT’s updated directory of certified DBEs.

As the Administrator of the Office of Business & Economic Opportunity (OBEO), Deborah Green is responsible for managing OBEO staff and staffing needs to administer a top-notch DBE Program. All correspondence related to ODOT’s DBE Program should be directed to Deborah Green.

Section 26.27 DBE Financial Institutions

ODOT recognizes Minority Depository Institutions (MDIs) can be a critically important partner in the development of the DBE ecosystem. The Federal Deposit Insurance Corporation (FDIC) publishes a Minority Depository Institutions (MDIs) Report that lists the current MDIs across the United States that are registered with the FDIC. ODOT conducts an annual review of the FDIC MDI Report, assesses the new MDIs available within the State of Ohio and its neighboring states, invites them to partner with ODOT’s DBE Program, and encourages them to receive ODOT’s outreach communications and quarterly ODI newsletters.

ODOT understands that access to opportunity (contracts and procurement activities) has the highest impact on small businesses pursuing heavy highway or transit projects, and access to capital is the next critical concern. ODOT seeks to partner with MDIs to provide the full extent of services offered to qualifying DBEs, subcontractors, contractors, subconsultants, consultants, and recipients. ODOT provides the partnering MDIs the contact name, mailing address, and email address of each DBE firm and encourages the MDIs to reach out to the contact list.

ODOT seeks subject matter expert participation from MDIs for outreach events to provide a platform for the MDIs to provide education regarding their financial services and to speak directly to bidders of ODOT projects.

Refer to Exhibit C for details about the FDIC Quarterly MDI Report and assessment of which MDIs ODOT engages for its DBE Program.

Section 26.29 Prompt Payment Mechanisms

Federal and Ohio State law requires the prompt payment of subcontractors, subconsultants, subrecipients, and suppliers by the awarded prime contractor or consultant. This provision also ensures that second tier subcontractors, subconsultants, and suppliers are paid promptly. A prompt payment provision is included in every contract. Prime contractors include the contract provisions provided in this section in all subcontracts. These provisions apply to all tiers of subcontracting and to contracts in any form, including those with DBEs.

  1. Contract Clauses
    1. Construction Contracts Clause. The prompt payment contractual language for construction contracts is included in the C&MS at Section 107.21. In the 2019 C&MS this language is as follows:

      In accordance with ORC 4113.61, make payment to each subcontractor and supplier within 10 Calendar Days after receipt of payment from the Department for Work performed or materials delivered or incorporated into the Project, provided that the pay estimate prepared by the Engineer includes Work performed or materials delivered or incorporated into the public improvement by the subcontractor or supplier. Contractors are prohibited from holding retainage from subcontractors that can provide a bond. For unbonded subcontractors and suppliers, promptly release any retainage held, as set forth in any subcontractor or supplier agreement, 30 days after the work is satisfactory completed. For the purposes of this section, satisfactory completed will be interpreted as when the subcontractor has completed all physical work and submitted any necessary documentation required by the specifications and the Department. No subcontract provision shall permit the Contractor to delay subcontractor’s retainage payments until the Project’s final payment.

      Also require that this contractual obligation be placed in all subcontractor and supplier contracts that it enters into and further require that all subcontractor and suppliers place the same payment obligation in each of their lower tier contracts. If the Contractor, subcontractors, or supplier subject to this provision fail to comply with the 10 Calendar Day requirement, the offending party shall pay, in addition to the payment due, interest in the amount of 18 percent per annum of the payment due, beginning on the eleventh Calendar Day following the receipt of payment from the Department and ending on the date of full payment of the payment due plus interest.

      Repeated failures to pay subcontractors and suppliers timely pursuant to this subsection will result in a finding by the Department that the Contractor is in breach of Contract and subject to all legal consequences that such a finding entails. Further, repeated failures to pay timely pursuant to this subsection will result in a lower evaluation score for the Contractor and those subcontractors who are subject to evaluation by the Department.

    2. Consultant Contract Clause

      The consultant shall pay each subconsultant within 30 calendar days after receipt of payment from the Department for services performed and invoiced by the subconsultant. The consultant shall also require that this contractual obligation be placed in all subconsultant contracts that it enters into and further require that all subconsultants place the same payment obligation in each of their lower tier contracts. If the invoice submitted to the consultant (or subconsultant) contains a defect or impropriety, the consultant shall send written notification to the firm within fifteen days after receipt of the invoice. The notice shall contain a description of the defect or impropriety and any additional information necessary to correct the defect or impropriety. If the consultant sends such written notification to the firm, the required payment date shall be thirty days after the consultant receives a proper invoice.

      A consultant that fails to make payment for the services by the required payment date shall pay an interest charge to the subconsultant, unless the amount of the interest charge is less than ten dollars. The interest charge on amounts due shall be paid to the subconsultant for the period beginning on the day after the required payment date and ending on the day that payment of the amount due is made. The amount of the interest charge that remains unpaid at the end of any thirty-day period after the required payment date, including amounts under ten dollars, shall be added to the principal amount of the debt and thereafter the interest charge shall accrue on the principal amount of the debt plus the added interest charge. The interest charge shall be at the rate per calendar month that equals one-twelfth of the rate per annum prescribed by section 5703.47 of the Revised Code for the calendar year that includes the month for which the interest charge accrues.

      Repeated failures to pay subconsultants timely pursuant to this section will result in a finding by the Department that the consultant is in breach of contract and subject to all legal consequences that such a finding entails.

  2. ODOT and its subrecipients ensure prompt and full payment of retainage from the prime contractor to the subcontractor within 30 days after the subcontractor's work is satisfactorily completed. ODOT and its subrecipients use the method outlined in 49 CFR 26.29(b)(2)1F2 to comply with this requirement: Retainage is not held from prime contractors, and ODOT prohibits LPAs from holding such retainage on projects with federal funding the LPA receives as ODOT’s subrecipient. (LPAs may, however, hold retainage from prime contractors on projects sold prior to July 1, 2021, or on any project without federal funding the LPA received as ODOT’s subrecipient.) A prime contractor must make prompt and full payment of any retainage to the subcontractor within 30 days after the subcontractor's work is satisfactorily completed.
  3. For the purposes of this section, satisfactory completed will be interpreted as when the subcontractor has completed all physical work and submitted any necessary documentation required by the specifications and ODOT. When ODOT or its subrecipient has made an incremental acceptance of a portion of a prime contract, the work of a subcontractor covered by that acceptance is deemed to be satisfactorily completed.
  4. Enforcement
    1. Prompt Payment Investigation Process. In the event ODOT is apprised of a lack of timely payments, ODOT initiates an investigation to determine the cause of the lack of timely payment. Repeated violations may impact the prime or subcontractor’s ability to secure future work with ODOT. In the event funds are unlawfully retained by an ODOT contractor in violation with ODOT’s Prompt Payment policy, the sub-contractor also has the right to pursue their legal remedies.
    2. Prompt Payment Violations. If, based on the results of any DBE Contractor Compliance, Prompt Payment, or DBE Payment Monitoring investigation, a contractor is determined to be noncompliant with the above policies, the contractor may be subject to sanctions. See the text of Proposal Note 31 (Exhibits D and E) (within section (e) below) for these sanctions.
  5. Prompt Payment Data Collection. ODOT utilizes an internal monitoring system to assess payment transactions between ODOT and each project’s awarded prime contractor or consultant, and the duration for the prime to in turn complete payments to its subcontractors or subconsultants within the allowable 10 calendar days.

    All ODOT-let highway construction projects are tracked in AASHTOWare Project Civil Rights & Labor (“CRL”). Payments ODOT makes to prime contractors, including DBE-certified prime contractors, are fed into CRL via an automated process.

    Contractually, prime contractors must use CRL to report the payments they make to their payees, including DBE-certified subcontractors, suppliers and trucking firms, as well as non-DBE-certified payees that use second-tier DBE-certified subcontractors, suppliers and trucking firms. Payees then verify the amount received. If a first-tier payee uses a second-tier DBE-certified subcontractor, supplier, or trucking firm, the first-tier payee becomes the second-tier payer and reports the payments it makes to the second-tier payee. The second-tier payee verifies the amounts received from the second-tier payee.

    ODOT requires prime contractors and consultants to maintain records and documents of payments to DBEs for three years following the performance of the contract. These records are made available for inspection upon request by any authorized representative of ODOT or USDOT. This reporting requirement also extends to any certified DBE subcontractor or subconsultant.

    1. Prompt payment data collection procedure for ODOT-let projects that include the version of Proposal Note 031 dated February 22, 2016:

      Prime Contractors must notify ODOT that it has complied with the Prompt Payment requirements set forth in Construction and Materials Specification 107.21 utilizing the Civil Rights and Labor (CRL) System.

      To report prompt payments, Prime Contractors utilize ODOT’s CRL system within 10 calendar days of payment from ODOT.

      CRL Requirements with interactive training guides can be found at http://transportation.ohio.gov/crl/ under “Ohio DOT Reference Materials.”

      The Prime Contractor’s “Affirmation of Compliance” submitted through CRL includes the following information:

      1. The name of the subcontractor or supplier that was paid;
      2. The dollar amount of the payment to the subcontractor or supplier; and
      3. The date the subcontractor/supplier was paid.

      Subcontractors or suppliers affirm the payment was made in the CRL system, on the date and in the amount listed in the affirmation. The Prime Contractor includes this affirmation requirement in all subcontractor and supplier contracts that it enters into and further require that all subcontractors and suppliers place the same payment obligation in each of their lower tier contracts.

    2. Prompt payment data collection procedure for ODOT-let projects that include the version of Proposal Note 031 dated April 17, 2020:

      The U.S. Department of Transportation’s (DOT’s) rules related to Disadvantaged Business Enterprises are published in the Code of Federal Regulations (CFR), 49 CFR Part 26. Within 49 CFR Part 26, 49 CFR 26.29 lays out the prompt payment requirements that apply to ODOT (the Department) and, by extension, its Prime Contractors and Subcontractors (including non-DBEs). The 49 CFR 26.29 requirements apply only to federally funded contracts (i.e., contracts with DOT financial assistance). The State of Ohio’s laws related to prompt payment are published in Ohio Revised Code (ORC) 4113.61 (Exhibit F). ORC 4113.61 applies to all contracts. Prompt payment is also part of ODOT’s standard specifications (Construction and Materials Specifications (C&MS) 107.21). The Prime Contractor must comply with this Proposal Note, ORC 4113.61, C&MS 107.21 and, where applicable, 49 CFR 26.29.

      The Department monitors the payments made by Prime Contractors and Subcontractors for compliance with this Proposal Note, ORC 4113.61, C&MS 107.21 and, where applicable, 49 CFR 26.29. To facilitate this monitoring, the Department requires Prime Contractors to report their payments to Subcontractors, and Subcontractors to report their payments to Sub-subcontractors. The payment data reported must include any retainage withheld and any previously withheld retainage released. All such reporting must take place within the AASHTOWare Project Civil Rights and Labor (CRL) system. The payer must enter and sign payments within 7 calendar days of making the payment. The payer must also enter and sign return of retainage within 7 calendar days of release back to the payee.

      Prime Contractors and Subcontractors must report payments to Subcontractors (DBE and non- DBE), Sub-subcontractors (DBE and non-DBE), suppliers (DBE only), and trucking firms (DBE only).

      An interactive training guide on reporting Subcontractor payments in CRL can be found at http://www.dot.state.oh.us/Divisions/ConstructionMgt/CRL/Pages/Program-Information.aspx under “Ohio DOT Reference Materials”.

      The payer (whether Prime Contractor or Subcontractor) must report the following information:

      1. The name of the payee;
      2. The dollar amount of the payment to the payee;
      3. The date the payee was paid;
      4. The amount of retainage withheld (if any).

      The payer must report the return of retainage in a standalone payment entry.

      The payer must sign each reported payment. The payee cannot verify a payment until the payer signs it.

      Payees must verify, in CRL, each payment reported by the payer within 30 days of the payment being signed by the payer. This verification must include:

      1. Whether the payment was received, and if so, whether it was as expected or not;
      2. The dollar amount of the payment received;
      3. The date the payment was received.

      The Prime Contractor must include the aforementioned prompt payment and reporting requirements in all Subcontractor agreements that it enters into and further require that all Subcontractors place the same prompt payment and reporting obligation in each of their lower tier agreements.

      SANCTIONS AND ADMINISTRATIVE REMEDIES

      Failure by the prime contractor to follow Prompt Payment requirements may result in the issuance of sanctions as follows:

      • 1st Level Occurrence: The Department will issue a Letter of Reprimand to the contractor (applies if there is a failure to report payments in CRL and/or failure to timely pay subcontractor(s));
      • 2nd Level Occurrence: The Department may withhold an estimate in the amount due to the subcontractor(s) that was not reported or paid (applies if there is a failure to report payments in CRL and/or failure to timely pay subcontractor(s)); or
      • 3rd Level Occurrence: The contractor may be required to pay interest in the amount of 18% per annum of the payment due, beginning on the eleventh day following the receipt of payment from the owner and ending on the date of full payment of the payment due plus interest (applies if a pattern of not paying subcontractor(s) persists or the Contractor has falsified, misrepresented or withheld information, ODOT can pursue other remedies available by law including suspension, revocation, and/or debarment).

      Factors to be considered in issuing sanctions may include, but are not limited to the following:

      • the Contractor’s past project practices;
      • the magnitude and the type of offense;
      • the degree of the Contractor’s culpability;
      • any steps taken to rectify;
      • the Contractor’s record of performance on other projects; and
      • the number of times the Contractor has been previously sanctioned by ODOT.

    3. Prompt payment data collection procedure for local-let projects that include the version of Proposal Note 031 dated September 1, 2020:

      The U.S. Department of Transportation’s (DOT’s) rules related to Disadvantaged Business Enterprises are published in the Code of Federal Regulations (CFR), 49 CFR Part 26. Within 49 CFR Part 26, 49 CFR 26.29 lays out the prompt payment requirements that apply to ODOT (the Department), it’s subrecipients (LPA’s), and, by extension, both Prime Contractors and Subcontractors (including non-DBEs). The 49 CFR 26.29 requirements apply only to federally funded contracts (i.e., contracts with DOT financial assistance). The Prime Contractor must comply with this Proposal Note and the Department’s prompt payment requirements as published in 107.21 of the Construction and Materials Specifications (C&MS).

      The Department will monitor payments made by Prime Contractors and Subcontractors for compliance with this Proposal Note, C&MS 107.21 and, where applicable, 49 CFR 26.29. To facilitate this monitoring, the Department requires prime contractors to report their payments to all subcontractors with the submission of each invoice. The payment data reported must include any retainage withheld and any previously withheld retainage released. All such reporting must take place through a web-based submission on GoForms. Invoices will not be approved and processed for payment unless this reporting form has been submitted and received by the Department.

      The Prime Contractor must report the following information:

      1. The name of the payee;
      2. The dollar amount of the payment to the payee;
      3. The date the payee was paid;
      4. The amount of retainage withheld (if any).

      The Prime Contractor must sign each reported payment and submit to ODOT via the GoForms website.

      If the Prime Contractor fails to submit the aforementioned documentation with each invoice, they will be determined to be non-compliant and invoices will not be processed for payment.

      Payees must verify each payment reported by the payer within 30 days of the payment being signed by the payer. This verification must include:

      1. Whether the payment was received, and if so, whether it was as expected or not;
      2. The dollar amount of the payment received; 2
      3. The date the payment was received.

      (Sanctions for non-compliance are the same as in the version of Proposal Note 031 dated April 17, 2020.)

      The following language is being included in the Construction Chapter of the LPA Construction Contract Administration manual.

      The Prime Contractor is prohibited from holding retainage on subcontractors that can provide a bond. The CPE shall monitor the release of retainage held by the Prime Contractor is completed within 30 days after the work is satisfactorily completed for unbonded subcontractors. No subcontract provision shall permit the Prime Contractor to delay a subcontractor’s retainage payment to the final payment of the project.

Section 26.31 Directory

ODOT maintains a directory identifying all firms eligible to participate as DBEs. The directory lists the firm’s pertinent information, inclusive of firm name, address, phone number, email address, ethnic group of primary ownership, certification status, original certification date, and the approved NAICS Code(s) and corresponding NAICS Code descriptors defining the type of work the firm has been certified to perform as an eligible DBE.

ODOT utilizes its Outreach resources on an on-going basis to connect with all relevant agencies, trade unions, and associations, to identify potential DBE firms, and, once certified, add these firms to its DBE Directory.

ODOT updates the directory in real time. The Directory is available at www.ohioucp.org (Click Ohio Unified DBE Directory).

Section 26.33 Overconcentration

If the DBELO or her designee determines that the DBE participation is so over-concentrated in certain types of work or in contracting or procurement opportunities that it unduly burdens the participation of non-DBEs in that type of work, the DBELO or her designee will develop appropriate measures to address the overconcentration. The DBELO or her designee will seek approval from the appropriate operating administration(s), as required. Once approved, the measures will become an integral part of ODOT’s DBE Program. Measures to address DBE overconcentration in a particular field may include, but are not limited to the following:

  1. The DBELO or her designee will develop ways to assist DBEs to move into non-traditional areas of work, including but not limited to;
    1. Outreach efforts;
    2. Use of incentives;
    3. Technical assistance;
    4. Capacity building;
    5. Mentor/Protégé programs;
    6. Business development programs; and
    7. Other appropriate measures such as providing assistance with obtaining bonding and capital designed to assist the DBEs in performing work outside of the specific field where over-concentration is occurring.
  2. The DBELO or her designee may vary the use of DBE contract goals;
  3. The DBELO or her designee may work with prime contractors and consultants to find and use DBEs in other industry areas;

Upon receipt of an allegation of overconcentration, ODOT will consult with the appropriate operating administration regarding the allegation and next steps to be taken.

Section 26.35 Business Development Program

ODOT, as part of its regular business, has developed a number of program strategies that ensure the fullest possible participation of DBE contractors in heavy highway construction and DBE consultants on engineering projects. These program strategies include but are not limited to: providing timely notification of opportunities, outreach, education, mentoring, and technical assistance through business development, which is provided through ODOT’s DBE Supportive Services Program (DBE/SSP). DBE/SSP offers tuition reimbursement for ODOT-and non-ODOT-sponsored seminars. Reimbursement can be obtained if attending relevant trade shows, association sponsored programs, workshops, and professional conferences. Tuition reimbursement can be obtained for formal education courses such as relevant technical training from a university, community college, technical trade school, or courses offered by ODOT.

DBE/SSP (see Exhibit G) also offers one-on-one technical services designed to assist in the growth and self-sufficiency of DBE firms with the ability to participate in the Federally-assisted heavy highway program, which includes engineering services. These technical services are offered at zero cost to those DBE firms determined to be eligible to participate in accordance with 23 CFR Part 230, Subpart B, and 49 CFR Part 26, and have a work specialty related to the highway construction industry. The technical services offered include customized help from professionals in marketing plans, business plan development, loan packages, advertising/promotion, accounting services, bidding/estimating, bonding, small business fundamental information systems, website development, and overall capacity building services.

ODOT has, as part of its regular business, developed a number of robust programmatic strategies that will ensure the fullest possible inclusion and participation of DBEs in Federally-assisted programs and projects. The two most noteworthy programs are the Mentor/Protégé Program and the Business Development Program.

The Mentor/Protégé Program (Exhibit H) has been developed as a permanent aspect of ODOT’s DBE Program. It involves a comprehensive developmental program of hands-on training and assistance in all phases of the heavy highway industry. The Mentor Protégé Program helps DBE firms increase business acumen, understand how to do business with ODOT, become more competitive at bidding and performing work, and grow to be a mentor to other firms. ODOT contractors and consultants are encouraged to participate as mentors to assist DBEs as protégés in developing technical and business capabilities as well as growing capacity.

Likewise, the Business Development Program has been developed to assist DBE firms in building and implementing viable business strategies, expanding technical skills, and enhancing leadership and collaboration capabilities. The Business Development Program targets DBEs that have established themselves as a viable business but are seeking to increase capacity through building in-house technical expertise, pursuing larger contracting opportunities, and/or transitioning from the role of subcontractor to prime contractor. Specific focus will be placed on improving the DBE’s infrastructure, its performance on projects, improving the DBE’s ability to perform on ODOT projects, identifying an avenue for sustainable work, and developing a strategy that will lead to additional profit-generating opportunities.

Section 26.37 Monitoring and Enforcement Mechanisms

ODOT utilizes the following mechanisms in monitoring and enforcement activities:

  1. Mechanisms to Ensure Compliance, Generally
    1. ODOT will bring to the attention of USDOT any false, fraudulent, or dishonest conduct in connection with the program, so that USDOT can take the steps (e.g., referral to the Department of Justice for criminal prosecution, referral to the USDOT Inspector General, action under suspension and debarment or Program Fraud and Civil Penalties rules) provided in Section 26.109. ODOT has the authority to ensure compliance with DBE requirements by withholding progress payments until the contractor has satisfied compliance requirements.
    2. ODOT will consider similar action under state legal authorities, including responsibility determinations in future contracts, removal of firms from the prequalified bidders and consultants’ lists or revocation of DBE certification if applicable, pursuant to Ohio Administrative Code Section 5501:2-3-10 (Exhibit I). ODOT monitors compliance with the DBE requirements through district construction staff and provides direction on how to monitor through the DBE CUF Monitoring Procedures found under Exhibit J.
    3. ODOT recognizes that ongoing staff training and professional development opportunities are essential in maintaining competent compliance professionals. ODI provides ongoing technical assistance and training to district and field staff regarding changes to state and federal regulations.
  2. Monitoring and Enforcement Mechanism to Ensure Work Committed to a DBE is Actually Performed by that DBE
    1. ODOT’s CUF DBE Monitoring Report is used by its District Contractor Compliance Officers (CCOs) to document and certify ODOT’s efforts to assess the DBE subcontractors are performing CUF. ODOT developed a CUF Form for District Construction staff to complete and submit to the District CCOs. The frequency in DBE monitoring and delineating parameters and timeframes for compliance monitoring are also indicated in the DBE CUF Monitoring Procedures.
    2. For professional service contracts specifically related to Transit, ODOT has developed a CUF Form (Exhibit K) to be completed by the Office of Transit and its subrecipients.
  3. Running Tally of DBE Attainments
    1. ODOT-let projects. ODOT keeps a project-by-project running tally of DBE attainments (i.e., payments made to DBE firms towards fulfillment of a DBE contract goal) and displays this on its Basic Project Data by Project3 report, which is accessible to anyone via ODOT’s Construction Management Reporting System webpage, and which includes each project’s DBE contract goal and a running tally of the payments made to DBE firms. The report shows, using the data in CRL, how much has been paid to DBE firms and how much would need to be paid to DBE firms to meet the DBE contract goal. Data for the running tally is supplied by prime contractors in fulfillment of PN 031 requirements (see Section 26.29(e) above). Actual payment to the DBE is compared to the original commitment amount and attainment of the DBE goal will be calculated based on the final contract amount and the actual payments made to the DBE.
    2. Local-let projects. Local-let projects are tracked outside of CRL.

      Prime contractors, including DBE-certified prime contractors, must use an online form to report payments received from LPAs. Prime contractors use this same form to report the payments they make to their payees, including DBE-certified subcontractors and suppliers.

      ODOT’s Division of Information Technology takes data from the online forms and puts it into a format whereby that data can be queried.

      (Projects awarded prior to November 2020) At the end of each project with a race-conscious DBE goal, the prime contractor submits signed final payment affidavits (although technically, these are not affidavits because they are not notarized) showing the amount paid to each race-conscious DBE. The race-conscious DBE signs off on the affidavit to show its concurrence on the amount received from the prime.

      If the amount shown on the final payment affidavit differs from the amount reported on the online form, the Office of Business & Economic Opportunity’s Goal Attainment Coordinator will email the prime with a request for a breakdown of the payments made to the DBE. The Goal Attainment Coordinator will identify payments reported on the online form that differ from payments shown in the provided breakdown and will have the correct the online form. Once the Goal Attainment Coordinator is satisfied that the amounts shown on final payment affidavits match the amounts reported on the online form, they will notify the district Contractor Compliance Officer that project closeout may proceed.

    3. Professional services. Professional services projects are tracked outside of CRL.

      Payments ODOT makes to prime consultants, including DBE-certified prime consultants, are tracked in the CSS system.

      Using ODOT’s Sub-consultant Payment System, prime consultants report payments to DBE/EDGE sub-consultants.

      ODOT’s Division of Information Technology takes data from the Sub-consultant Payment System and puts it into a format whereby that data can be queried.

    4. Reporting of DBE participation to USDOT will indicate both commitments and attainments as required by USDOT, “Uniform Report of DBE Awards, Commitments, and Payments” form (Exhibit A). DBE Commitment is reported in the reporting period in which the award of the contract is made. This information is reported on the top half of the Uniform Report of DBE Awards or Commitments and Payments form. The report of DBE participation is based on the actual dollars paid to the DBEs in full on that project for the reporting period in which the project has been completed. This is reported on the bottom portion of the Uniform Report (completed projects).


3 https://cmsportal.dot.state.oh.us/Home/ViewIntReport?RptNme=CONSTRUCTION%2520MANAGEMENT%2F8002-BasicProjectDatabyProject&RptTitle=Basic%20Project%20Data%20by%20Project

Section 26.39 Fostering small business participation

ODOT established a Small Business Enterprise (SBE) Program in order to continuously meet the maximum achievable portion of its DBE goal through race-neutral means. (see Exhibit L– Small Business Enterprise Program). To ensure that the maximum achievable portion of the overall DBE goal is met by using race-neutral means, ODOT assesses the latest availability data and take measures to facilitate competition and small business participation on ODOT contracts.

Subpart C – Goals, Good Faith Efforts, and Counting

Section 26.43 Set-asides or Quotas

ODOT does not use quotas or set-asides in any way in the administration of its DBE program.

Section 26.45 Overall Goals

ODOT submitted its triennial overall DBE goal to the appropriate operating administrations on August 1, 2019 and every three years thereafter.

ODOT establishes project-specific DBE goals if and when directed by the appropriate operating administrations.

A description of the methodology to calculate the overall goal and the goal calculations can be found in Exhibit M. This section of the program document will be updated every three years or after an adjustment of the overall goals, which has been approved by USDOT.

Before establishing its overall goal, in accordance with 26.45(g)(1)(i), ODOT consults with minority and women contractors and/or consultant groups, general contractors and consultants, community organizations, and other organizations or officials to obtain information concerning the availability of disadvantaged and non-disadvantaged businesses, the effects of discrimination on opportunities for DBEs, and ODOT’s efforts to establish a level playing field for the participation of DBEs. This consultation is required to include a scheduled, direct, interactive exchange (e.g., a face-to-face meeting, video conference, or teleconference) with as many interested stakeholders as possible focused on obtaining information relevant to the goal setting process, and it must occur before ODOT is required to submit its methodology to the appropriate operating administration for review. ODOT documents in its goal submission the consultation process in which it engaged.4

Following the consultation, ODOT publishes a notice of the proposed overall goal(s) informing the public that the proposed goal(s) and its rationale are available for inspection during normal business hours at ODOT Central Office for 30 days following the date of the notice and informing the public that ODOT will accept comments on the goals for 45 days from the date of the notice. The overall goal will be published in newspapers (e.g., Advertiser Tribunal, Akron Beacon Journal, Athens Messenger, Bellefontaine Examiner, Call and Post, Chillicothe Gazette, Chronicle Telegram, Cincinnati Post, Columbus Dispatch, Daily Sentinel, Dayton Newspapers, Inc., Delaware Gazette, Lima News, Marietta Times, The Cleveland Plain Dealer, The Courier, The Mt. Vernon News, The Repository, The Sandusky Register, The Times Recorder, Toledo Blade, Vindicator Printing Co., Wooster Daily Record, Inc.), in publications such as OhioMBE, and on ODOT’s website. In addition, ODOT will email the notice to all DBEs. Normally, ODOT will issue the notice no later than June 10 and it will include the address to which comments may be sent and where the proposal may be reviewed.

ODOT’s overall goal submission to the operating administrations includes: the goal (including the breakout of estimated race-neutral and race-conscious participation, as appropriate); a copy of the methodology, worksheets, etc. used to develop the goal; a summary of information and comments received during the public participation process and ODOT’s responses; and proof of publication of the goal in media outlets listed above.

ODOT implements its overall goal on October 1 of the specified year unless it has received other instructions from the operating administrations. If ODOT establishes a goal on a project basis, it will begin using the goal by the time of the first solicitation for a USDOT-assisted contract for the project. ODOT’s goal remains effective for the duration of the three-year period established and approved by the operating administrations.


4 In February 2015, ODOT in association with the Ohio Turnpike Infrastructure Commission retained the services of BBC Research & Consulting and Exstare Federal Services Group to conduct a disparity study for each agency, which included a market availability study. In January 2016, ODOT amended the scope of services to include a market availability study for DBE goal methodology related to FTA-funded projects. Thus, for its FY 2017-2019 DBE Goal Methodology submittal to FHWA and FTA, the public participation and information gathering was obtained during the aforementioned studies.

Section 26.47 Failure to Meet Overall Goals

If the awards and commitments shown on ODOT’s Uniform Report of Awards and Commitments and Payments at the end of any fiscal year are less than the overall goal applicable to that fiscal year, ODOT will do the following:

  1. Analyze in detail the reasons for the difference between ODOT’s overall goal and its awards and commitments in that fiscal year:

    Analysis steps are as described in:

    • “DBE Goal Shortfall Analysis & Corrective Action Plan,” Lance Yokota, FHWA California Division, and Lisa Neie, FHWA New Mexico & Arizona Divisions. n.d. Accessed at https://www.transportation.gov/civil-rights/disadvantaged-business-enterprise/dbeacdbe-training-0, e.g.:
      • Reviewing the quality and completeness of the data
      • Differences between overall DBE goal and participation
      • Calculating the dollar-weighted contract goal
      • Reviewing pre-award GFEs and whether they were excessive
      • Effectiveness of race-neutral measures
    • Preparing an Adequate Shortfall Analysis and Corrective Action Plan. FTA. n.d. Accessed at https://www.transit.dot.gov/regulations-and-guidance/civil-rightsada/preparing-adequate-shortfall-analysis-and-corrective, e.g.:
      • Methodology for calculating goal participation
  2. Establish specific steps and milestones to correct the problems ODOT has identified in its analysis and to enable it to meet fully its goal for the new fiscal year.
  3. Submit, within 90 days of the end of the fiscal year, the analysis and corrective actions developed under (1) and (2) above to FHWA for approval.
  4. Accept any conditions that FHWA may impose on ODOT as part of its approval of ODOT’s analysis and corrective actions.
  5. Fully implement the corrective actions to which ODOT has committed or that FHWA has imposed following its review.

Section 26.49 Transit Vehicle Manufacturers Goals

Each transit vehicle manufacturer, as a condition of being authorized to bid or propose on FTA-assisted transit vehicle procurements, must certify that it has complied with the requirements of 49 CFR 26.49. A copy of the TVM Certification is attached as Exhibit N.

A TVM's failure to implement the DBE Program in the manner as prescribed in this section and throughout 49 CFR part 26 will be deemed as non-compliance, which will result in removal from FTA's certified TVMs list, resulting in that manufacturer becoming ineligible to bid.

Only those transit vehicle manufacturers listed on FTA's certified list of Transit Vehicle Manufacturers, or that have submitted a goal methodology to FTA that has been approved or has not been disapproved, at the time of solicitation are eligible to bid.

ODOT maintains a State purchasing schedule for transit vehicles. A State purchasing schedule is an arrangement that a State establishes with multiple vendors in which those vendors agree to provide essentially an option to the State, and its subordinate governmental entities and others it might include in its programs, to acquire specific property or services in the future at established prices. ODOT usually refers to its State purchasing schedule for transit vehicles as “vehicle term contracts.”

ODOT selects a single vendor for each type of transit vehicle available on its State purchasing schedule. ODOT selects its vendors using a formal Invitation to Bid process. As part of this process, each bidder must certify that it (or, if the bidder is a dealer/distributor, that the transit vehicle manufacturer who will actually be producing the vehicles) is listed on FTA's certified list of Transit Vehicle Manufacturers, or that it has submitted a goal methodology to FTA that has been approved or has not been disapproved, at the time of solicitation. Bidders that cannot make this certification will be deemed non-responsive. Prior to entering into an agreement with a vendor, ODOT confirms the bidder’s certification by confirming the bidder’s presence on FTA’s Eligible TVMs List.

When subrecipients choose not to use the State purchasing schedule when procuring transit vehicles with a total value of $50,000 or more: As part of the pre-bid concurrence process, ODOT will ensure that subrecipients have a mechanism to obtain each bidder’s certification that it (or, if the bidder is a dealer/distributor, that the transit vehicle manufacturer who will actually be producing the vehicles) is listed on FTA's certified list of Transit Vehicle Manufacturers, or that it has submitted a goal methodology to FTA that has been approved or has not been disapproved, at the time of solicitation. Furthermore, ODOT will ensure that subrecipients will deem non-responsive any bidders that cannot make this certification. As part of the pre-award concurrence process, ODOT will ensure that subrecipients collected and confirmed the certifications.

FTA recipients are required to submit within 30 days of making an award, the name of the successful bidder, and the total dollar value of the contract in the manner prescribed in the grant agreement.

Within 30 days of entering into an agreement with a vendor, ODOT will report the name of the successful bidder to the FTA Regional Civil Rights Officer. Within 30 days of executing a purchase order for transit vehicles, ODOT will report the vendor name, the specific number of vehicles purchased, and the price of the vehicles to the FTA Regional Civil Rights Officer. Subrecipients must submit the above information to ODOT within 15 days of executing a purchase order so that ODOT can make the required report to the FTA Regional Civil Rights Officer within the 30-day timeframe.

Section 26.51 Meeting Overall Goals

  1. ODOT meets the maximum feasible portion of its overall goal by using race-neutral means of facilitating race-neutral means of facilitating race-neutral DBE participation. Race-neutral DBE participation includes any time a DBE wins a prime contract through customary competitive procurement procedures or is awarded a subcontract on a prime contract that does not carry a DBE contract goal. Race-neutral DBE participation also includes any DBE participation in excess of the DBE contract goal, as well as any time a DBE is awarded a subcontract on a prime contract that carries a DBE contract goal, but for which the prime contractor does not take the necessary steps for ODOT to consider that DBE’s participation as race-conscious (as sometimes happens when a prime contractor, post-award, identifies work that it needs to sublet and the subcontractor it wants to use for that work happens to be a DBE, and the prime contractor continues to fully use the DBEs to which it made commitments pre-award).
  2. The following are some race-neutral means utilized by ODOT to facilitate race-neutral DBE participation:
    1. Arranging solicitations, times for the presentation of bids, quantities, specifications, and delivery schedules in ways that facilitate participation by DBEs and other small businesses and by making contracts more accessible to small businesses.
    2. Providing access to overcoming limitations such as inability to obtain bonding or financing.
    3. Providing technical assistance and other services.
    4. Carrying out information and communications programs on contracting procedures and specific contract opportunities.
    5. Providing services to help DBEs and other small businesses improve long-term development, increase opportunities to participate in a variety of kinds of work, handle increasingly significant projects, achieve eventual self-sufficiency, develop their capability to utilize emerging technology, and conduct business through electronic means as a part of ODOT’s business development programming.
  3. Each time ODOT submits its overall goal for review by the concerned operating administration, ODOT submits its projection of the portion of the goal it expects to meet through race-neutral means and the basis for that projection. The projection is subject to the approval of the concerning operating administration, in conjunction with its review of ODOT’s overall goal.
  4. ODOT establishes contract goals to meet any portion of its overall highway goal it does not project being able to meet using race-neutral means. As noted above, ODOT’s Transit DBE goal is 100% race-neutral. As such, at this time, Transit does not set contract goals.
  5. Contract goal provisions
    1. Based on past participation and projections, ODOT only sets contract goals on USDOT-assisted contracts and professional services agreements that have subcontracting opportunities.
    2. ODOT does not set a contract goal on every USDOT-assisted contract or professional services agreement, and the size of the subcontract goals will be adapted to the circumstances of the contract or professional services agreement (e.g., type, location of work, availability of DBEs to perform the particular work, etc.). Contract goals are established on construction and professional service contracts so that, over the period to which the overall goal applies, they will cumulatively result in meeting that portion of ODOT’s overall goal that is not projected to be met through the use of race-neutral means.

      In order to set contract goals on USDOT-assisted construction contracts or professional services agreements, ODOT has established a DBE Goal Setting Committee. This Committee is comprised of members from the Office of Business & Economic Opportunity (OBEO), Structural Engineering, Construction Management, Roadway Engineering, Consultant Services, Contracts, Transit (for Transit projects), and Local Programs. Projects or professional services agreements are evaluated by ODOT’s Office of Estimating and then by ODOT’s Office of Consultant Services. Before the project is advertised, each project or professional services agreement is presented to the DBE Goal Setting Committee to determine if a DBE goal should be assigned to the project or professional services agreement. If it is determined that a DBE goal is appropriate, the goal will be assigned in the form of a percentage of the project or professional services agreement.

      The members of the Committee will review the projected work types included in the respective project or professional services agreement. Consideration will be given to the availability of DBE firms that may be available for the project or professional services agreement. Items that are taken into consideration may include, but are not limited to, the list of existing certified DBE firms, the work types or services performed by certified DBE firms, the availability of certified DBE firms in the project area, and associative knowledge of the members of the Committee. Once a project or professional services agreement has been evaluated by the Committee, it will be advertised with the DBE goal that was assigned by the Committee, if any.

      1. Scheduled Meetings. The Goal Setting Committee currently meets every other Wednesday opposite ODOT Letting Dates to establish contract goals on upcoming construction projects, and as needed to establish goals on consultant agreements. There must be a minimum of four voting members attending and voting for each meeting in order for DBE Goals to be set on projects.

        One of the minimum four voting members must be a representative from the Office of Business & Economic Opportunity. In the event that the representative from the Office of Business & Economic Opportunity cannot attend the meeting, the Administrator of the Office of Business & Economic Opportunity may vote or appoint an alternative voting member.

        The Committee Chairperson is a representative from the Office of Business & Economic Opportunity or an alternative appointed by the Administrator of the Office of Business & Economic Opportunity. The Administrator & DBE Liaison Officer for the Office of Business & Economic Opportunity reserves the right to make all final determinations regarding project DBE Goals set by the committee.

      2. Emergency meetings. If there is a rush project and it cannot wait until the next scheduled meeting, an emergency meeting can be called in order to set the goal on a project. The request for an emergency meeting must be sent to the Committee Chairperson, approved in advance and scheduled accordingly.

        There must be a minimum of four voting members attending and voting for each meeting. One of the minimum four voting members must be the representative from the Office of Business & Economic Opportunity. In the event that the representative from the Office of Business & Economic Opportunity cannot attend the meeting, the Administrator of the Office of Business & Economic Opportunity may vote or appoint an alternative voting member.

        Setting the goal on projects by proxy (i.e., e-mail) will not be acceptable unless approved by the Administrator of the Office of Business & Economic Opportunity. The Administrator & DBELO for the Office of Business & Economic Opportunity reserves the right to make all final determinations regarding project DBE Goals set by the committee.

      3. DBE goal calculation for construction projects. In advance of the meetings, a list of federally-assisted projects that require a DBE Goal to be set is sent to the Office of Business & Economic Opportunity from the Office of Contract Sales and Estimating and the Office of Local Programs.

        These lists and the pertinent project information are sent out to the Committee Members in advance of the scheduled meeting in order to give them appropriate time for meeting preparation.

        The DBE Goal for each project is calculated by taking the average of the votes submitted by the Committee Members. The results of the voting are charted on a spreadsheet.

        Once the DBE Goals have been established, the information is distributed to the appropriate individuals in the Office of Business & Economic Opportunity, the Office of Contract Sales and Estimating, and the Office of Local Programs.

        1. Contract goals for ODOT-let projects. The Office of Contract Sales and Estimating (CS&E) is involved in assisting the Goal Setting Committee. Below is the process that CS&E follows before and after the Goal Setting Meetings:

            • Goal Setting Meeting report - For the letting, provide a report for all federally-funded projects for the Goal Setting Committee. This report provides:
              • Location of the project;
              • Type of project (Resurfacing, Culvert Repair, Bridge Repair, Bridge Replacement, Guardrail, etc.);
              • Cost of the project;
              • The major work types and % of the project for each. For example, a typical resurfacing job would show:
                • 75% WT 10 - Flexible Paving
                • 6% WT 39 – MOT
                • 5% WT 06 - Incidental Grading
            • Proposals – ensure the Goals from the Goal Setting Results are posted on the cover of the proposal.
            • Electronic Bidding File – ensure the electronic bidding file includes the section where the bidder can enter their DBE utilization.
            • Post-bid/pre-award – receive instruction from the Office of Business & Economic Opportunity’s Goal Attainment Coordinator if any low bidders failed to complete the DBE affirmation process and the bid should be rejected for being non-responsive.
            • Post-award/sub-contracting:
              • If a subcontractor is a DBE for goal, require the prime to provide the subcontract agreement and verify that the subcontract agreement is included with the SiteXchange file.
              • Forward the subcontract(s) to the Office of Business & Economic Opportunity’s Goal Attainment Coordinator for review and approval.
              • When the subcontract is approved by the Office of Business & Economic Opportunity’s Goal Attainment Coordinator, populate the approval date for that subcontractor in SiteManager.
        2. Contract goals for local-let projects. This is the process for setting a contract goal for Local-let (LPA) projects.
          • District will send in a copy of the project estimate to the Office of Local Programs.
          • Office of Local Programs will send a copy of the estimate to the Office of Business & Economic Opportunity’s Goal Attainment Coordinator.
            • Copy of the estimate will need to be labeled with the PID, type of goal needed (DBE or EDGE) and the number the goal request is during the bi-weekly cycle.
              Example: LPA #1
              PID XXXXXX
              DBE Goal Needed
          • After project goals are determined, the Office of Business & Economic Opportunity’s Goal Attainment Coordinator will email the assigned goals to the Office of Local Programs.
          • The Office of Local Programs will email DBE Goal assignments back to the District LPA Managers. The District LPA Managers will then share the established goals with the LPA for incorporation into their bidding documents.
        3. Contract goals for professional services. For projects noted as having DBE or EDGE goals, the Consultant must use good faith efforts to include DBE or EDGE subconsultants. Consequently, the requirements of Title 49 CFR Part 26 will apply to agreements noted as having DBE goals, and Ohio Revised Code Section 123.152 will apply to agreements noted as having EDGE goals. For projects with DBE goals, the Consultant must ensure that the DBE subconsultant(s) is performing a "commercially useful function" as defined in 49 CFR 26.55.

          Contracts may include either:

          • DBE or EDGE Contract Participation Goals that establish a percent of the contract amount to be subcontracted to DBE/EDGE firms; or
          • DBE or EDGE Contract Development Goals that are intended to help DBE and EDGE firms improve long-term development, increase opportunities to participate in a variety of kinds of work, handle increasingly significant projects, and achieve eventual self-sufficiency. Contract Development Goals do not include a percentage of the fee or amount that must be subcontracted to DBE/EDGE firms.

          The Department utilizes five consultant selection processes, the use of which depends on the complexity of the project, estimated total fee, the number of available qualified consultants and whether an emergency exists, summarized as follows:

          • Programmatic Selection Process
          • Technical Proposal Selection Process
          • Emergency Selection Process
          • Small Purchase Selection Process
          • Special Expertise Selection Process

          All contracts, regardless of the selection process, must be presented to the Goal Committee for consideration of assignment of a Goal prior to public announcement (or prior to selection for contracts that do not require public announcement).

          The following rules are written to address procedures for establishing Goals for contracts included in pre-scheduled groups (January, May, and September). The Goals Committee considers the same factors in considering Goals for projects posted individually and projects eligible for direct selection, but the schedule, analysis and presentation to the Committee are less complex than those used for large groups of projects.

          Approximately 12 to 13 weeks prior to each Programmatic posting date (January, May, and September), the Office of Consultant Services runs an Ellis report listing all projects scheduled for selection with that specific Programmatic group. The projects are separated into two lists based on funding information included in Ellis:

          • Projects that include Federal funding; and
          • Projects funded with only State funds.

          District Consultant Contract Managers and Central Office Administrators/Contract Managers are then contacted by Consultant Services to gain more information on the scope of their projects such as size of the project, disciplines involved, and suitability for DBE/EDGE Goals.

          Recommended preliminary Goals are then identified by Consultant Services based on the following considerations:

          • The number and size of certified DBE/EDGE firms available to perform the work.
          • The Prequalification categories of the certified DBE/EDGE firms.
          • Past DBE/EDGE goals set on similar projects.
          • Past DBE/EDGE goal attainment on similar projects.
          • The estimated total fee for each project.
          • The variety of disciplines and prequalification categories required for specific projects.
          • Projects with repetitive work that provide opportunities for mentoring and development.

          DBE Goals are considered for projects that include Federal funding. EDGE Goals are considered for projects funded exclusively with State dollars. For the overall group of projects, target Goals are approximately 8-9% for DBE projects based on DBE availability to perform the work and 5%-6% for the overall group of EDGE projects based on EDGE firms available to perform the work. Race neutral selections historically make up any shortfall needed to meet overall Departmental Goals.

          Not all projects are suitable for Goals based on the work involved and availability of qualified DBE/EDGE firms to perform the work. The strategy typically followed by Consultant Services is to recommend larger Goals on a smaller number of projects that offer the best opportunities for meaningful DBE/EDGE participation, in compliance with commercially useful function requirements.

          Participation Goal percentages recommended for individual projects typically range from 5% to 15%, although larger percentages are occasionally recommended based on availability of DBE/EDGE firms available to perform the work involved.

          All projects are reviewed for assignment of a Goal, but projects typically viewed as good candidates for Contract Participation Goals include:

          • Larger project specific agreements that include a variety of disciplines that provide good subcontract opportunities for prequalified DBE and EDGE consultants;
          • IDIQ agreements with one primary work type such as Environmental Services, Geotechnical Services or Construction Inspection/Administration.

          Less likely candidates for Participation Goals are those projects with lower fees, disciplines in which only a few DBE/EDGE firms are prequalified and/or DBE/EDGE certified, General Engineering Service’s agreements with unknown tasks, or specialized/critical schedule projects.

          Good candidates for Development Goals are those that include a variety of work type opportunities, larger fees, multiple sets of the same work type (such as multiple bridges or traffic signals), or work types in which there are only a few prequalified DBE/EDGE firms that will provide opportunities for DBE/EDGE firms to add prequalification categories.

          Less likely candidates for Development Goals are those of limited work types where there are already numerous DBE/EDGE firms prequalified, or smaller projects that provide limited sub consultant opportunities.

          Upon completion of the initial Consultant Services recommendations, a spreadsheet list of recommended Goals are sent to District and Central Office Consultant Managers for their review and comment. The recommended Goals may be revised after review of any comments and further discussions if needed.

          Approximately 11 ½ weeks prior to the Programmatic posting date, Consultant Services distributes the recommended Goals to all members of the DBE/EDGE Goal Setting Committee (Goal Setting Committee) for preliminary review. Approximately 10 ½ weeks prior to the Programmatic posting date, the Goal Setting Committee meets to review the recommended Goals for finalization. Adjustments are made during the meeting as needed/recommended and the list is then approved by consensus of the Goals Committee. District and Central Office Consultant Managers are provided with an updated Goals list. Any further requests to consider adjustments to the approved Goals are sent back to the Goals Committee for their consideration.

          Approximately 10 weeks prior to the Programmatic posting date, the project list along with the approved DBE/EDGE Goals are posted to the Consultant Services Future Programmatic website.

          For the next 10 weeks the programmatic list is checked versus Ellis to see if any changes have been made (projects added or pulled, or significant fee changes). Goals may be updated if necessary to maintain the overall targeted Goals. If so, the Goal Setting Committee is informed and must review and approve any changes/additions. If changes are made, a revised list of projects/Goals is posted to the Consultant Services website.

          On the scheduled Programmatic posting date, a Request for Letters of Interest including the project list and approved Goals is posted on the Consultant Services website.

          For projects that are not included in Programmatic selection groups or use different selection processes, the same basic procedures are followed including review and approval by the Goal Setting Committee.

        4. Contract goals for Ohio Rail Development Commission projects.
          • The Ohio Rail Development Commission (ORDC) asks ODOT’s DBE & EDGE Goal Setting Committee to establish DBE goals on federally funded rail infrastructure projects. The request consists of the project estimate and a description of the contracting and construction methods that will be used for the projects. This includes identifying whether the project will be constructed by railroad forces or a contractor, as well as describing the types of work that will be completed as part of the project. Information is gathered by the ORDC Project Manager and provided to the Committee by ORDC’s Secretary-Treasurer.
          • ORDC’s Secretary-Treasurer serves on the Committee and attends meetings when the agenda includes projects with railroad construction elements in order to provide descriptions of the methods and types of work.
          • ORDC ensures that railroads’ bid packages include language to ensure that the contract is awarded only to a bidder that makes documented, good faith efforts to reach the goal. In addition, participation by certified DBE firms is discussed during any available pre-bid and pre-construction meetings.
          • ORDC reviews the DBE participation plans submitted by bidders to verify—using the Ohio Unified DBE Directory—that firms are, in fact, DBE-certified and are certified in the NAICS code(s) applicable to the kind of work the firms would perform on the project. If the amount of a bidder’s plan does not meet or exceed the established goal, ORDC reviews the bidder’s documented good faith efforts, which are then forwarded to ODOT’s GFE Review Committee for approval or disapproval. ORDC consults with the Office of Business & Economic Opportunity if there are any questions about either DBE certification or the DBE participation plan.
          • ORDC requires DBE Affidavits of Subcontractor Payment to be submitted upon completion of the project and compares the reported expenditures with DBE firms to the contract amount to assess conformity with the plan. Any inconsistencies or shortcomings are discussed with the Office of Business & Economic Opportunity to determine an appropriate course of action.
    3. Any contract goal established by ODOT is subject to FHWA/FTA review and approval.
    4. ODOT’s contract goals provide for participation by all certified DBEs and are not subdivided into group-specific goals.

Section 26.53 Good Faith Efforts Procedures

A bidder’s obligation is to make good faith efforts to meet the established DBE contract goal. However, ODOT does not require all bidders to demonstrate these good faith efforts. Only the apparent low bidder, once named, must demonstrate its good faith efforts to meet the established DBE contract goal either by meeting the contract goal (and submitting signed participation affirmations from each participating DBE) or documenting that it made adequate good faith efforts to meet the goal, even though it did not succeed in obtaining enough DBE participation to do so. If the apparent low bidder is found to be nonresponsive, the apparent second lowest bidder must demonstrate its good faith efforts to meet the established DBE contract goal. If the apparent second lowest bidder is found to be nonresponsive, the process continues with the next lowest bidder (unless ODOT opts to reject all bids).

ODOT Bidding Process

Although all bidders are NOT required to demonstrate their good faith efforts to meet the established DBE contract goal, all bidders ARE required to submit a DBE Utilization Plan at the time of bid setting forth specific information identifying the participating DBE’s and describing the types and dollar amounts of work they would perform. By submitting a DBE Utilization Plan, the bidder is affirming that it will be using the DBE’s identified in the Utilization Plan. The DBE Utilization Plan includes the following information:

  1. The names of the DBEs that will participate in the contract;
  2. A description of the work that each DBE will perform. To count toward meeting the contract goal, each DBE must be certified in a NAICS code/descriptor applicable to the kind of work the firm would perform on the contract;
  3. Whether the DBEs being used to meet the contract goal will be utilized as a subcontractor, regular dealer, manufacturer, consultant, or other capacity; and
  4. The dollar amount of the participation of each DBE.

The Apparent Low Bidder, once named, shall ensure the Utilization Plan DBE’s affirm their participation in the bid within five calendar days after the bid opening. (Local public agencies tell ODOT when they will have their bid openings using the LPA Bid Opening Date Form.4F5) The DBE Affirmation Form (Exhibit O) will be utilized as written confirmation from each listed DBE firm that it is participating in the contract or professional services agreement in the kind and amount of work provided in the bidder’s DBE Utilization Plan. The Apparent Low Bidder will submit a separate DBE Affirmation Form for each DBE it is utilizing to meet the DBE goal. All other bidders will submit a DBE Affirmation Form(s) if notified that the information is required in order for ODOT to complete its bid assessment. Bidders have five calendar days from the date of notification to submit all required DBE Affirmation Forms. Notification will be by phone or email.

In the event a DBE firm fails to confirm the information contained in the DBE Affirmation Form within five calendar days of bid opening, the Apparent Low Bidder needs to submit a Request to Terminate/Substitute DBE Form (Exhibit P) and described below in order for the Apparent Low Bidder to still be considered for contract award. The Apparent Low Bidder must provide the Good Faith Efforts it made to obtain the DBE participation included in its original Utilization Plan, plus all efforts it made to obtain the affirmation from the DBE firm and will need to attach proof of these efforts. The Request to Terminate/Substitute DBE Form (plus signed DBE Affirmation Form for the substitute DBE, if any), Good Faith Efforts documentation, and documentation of attempts to obtain the signed affirmation from the DBE firm must be submitted within eight calendar days of bid opening.

In the event that the bidder is also a certified DBE firm, the bidder is required to complete a DBE Utilization Plan as set forth above. In this instance, however, the certified DBE bidder would not need to submit a DBE Affirmation Form for the work it is planning to self-perform in order to meet the goal. ODOT will consider the submission of the bid as the certified DBE bidder’s written confirmation that it is participating in the contract or professional services agreement. However, a DBE Affirmation Form must be submitted for all other DBE firms that are being utilized toward the DBE goal.

Local-let Process

The Local-let process is outlined in Exhibit Q.

In the event that the DBE contract goal established by ODOT is not met, the Apparent Low Bidder (prime contractor or consultant) must document and submit its good faith efforts (GFEs) to meet the goal, even though it did not succeed in obtaining enough DBE participation to do so.

The Apparent Low Bidder’s GFE documentation package (Exhibits R and S), which must be submitted to ODOT within five calendar days after the bid opening, must include:

  1. All written quotes received from certified DBE firms;
  2. All written (including email) communications between the Apparent Low Bidder and DBE firms;
  3. All written solicitations to DBE firms, even if unsuccessful;
  4. Copies of each non-DBE quote when a non-DBE was selected over a DBE for work on the contract or professional services agreement;
  5. Phone logs of communications with DBE firms.

ODOT will utilize the guidance set forth in 49 CFR §26.53 Appendix A in determining whether the Apparent Low Bidder has made adequate GFEs to meet the goal. ODOT will review the GFE documentation and issue a written determination on whether adequate GFEs have been demonstrated prior to contract award.

In the event ODOT determines that the Apparent Low Bidder has failed to demonstrate adequate GFEs to meet the goal, the Apparent Low Bidder will have an opportunity for administrative reconsideration prior to the contract being awarded. As part of this reconsideration, the Apparent Low Bidder may provide written documentation or argument concerning the issue of whether it met the goal or made adequate good faith efforts to do so. Such written documentation or argument must be provided to ODOT, attention to the Deputy Director of the Division of Chief Legal Counsel, 1980 West Broad Street, MS 1500, Columbus, Ohio 43223, within two (2) business days of ODOT’s written determination that GFE’s were not adequately demonstrated. The Apparent Low Bidder may also include in their written documentation a request for an in-person meeting to discuss the issue of whether it met the goal or made adequate good faith efforts to do so.

ODOT will send the Apparent Low Bidder a written decision on reconsideration explaining the basis for finding that the Apparent Low Bidder did or did not meet the goal or make adequate GFEs to do so. The result of the reconsideration process is not administratively appealable to USDOT.

At this time, ODOT’s Transit DBE goal is 100% race-neutral and therefore ODOT does not set DBE contract goals for transit projects. If, in the future, ODOT’s Transit DBE goal becomes race-conscious, ODOT will use the sample GFE template attached as Exhibit T to evaluate the GFEs of its subrecipients’ contractors or consultants and to determine whether they are sufficient.

Good Faith Efforts Review Committee

The Good Faith Efforts Review Committee (hereinafter “GFE Committee”) shall evaluate and provide a subsequent decision of a Prime Contractor’s Good Faith Efforts in meeting the DBE Goal on ODOT and LPA construction projects when the DBE Goal Shortfall is more than 20% of the assigned DBE Goal. The Committee will also evaluate and provide a subsequent decision of Good Faith Efforts in Consultant Letters of Interest. The GFE Committee meetings shall be scheduled as necessary and when requested by the Administrator of the Office of Business & Economic Opportunity (OBEO) within the Division of Opportunity, Diversity, and Inclusion (ODI). The GFE Committee will not meet more than once on a bi-weekly basis. The GFE Committee consists of seven members from the Offices of Construction Management, Engineering Consultant Services and Business & Economic Opportunity (OBEO). There is an additional position on the Committee for a subject matter expert from the Office of Construction Administration when the committee is in need of their expertise. The titles of the members of the GFE Committee are listed below:

  • EEO Program Administrator – Committee Liaison
  • Administrator, Office of Business & Economic Opportunity
  • Project Manager 2, Office of Contracts
  • Transportation Engineer 5, Office of Consultant Services
  • Transportation Engineer 4, Office of Alternative Project Delivery
  • Project Manager 1, Office of Local Programs
  • Committee Member, Office of Alternative Project Delivery
  • Floating Subject Matter Experts are comprised of a five-member panel.

If an original member can no longer serve on the committee, a replacement member shall be nominated by the remaining members of the committee and approved by the Administrator of the OBEO. In the case that there is a design/consulting goal shortfall, there shall be an additional committee member added with design experience to make the determination of Good Faith Efforts.

Prior to each meeting, the OBEO will provide a detailed analysis report for each case that will include, but is not limited to, the basic project information, the approved DBE Plan information, and the Prime explanation for the DBE Shortfall and documented Good Faith Efforts from the Prime Contractor. The GFE Committee meetings will include an open discussion by the members. A vote of the members of the committee with a minimum of four votes will be required to make a final determination. If more information is required by the committee, the vote will be tabled until the next meeting. The Committee Liaison will tally the votes and document the final determination of the committee. The OBEO reserves the right to make all final determinations regarding GFE’s brought to committee. The Committee will provide a determination in the form of approval or disapproval of a Prime’s Good Faith Efforts in meeting the assigned DBE Goal for the project.

Termination or Replacement of a DBE

By submitting a DBE Utilization Plan, the bidder is committing to use the DBE firms identified in the plan. The Apparent Low Bidder/Awarded Contractor will utilize the specific DBEs listed in the DBE Utilization Plan to perform the work and supply the materials for which each is listed unless the Apparent Low Bidder/Awarded Contractor obtains written consent as provided herein.

In order to request termination or substitution of a DBE firm, the Apparent Low Bidder/Awarded Contractor will utilize the Request to Terminate/Substitute DBE Form (Exhibit P). This termination/replacement procedure applies only to DBE firms or the amount of work being utilized to meet the goal. Without ODOT’s written consent to terminate/replace a DBE firm being utilized to meet the goal, the Awarded Contractor is not entitled to any payment for DBE listed work or materials unless it is performed or supplied by the listed DBE. This requirement is outlined in Proposal Note 013 (Exhibits U and V).

Good Cause

ODOT will provide written consent to terminate a DBE only if it agrees, for reasons stated in a concurrence document, that the Apparent Low Bidder/Awarded Contractor has good cause to terminate the DBE firm.

Good cause to terminate a DBE includes the following circumstances:

  1. The listed DBE firm fails or refuses to provide the required DBE Affirmation Form or to execute a written contract;
  2. The listed DBE firm fails or refuses to perform the work of its subcontract in a manner consistent with normal industry standards. Provided, however, that good cause does not exist if the failure or refusal of the DBE firm to perform its work on the subcontract results from the bad faith or discriminatory action of the Awarded Contractor;
  3. The listed DBE firm fails or refuses to meet the Awarded Contractor's reasonable, nondiscriminatory bond requirements.
  4. The listed DBE firm becomes bankrupt, insolvent, or exhibits credit unworthiness;
  5. The listed DBE firm is ineligible to work on public works projects because of suspension and debarment proceedings pursuant 2 CFR Parts 180, 215 and 1200 or applicable state law;
  6. ODOT has determined that the listed DBE firm is not a responsible contractor;
  7. The listed DBE firm voluntarily withdraws from the project and provides the Awarded Contractor written notice of its withdrawal;
  8. The listed DBE is ineligible to receive DBE credit for the type of work required;
  9. A DBE owner passes away or becomes disabled with the result that the listed DBE contractor is unable to complete its work on the contract; and
  10. Other documented good cause that ODOT determines supports the termination of the DBE firm. Provided, that good cause does not exist if the Awarded Contractor seeks to terminate a DBE it relied upon to obtain the contract so that the Awarded Contractor can self-perform the work for which the DBE contractor was engaged or so that the Awarded Contractor can substitute another DBE or non-DBE contractor after contract award.

Substitution

When a DBE firm is terminated or fails to complete its work on the contract for any reason (including significant change orders) the Awarded Contractor must make GFEs to find another DBE firm. These GFEs must be directed at finding another DBE to perform at least the same amount (not necessarily the same type) of work under the contract as the DBE that was terminated, to the extent needed to meet the contract goal. The GFEs must be documented by the Awarded Contractor. If ODOT requests documentation under this provision, the Awarded Contractor must submit the documentation within seven calendar days, which may be extended for an additional seven calendar days if necessary at the request of the Awarded Contractor, and ODOT will provide a written determination to the contractor stating whether GFEs have been demonstrated. In addition to post-award terminations, the provisions of this section apply to pre-award deletions and substitutions of DBE firms put forward by bidders in the DBE Utilization Plan.

Written Notice to DBE

Before submitting its request to ODOT to terminate and/or substitute a DBE firm, the Apparent Low Bidder/Awarded Contractor must give notice in writing to the DBE firm, with a copy to ODOT, of its intent to request to terminate and/or substitute and must include the reason(s) for the request.

The Apparent Low Bidder/Awarded Contractor must give the DBE firm five calendar days to respond to the notice, advising ODOT and the Apparent Low Bidder/Awarded Contractor of the reasons, if any, why it objects to the proposed termination of its subcontract and why ODOT should not approve the Apparent Low Bidder/Awarded Contractor's request. If required in a particular case as a matter of public necessity (e.g., safety), ODOT may provide a response period shorter than five days.

Goal Attainment Post-Award

The Awarded Contractor must make available upon request a copy of all DBE subcontracts. The Awarded Contractor will ensure that all subcontracts or agreements with DBEs require that the subcontract and all lower tier subcontractors be performed in accordance with Proposal Note 013 (Exhibits U and V).

Approval of a DBE Utilization Plan does not ensure approval of C-92 Requests to Sublet nor does approval of a DBE Utilization Plan indicate that the DBE goal has been met. ODOT will monitor goal attainment throughout the life of the project. It is the responsibility of the Awarded Contractor to advise ODOT of any changes to the DBE Utilization plan throughout the life of the project.

DBE Bidders for Prime Contracts

In determining whether a DBE bidder for a prime contract has met a contract goal, ODOT will count the work the DBE has committed to performing with its own forces as well as the work that it has committed to be performed by DBE subcontractors and DBE suppliers.

Design-Build

GFE for design-build projects are treated the same as for design-bid-build.

Sanctions and Administrative Remedies

Failure to do any of the following will result in the bid being rejected in accordance with ORC §5525.08:

  1. Failure to submit a complete DBE Utilization Plan at the time of bid;
  2. Failure to submit DBE Affirmation Form(s) and/or failure to submit Request to Terminate/Substitute DBE Form(s) as required.
  3. Failure to meet the goal and/or failure to demonstrate GFEs to meet the goal as required. ODOT will not penalize a company for failure to achieve dollar amounts listed beyond the contract goal.

Failure by the Apparent Low Bidder and/or Awarded Contractor/Consultant to carry out the requirements of Proposal Note 013 (Exhibits U and V) is a material breach of the contract and may result in the termination of the contract or other remedies available by law including suspension and/or revocation of a contractor’s or consultant’s prequalification and/or debarment.

In the event the post award GFEs are not approved by ODOT, the prime contractor/consultant may face the following ODOT-issued sanctions:

  1. Letter of Reprimand
  2. Liquidated damages equivalent to the DBE shortfall
  3. If a pattern of paying liquidated damages persists or the contractor/consultant has falsified, misrepresented or withheld information, ODOT can pursue other remedies available by law including suspension, revocation, and/or debarment

Factors to be considered in issuing sanctions may include, but are not limited to the following:

  • The magnitude and the type of offense
  • The degree of the contractor’s culpability
  • Any steps taken to rectify the situation
  • The contractor’s record of performance on other projects including, but not limited to:
    • annual DBE participation
    • annual DBE participation on projects without goals6
    • the number of complaints ODOT has received regarding the contractor
    • the number of times the contractor has been previously sanctioned by ODOT

ODOT issued GFE guidance (Exhibit W), developed templates for contractor/consultants to complete regarding GFEs in the event of a shortfall (Exhibits R and S), and outlined sanctions (at the end of Proposal Note 013, Exhibits U and V) in the event a contractor/consultant did not demonstrate adequate GFEs. The completed GFE templates are to be submitted to ODOT to document a prime contractor’s or consultant’s GFEs.


6 It should be noted that prime contractors/consultants are strongly encouraged to subcontract with DBE firms to assist in enhancing capacity regardless of whether the work will count toward the DBE goal. Such partnerships will allow ODOT to meet the maximum achievable portion of its overall DBE goal through race-neutral measures.

Section 26.55 Counting DBE Participation

DBE certification does not guarantee that ODOT will count the firm’s work on a project towards ODOT’s DBE goal. For services performed by a DBE to count toward the ODOT goal, the firm must perform a Commercial Useful Function (CUF) and its work must be in the NAICS code for which the DBE is certified.

  1. DBE participants in a contract/consultant agreement
    In determining the portion of DBE work on a project that will count toward the DBE goal, please refer to the bulleted list below. This list is not an exhaustive list; ODOT may request additional information from the prime contractor/consultant and/or DBE firm to determine the portions of work ODOT will count as DBE participation.

    • The DBE firm is performing a CUF;
    • The work is in the NAICS code for which the DBE is certified;
    • The work is performed by the DBE’s own workforce;
    • Supplies and equipment purchased or leased by the DBE are not affiliated with the prime contractor/consultant;
    • The cost of supplies and materials obtained by the DBE for the work is counted including purchases and leased equipment;
    • Reasonable fees or commissions charged by a DBE for providing a bona fide service, or for providing bonds or insurance required for performance of an ODOT contract may be counted. Examples of bona fide services include professional, technical, consultant, or managerial services;
    • When a DBE subcontracts part of the DBE’s work to another firm, the value of the subcontracted work is counted only if the work is subcontracted to another DBE. Work that a DBE subcontracts to a non-DBE firm does not count toward DBE goals.
  2. Joint ventures
    When a DBE performs as a participant in a joint venture, DBE credit will be counted only for work that is clearly defined in the contract that the DBE performs with the DBE’s own management, workforce, and equipment. All CUF rules still apply.
  3. Commercially useful function: Contractors and consultants

    Expenditures to a DBE contractor can be counted toward DBE goals only if the DBE is performing a CUF. Considerations in determining CUF include the following:

    A DBE performs a CUF when the DBE is responsible for execution of the work and is performing, managing, and supervising the work involved. To perform a CUF, the DBE must be able to quote and negotiate its own prices. The DBE must be responsible, with respect to materials and supplies used on the contract, determining quality and quantity, negotiating price, ordering the material, installing (where applicable), and paying for the material.

    1. To determine whether a DBE is performing a CUF, ODOT must evaluate the following:
      • The amount of work subcontracted
      • Industry practices
      • Whether the amount the DBE is to be paid under the contract is commensurate with the work performed
      • DBE credit claimed for the performance of the work, and other relevant factors
    2. ODOT must presume a DBE is not performing a CUF if the DBE’s role is limited to the following:
      • An extra participant in a transaction, contract, or project through which funds are passed to create the appearance of DBE participation.
      • In determining whether a DBE is such an extra participant, ODOT must examine similar transactions, particularly those in which DBEs do not participate.
      • If a DBE acting as the Prime contractor does not perform or exercise responsibility for at least 30 percent of the total cost of the DBE’s contract with its own workforce, or the DBE subcontracts a greater portion of the work of a contract than would be expected on the basis of normal industry practice for the type of work involved, ODOT must presume that the DBE is not performing a CUF.

      If it is presumed that a DBE is not performing a CUF, the DBE may present evidence to refute this presumption. ODOT may determine that the DBE is performing a CUF given the type of work involved and normal industry practices.

  4. Commercially useful function: Trucking
    In determining whether a DBE trucking firm is performing a CUF include the following:

    • The DBE trucking firm must be able to quote and negotiate its own prices.
    • The DBE will be responsible for the management and supervision of the entire trucking operation on each contract. A DBE is not performing a CUF if the contract exists to create the appearance of DBE participation.
    • The DBE must own and operate at least one fully licensed, insured, and operational truck used on the contract.
    • The DBE receives credit for the total value of the transportation services the DBE provides on the contract using trucks the DBE owns, insures, and operates using drivers it employs (not 1099/independent contractors).
    • If the DBE lessee is approved prior to the work taking place, the DBE who leases trucks (lessor) from the DBE (lessee), including an owner-operator who is certified as a DBE, the DBE lessor will receive credit for the total value of the transportation services the lessee DBE provides on the contract.
    • A lease must indicate that the DBE has exclusive use of and control over the truck, including responsibility of maintenance and insurance for the truck. This does not preclude the leased truck from working for others during the term of thelease with the DBEs consent, as long as the lease gives the DBE absolute priority for use of the leased truck. Leased trucks must display the DBEs name and identification number.
  5. Commercially useful function: Materials and Supplies Vendors (MSVs)

    Materials and Supplies: Counting Expenditures with DBE Materials and Supplies Vendors (MSVs) toward DBE Goals

    ODOT refers to DBEs that are materials and supplies vendors as DBE MSVs. ODOT assigns descriptors to DBE MSVs that have been used on ODOT projects and upon request. A DBE MSV must have the correct NAICS code and descriptor in order for an item vended by that DBE MSV to be counted toward DBE goals. An exception will be made to the descriptor requirement if a firm has not yet received descriptors from ODOT for its manufacturing/wholesale/retail NAICS codes. A 2018 Notice to Industry (Exhibit X) explains how ODOT determines regular dealers and addresses how bulk items are counted.

  6. Uncertified Firms; Previously Certified Firms
    ODOT will ensure no contract goal credit will be provided if the subcontracted DBE firm is not certified at the time of contract award (except as provided for in 49 CFR 26.87(i)); and
  7. Decertified Firms
    ODOT will not count the dollar value of work performed under a contract with a firm after it has ceased to be certified toward its overall goal.
  8. Payments to DBEs
    ODOT will ensure no contract goal credit will be provided if the Prime contractor’s or consultant’s payments to the certified DBEs on the project have not been paid.
  9. Monitoring and Assessing CUF

    Monitoring CUF plays a vital role in the success of ODOT’s DBE Program. In keeping with normal contract requirements, it is the primary responsibility of the prime contractor/consultant to ensure that the DBE is performing a CUF. ODOT, as the contracting agency, has oversight responsibility to ensure that the prime contractor/consultant has effectively met this responsibility under its contract with ODOT.

    CCOs will advise the prime contractor at the Pre-Construction Meeting to maintain and make available to ODOT, when so requested, records substantiating the performance of a CUF by a DBE contractor and supplier as part of the contractor’s compliance. Contractor records, which may be reviewed to substantiate CUF, include, but are not limited to:

    • Contracts, subcontracts, or rental agreements
    • Delivery tickets
    • Invoices
    • Bills of Lading
    • Lease agreements
    • Hauling tickets
    • Contractor's daily trucking records
    • Canceled checks
    • Bank records
    • Equipment titles of ownership
    • Material/supply agreements
    • Payroll records

    ODOT records which will be reviewed to confirm CUF include, but are not limited to:

    • Contractual commitments
    • Daily reports and project photos
    • Subcontractor payments
    • CUF Reports completed by the CCOs
    • CUF Form and Prevailing Wage (PW) Interviews
    • Payroll records
    • DBE Directory Information
    • NAICS Website information
    • ODOT Work Type - NAICS Walkway

    In the assessment of a CUF, a district should request copies of invoices based on the following factors:

    1. The DBE is a material supplier, manufacturer, or regular dealer on a project;
    2. There is a concern that the DBE is not performing a CUF and invoices are needed for further verification.

    When a DBE is presumed not to be performing a CUF, the DBE may present evidence to rebut this presumption. Decisions regarding CUF determinations are subject to review by concerned operating administrations. However, CUF decisions are not appealable to USDOT as such are considered to be contract administration issues.
    ODOT’s internal monitoring system and electronic bidding system provide the conduit for contractors to submit the DBE Utilization Plan at time of bid and the DBE Affirmations five days after bid. Contractors are trained on how to utilize these programs through webinars when necessary. This is where DBE utilization and CUF tracking begin.
    Please refer to ODOT’s CUF Procedures (Exhibit J), CUF Project Site Review (Exhibit Y), and CUF DBE Monitoring Report (Exhibit Z).

Subpart D – Certification Standards

Section 26.61 Burdens of Proof

  1. In its capacity as a representative of the Ohio Unified Certification Program (UCP), ODOT applies the standards of 49 CFR 26 Subpart D when determining whether to certify a firm as eligible to participate as a DBE.
  2. The firm seeking certification has the burden of demonstrating to ODOT (in its capacity as a representative of the Ohio UCP), by a preponderance of the evidence, that it meets the requirements of this subpart concerning group membership or individual disadvantage, business size, ownership, and control.
  3. ODOT (in its capacity as a representative of the Ohio UCP) rebuttably presumes that members of the designated groups identified in 49 CFR 26.67(a) are socially and economically disadvantaged. This means they do not have the burden of proving to ODOT (in its capacity as a representative of the Ohio UCP) that they are socially and economically disadvantaged. In order to obtain the benefit of the rebuttable presumption, individuals must submit a signed, notarized statement that they are a member of one of the groups in 49 CFR 26.67(a). Applicants do have the obligation to provide ODOT (in its capacity as a representative of the Ohio UCP) information concerning their economic disadvantage (see §26.67).
  4. Individuals who are not presumed to be socially and economically disadvantaged, and individuals concerning whom the presumption of disadvantage has been rebutted, have the burden of proving to ODOT (in its capacity as a representative of the Ohio UCP), by a preponderance of the evidence, that they are socially and economically disadvantaged. (See Appendix E of 49 CFR Part 26.)
  5. ODOT (in its capacity as a representative of the Ohio UCP) makes determinations concerning whether individuals and firms have met their burden of demonstrating group membership, ownership, control, and social and economic disadvantage (where disadvantage must be demonstrated on an individual basis) by considering all the facts in the record, viewed as a whole.

Section 26.63 Group Membership Determinations

  1. Generally
    1. If, after reviewing the signed notarized statement of membership in a presumptively disadvantaged group (see §26.61(c)), ODOT (in its capacity as a representative of the Ohio UCP) has a well-founded reason to question the individual's claim of membership in that group, ODOT (in its capacity as a representative of the Ohio UCP) requires the individual to present additional evidence that he or she is a member of the group.
    2. ODOT (in its capacity as a representative of the Ohio UCP) provides the individual a written explanation of its reasons for questioning his or her group membership and a written request for additional evidence as outlined in paragraph (b) of this section.
    3. In implementing this section, ODOT (in its capacity as a representative of the Ohio UCP) takes special care to ensure that it do not impose a disproportionate burden on members of any particular designated group. Imposing a disproportionate burden on members of a particular group could violate §26.7(b) and/or Title VI of the Civil Rights Act of 1964 and 49 CFR part 21.
  2. In making such a determination, ODOT (in its capacity as a representative of the Ohio UCP) considers whether the person has held himself out to be a member of the group over a long period of time prior to application for certification and whether the person is regarded as a member of the group by the relevant community. ODOT (in its capacity as a representative of the Ohio UCP) may require the applicant to produce appropriate documentation of group membership.
    1. If ODOT (in its capacity as a representative of the Ohio UCP) determines that an individual claiming to be a member of a group presumed to be disadvantaged is not a member of a designated disadvantaged group, the individual must demonstrate social and economic disadvantage on an individual basis.
    2. Decisions concerning membership in a designated group are subject to the certification appeals procedure of §26.89.

Section 26.65 Business Size Determinations

  1. To be an eligible DBE, a firm (including its affiliates) must be an existing small business, as defined by Small Business Administration (SBA) standards. ODOT (in its capacity as a representative of the Ohio UCP) applies current SBA business size standard(s) found in 13 CFR part 121 appropriate to the type(s) of work the firm seeks to perform in DOT-assisted contracts, including the primary industry classification of the applicant.
  2. Even if it meets the requirements of paragraph (a) of this section, a firm is not an eligible DBE in any Federal fiscal year if the firm (including its affiliates) has had average annual gross receipts, as defined by SBA regulations (see 13 CFR 121.402), over the firm's previous three fiscal years, in excess of $23.98 million.
  3. If USDOT adjusts the number in paragraph (b) of this section, ODOT (in its capacity as a representative of the Ohio UCP) will use the adjusted number in its DBE eligibility determinations beginning on the date the adjusted number takes effect.

Section 26.67 Social and Economic Disadvantage

  1. Presumption of disadvantage
    1. ODOT (in its capacity as a representative of the Ohio UCP) rebuttably presumes that citizens of the United States (or lawfully admitted permanent residents) who are women, Black Americans, Hispanic Americans, Native Americans, Asian-Pacific Americans, Subcontinent Asian Americans, or other minorities found to be disadvantaged by the SBA, are socially and economically disadvantaged individuals. ODOT (in its capacity as a representative of the Ohio UCP) requires applicants to submit a signed, notarized certification that each presumptively disadvantaged owner is, in fact, socially and economically disadvantaged.
    2. Personal net worth
      1. ODOT (in its capacity as a representative of the Ohio UCP) requires each individual owner of a firm applying to participate as a DBE, whose ownership and control are relied upon for DBE certification, to certify that he or she has a personal net worth that does not exceed $1.32 million.
      2. ODOT (in its capacity as a representative of the Ohio UCP) requires each individual who makes this certification to support it with a signed, notarized statement of personal net worth, with appropriate supporting documentation. To meet this requirement, ODOT (in its capacity as a representative of the Ohio UCP) uses the DOT personal net worth form provided in appendix G to 49 CFR Part 26 without change or revision (Exhibit AA). Where necessary to accurately determine an individual's personal net worth, ODOT (in its capacity as a representative of the Ohio UCP) may, on a case-by-case basis, require additional financial information from the owner of an applicant firm (e.g., information concerning the assets of the owner's spouse, where needed to clarify whether assets have been transferred to the spouse or when the owner's spouse is involved in the operation of the company). Requests for additional information will not be unduly burdensome or intrusive.
      3. In determining an individual's net worth, ODOT (in its capacity as a representative of the Ohio UCP) observes the following requirements:
        1. Exclude an individual's ownership interest in the applicant firm;
        2. Exclude the individual's equity in his or her primary residence (except any portion of such equity that is attributable to excessive withdrawals from the applicant firm). The equity is the market value of the residence less any mortgages and home equity loan balances. ODOT (in its capacity as a representative of the Ohio UCP) ensures that home equity loan balances are included in the equity calculation and not as a separate liability on the individual's personal net worth form. Exclusions for net worth purposes are not exclusions for asset valuation or access to capital and credit purposes.
        3. Do not use a contingent liability to reduce an individual's net worth.
        4. With respect to assets held in vested pension plans, Individual Retirement Accounts, 401(k) accounts, or other retirement savings or investment programs in which the assets cannot be distributed to the individual at the present time without significant adverse tax or interest consequences, include only the present value of such assets, less the tax and interest penalties that would accrue if the asset were distributed at the present time.
      4. Notwithstanding any provision of Federal or State law, ODOT (in its capacity as a representative of the Ohio UCP) does not release an individual's personal net worth statement nor any documents pertaining to it to any third party without the written consent of the submitter. Provided, that ODOT (in its capacity as a representative of the Ohio UCP) transmits this information to USDOT in any certification appeal proceeding under §26.89 of 49 CFR Part 26 or to any other State to which the individual's firm has applied for certification under §26.85 of 49 CFR Part 26.
  2. Rebuttal of presumption of disadvantage
    1. An individual's presumption of economic disadvantage may be rebutted in two ways.
      1. If the statement of personal net worth and supporting documentation that an individual submits under paragraph (a)(2) of this section shows that the individual's personal net worth exceeds $1.32 million, the individual's presumption of economic disadvantage is rebutted. ODOT (in its capacity as a representative of the Ohio UCP) does not have a proceeding under paragraph (b)(2) of this section in order to rebut the presumption of economic disadvantage in this case.
        Example to paragraph (b)(1)(i): An individual with very high assets and significant liabilities may, in accounting terms, have a PNW of less than $1.32 million. However, the person's assets collectively (e.g., high income level, a very expensive house, a yacht, extensive real or personal property holdings) may lead a reasonable person to conclude that he or she is not economically disadvantaged. ODOT (in its capacity as a representative of the Ohio UCP) may rebut the individual's presumption of economic disadvantage under these circumstances, as provided in this section, even though the individual's PNW is less than $1.32 million.
      2. Ability to accumulate substantial wealth
        1. If the statement of personal net worth and supporting documentation that an individual submits under paragraph (a)(2) of this section demonstrates that the individual is able to accumulate substantial wealth, the individual's presumption of economic disadvantage is rebutted. In making this determination, ODOT (in its capacity as a representative of the Ohio UCP) may consider factors that include, but are not limited to, the following:
          1. Whether the average adjusted gross income of the owner over the most recent three-year period exceeds $350,000;
          2. Whether the income was unusual and not likely to occur in the future;
          3. Whether the earnings were offset by losses;
          4. Whether the income was reinvested in the firm or used to pay taxes arising in the normal course of operations by the firm;
          5. Other evidence that income is not indicative of lack of economic disadvantage; and
          6. Whether the total fair market value of the owner's assets exceed $6 million.
        2. ODOT (in its capacity as a representative of the Ohio UCP) has a proceeding under paragraph (b)(2) of this section in order to rebut the presumption of economic disadvantage in this case.
    2. If ODOT (in its capacity as a representative of the Ohio UCP) has a reasonable basis to believe that an individual who is a member of one of the designated groups is not, in fact, socially and/or economically disadvantaged it may, at any time, start a proceeding to determine whether the presumption should be regarded as rebutted with respect to that individual. Such a proceeding follows the procedures of §26.87.
    3. In such a proceeding, ODOT (in its capacity as a representative of the Ohio UCP) has the burden of demonstrating, by a preponderance of the evidence, that the individual is not socially and economically disadvantaged. ODOT (in its capacity as a representative of the Ohio UCP) may require the individual to produce information relevant to the determination of his or her disadvantage.
    4. When an individual's presumption of social and/or economic disadvantage has been rebutted, his or her ownership and control of the firm in question cannot be used for purposes of DBE eligibility under 49 CFR 26 Subpart D unless and until he or she makes an individual showing of social and/or economic disadvantage. If the basis for rebutting the presumption is a determination that the individual's personal net worth exceeds $1.32 million, the individual is no longer eligible for participation in the program and cannot regain eligibility by making an individual showing of disadvantage, so long as his or her PNW remains above that amount.
  3. Transfers within two years
    1. Except as set forth in paragraph (c)(2) of this section, ODOT (in its capacity as a representative of the Ohio UCP) attributes to an individual claiming disadvantaged status any assets which that individual has transferred to an immediate family member, to a trust a beneficiary of which is an immediate family member, or to the applicant firm for less than fair market value, within two years prior to a concern's application for participation in the DBE program or within two years of its review of the firm's Annual No Changes Declaration, unless the individual claiming disadvantaged status can demonstrate that the transfer is to or on behalf of an immediate family member for that individual's education, medical expenses, or some other form of essential support.
    2. ODOT (in its capacity as a representative of the Ohio UCP) does not attribute to an individual claiming disadvantaged status any assets transferred by that individual to an immediate family member that are consistent with the customary recognition of special occasions, such as birthdays, graduations, anniversaries, and retirements.
  4. Individual determinations of social and economic disadvantage. Firms owned and controlled by individuals who are not presumed to be socially and economically disadvantaged (including individuals whose presumed disadvantage has been rebutted) may apply for DBE certification. ODOT (in its capacity as a representative of the Ohio UCP) makes a case-by-case determination of whether each individual whose ownership and control are relied upon for DBE certification is socially and economically disadvantaged. In such a proceeding, the applicant firm has the burden of demonstrating to ODOT (in its capacity as a representative of the Ohio UCP), by a preponderance of the evidence, that the individuals who own and control it are socially and economically disadvantaged. An individual whose personal net worth exceeds $1.32 million shall not be deemed to be economically disadvantaged. In making these determinations, ODOT (in its capacity as a representative of the Ohio UCP) uses the guidance found in Appendix E of 49 CFR Part 26. ODOT (in its capacity as a representative of the Ohio UCP) requires that applicants provide sufficient information to permit determinations under the guidance of appendix E of 49 CFR Part 26.

Section 26.69 Ownership

  1. In determining whether the socially and economically disadvantaged participants in a firm own the firm, ODOT (in its capacity as a representative of the Ohio UCP) considers all the facts in the record viewed as a whole, including the origin of all assets and how and when they were used in obtaining the firm. All transactions for the establishment and ownership (or transfer of ownership) must be in the normal course of business, reflecting commercial and arms-length practices.
  2. To be an eligible DBE, a firm must be at least 51 percent owned by socially and economically disadvantaged individuals.
    1. In the case of a corporation, such individuals must own at least 51 percent of each class of voting stock outstanding and 51 percent of the aggregate of all stock outstanding.
    2. In the case of a partnership, 51 percent of each class of partnership interest must be owned by socially and economically disadvantaged individuals. Such ownership must be reflected in the firm's partnership agreement.
    3. In the case of a limited liability company, at least 51 percent of each class of member interest must be owned by socially and economically disadvantaged individuals.
  3. Pro forma ownership is not enough
    1. The firm's ownership by socially and economically disadvantaged individuals, including their contribution of capital or expertise to acquire their ownership interests, must be real, substantial, and continuing, going beyond pro forma ownership of the firm as reflected in ownership documents. Proof of contribution of capital should be submitted at the time of the application. When the contribution of capital is through a loan, there must be documentation of the value of assets used as collateral for the loan.
    2. Insufficient contributions include a promise to contribute capital, an unsecured note payable to the firm or an owner who is not a disadvantaged individual, mere participation in a firm's activities as an employee, or capitalization not commensurate with the value for the firm.
    3. The disadvantaged owners must enjoy the customary incidents of ownership and share in the risks and be entitled to the profits and loss commensurate with their ownership interests, as demonstrated by the substance, not merely the form, of arrangements. Any terms or practices that give a non-disadvantaged individual or firm a priority or superior right to a firm's profits, compared to the disadvantaged owner(s), are grounds for denial.
    4. Debt instruments from financial institutions or other organizations that lend funds in the normal course of their business do not render a firm ineligible, even if the debtor's ownership interest is security for the loan.
      Examples to paragraph (c):

      1. An individual pays $100 to acquire a majority interest in a firm worth $1 million. The individual's contribution to capital would not be viewed as substantial.
      2. A 51% disadvantaged owner and a non-disadvantaged 49% owner contribute $100 and $10,000, respectively, to acquire a firm grossing $1 million. This may be indicative of a pro forma arrangement that does not meet the requirements of (c)(1).
      3. The disadvantaged owner of a DBE applicant firm spends $250 to file articles of incorporation and obtains a $100,000 loan but makes only nominal or sporadic payments to repay the loan. This type of contribution is not of a continuing nature.
  4. All securities that constitute ownership of a firm shall be held directly by disadvantaged persons. Except as provided in this paragraph (d), no securities or assets held in trust, or by any guardian for a minor, are considered as held by disadvantaged persons in determining the ownership of a firm. However, securities or assets held in trust are regarded as held by a disadvantaged individual for purposes of determining ownership of the firm, if—
    1. The beneficial owner of securities or assets held in trust is a disadvantaged individual, and the trustee is the same or another such individual; or
    2. The beneficial owner of a trust is a disadvantaged individual who, rather than the trustee, exercises effective control over the management, policy-making, and daily operational activities of the firm. Assets held in a revocable living trust may be counted only in the situation where the same disadvantaged individual is the sole grantor, beneficiary, and trustee.
  5. The contributions of capital or expertise by the socially and economically disadvantaged owners to acquire their ownership interests must be real and substantial. Examples of insufficient contributions include a promise to contribute capital, an unsecured note payable to the firm or an owner who is not a disadvantaged individual, or mere participation in a firm's activities as an employee. Debt instruments from financial institutions or other organizations that lend funds in the normal course of their business do not render a firm ineligible, even if the debtor's ownership interest is security for the loan.
  6. The following requirements apply to situations in which expertise is relied upon as part of a disadvantaged owner's contribution to acquire ownership:
    1. The owner's expertise must be—
      1. In a specialized field;
      2. Of outstanding quality;
      3. In areas critical to the firm's operations;
      4. Indispensable to the firm's potential success;
      5. Specific to the type of work the firm performs; and
      6. Documented in the records of the firm. These records must clearly show the contribution of expertise and its value to the firm.
    2. The individual whose expertise is relied upon must have a significant financial investment in the firm.
  7. ODOT (in its capacity as a representative of the Ohio UCP) always deems as held by a socially and economically disadvantaged individual, for purposes of determining ownership, all interests in a business or other assets obtained by the individual—
    1. As the result of a final property settlement or court order in a divorce or legal separation, provided that no term or condition of the agreement or divorce decree is inconsistent with this section; or
    2. Through inheritance, or otherwise because of the death of the former owner.
  8. Gifts or transfers without adequate consideration
    1. ODOT (in its capacity as a representative of the Ohio UCP) presumes as not being held by a socially and economically disadvantaged individual, for purposes of determining ownership, all interests in a business or other assets obtained by the individual as the result of a gift, or transfer without adequate consideration, from any non-disadvantaged individual or non-DBE firm who is—
      1. Involved in the same firm for which the individual is seeking certification, or an affiliate of that firm;
      2. Involved in the same or a similar line of business; or
      3. Engaged in an ongoing business relationship with the firm, or an affiliate of the firm, for which the individual is seeking certification.
    2. To overcome this presumption and permit the interests or assets to be counted, the disadvantaged individual must demonstrate to ODOT (in its capacity as a representative of the Ohio UCP), by clear and convincing evidence, that—
      1. The gift or transfer to the disadvantaged individual was made for reasons other than obtaining certification as a DBE; and
      2. The disadvantaged individual actually controls the management, policy, and operations of the firm, notwithstanding the continuing participation of a non-disadvantaged individual who provided the gift or transfer.
  9. ODOT (in its capacity as a representative of the Ohio UCP) applies the following rules in situations in which marital assets form a basis for ownership of a firm:
    1. When marital assets (other than the assets of the business in question), held jointly or as community property by both spouses, are used to acquire the ownership interest asserted by one spouse, ODOT (in its capacity as a representative of the Ohio UCP) deems the ownership interest in the firm to have been acquired by that spouse with his or her own individual resources, provided that the other spouse irrevocably renounces and transfers all rights in the ownership interest in the manner sanctioned by the laws of the state in which either spouse or the firm is domiciled. ODOT (in its capacity as a representative of the Ohio UCP) does not count a greater portion of joint or community property assets toward ownership than state law would recognize as belonging to the socially and economically disadvantaged owner of the applicant firm.
    2. A copy of the document legally transferring and renouncing the other spouse's rights in the jointly owned or community assets used to acquire an ownership interest in the firm must be included as part of the firm's application for DBE certification.
  10. ODOT (in its capacity as a representative of the Ohio UCP) may consider the following factors in determining the ownership of a firm. However, it does not regard a contribution of capital as failing to be real and substantial, or find a firm ineligible, solely because—
    1. A socially and economically disadvantaged individual acquired his or her ownership interest as the result of a gift, or transfer without adequate consideration, other than the types set forth in paragraph (h) of this section;
    2. There is a provision for the co-signature of a spouse who is not a socially and economically disadvantaged individual on financing agreements, contracts for the purchase or sale of real or personal property, bank signature cards, or other documents; or
    3. Ownership of the firm in question or its assets is transferred for adequate consideration from a spouse who is not a socially and economically disadvantaged individual to a spouse who is such an individual. In this case, ODOT (in its capacity as a representative of the Ohio UCP) gives particularly close and careful scrutiny to the ownership and control of a firm to ensure that it is owned and controlled, in substance as well as in form, by a socially and economically disadvantaged individual.

Section 26.71 Control

  1. In determining whether socially and economically disadvantaged owners control a firm, ODOT (in its capacity as a representative of the Ohio UCP) considers all the facts in the record, viewed as a whole.
  2. Only an independent business may be certified as a DBE. An independent business is one the viability of which does not depend on its relationship with another firm or firms.
    1. In determining whether a potential DBE is an independent business, ODOT (in its capacity as a representative of the Ohio UCP) scrutinizes relationships with non-DBE firms, in such areas as personnel, facilities, equipment, financial and/or bonding support, and other resources.
    2. ODOT (in its capacity as a representative of the Ohio UCP) considers whether present or recent employer/employee relationships between the disadvantaged owner(s) of the potential DBE and non-DBE firms or persons associated with non-DBE firms compromise the independence of the potential DBE firm.
    3. ODOT (in its capacity as a representative of the Ohio UCP) examines the firm's relationships with prime contractors to determine whether a pattern of exclusive or primary dealings with a prime contractor compromises the independence of the potential DBE firm.
    4. In considering factors related to the independence of a potential DBE firm, ODOT (in its capacity as a representative of the Ohio UCP) considers the consistency of relationships between the potential DBE and non-DBE firms with normal industry practice.
  3. A DBE firm must not be subject to any formal or informal restrictions which limit the customary discretion of the socially and economically disadvantaged owners. There can be no restrictions through corporate charter provisions, by-law provisions, contracts or any other formal or informal devices (e.g., cumulative voting rights, voting powers attached to different classes of stock, employment contracts, requirements for concurrence by non-disadvantaged partners, conditions precedent or subsequent, executory agreements, voting trusts, restrictions on or assignments of voting rights) that prevent the socially and economically disadvantaged owners, without the cooperation or vote of any non-disadvantaged individual, from making any business decision of the firm. This paragraph does not preclude a spousal co-signature on documents as provided for in §26.69(j)(2).
  4. The socially and economically disadvantaged owners must possess the power to direct or cause the direction of the management and policies of the firm and to make day-to-day as well as long-term decisions on matters of management, policy and operations.
    1. A disadvantaged owner must hold the highest officer position in the company (e.g., chief executive officer or president).
    2. In a corporation, disadvantaged owners must control the board of directors.
    3. In a partnership, one or more disadvantaged owners must serve as general partners, with control over all partnership decisions.
  5. Individuals who are not socially and economically disadvantaged or immediate family members may be involved in a DBE firm as owners, managers, employees, stockholders, officers, and/or directors. Such individuals must not, however possess or exercise the power to control the firm or be disproportionately responsible for the operation of the firm.
  6. The socially and economically disadvantaged owners of the firm may delegate various areas of the management, policymaking, or daily operations of the firm to other participants in the firm, regardless of whether these participants are socially and economically disadvantaged individuals. Such delegations of authority must be revocable, and the socially and economically disadvantaged owners must retain the power to hire and fire any person to whom such authority is delegated. The managerial role of the socially and economically disadvantaged owners in the firm's overall affairs must be such that the recipient can reasonably conclude that the socially and economically disadvantaged owners actually exercise control over the firm's operations, management, and policy.
  7. The socially and economically disadvantaged owners must have an overall understanding of, and managerial and technical competence and experience directly related to, the type of business in which the firm is engaged and the firm's operations. The socially and economically disadvantaged owners are not required to have experience or expertise in every critical area of the firm's operations, or to have greater experience or expertise in a given field than managers or key employees. The socially and economically disadvantaged owners must have the ability to intelligently and critically evaluate information presented by other participants in the firm's activities and to use this information to make independent decisions concerning the firm's daily operations, management, and policymaking. Generally, expertise limited to office management, administration, or bookkeeping functions unrelated to the principal business activities of the firm is insufficient to demonstrate control.
  8. If state or local law requires the persons to have a particular license or other credential in order to own and/or control a certain type of firm, then the socially and economically disadvantaged persons who own and control a potential DBE firm of that type must possess the required license or credential. If state or local law does not require such a person to have such a license or credential to own and/or control a firm, ODOT (in its capacity as a representative of the Ohio UCP) does not deny certification solely on the ground that the person lacks the license or credential. However, it may take into account the absence of the license or credential as one factor in determining whether the socially and economically disadvantaged owners actually control the firm.
  9. Differences in remuneration
    1. ODOT (in its capacity as a representative of the Ohio UCP) may consider differences in remuneration between the socially and economically disadvantaged owners and other participants in the firm in determining whether to certify a firm as a DBE. Such consideration shall be in the context of the duties of the persons involved, normal industry practices, the firm's policy and practice concerning reinvestment of income, and any other explanations for the differences proffered by the firm. ODOT (in its capacity as a representative of the Ohio UCP) may determine that a firm is controlled by its socially and economically disadvantaged owner although that owner's remuneration is lower than that of some other participants in the firm.
    2. In a case where a non-disadvantaged individual formerly controlled the firm, and a socially and economically disadvantaged individual now controls it, ODOT (in its capacity as a representative of the Ohio UCP) may consider a difference between the remuneration of the former and current controller of the firm as a factor in determining who controls the firm, particularly when the non-disadvantaged individual remains involved with the firm and continues to receive greater compensation than the disadvantaged individual.
  10. In order to be viewed as controlling a firm, a socially and economically disadvantaged owner cannot engage in outside employment or other business interests that conflict with the management of the firm or prevent the individual from devoting sufficient time and attention to the affairs of the firm to control its activities. For example, absentee ownership of a business and part-time work in a full-time firm are not viewed as constituting control. However, an individual could be viewed as controlling a part-time business that operates only on evenings and/or weekends, if the individual controls it all the time it is operating.
  11. Participation by family members
    1. A socially and economically disadvantaged individual may control a firm even though one or more of the individual's immediate family members (who themselves are not socially and economically disadvantaged individuals) participate in the firm as a manager, employee, owner, or in another capacity. Except as otherwise provided in this paragraph, ODOT (in its capacity as a representative of the Ohio UCP) makes a judgment about the control the socially and economically disadvantaged owner exercises vis-a-vis other persons involved in the business as it does in other situations, without regard to whether or not the other persons are immediate family members.
    2. If ODOT (in its capacity as a representative of the Ohio UCP) cannot determine that the socially and economically disadvantaged owners—as distinct from the family as a whole—control the firm, then the socially and economically disadvantaged owners have failed to carry their burden of proof concerning control, even though they may participate significantly in the firm's activities.
  12. Where a firm was formerly owned and/or controlled by a non-disadvantaged individual (whether or not an immediate family member), ownership and/or control were transferred to a socially and economically disadvantaged individual, and the non-disadvantaged individual remains involved with the firm in any capacity, there is a rebuttable presumption of control by the non-disadvantaged individual unless the disadvantaged individual now owning the firm demonstrates to ODOT (in its capacity as a representative of the Ohio UCP), by clear and convincing evidence, that:
    1. The transfer of ownership and/or control to the disadvantaged individual was made for reasons other than obtaining certification as a DBE; and
    2. The disadvantaged individual actually controls the management, policy, and operations of the firm, notwithstanding the continuing participation of a non-disadvantaged individual who formerly owned and/or controlled the firm.
  13. In determining whether a firm is controlled by its socially and economically disadvantaged owners, ODOT (in its capacity as a representative of the Ohio UCP) may consider whether the firm owns equipment necessary to perform its work. However, it will not determine that a firm is not controlled by socially and economically disadvantaged individuals solely because the firm leases, rather than owns, such equipment, where leasing equipment is a normal industry practice and the lease does not involve a relationship with a prime contractor or other party that compromises the independence of the firm.
  14. ODOT (in its capacity as a representative of the Ohio UCP) grants certification to a firm only for specific types of work in which the socially and economically disadvantaged owners have the ability to control the firm. To become certified in an additional type of work, the firm need demonstrate to ODOT (in its capacity as a representative of the Ohio UCP) only that its socially and economically disadvantaged owners are able to control the firm with respect to that type of work. ODOT (in its capacity as a representative of the Ohio UCP) does not require that the firm be recertified or submit a new application for certification, but it must verify the disadvantaged owner's control of the firm in the additional type of work.
    1. The types of work a firm can perform (whether on initial certification or when a new type of work is added) are described in terms of the most specific available NAICS code for that type of work. ODOT (in its capacity as a representative of the Ohio UCP) also, in addition to applying the appropriate NAICS code, applies a descriptor from the Ohio UCP Descriptors7 table. A correct NAICS code/descriptor is one that describes, as specifically as possible, the principal goods or services which the firm would provide to USDOT recipients. Multiple NAICS codes/descriptors may be assigned where appropriate. Program participants must rely on, and not depart from, the plain meaning of NAICS code descriptions in determining the scope of a firm's certification.
    2. Firms and recipients must check carefully to make sure that the NAICS codes cited in a certification are kept up-to-date and accurately reflect work which the UCP has determined the firm's owners can control. The firm bears the burden of providing detailed company information ODOT (in its capacity as a representative of the Ohio UCP) needs to make an appropriate NAICS code/descriptor designation.
    3. If a firm believes that there is not a NAICS code that fully or clearly describes the type(s) of work in which it is seeking to be certified as a DBE, the firm may request that ODOT (in its capacity as a representative of the Ohio UCP), in its certification documentation, supplement the assigned NAICS code(s) with a clear, specific, and detailed narrative description of the type of work in which the firm is certified. A vague, general, or confusing description is not sufficient for this purpose, and recipients should not rely on such a description in determining whether a firm's participation can be counted toward DBE goals.
    4. ODOT (in its capacity as a representative of the Ohio UCP) may change a certification classification or description if there is a factual basis in the record. However, it does not make after-the-fact statements about the scope of a certification, not supported by evidence in the record of the certification action.
  15. A business operating under a franchise or license agreement may be certified if it meets the standards in this subpart and the franchiser or licenser is not affiliated with the franchisee or licensee. In determining whether affiliation exists, ODOT (in its capacity as a representative of the Ohio UCP) does generally not consider the restraints relating to standardized quality, advertising, accounting format, and other provisions imposed on the franchisee or licensee by the franchise agreement or license, provided that the franchisee or licensee has the right to profit from its efforts and bears the risk of loss commensurate with ownership. Alternatively, even though a franchisee or licensee may not be controlled by virtue of such provisions in the franchise agreement or license, affiliation could arise through other means, such as common management or excessive restrictions on the sale or transfer of the franchise interest or license.
  16. In order for a partnership to be controlled by socially and economically disadvantaged individuals, any non-disadvantaged partners must not have the power, without the specific written concurrence of the socially and economically disadvantaged partner(s), to contractually bind the partnership or subject the partnership to contract or tort liability.
  17. The socially and economically disadvantaged individuals controlling a firm may use an employee leasing company. The use of such a company does not preclude the socially and economically disadvantaged individuals from controlling their firm if they continue to maintain an employer-employee relationship with the leased employees. This includes being responsible for hiring, firing, training, assigning, and otherwise controlling the on-the-job activities of the employees, as well as ultimate responsibility for wage and tax obligations related to the employees.

7https://www.transportation.ohio.gov/wps/portal/gov/odot/programs/business-economic-opportunity/ucp/ucp-descriptors

Section 26.73 Other Considerations

  1. Commercially useful function
    1. Consideration of whether a firm performs a commercially useful function or is a regular dealer pertains solely to counting toward DBE goals the participation of firms that have already been certified as DBEs. Except as provided in paragraph (a)(2) of this section, ODOT (in its capacity as a representative of the Ohio UCP) does not consider commercially useful function issues in any way in making decisions about whether to certify a firm as a DBE.
    2. ODOT (in its capacity as a representative of the Ohio UCP) may consider, in making certification decisions, whether a firm has exhibited a pattern of conduct indicating its involvement in attempts to evade or subvert the intent or requirements of the DBE program.
  2. Present circumstances
    1. ODOT (in its capacity as a representative of the Ohio UCP) evaluates the eligibility of a firm on the basis of present circumstances. It does not refuse to certify a firm based solely on historical information indicating a lack of ownership or control of the firm by socially and economically disadvantaged individuals at some time in the past, if the firm currently meets the ownership and control standards of 49 CFR Part 26.
    2. ODOT (in its capacity as a representative of the Ohio UCP) does not refuse to certify a firm solely on the basis that it is a newly formed firm, has not completed projects or contracts at the time of its application, has not yet realized profits from its activities, or has not demonstrated a potential for success. If the firm meets disadvantaged, size, ownership, and control requirements of 49 CFR Part 26, the firm is eligible for certification.
  3. DBE firms and firms seeking DBE certification shall cooperate fully with requests (and USDOT requests) for information relevant to the certification process. Failure or refusal to provide such information is a ground for a denial or removal of certification.
  4. Only firms organized for profit may be eligible DBEs. Not-for-profit organizations, even though controlled by socially and economically disadvantaged individuals, are not eligible to be certified as DBEs.
  5. An eligible DBE firm must be owned by individuals who are socially and economically disadvantaged. Except as provided in this paragraph, a firm that is not owned by such individuals, but instead is owned by another firm—even a DBE firm—cannot be an eligible DBE.
    1. If socially and economically disadvantaged individuals own and control a firm through a parent or holding company, established for tax, capitalization or other purposes consistent with industry practice, and the parent or holding company in turn owns and controls an operating subsidiary, ODOT (in its capacity as a representative of the Ohio UCP) may certify the subsidiary if it otherwise meets all requirements of this subpart. In this situation, the individual owners and controllers of the parent or holding company are deemed to control the subsidiary through the parent or holding company.
    2. ODOT (in its capacity as a representative of the Ohio UCP) may certify such a subsidiary only if there is cumulatively 51 percent ownership of the subsidiary by socially and economically disadvantaged individuals. The following examples illustrate how this cumulative ownership provision works:

      Example 1: Socially and economically disadvantaged individuals own 100 percent of a holding company, which has a wholly-owned subsidiary. The subsidiary may be certified, if it meets all other requirements.

      Example 2: Disadvantaged individuals own 100 percent of the holding company, which owns 51 percent of a subsidiary. The subsidiary may be certified, if all other requirements are met.

      Example 3: Disadvantaged individuals own 80 percent of the holding company, which in turn owns 70 percent of a subsidiary. In this case, the cumulative ownership of the subsidiary by disadvantaged individuals is 56 percent (80 percent of the 70 percent). This is more than 51 percent, so ODOT (in its capacity as a representative of the Ohio UCP) may certify the subsidiary, if all other requirements are met.

      Example 4: Same as Example 2 or 3, but someone other than the socially and economically disadvantaged owners of the parent or holding company controls the subsidiary. Even though the subsidiary is owned by disadvantaged individuals, through the holding or parent company, ODOT (in its capacity as a representative of the Ohio UCP) cannot certify it because it fails to meet control requirements.

      Example 5: Disadvantaged individuals own 60 percent of the holding company, which in turn owns 51 percent of a subsidiary. In this case, the cumulative ownership of the subsidiary by disadvantaged individuals is about 31 percent. This is less than 51 percent, so ODOT (in its capacity as a representative of the Ohio UCP) cannot certify the subsidiary.

      Example 6: The holding company, in addition to the subsidiary seeking certification, owns several other companies. The combined gross receipts of the holding companies and its subsidiaries are greater than the size standard for the subsidiary seeking certification and/or the gross receipts cap of §26.65(b). Under the rules concerning affiliation, the subsidiary fails to meet the size standard and cannot be certified.

  6. Recognition of a business as a separate entity for tax or corporate purposes is not necessarily sufficient to demonstrate that a firm is an independent business, owned and controlled by socially and economically disadvantaged individuals.
  7. ODOT (in its capacity as a representative of the Ohio UCP) does not require a DBE firm to be prequalified as a condition for certification.
  8. A firm that is owned by an Indian tribe or Native Hawaiian organization, rather than by Indians or Native Hawaiians as individuals, may be eligible for certification. Such a firm must meet the size standards of §26.65. Such a firm must be controlled by socially and economically disadvantaged individuals, as provided in §26.71.
  9. The following special rules apply to the certification of firms related to Alaska Native Corporations (ANCs).
    1. Notwithstanding any other provisions of this subpart, a direct or indirect subsidiary corporation, joint venture, or partnership entity of an ANC is eligible for certification as a DBE if it meets all of the following requirements:
      1. The Settlement Common Stock of the underlying ANC and other stock of the ANC held by holders of the Settlement Common Stock and by Natives and descendants of Natives represents a majority of both the total equity of the ANC and the total voting power of the corporation for purposes of electing directors;
      2. The shares of stock or other units of common ownership interest in the subsidiary, joint venture, or partnership entity held by the ANC and by holders of its Settlement Common Stock represent a majority of both the total equity of the entity and the total voting power of the entity for the purpose of electing directors, the general partner, or principal officers; and
      3. The subsidiary, joint venture, or partnership entity has been certified by the Small Business Administration under the 8(a) or small disadvantaged business program.
    2. As a recipient to whom an ANC-related entity applies for certification, ODOT (in its capacity as a representative of the Ohio UCP) does not use the DOT uniform application form (see Appendix F of 49 CFR Part 26). ODOT (in its capacity as a representative of the Ohio UCP) obtains from the firm documentation sufficient to demonstrate that entity meets the requirements of paragraph (i)(1) of this section. ODOT (in its capacity as a representative of the Ohio UCP) also obtains sufficient information about the firm to allow for program administration (e.g., information that would appear in the Ohio Unified DBE Directory).
    3. If an ANC-related firm does not meet all the conditions of paragraph (i)(1) of this section, then it must meet the requirements of paragraph (h) of this section in order to be certified, on the same basis as firms owned by Indian Tribes or Native Hawaiian Organizations.

Subpart E – Certification Procedures

For information about the DBE certification process or to apply for DBE certification, firms should visit www.ohioucp.org or contact:

Ohio Department of Transportation
Division of Opportunity, Diversity, & Inclusion
Office of Business & Economic Opportunity
1980 W. Broad Street, MS 3720
Columbus, Ohio 43223
Telephone: (614) 466-2878
Dot.sdbe@dot.ohio.gov

The Ohio Unified Certification Program (UCP) certification application forms and documentation requirements can be found online at www.OhioUCP.org.

Section 26.81 Unified Certification Programs

  1. ODOT is a representative of, and is responsible for oversight of, the Ohio Unified Certification Program (Ohio UCP), which is governed by a memorandum of understanding (UCP MOU).
    The UCP MOU specifies the UCP will follow all certification procedures and standards of 49 CFR Part 26; the UCP shall cooperate fully with oversight, review, and monitoring activities of USDOT and its operating administrations; and the UCP shall implement USDOT directives and guidance concerning certification matters. The UCP MOU also commits recipients to ensuring the UCP has sufficient resources and expertise to carry out the requirements of 49 CFR Part 26.
  2. The Ohio UCP makes all certification decisions on behalf of all USDOT recipients in Ohio with respect to participation in the USDOT DBE Program.
    1. Certification decisions by the Ohio UCP are binding on all USDOT recipients within Ohio.
    2. The Ohio UCP provides “one-stop shopping” to applicants for certification, such that an applicant is required to apply only once for a DBE certification that will be honored by all recipients in Ohio.
    3. All obligations of recipients with respect to certification and nondiscrimination are carried out by the Ohio UCP, which complies with the certification and nondiscrimination requirements of 49 CFR Part 26.
  3. All certifications by the Ohio UCP are pre-certifications; i.e., certifications that have been made final before the due date for bids or offers on a contract on which a firm seeks to participate as a DBE.
  4. The Ohio UCP does not process an application for certification from a firm having its principal place of business outside Ohio if the firm is not certified by the UCP in the state in which it maintains its principal place of business. When Ohio is the “home state” UCP, it shares its information and documents concerning the firm with other UCPs that are considering the firm's application.
  5. Subject to USDOT approval as provided in this section, the recipients in two or more states may form a regional UCP. UCPs may also enter into written reciprocity agreements with other UCPs. Such an agreement shall outline the specific responsibilities of each participant. A UCP may accept the certification of any other UCP or DOT recipient.
  6. With the establishment of the Ohio UCP, ODOT does not enter into agreements with other recipients, on a regional or inter-jurisdictional basis, to perform certification functions required by 49 CFR Part 26.
  7. The Ohio UCP maintains a unified DBE directory containing, for all firms certified by the UCP (including those from other states certified under the provisions of 49 CFR Part 26), the information required by §26.31. The Ohio UCP makes the directory available to the public electronically, on the internet9, as well as in print. The Ohio UCP updates the electronic version of the directory by including additions, deletions, and other changes as soon as they are made and revises the print version of the Directory at least once a year.

https://www.transportation.ohio.gov/wps/portal/gov/odot/programs/business-economic-opportunity/ucp/ucp-mou
9 http://www.dot.state.oh.us/Divisions/ODI/SDBE/Pages/DBE-Directory.aspx

Section 26.83 Procedures for Certification Decisions

The DBE certification process allows small businesses, which are independently owned and controlled by one or more socially and economically disadvantaged individuals, admittance into the DBE Program. DBE certification standards and procedures include collecting information, applying the criteria for eligibility, providing a DBE eligibility determination, and implementing an appeal process for denials and de-certifications.

As a UCP representative in accordance with 49 CFR Part 26:

  1. ODOT makes certifications determinations based on all the requirements of Part 26 Subpart D – Certification Standards and Subpart E – Certification Procedures;
  2. ODOT provides eligibility determinations for new applications within 150 days of receipt of a complete application;
    1. A complete application is comprised of the application (Exhibit BB), a notarized Affidavit of Certification from each socially and economically disadvantaged owner (within the application), the supporting documents shown on the checklist (within the application), the Ohio UCP’s NAICS Code/Descriptor Request Form (Exhibit CC) and the timely response to any request for additional information. The completed application is then reviewed by a certification analyst.
    2. Within 30 days of receiving the initial application, the firm will be notified if additional information and/or supporting documentation is needed.
  3. ODOT safeguards applicant information and documents in accordance with §§ 26.109, 26.67(a)(2)(ii); and
  4. ODOT cooperates fully with other USDOT recipients regarding all DBE issues

There is no application fee for DBE certification. ODOT must rebuttably presume that members of the designated groups identified in §26.67(a) are socially and economically disadvantaged. This means members of these groups do not have the burden of proving they are socially and economically disadvantaged. To obtain the benefit of the rebuttable presumption, individuals must submit a signed, notarized statement that they are a member of one of the groups in §26.67(a). Applicants have the obligation to provide ODOT with information concerning their economic disadvantage.

A DBE certifying agent will conduct an on-site visit at the applicant firm’s premises after a complete application has been received. In the event the firm has a warehouse or equipment stored offsite, an onsite review will also be conducted at those locations. The purpose of the on-site visit is to verity information submitted, assess the firm’s capabilities and capacity, and determine the independence of the firm and the control or management of the firm demonstrated by the disadvantaged owner(s).

Applicant firms must allow the DBE certifying agent to examine and review all books, records, documents and files of the firm and its affiliates, inspect its place of business and equipment, and allow interviews of its principals, agents, and employees.

Refusal to permit such inquiries shall be grounds for denial of certification. The DBE certification agent may contact firms (i.e., contract, invoices, purchase order verifications, customers, etc.) or individuals associated with or having direct knowledge of the firm applying for certification as a normal part of its investigation.

OBEO will make every reasonable effort to schedule the on-site visit within 30 days of receipt of a complete application. The DBE certifying agent will contact the firm to schedule the onsite review. Once confirmed, an invitation is sent to the firm including the date, time, and location of the onsite review as well as what information to have available for examination during the onsite review. If the applicant is unable to attend the scheduled interview, the onsite review will be rescheduled. If the applicant fails to attend the onsite review, the file is closed, and the firm is denied certification.

Questions will be asked of all firms and photographs may be taken during the onsite review to support ODOT’s certification decision. Copies of the onsite review questions and answers as well as any photographs taken are part of the permanent certification file.

The onsite review conducted for firms headquartered or having their principal place of business in Ohio will include:

  1. A visit to the firm’s home office;
  2. A review of any of the firm’s records as deemed necessary;
  3. Personal interviews with the firm’s principal owner(s), manager, and other individuals as deemed necessary;
  4. Onsite reviews to the firm’s active ODOT construction projects (if applicable);
  5. Review of information from other states if the firm is or has been certified as a DBE in another state; and
  6. Review of any information deemed necessary and obtained from other sources.

Declarations/Notices of Change

Every certified DBE must inform the Ohio UCP in writing of any change in circumstances affecting its ability to meet size, disadvantaged status, ownership, or control requirements of the DBE regulations or any material change in the information provided in its application form. The notice must take the form of an unsworn declaration executed under penalty of perjury of the laws of the United States (Exhibit DD). The certified DBE must provide the written notification within 30 days of the occurrence of the change. If the certified DBE fails to make timely notification of such a change, it will be deemed to have failed to cooperate under 49 CFR 26.109(c).

Annual No Changes Declarations

Every certified DBE must provide to the Ohio UCP, every year on the anniversary of the date of its certification (or no more than 30 calendar days prior), an unsworn declaration executed under penalty of perjury of the laws of the United States (Exhibit EE). This declaration must affirm there have been no changes in the firm's circumstances affecting its ability to meet size, disadvantaged status, ownership, or control requirements of the DBE regulations nor any material changes in the information provided in its application form, except for changes about which it has previously notified the Ohio UCP via Declaration/Notice of Change. The declaration shall specifically affirm that the firm continues to meet U.S. Small Business Administration business size criteria and the overall gross receipts cap of the DBE regulations, documenting this affirmation with supporting documentation of the firm’s number of employees (if subject to an employee-based size standard) and receipts (via submission of Federal tax returns). If the certified DBE fails to provide this declaration in a timely manner, it will be deemed to have failed to cooperate under 49 CFR 26.109(c).

Section 26.85 Interstate Certification; Ineligibility Determination Online Database

  1. This section applies with respect to any firm that is currently certified in its home state.
  2. When a firm currently certified in its home state (“State A”) applies to the Ohio UCP for DBE certification, the Ohio UCP may, at its discretion, accept State A's certification and certify the firm, without further procedures.
    1. To obtain certification in this manner, the firm must provide to the Ohio UCP a copy of its certification notice from State A.
    2. Before certifying the firm, the Ohio UCP confirms that the firm has a current valid certification from State A. The Ohio UCP does so by reviewing State A's electronic directory or obtaining written confirmation from State A.
  3. In any situation in which the Ohio UCP chooses not to accept State A's certification of a firm as provided in paragraph (b) of this section, the applicant firm must provide the information in paragraphs (c)(1) through (4) of this section, along with a completed Interstate Certification Request (Exhibit FF), to the Ohio UCP.
    1. The applicant firm must provide to the Ohio UCP a complete copy of the application form, all supporting documents, and any other information it has submitted to State A or any other state related to its certification. This includes affidavits of no change (see §26.83(j)) and any notices of changes (see §26.83(i)) that it has submitted to State A, as well as any correspondence it has had with State A's UCP or any other recipient concerning its application or status as a DBE firm.
    2. The applicant firm must also provide to the Ohio UCP any notices or correspondence from states other than State A relating to its status as an applicant or certified DBE in those states. For example, if it has been denied certification or decertified in State C, or subject to a decertification action there, it must inform the Ohio UCP of this fact and provide all documentation concerning this action to the Ohio UCP.
    3. If the applicant firm has filed a certification appeal with USDOT (see §26.89), it must inform the Ohio UCP of the fact and provide its letter of appeal and USDOT's response to the Ohio UCP.
    4. The applicant firm must submit an unsworn declaration executed under penalty of perjury of the laws of the United States.
      1. This declaration must affirm that the applicant firm has submitted all the information required by 49 CFR 26.85(c) and the information is complete and, in the case of the information required by §26.85(c)(1), is an identical copy of the information submitted to State A.
      2. If the on-site report from State A supporting the applicant firm’s certification in State A is more than three years old, as of the date of its application to the Ohio UCP, the Ohio UCP may require that the applicant firm’s affidavit also affirm that the facts in the on-site report remain true and correct.
  4. When the Ohio UCP receives from an applicant firm all the information required by paragraph (c) of this section, it takes the following actions:
    1. Within seven days contact State A and request a copy of the site visit review report for the firm (see §26.83(c)(1)), any updates to the site visit review, and any evaluation of the firm based on the site visit.
    2. Determine whether there is good cause to believe that State A's certification of the firm is erroneous or should not apply in Ohio. Reasons for making such a determination may include the following:
      1. Evidence that State A's certification was obtained by fraud;
      2. New information, not available to State A at the time of its certification, showing that the firm does not meet all eligibility criteria;
      3. State A's certification was factually erroneous or was inconsistent with the requirements of this part;
      4. The State law of Ohio requires a result different from that of the State law of State A.
      5. The information provided by the applicant firm did not meet the requirements of paragraph (c) of this section.
    3. The Ohio UCP, unless it determines that there is good cause to believe that State A's certification is erroneous or should not apply in Ohio, no later than 60 days from the date on which it receives from the applicant firm all the information required by paragraph (c) of this section, sends to the applicant firm a notice that it is certified and places the firm on the Ohio Unified DBE Directory.
    4. If the Ohio UCP determines that there is good cause to believe that State A's certification is erroneous or should not apply in Ohio, it, no later than 60 days from the date on which it receives from the applicant firm all the information required by paragraph (c) of this section, sends to the applicant firm a notice stating the reasons for its determination.
      1. This notice states with particularity the specific reasons why the Ohio UCP believes that the firm does not meet the requirements of 49 CFR Part 26 for DBE eligibility and offers the firm an opportunity to respond to the Ohio UCP with respect to these reasons.
      2. The firm may elect to respond in writing, to request an in-person meeting with the Ohio UCP’s decision maker to discuss their objections to the firm's eligibility, or both. If the firm requests a meeting, the Ohio UCP schedules the meeting to take place within 30 days of receiving the firm's request.
      3. The firm bears the burden of demonstrating, by a preponderance of evidence, that it meets the requirements of 49 CFR Part 26 with respect to the particularized issues raised by the Ohio UCP’s notice. The firm is not otherwise responsible for further demonstrating its eligibility to the Ohio UCP.
      4. The decision maker for the Ohio UCP is an individual who is thoroughly familiar with the provisions of 49 CFR Part 26 concerning certification.
      5. The Ohio UCP issues a written decision within 30 days of the receipt of the written response from the firm or the meeting with the decision maker, whichever is later.
      6. The firm's application for certification is stayed pending the outcome of this process.
      7. A decision under this paragraph (d)(4) may be appealed to the USDOT Departmental Office of Civil Rights under §26.89 of 49 CFR Part 26.
  5. If the Ohio UCP has not received from State A a copy of the site visit review report by a date 14 days after it has made a timely request for it, the Ohio UCP holds action required by paragraphs (d)(2) through (4) of this section in abeyance pending receipt of the site visit review report. In this event, the Ohio UCP, no later than 30 days from the date on which it receives from an applicant firm all the information required by paragraph (c) of this section, notifies the firm in writing of the delay in the process and the reason for it.
  6. Ineligibility Determination Online Database
    1. When the Ohio UCP denies a firm's application, rejects the application of a firm certified in State A or any other State in which the firm is certified, through the procedures of paragraph (d)(4) of this section, or decertifies a firm, in whole or in part, it makes an entry in the USDOT Office of Civil Rights' (DOCR's) Ineligibility Determination Online Database. The Ohio UCP enters the following information:
      1. The name of the firm;
      2. The name(s) of the firm's owner(s);
      3. The type and date of the action;
      4. The reason for the action.
    2. The Ohio UCP checks the DOCR Web site as follows:
      1. For DBE/ACDBE certification applications (both in-state and out-of-state): At the beginning of the review process and just before preparing the certification approval or denial letter (as a final check)
      2. For DBE/ACDBE Annual Declarations and Declarations of Change: At the beginning of the review process
      3. For DBE/ACDBE certification reviews: At the beginning of the review process
      4. The Ohio UCP saves a screenshot of each database search result in the firm’s file.
    3. For any such firm that is on the list, the Ohio UCP promptly requests a copy of the listed decision from the UCP that made it. When the Ohio UCP receives such a request, it provides a copy of the decision to the requesting UCP within 7 days of receiving the request. As the UCP receiving the decision, the Ohio UCP considers the information in the decision in determining what, if any, action to take with respect to the certified DBE firm or applicant.

Section 26.86 Denials of Initial Requests for Certification

When an applicant is denied certification as a DBE, he or she will be notified in writing of the reasons for that decision with specific references to the evidence in the record that supports each reason for the denial. The applicant may request an administrative appeal by writing to the USDOT in accordance with 49 CFR §26.89. The applicant cannot apply again for certification until 12 months has lapsed from the date the denial notice was received by the firm.

Section 26.87 Removal/Decertification of DBE Firm

The action to remove/decertify a DBE firm may originate from a review of a firm’s records, standard operating procedures, and/or a third-party ineligibility complaint. ODOT will require claims of ineligibility to be documented to officially initiate an investigation. All documented claims of ineligibility challenges must be elevated to the DBELO. The DBELO and/or her assigned designee will investigate these claims for reasonable cause.

When ODOT, or any other UCP certifying entity, determines there is reasonable cause to believe that a firm is ineligible for failing to meet the requirements of the DBE program, either through its own review of the records concerning the firm or through a third-party challenge, ODOT will follow the following process:

  1. ODOT will notify the business in writing of its intent to decertify the firm;
  2. The firm will be given the opportunity to request an informal hearing within 30 days of receipt of the notice of intent to decertify. The informal hearing process will be conducted in accordance with 49 CFR 26.87(d)-(g);
  3. Following its decision, ODOT will provide the firm written notice of the decision and the specific reasons for it. The notice will inform the firm of the consequences of the decision and of the availability of an appeal to the USDOT under 49 CFR 26.89;
  4. A firm will remain an eligible DBE during the pendency of the informal hearing process. The firm will not be removed from eligibility until after the aforementioned notice of decision is issued by ODOT to the firm.

When, upon completing the investigation, the DBELO and/or her assigned designee determines reasonable cause to pursue removal/decertification does not exist, no action will be taken against the DBE firm in question. A written determination will be created for every ineligibility challenge and filed in the records of the DBE firm in question.

Section 26.88 Suspension of Certification

Circumstances supporting ODOT’s need to immediately suspend a firm’s DBE certification without adhering to the requirements in §26.87(d) include:

  1. When an individual owner whose ownership and control of the firm are necessary to the firm's certification passes away or is incarcerated;
  2. (b)
    1. When there is adequate evidence to believe that there has been a material change in circumstances that may affect the eligibility of the DBE firm to remain certified, or when the DBE fails to notify the recipient or UCP in writing of any material change in circumstances as required by §26.83(i) or fails to timely file an affidavit of no change under §26.83(j);
    2. In determining the adequacy of the evidence to issue a suspension under (b)(1), ODOT will consider all relevant factors, including how much information is available, the credibility of the information and allegations given the circumstances, whether or not important allegations are corroborated, and what inferences can reasonably be drawn as a result.
  3. The concerned operating administration may direct ODOT to take action pursuant to paragraph (a) or (b) if it determines that information available to it is sufficient to warrant immediate suspension;
  4. When a firm is suspended pursuant to paragraph (a) or (b), ODOT will immediately notify the DBE of the suspension by email and certified mail, return receipt requested, to the last known address of the owner(s) of the DBE firm;
  5. Suspension is a temporary status of ineligibility pending an expedited show cause hearing/proceeding under §26.87 to determine whether the DBE is eligible to participate in the program or should be removed. The suspension takes effect when the DBE receives, or is deemed to have received, the Notice of Suspension;
  6. While suspended, the DBE may not be considered to meet a contract goal on a new contract, and, any work it does on a contract received during the suspension will not be counted toward ODOT’s overall goal. The DBE may continue to perform under an existing contract executed before the DBE received a Notice of Suspension and may be counted toward the contract goal during the period of suspension as long as the DBE is performing a CUF under the existing contract.
  7. Following receipt of the Notice of Suspension, if the DBE firm believes it is no longer eligible, it may voluntarily withdraw from the program, in which case no further action is required. If the DBE firm believes that its eligibility should be reinstated, it must provide to ODOT information demonstrating that the firm is eligible notwithstanding its changed circumstances. Within 30 days of receiving this information, ODOT will either lift the suspension and reinstate the firm's DBE certification or commence a decertification action under §26.87. If ODOT commences a decertification proceeding, the suspension remains in effect during the proceeding.
  8. The decision to immediately suspend a DBE firm under paragraph (a) or (b) above is not appealable to USDOT. The failure of ODOT to either lift the suspension and reinstate the firm or commence a decertification proceeding, as required by paragraph (g) above, is appealable to USDOT under §26.89, as a constructive decertification.

Section 26.89 Certification Appeals to USDOT

ODOT abides by the follow process to address certification appeals:

  1. When ODOT denies certification to an applicant firm, ODOT will state in the denial letter that the firm has the right to appeal and that all appeals must be sent to USDOT, letters will include the following statement:

    Appeals to USDOT should be sent in on a USB flash drive, accompanied by a short cover letter. Other than the cover letter, paper records will not be accepted. (If desired, the cover letter may be emailed to S33appealsmanagementrecords@dot.gov instead of being printed).

    The cover letter should provide your contact information, the certifier name (i.e., Ohio Department of Transportation), and the date of the decertification (Today’s Date). Any appeal to USDOT must be in writing and must be sent within 90 days of the date of this letter. Please see 49 CFR §26.89(c) for additional appeal letter content requirements and send the USB flash drive containing your appeal to:

    U.S. Department of Transportation
    Departmental Office of Civil Rights
    Disadvantaged Business Enterprise Division
    1200 New Jersey Avenue, SE, Room W78-103
    Washington, DC 20590

    The required statement of §26.89(c) appeal grounds, decision letter, and all supporting materials should be on the USB flash drive.

  2. If the firm chooses to appeal, ODOT’s decision to deny certification remains in effect pending USDOT’s decision.

Section 26.91 Actions Taken Following USDOT Certification Appeal Decisions

The decisions of USDOT are binding on ODOT and, by extension, the Ohio UCP and all of its participants. ODOT will take the following actions after USDOT decisions:

  1. If USDOT determines that ODOT erroneously certified a firm, ODOT must remove the firm’s eligibility on receipt of the determination without further proceedings;
  2. If USDOT determines that ODOT erroneously failed to find reasonable cause to remove the firm’s eligibility, ODOT will expeditiously commence a hearing to determine whether the firm’s eligibility should be removed;
  3. If USDOT determines that ODOT erroneously declined to certify or remove eligibility of the firm, ODOT must certify the firm effective on the date of receipt of the written notice;
  4. If USDOT determines that ODOT erroneously determined that the presumption of social and economic disadvantage either should or should not be deemed rebutted, ODOT must take appropriate corrective action as determined by USDOT;
  5. If USDOT affirms ODOT’s determination, no further action is necessary;
  6. When USDOT has upheld ODOT’s denial of certification or removal of eligibility of a firm, or directed the removal of a firm’s eligibility, other grantees with whom the firm is certified may commence a proceeding to remove the firm’s eligibility. If ODOT receives information on a USDOT decision of DBE eligibility or ineligibility, ODOT will consider the USDOT action in any certification action involving the firm.

Subpart F – Compliance and Enforcement

Section 26.101 Compliance Procedures that Apply to ODOT

If ODOT fails to comply with any requirement of this section, it is subject to formal enforcement action under §§ 26.103 or 26.105 or appropriate program sanctions by USDOT, such as the suspension or termination of Federal funds or refusal to approve projects, grants, or contracts until deficiencies are remedied. Program sanctions may include, in the case of the FHWA program actions provided for under 23 CFR 1.36; in the case of the FAA program, actions consistent with 49 USC 47106(d), 47111(d), and 47122; and in the case of the FTA program, any actions permitted under 49 USC Chapter 53 or applicable FTA program requirements.

As provided in statute, ODOT will not be subject to compliance actions or sanctions for failing to carry out these requirements because it has been prevented from complying due to a Federal court issuing a final order in which it has found that the requirement is unconstitutional.

Section 26.103 Enforcement Actions that Apply in FHWA and FTA Programs

The provisions of this section apply to enforcement actions under FHWA and FTA programs:

Noncompliance complaints. Any person who believes that ODOT has failed to comply with its obligation under this part may file a written complaint with the USDOT Office of Civil Rights. The complaint must be filed no later than 180 days after the date of the alleged violation or the date on which the continuing course of conduct was discovered. In response to a written request, the Office of Civil Rights may extend the time for filing in the interest of justice, specifying in writing the reason for so doing. The Office of Civil Rights may protect the confidentiality of the individual’s identity as provided in § 26.109(b). Complaints under this part are limited to allegations of violations of the provisions of this section.

Compliance reviews. USDOT may review ODOT’s compliance with this section at any time, including reviews of paperwork and on-site reviews, as appropriate. The Office of Civil Rights may direct the initiation of a compliance review based on complaints received.

Reasonable cause notice. If it appears, from the investigation of a complaint or the results of a compliance review, that ODOT is in noncompliance with this part, the appropriate USDOT operating administration will promptly send ODOT, return receipt requested, a written notice advising that there is reasonable cause to find ODOT in noncompliance. The notice will state the reasons for the finding and direct ODOT to reply within 30 days concerning whether ODOT wishes to begin conciliation.

Conciliation. If ODOT requests conciliation, the appropriate USDOT operating administration will pursue conciliation for at least 30, but not more than 120, days from the date of ODOT’s request. The appropriate USDOT operating administration may extend the conciliation periods for up to 30 days for good cause, consistent with applicable statues.

If ODOT and the appropriate USDOT operating administration sign a conciliation agreement, the matter is regarded as closed and ODOT is regarded as being in compliance. The conciliation agreement sets forth the measures ODOT has taken or will take to ensure compliance. While a conciliation agreement is in effect, ODOT will remain eligible for Federal financial assistance.

The FHWA Ohio Division Office and/or appropriate FTA Regional Office will monitor ODOT’s implementation of the conciliation agreement and ensure that its terms are complied with. If ODOT fails to carry out the terms of a conciliation agreement, ODOT will be deemed to be in noncompliance.

If ODOT does not request conciliation, or a conciliation agreement is not signed within the time provided above, enforcement proceeding will begin.

Enforcement actions. Enforcement actions will be taken as provided. Applicable findings in enforcement proceeding are binding on all USDOT offices.

Section 26.107 Enforcement Actions that Apply to Firms Participating in the DBE Program

  1. If a firm that does not meet the eligibility criteria of Subpart D outlined above and the firm attempts to participate in a USDOT-assisted program as a DBE on the basis of false, fraudulent, or deceitful statements or representations or under circumstances indicating a serious lack of business integrity or honesty, ODOT may initiate suspension or debarment proceedings against the firm under 49 CFR Part 29;
  2. If a firm, in order to meet DBE contract goals or other DBE Program requirements, uses or attempts to use, on the basis of false, fraudulent or deceitful statements or representations or under circumstances indicating a serious lack of business integrity or honesty, another firm that does not meet the eligibility criteria of Subpart D, ODOT may initiate suspension or debarment proceedings against the firm under 49 CFR Part 29;
  3. In a suspension or debarment proceeding brought under paragraph (1) or (2) above, the concerned operating administration may consider the fact that a purported DBE has been certified by a recipient. Such certification does not preclude ODOT from determining that the purported DBE, or another firm that has used or attempted to use it to meet DBE goals, should be suspended, or debarred;
  4. USDOT may take enforcement action under 49 CFR Part 31, Program Fraud and Civil Remedies, against any participant in the DBE Program whose conduct is subject to such action under 49 CFR Part 31;
  5. USDOT may refer to the Department of Justice, for prosecution under 18 U.S.C. 1001 or other applicable provisions of law, any person who makes a false or fraudulent statement in connection with participation of a DBE in any USDOT-assisted program, or otherwise violates applicable Federal statutes.

Section 26.109 Information, Confidentiality, and Cooperation

ODOT will safeguard from disclosure to third parties information that may reasonably be regarded as confidential business information, consistent with federal, state, and local laws (Federal Freedom of Information and Privacy Acts (5 USC 552 and 552a) and Ohio Revised Code Chapter 149.43).

Notwithstanding any contrary provisions of state or local law, ODOT will not release personal financial information submitted in response to the personal net worth requirements to a third party (other than USDOT) without the written consent of the DBE firm.