Preliminary Note: The U.S. Department of Transportation recently released a long-awaited Notice of Proposed Rulemaking to modernize the Disadvantaged Business Enterprise (DBE) program regulations. This blog is part of a series looking at some of the significant proposed changes. A copy of all of the proposed changes can be found here: https://www.federalregister.gov/documents/2022/07/21/2022-14586/disadvantaged-business-enterprise-and-airport-concession-disadvantaged-business-enterprise-program.

Among the many potential changes announced by the U.S. Department of Transportation is a change to how an individual provides evidence of social disadvantage (a requirement for DBE certification). 

Under the regulations, women, Black Americans, Hispanic Americans, Native Americans, Asian-Pacific Americans, Subcontinent Asian Americans, and other minorities found to be disadvantaged by the SBA, are presumed to be socially disadvantaged.  49 C.F.R. § 26.67(a)(1).  

Currently, if a certifier questions an individual’s membership in one of these groups, it “must consider 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…”  49 C.F.R. § 26.63(b)(1).  With this language, the Department is trying to deal with a situation where, for example, a White man suddenly discovers a black ancestor, and applies for certification though he has never held himself out as Black or been treated as if he were Black.  However, “a long period of time” is vague and undefined.  Under the proposed changes, the Department defines that as a period of at least five years.

Another change proposed by the Department is changing the name of the Affidavit of Certification to “Declaration of Eligibility” or “DOE.”  It also wants to add a reminder to the regulations that the DOE is the only evidence of group members that an individual must provide with their application. There have been circumstances where the certifier has required applicants to provide additional evidence of group membership without a well-founded reason to question that individual’s group membership. 

Unfortunately, the proposed rules do not add North African Americans or Middle Eastern Americans to the list of presumed socially disadvantaged individuals.  I am frequently asked whether these groups of individuals qualify. If you are a North African American or Middle Eastern American, I urge you to comment on the proposed rule to voice for your inclusion.

Thoughts on these proposed changes? The proposed rule changing the definition is not yet final.  You can easily and quickly comment on the proposed rule by going here: https://www.regulations.gov/docket/DOT-OST-2022-0051/document.