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Why Failing to File Your No-Change Affidavit Will Cause Your Business to Lose Disadvantaged Business Enterprise Certification

If your business is certified as a Disadvantaged Business Enterprise (DBE), it is required by 49 C.F.R. § 26.83(j) to file a yearly “affidavit of no change” which is sometimes called a “DBE Annual Affidavit.”  Not only is this form required in your home state, but you are also required to file one for each state in which your business has DBE certification.  This is a strict requirement, and there is no leniency for tardy affidavits.  Your failure to file this affidavit will result in a loss of the company’s DBE certification.

The form must be completed by the firm’s owner(s), be notarized, and provide a copy of the company’s most recent federal business tax return.  It asks questions about changes in ownership/leadership, the personal net worth of the owner(s) and any changes to business activities.  As an example, a copy of Pennsylvania’s form can be found here: https://www.dotsbe.pa.gov/PAUCPHelp/PA%20UCP%20Annual%20Affidavit.pdf

DBEs should calendar the due date for these forms in multiple places, along with reminders a few weeks or more ahead of time to complete the affidavit.  Your certifying agency may send reminders via email or letter, but they are not required to do so.  The responsibility for completing the form is entirely on the DBE.

Many companies have missed this deadline and lost their DBE certification.  Many have appealed that decertification to the US Department of Transportation (“USDOT”).  Nearly universally, the USDOT upholds the denial.  Here are some examples:

  • Reminder notice being sent to non-working email address is not a valid excuse. In re Kingly Hand Car Wash & Wax, LLC, No. 19-007, May 6, 2019.

  • Misplaced/lost in transit mail and administrative personnel changes were not an excuse. In re Economy Trucking Services, Inc. , No. 18-0175, April 23, 2019.

  • A fire at the firm’s building and resulting misplaced mail was not an excuse for failing to file the affidavit. In re: Polished Clean Janitorial Services, Inc., 16-0111, Feb. 15, 2017.

  • Claiming that the firm did not receive the reminder letter or follow up notices was not an excuse, as the reminder was just a courtesy. In re: M&O Construction, 14-0107, February 20, 2015.

  • Waiting for tax information because your firm is changing accounting firms is not an excuse for tardiness. In re: Atrium, Inc., 14-0091, February 20, 2015.

  • Firm has a duty to provide the annual affidavit without prompting or notice from the certifying agency. In re: CK Franklin, LLC, 14-0128, February 26, 2015.

  • Firm cannot blame a former employee whose responsibility was to maintain the certification for failing to submit the affidavit. In re: SUPRA Office Solutions, 14-0111, March 19, 2015.

  • Change in corporate banking account status and lack of work is not an excuse for a failure to file the required affidavit. In re: Austin Construction Group Corp., 14-0150, April 21, 2015.

  • A firm’s financial crisis does not excuse failing to file the affidavit. In Re: WJL Equities Corp., 14-0102, February 26, 2015.

  • Requested extension on tax returns was not an excuse for not filing the affidavit. In re: Caridigm, Inc., 16-0003, May 27, 2016.

This author has only come across one time when the USDOT reversed a decertification based on failure to submit the no-change affidavit: when the certifying agency decertified the firm for failure to submit the affidavit, before the affidavit was even due!  In re: Berona Engineers, 13-0239, July 1, 2013.

If you do miss the deadline for filing the affidavit and lose your company’s certification, you may still reapply for certification in the future.

©2021 Strassburger McKenna Gutnick & GefskyNational Law Review, Volume X, Number 281
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About this Author

Danielle L. Dietrich SMGG Attorney Pittsburgh, PA
Shareholder

Danielle L. Dietrich, Shareholder in the Pittsburgh Office of SMGG, focuses her practice in the areas of women and diverse-owned businesses, healthcare, elder law and litigation.  She has a broad range of experience in providing legal counsel and advice to her clients (both large and small), as well as having handled a wide range of disputes and litigation in Pennsylvania, Ohio and West Virginia.

A large portion of Ms. Dietrich’s practice focuses on the representation of women and diverse-owned businesses.  That practice includes assisting these...

(412) 281-5423
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