HomeMy WebLinkAbout2000-03-28 - AGENDA REPORTS - DBE PGM (2)CITY OF SANTA CLARITA
AGENDA REPORT
CONSENT CALENDAR
DATE: March 28, 2000
City Manager Approval:
Item to be presented by:
1'iony J. Nisich
SUBJECT: DISADVANTAGED BUSINESS ENTERPRISE (DBE) PROGRAM
DEPARTMENT: Transportation & Engineering Services
RECOMMENDED ACTION
City Council approve and direct the City Manager to administer the Disadvantaged Business
Enterprise Program.
BACKGROUND
On July 12, 1994, the City Council authorized a Disadvantaged Business Enterprise Program (DBE)
in accordance with Section 9 of the Urban Mass Transportation Act of 1964. In light of case law
requiring "narrow tailoring" of affirmative action programs, the Department of
Transportation (DOT) issued a new regulation, "Participation by Disadvantaged Business Enterprises
in Department of Transportation Programs," effective March 4, 1999.
The attached program has been developed to meet the requirements of that regulation, and to ensure
that all contracts and procurements will be administered without discrimination on the basis of race,
color, sex, or national origin. The program will ensure that DBEs have an equal opportunity to
compete for, and participate in, the performance of all Department of Transportation funded
contracts and subcontracts awarded by the City of Santa Clarita.
ALTERNATIVE ACTIONS
Other action as determined by the City Council.
FISCAL IMPACT
As a recipient of federal financial assistance from the United States Department of Transportation,
the City is required to implement a DBE Program. Failure to do so may delay or prevent receipt of
significant federal financial assistance.
ATTACHMENT
Disadvantaged Business Enterprise Program Policy (available in City Clerk's Reading File)
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DISADVANTAGED BUSINESS ENTERPRISE
(DBE)
PROGRAM POLICY
March 2000
City of Santa Clarita
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City of Santa Clarita
Disadvantaged Business Enterprise (DBE) Program
Table of Contents
i2lik
Page
DBEPROGRAM POLICY.......................................................................................
1
OBJECTIVES............................................................................................................
2
APPLICABILITY......................................................................................................3
DEFINITIONS............................................................................................:..............
3
Disadvantaged Business Enterprise ..................................................
3
Small Business Concern.......................................................
4
Socially and Economically Disadvantaged Individuals .........
4
Black American
Hispanic American
Native American
Asian -Pacific American
Subcontinent Asian American
Woman
Small Business Administration (SBA)
Race-Neutral......................................................................................
5
Race-Conscious.................................................................:.............:..5
PersonalNet Worth............................................................................5
RESPONSIBILITY FOR DBE PROGRAM IMPLEMENTATION ........................
5
CityCouncil......................................................................................
5
The Director of Administrative Services ...........................................
5
The Accounting Manager..................................................................
5
The DBE Officer and the Purchasing Agent .............................
6
TheCity Attorney..............................................................................
6
The DBE Officer Activities...............................................................
6
DBE Program Review Committee(DPRC).....................:.........................................8
Regional Certification Reciprocity Council(RCRC)................................................
8
RCRC Appeals Review Panel............................................................9
ADMINISTRATIVE REQUIREMENTS.................................................................
9
DBE Financial Institutions.................................................................9
DBEDirectory...................................................................................
9
Over-Concentration...........................................................................
10
Business Development and Mentor -Protege Programs .....................
10
Reconsideration Official..................................................................
10
Transit Vehicle Manufacturer Certification.......................................10
DETERMINING, ACHIEVING, AND COUNTING OVERALL ANNUAL
AND CONTRACT -SPECIFIC DBE GOALS..........................................................
11
Overall Annual DBE Goal.................................................................
11
Projecting DOT -Assisted Contract Expenditures ..................
I 1
Establishing a Base Figure .....................................................
l l
Analyzing Available Businesses................................12
1
Analyzing Available DBEs........................................12
Calculating the Base Figure.......................................12
Adjusting the Base Figure......................................................13
Projection of Percentage of Race-Neutral
and Race-Conscious...............................................................13
Publishing and Submitting the Overall Annual DBE Goal...
14
Submission of Total Overall Annual Goal.................14
Publication of Proposed Overall Annual Goal ...........
14
Achieving the Overall Annual Goal......................................
14
Race-Neutral Methods...............................................
14
Contract Specific Goals — Race-Conscious Measures...................................15
Establishing Contract Specific Goals.....................................15
Awarding Contracts with Contract-Specific Goals................16
Evaluation of Bids with DBE Goals......................................
17
Evaluation of DBE Certification Status.....................17
Determination of Amount of DBE Participation.......
17
Determination of Good Faith Efforts.........................
17
Bidder's Right to Administration Reconsideration ....
18
Recommendation for Award of Contract with DBE Goal.........................................19
DBEReplacement......................................................................................................19
Counting and Tracking DBE Participation................................................................20
REQUIRED CONTRACT PROVISIONS................................................................
20
Nondiscrimination Assurance............................................................20
Prompt Payment Policy and Provisions.............................................21
Legal and Contract compliance Mechanisms and Remedies.............22
Legal Mechanisms and Remedies..........................................22
Contract Monitoring and Remedies for Race-Neutral...........
22
Contract Monitoring and Remedies for Race-Conscious......
22
Other Reporting Requirements..............................................
23
DBE CERTIFICATION STANDARDS...................................................................
23
Burdenof Proof..................................................................................23
Group Membership Determinations..................................................
24
Social and Economic Disadvantage Determination ...........................24
Social Disadvantage...............................................................24
Economic Disadvantage.........................................................25
Statement of Personal Net Worth..........................................
26
Small Business Administration Firms...................................
27
Individual Determination of Social or
Economic Disadvantage.........................................................27
Business Size Determinations............................................................27
Ownership Determinations................................................................
28
Control Determinations......................................................................31
Other Considerations.........................................................................
34
Commercially-Useful Function.............................................
34
Patternof Conduct.................................................................
34
Present Circumstances...........................................................
34
P
DBECooperation...................................................................34
For -Profit Firms.....................................................................
35
Subsidiaries and Affiliates.....................................................
35
Prequalification......................................................................
35
Tribal Organizations..............................................................
35
Privacy/Confidentiality......................................................................
36
CERTIFICATION PROCEDURES..........................................................................
36
Unified Certification Program...........................................................
36
Initial Certification Procedures..........................................................36
Recertification Procedures.................................................................38
Denials and Reapplication Procedures...............................................39
Removal Procedures (Decertification)...............................................39
Ineligibility Complaints.........................................................
39
City -Initiated Proceedings.....................................................
40
U.S. DOT Directive to Initiate Proceeding ............................40
Hearing...................................................... ........................
.....40
Separation of Functions.........................................................
41
Grounds for Decision.............................................................41
Notice of Decision.................................................................
41
Status of Firm During Proceeding .........................................
42
Effects of Removal of Eligibility...........................................42
Process for Certification Appeals to U.S. DOT.................................42
Actions Following U.S. DOT Decision................................44
MONITORING AND RECORD-KEEPING............................................................
45
BiddersList........................................................................................45
Monitoring Payments to DBEs..........................................................
45
Reportingto U.S. DOT......................................................................45
PUBLIC PARTICIPATION AND OUTREACH......................................................45
PublicParticipation............................................................................45
OutreachEfforts.................................................................................46
End of Table of Contents
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The City of Santa Clarita .(City) is committed to carrying out the Disadvantaged
Business Enterprise (DBE) requirements of 49 CFR Part 26 "Participation by
Disadvantaged Business Enterprises in U.S. Department of Transportation (DOT)
Financial Assistance Programs," which became effective March 4, 1999. The
procedures contained in the City's DBE Program will assure that all contracts and
procurements will be administered without discrimination on the basis of race, color,
sex, or national origin. The City will ensure that DBEs have an equal opportunity to
compete for, and participate in, the performance of all DOT -funded contracts and
subcontracts awarded by the City of Santa Clarita.
The Director of Administrative Services is responsible for adherence to this policy.
The DBE Officer, in coordination with the Director of Administrative Services and the
Purchasing Agent, will be responsible for development, implementation, and
monitoring of this program. It is the expectation of the Santa Clarita City Council and
the Director of Administrative Services that the stipulations and provisions contained in
this DBE Program will be adhered to both in spirit and letter by City personnel.
It is the policy of the City to ensure nondiscrimination on the basis or race, color, sex,
or national origin in the award and administration of DOT -assisted contracts. It is the
intention of the City to create a level playing field on which DBEs can compete fairly
for contracts and subcontracts relating to the City's construction, procurement, and
professional service contracting activities.
This Policy will be circulated to City employees and to appropriate community and
business organizations that perform work on DOT -assisted contracts.
Passed and adopted by the City Council of the City of Santa Clarita this day of
.2000.
Mayor, City of Santa Clarita Director of Administrative Services
City af'Sa as Clarita DBE Progrwn
Murch 2000
7
The objectives of this Program are to:
Ensure nondiscrimination in the award and administration of DOT -
assisted contracts.
2. Create a level playing field on which DBEs can compete fairly for
DOT- assisted contracts.
3. Help remove barriers to DBE participation in the bidding, award, and
administration of City contracts;
4. Assist the development of firms that can compete successfully in the
market place outside of the DBE Program;
5. Ensure that only firms that fully meet the eligibility standards of 49
CFR Part 26 are permitted to participate as DBEs;
6. Identify business enterprises that are qualified as DBEs and are
competent to provide the City with required materials, equipment,
supplies, and services; and to develop a good rapport with the owners,
managers, and sales representatives of those enterprises;
Develop communications programs and procedures which will acquaint
prospective DBEs with the City's contract procedures, activities, and
requirements, and allow DBEs to provide the City with feedback on
existing barriers to participation and effective procedures to eliminate
those barriers; and
8. Administer the Program in close coordination with the various
Departments and Divisions within the City so as to facilitate the
successful implementation of this Program.
City of Soma Clarita DBE Program
March 2000
APPLICABILITY (Sections 26.3; 26.21)
The applicability of this Program is as follows:
Pursuant to 49 CFR § 26.3 and 26.21, the City, as a recipient of federal financial
assistance from the Federal Transit Administration (FTA) of the United States
Department of Transportation (DOT), is required to implement a DBE Program in
accordance with 49 CFR Part 26. The Program outlined herein applies to all City
contracts that are funded, in whole or in part, by DOT federal financial assistance.
Prohibited Discrimination (Section 26.7)
It is the policy of the City of Santa Clarita that no person will ever be excluded from
participation in, denied the benefits of, or otherwise be discriminated against, in
connection with the award and performance of any contract covered by 49 CFR Part 26
on the basis of race, color, sex, or national origin.
In the administration of the DBE Program, the City of Santa Clarita will not directly,
nor 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 this DBE Program with respect to individuals of a particular race, color,
sex, or national origin.
Any terms used in this Program that are defined in 49 CFR § 26.5, or elsewhere in the
Regulations, shall have the meaning set forth in the Regulations. Some of the more
commonly used terms are defined below:
A. Disadvantaged Business Enterprise (DBE)
A DBE is a for-profit, small business concern: 1) that is at least fifty-one
percent (51 %) owned by one or more individuals who are both socially and
economically disadvantaged, or, in the case of a corporation, in which fifty-one
percent (51 %) of the stock is owned by one or more socially and economically
disadvantaged 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.
City of Santa Clarita DBE Program
March 2000
1. Small Business Concern
A small business concern is an existing small business, as defined by section 3
of the Small Business Act and the Small Business Administration regulations
which implemented the Act (13 C.F.R. Part 121), whose average annual gross
receipts for the previous three years do not exceed $16.6 million (or as adjusted
for inflation by the Secretary of DOT), pursuant to 49 CFR § 26.65(b).
2. Socially and Economically Disadvantaged Individuals
There is a rebuttable assumption that an individual is both socially and
economically disadvantaged if s/he is a citizen, or lawfully admitted permanent
resident of the United States, and is:
a. Black American (including persons having origins in any of the Black
racial groups of Africa);
b. Hispanic American (including persons of Central or South American,
Cuban, Dominican, Mexican, Puerto Rican, or other Spanish or
Portuguese culture or origin, regardless of race);
C. Native American (including persons who are Aleuts, American Indians,
Eskimos, or Native Hawaiians);
d. Asian -Pacific American (including persons whose origins are from
Brunei, Burma (Myanmar), Cambodia (Kampuchea), China, the
Commonwealth of the Northern Marianas Islands, the Federated States
of Micronesia, Fiji, Guam, Hong Kong, Indonesia, Japan, Juvalu,
Kirbati, Korea, Laos, Macao, Malaysia, Nauru, the Philippines, Samoa,
Taiwan, Thailand, Tonga, the U.S. Trust Territories of the Pacific
Islands (Republic of Palau), or Vietnam);
e. Subcontinent Asian American (including persons whose origins are
from Bangladesh, Bhutan, India, the Maldives Islands, Nepal, Pakistan,
or Sri Lanka);
Woman; or
g. A member of any additional group that is designated as socially and
economically disadvantaged by the Small Business Administration.
Additionally, any individual can demonstrate, by a preponderance of evidence, that s/he
is socially and economically disadvantaged on a case-by-case basis. The City will
Cky of Santa Clarita DQE Program
March 2000
follow the guidelines in 49 CFR Part 26, Appendix E for determining social and
economic disadvantage.
An individual cannot be presumed or determined on a case-by-case basis to be
economically disadvantaged if s/he has a personal net worth exceeding $750,000
(excluding the individual's ownership interests in the small business concern and his or
her primary residence).
B. Race -Neutral
A procedure or program that is used to assist all small businesses. For the purposes of
this Program, race -neutral includes gender neutrality.
C. Race -Conscious
A measure or program that is specifically focused on assisting only DBEs, including
women -owned DBEs.
D. Personal Net Worth
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 community property with the individual's spouse.
A. The City Council ultimately is responsible for ensuring that the DBE Program
has a high priority and is a reality within the City organization.
B. The Director of Administrative Services is responsible for seeing that the
Council's policies are implemented throughout the City.
C. The Accounting Manager has been designated DBE Officer by the Director
of Administrative Services as the management staff member responsible for
overseeing the DBE Program and has the full support of the Director of
Administrative Services. The DBE Officer, in coordination with the Director of
Administrative Services and the Purchasing Agent, is responsible for
City,# Santa Ciarita DBE Progranm
March 2000
recommending DBE policy, developing a written DBE program, and
establishing internal and external communication procedures.
D. The DBE Officer and the Purchasing Agent are responsible for contract and
procurement of goods and services; for assuring that such processes are carried
out in a non-discriminatory manner; for initiating procedures; and for
developing strategies to ensure non-discrimination in the City's purchasing and
contracting activities. The senior management staff and the contract/project
managers are expected to assist in problem identification when DBE goals are
included in a contract; to audit specific contracts and remove obstacles to
achieving DBE goals; and to provide the DBE Officer and other staff the
support to assure that DBE program guidelines are being followed.
E. The City Attorney is responsible for advising the City Council, the Director of
Administrative Services, and City staff on the legal ramifications of DBE
Program implementation.
F. The DBE Officer is responsible for carrying out the following day-to-day
activities:
Pursuant to 49 CFR § 26.23, the Program shall be administered by the DBE Officer,
who shall be appointed by and report to the Director of Administrative Services. The
DBE Officer is the primary person responsible for all aspects of this Program, and will
work closely with other departments and consultants of the City, including legal,
purchasing, engineering, and others who are responsible for making decisions relative
to the City's DOT -assisted construction, procurement, and professional service
contracts.
In accordance with 49 CFR 26.23, the specific duties and responsibilities of the DBE
Officer shall include, but not be limited to, the following:
1. Gathering and reporting statistical data and other information as required by
FTA;
2. Reviewing third party contracts and purchase requisitions for compliance with
this Program;
Working with appropriate divisions to establish overall annual goals;
4. Ensuring timely notification to the DBE community of bid and contract
opportunities;
City gf'Santa Cdarita DBE Program
Murch 2000
5. Identifying contracts and procurements so that DBE goals are included in
solicitations for both race -neutral and race -conscious DBE participation, and
monitoring the results;
6. Analyzing City progress toward DBE goal attainment, and identifying ways to
improve progress;
7. Participating in pre-bid meetings;
8. Analyzing and assessing the available resources and evidence for the
establishment and achievement of an annual overall participation goal for
DBEs each fiscal year;
9. Advising the Director of Administrative Services on DBE matters;
10. Maintaining and updating the DBE Directory in accordance with 49 CFR
23.61;*
H. Maintaining and updating the Bidders List in accordance with 49 CFR 26.11;*
12. Identifying race -neutral measures to facilitate DBE participation such as
outreach, communication programs, training and business development
programs, restructuring contracting opportunities, and simplifying bonding,
surety, and insurance requirements;
13. Planning and participating in DBE training and providing technical assistance;
14. Providing outreach to DBEs and community organizations with advice on DBE
Program issues and contract opportunities;
15. Participating in the contract bid and award process including establishing
specific contract goals where appropriate, reviewing contract specifications,
attending pre-bid conferences, and evaluating bids for contractor
responsiveness, responsibility, and good faith efforts;
16. Monitoring specific contract performance and actual DBE participation;*
17. Monitoring overall DBE participation, adjusting overall goals and means of
achievement, assessing areas of over concentration of DBE participation, and
reporting to the City and FTA as needed;
18. Determining all initial certification actions including certifications,
recertifications, denials, and removals;*
City OSanta Clarita DBE Propum
March 2000
19. Participating in the development of a statewide Unified Certification Program in
accordance with 49 CFR 26.81;*
20. Assisting the City's DBE Program Review Committee (DPRC);
21. Participating in the Regional Certification Reciprocity Council of Southern
California (RCRC); and
22. Maintaining all appropriate records and documentation of the DBE Program.
Note: Asterisk(*) indicates new or revised responsibility in 49 C.F.R. Part 26.
DBE Program Review Committee (DPRC)
The DBE Officer, the Transportation Manager, the Project Engineer, and the
Purchasing Agent will comprise the DBE Review Committee. The DBE Officer shall
serve as a resource to the Committee, attending all meetings and furnishing background
information. The Committee shall assist the DBE Officer with implementation of this
Program and shall preside over hearings that may be held pursuant to this Program,
including Administrative Reconsideration of the DBE Officer's determination of a
bidder's compliance with "good faith efforts," or of the removal of DBE certification, in
accordance with 49 CFR 26.53(d) and 26.87(d), respectively.
Regional Certification Reciprocity Council of Southern California (RCRC)
The DBE Officer is designated by the Director of Administrative Services to represent
the City as a member of the Regional Certification Reciprocity Council of Southern
California (RCRC). The City will participate in RCRC programs, activities, and efforts
in the Region to create a level playing field on which DBEs can compete fairly; to
enhance outreach and communication efforts with these firms; to provide appropriate
assistance and information for participation in DOT -assisted contracts; to develop joint
resources among recipients; and to coordinate certification efforts through reciprocity
and the development of a Unified Certification Program. To this end, the DBE Officer
will attend scheduled meetings of the RCRC and will contribute to the achievement of
RCRC projects approved by the City's Director of Administrative Services.
City of Santa Clarita DBE Program
March 2000
RCRC Appeals Review Panel
The DBE Officer will offer to serve as a member of the RCRC Appeals Review Panel,
as necessary. This panel was established by the RCRC for the purpose of facilitating a
truly impartial hearing, at the local level, of denials on applications for DBE
certification or recertification. It is the policy of RCRC member agencies to provide a
forum in which firms are provided the opportunity to participate in a hearing on their
DBE eligibility denial before a review panel composed of representatives from
agencies that did not make the eligibility decision.
In such proceeding, the City bears the burden of proving, by a preponderance of the
evidence, that the firm does not meet certification standards. If, in the opinion of a
majority of the RCRC Appeals Review Panel, the City fails to prove the firm's
ineligibility, the panel may override the City's decision and such determination by the
Appeals Review Panel will be accepted as final by the City. (See page 41 for further
discussion of the hearing process.)
A. DBE Financial Institutions
Pursuant to 49 CFR § 26.27, the DBE Officer shall investigate the availability
of services offered by financial institutions owned and controlled by socially
and economically disadvantaged individuals in the Los Angeles Area. The City
shall also encourage its prime contractors to use the services of DBE financial
institutions.
B. DBE DhwWry
Pursuant to 49 CFR § 26.3 1, the DBE Officer will maintain and update
annually a DBE directory that identifies all firms deemed to be eligible to
participate as DBEs in this Program. The DBE directory will be made
available, on request, to contractors and the public. The DBE directory shall
include the firm's name, address, telephone number, and types of work for
which the firm is certified as a DBE. The DBE directory shall not in any way
pre -qualify the identified DBE firms with respect to licensing, bondability,
competence, or financial responsibility.
City gfSama Clarita DBE Program
Murch 2000
C. Over -Concentration
Pursuant to 49 CFR § 26.33, if the DBE Officer determines that DBE
participation is so over -concentrated in certain types of work or contracting
opportunities that it unduly burdens the participation of non -DBEs in that type
of work, the DBE Officer will develop appropriate measures to address the
over -concentration. The DBE Officer will seek approval from the FTA, and at
that time, the measures will become part of this Program. Currently, the City is
unaware of any types of work that have a burdensome over -concentration of
DBE participation.
D. Business Development and Mentor-Prot6g6 Programs
One method of providing race -neutral efforts for DBE participation will be
through participating in Area Business Development programs. Instruction may
cover such topics as: teaming and joint ventures, writing a winning proposal or
bid, the bid evaluation process, and addressing various barriers that small
businesses encounter in third party contracting.
If the City is directed to develop a mentor/prot6ge program, one will be written
and submitted to FTA's Regional Office for approval, after which it will
become part of this DBE Program. Guidelines outlined in Appendices C and D
of 49 CFR Part 26 will be utilized in setting up requisite formal agreements and
programs.
When a company is identified by the City as a potential candidate for a formal
business development program, further technical assistance, or a
mentor/prot6ge relationship, the company will be provided with pertinent
information concerning available Area programs.
E. Reconsideration Official
In accordance with 49 CFR 26.53(d)(2) and 26.87(e), all proceedings by the
City regarding the reconsideration of compliance with the provisions of the
DBE regulation concerning a contract award, or the DBE status of a firm, shall
be made by a City representative who did not take part in the original
determination. Reconsideration procedures are further discussed on page 19.
F. Mransit Vehicle Manufacturer Certification (Section 26.49)
The City will require that transit vehicle manufacturers shall certify that they
have established an annual overall DBE participation goal that has been
approved by the FTA (or has been submitted, but not disapproved) before they
City f?f Santa Clarita DBE Program
March 2000
10
can bid on any City. contracts. Expenditures for FTA -assisted transit vehicle
procurements are not included in establishing the overall annual goal for DOT -
assisted contracting opportunities.
A. OVERALL ANNUAL DBE GOAL
Pursuant to 49 CFR § 26.45, the City shall establish an annual overall goal on a
fiscal year basis for the participation of DBEs in all budgeted contracts utilizing
DOT federal financial assistance. The annual overall goal shall be expressed as
a percentage of the total amount of DOT funds the City anticipates expending
in the fiscal year. The City's annual overall goal represents the amount of
ready, willing, and able DBEs that are identified as available to participate in
contracting opportunities, and is reflective of the amount of DBE participation
the City would expect absent the effects of discrimination. The City intends to
meet this goal to the maximum extent feasible through the race -neutral
measures described below. Where race -neutral measures are inadequate to meet
the annual overall goal, the City will establish specific contract goals for
particular projects with subcontracting opportunities.
1. ProiectingDOT-Assisted Contract Expenditures
In conjunction with the preparation and adoption of the budget for each fiscal
year, the DBE Officer, in consultation with the appropriate City divisions
responsible for transportation contracting activities, will conduct a thorough
analysis of the projected number, types of work, and dollar amounts of
contracting opportunities that will be funded, in whole or in part, by DOT
federal financial assistance for that fiscal year. This analysis will exclude
projected contract expenditures with Transit Vehicle Manufacturers, who are
exempt from the Program as described herein.
2. Establishing a Base Figure
Pursuant to 49 CFR § 26.45, the City will develop a base figure to express the
availability of DBEs as a percentage of all contractors, subcontractors,
manufacturers, and suppliers in the relevant contracting markets. The City will
follow one of the methodologies provided in the Regulations, or develop an
alternative methodology, and will provide the appropriate documentation in the
Annual Overall Goal Report described in this DBE Program.
Ciry(It Santa C[arita DBE Program
Murch 2000
11
a. Analyzing Available Businesses in Relevant Contracting Markets
The DBE Officer, in conjunction with the appropriate City divisions,
will conduct an analysis of the relevant contracting markets in which
the City will solicit participation from contractors, subcontractors,
manufacturers, and suppliers for the fiscal year. This analysis will
include a description of geographical boundaries of the solicitations, the
relevant standard industry codes (NAICS codes) for the types of work
to be contracted, and any other indicators that the City determines to be
relevant in defining its contracting markets for the fiscal year. The
DBE Officer will then determine the available businesses and will
consult a variety of sources such as the City's Bidder's List, Area DBE
Directories, the County Business Patterns Database, and pertinent
disparity studies.
Statistics may be utilized from the Census Bureau, the Department of
Commerce, Bidder's lists, and certified DBEs in the categories of
construction, professional services, and materials/supplies.
Consultation may he held with minority, women, and general contractor
groups, as well as other community organizations, in an effort to
establish a level playing field.
b. Analyzing Available DBEs in the Relevant Contracting Markets
The DBE Officer will conduct a similar analysis to determine the DBEs
that are available to participate as contractors, subcontractors,
manufacturers, and suppliers in the projected contracts for the fiscal
year. This analysis may include a description of the available DBEs
relative to the geographical boundaries of the solicitations, the SICs for
the types of work to be contracted, and any other factors as described
above. The City may consult a variety of sources including, but not
limited to, DBE Directories, Bidder's Lists, the County Business
Patterns Database, and relevant disparity studies.
C. Calculating the Base Figure
The DBE Officer will compare available DBEs in the relevant
contracting markets for the fiscal year to the available businesses in the
relevant contracting markets for the same period. The calculation will
include a weighting factor according to contract expenditure patterns.
City (If Santa Clanta DBE Program
March 2000
12
3. Adjusting the Base Figure
Pursuant to 49 CFR § 26.45(d), the City will examine all available evidence to
determine whether adjustment is needed to the base figure in order to arrive at
the City's overall goal. The DBE Officer will analyze the results of its efforts
to contract with DBEs for the past two years, any available and relevant
disparity studies (to the extent that they are not accounted for in the base
figure), any available and relevant results of other DOT recipients' efforts to
contract with DBEs, and any relevant feedback or projections from DBE
professional organizations, the Small Business Administration, or others.
Using the data collected regarding over -concentration, DBE availability of
firms ready, willing and able, and other necessary information (such as how
long each project will span), a goal will be set at the level of DBE participation
anticipated, absent the effects of discrimination.
4. Projection of Percentage of Overall Goal to be Achieved Through Race
Neutral and Race Conscious Measures
Once the annual overall goal is proposed, the DBE Officer will analyze and
project the maximum feasible portion of that goal that can be achieved by using
race neutral methods. Where the projected portion of the goal using race -
neutral methods is less than the annual overall goal, the remaining portion will
be achieved by establishing contract goals for particular projects that have
subcontracting opportunities. Any over -concentration of DBEs in a particular
trade will be excluded from race -conscious contract goals.
The City will attempt to meet the maximum feasible portion of the overall goal
by using race -neutral measures. Race -neutral participation includes
procurements in which a DBE wins a prime contract through customary
competitive procedures, or is awarded a subcontract on a prime contract that
does not carry a DBE goal, or even if there is a DBE subcontract goal the DBE
wins a subcontract from a prime that did not consider its DBE status in making
the award.
The DBE Officer shall monitor and adjust the use of contract -specific goals in
accordance with 49 CFR 26.51(f). When projecting the percentage of the
overall annual goal to be achieved through establishing contract -specific goals,
the DBE Officer shall analyze the actual achievement of the overall annual goal
through race -neutral methods in the previous two years. When establishing
contract -specific goals during a current fiscal year, -the DBE Officer shall
analyze the progress towards achieving the overall annual goal and increase or
reduce the use of contract -specific goals accordingly. DBE race -conscious
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contract goals will be used only on those DOT -assisted contracts that have
subcontracting opportunities. DBE contract goals will be established so as to
cumulatively result in meeting that portion of the City's overall goal that is not
projected to be met through race -neutral means.
5. Publishing and Submitting the Overall Annual DBE Goal
Upon completion of the process described above, the DBE Officer will prepare
an Overall Annual Goal report which documents the analysis and methodology,
as well as the proposed goal and estimate of participation to be achieved
through race -neutral measures.
a. Submission of Total Overall Annual Goal
The annual overall goal for DBE participation shall be submitted to
FTA for approval by September 1 for Fiscal Year 2000-2001, and by
August 1 in succeeding years.
b. Publication of Proposed Overall Annual Goal
Pursuant to 49 CFR § 26.45(g), the City will publish its proposed
overall annual goal. The notice shall include a statement that the
methodology and proposed goal are available for inspection by the
public for 30 days from the date of publication. The notice shall also
include a statement that the City will accept public comments to the
proposed goal and methodology for a period of 45 days from the date of
publication and provide instructions for the submission of comments.
6. Achieving the Overall Annual Goal
The City shall achieve the annual overall goal for DBE participation through a
combination of race -neutral measures and contract goals for particular contracts
with subcontracting opportunities.
a. Race -Neutral Methods
The City intends to use race neutral methods to the maximum extent
feasible to achieve its annual overall goal. DBE participation that is
obtained on contracts which have no specific DBE goal, or where prime
contractors use a strictly competitive bidding process, or do not
consider the DBE firm's status as a DBE in awarding a subcontract
shall be considered race -neutral DBE participation. In addition, the
City will use the following measures, as appropriate:
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unbundling large contracts;
ii. assisting in overcoming limitations in bonding;
providing technical assistance;
iv. providing assistance with outreach and communications
programs to DBEs;
providing assistance with business development activities
including financial ability, technical/business capacity, use of
emerging technology, and start-ups in non-traditional business
areas for DBEs; and
vi. distributing the DBE directory electronically and otherwise, as
requested.
B. CONTRACT SPECIFIC GOALS Race -Conscious Measures
1. Establishing Contract Specific Goals
The City shall establish contract -specific DBE participation goals on particular
prime contracts with subcontracting opportunities to the extent that the City
cannot achieve its annual overall goal with race -neutral measures. Where a
contract -specific DBE goal has been established, the bidder or proposer must
meet the contract -specific goal or demonstrate that it made good faith efforts to
do so. A bidder shall be ineligible for award if it does not meet the goal or
demonstrate good faith efforts.
The goal shall be established based on a recommendation and information
furnished by the DBE Officer. The contract -specific goal shall apply to the
percentage participation of DBEs in the total contract work and be set forth in
the contract documents. The City is not required to establish a contract -specific
goal for every prime contract with subcontracting opportunities. For each
contract involving subcontracting opportunities, the factors outlined below will
be considered to determine whether a contract -specific goal should be
established for the particular contract and, if so, what the percentage goal shall
be:
a. The projected portion of the overall annual goal that will be met by
establishing contract -specific goals;
b. The progress towards achieving the annual overall goal;
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C. The full range of activities in the proposed contract;
d. The availability of DBEs as prime contractors or subcontractors in the
types of work involved in the performance of the proposed contract;
e. The unique conditions of the project that might affect the ability of the
prime contractor to coordinate, utilize, or incorporate subcontractors or
suppliers into the project. (Projects consisting of only one or two sub -
trades may not be appropriate for a contract -specific goal due to the fact
that establishing a goal could result in restrictive bidding).
f. The effect that the contract -specific goal might have on the time of
completion; and
g. Any other relevant criteria.
2. Awarding Contracts with Contract -Specific Goals
Each solicitation for which a DBE contract goal has been established will
require the bidders/offerors to submit the following information either under
sealed bid procedures as a matter of responsiveness, or with initial proposals
under contract negotiation procedures, or at any time before a commitment to
the performance of a contract:
a. The names and addresses of DBE firms that will participate in the contract;
b. A description of the work that each DBE will perform;
c. The dollar amount of the participation of each DBE firm;
d. Written documentation of commitment to use DBE subcontractors whose
participation the prime submits to meet a contract goal;
e. Written confirmation from the DBE that it is participating in the contract as
provided in the prime contractor's commitment; and
f. If the DBE contract goal is not met, evidence of good faith efforts to meet
the goal
The City shall award contracts to the lowest responsible bidder, as required by
the California Public Contracts Code Sections 20914 and 20916. A bidder who
fails to demonstrate that it achieved the contract -specific DBE participation
goal, and fails to demonstrate that it made good faith efforts to do so, shall not
City ofSa to Clarita DBE Program
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be deemed "responsible" and, therefore, shall be ineligible for award of the
contract.
3. Evaluation of Bids with DBE Goals
After the bid opening, or submission of proposals, the DBE Officer shall
evaluate all bids/proposals with regard to the DBE requirements to determine a
recommendation for award of contract. The responsible bidder with the lowest
apparent bid price, who also meets the contract -specific goal or demonstrates
good faith efforts, shall be recommended for contract award. In the event that
the bidder with the lowest apparent bid price does not meet the contract -specific
goal or demonstrate good faith efforts, the DBE Officer shall evaluate the
bidder with the next lowest bid price. (See Reconsideration Process discussion
on pages 10 (E) and 19 (d).)
a. Evaluation of DBE Certification Status
The City shall require that any DBEs listed by bidders for participation
in the contract be certified as eligible DBEs. The DBE Officer shall
review the Bidder's DBE Report to confirm each DBE's certification
status. The City will accept current certifications by the City, DOT and
its agencies, the Small Business Administration, or other DOT federal
financial assistance recipients, as appropriate. The City will require any
firm listed, but not currently certified as a DBE, to submit the proper
certification information within five days of bid opening in order to be
included in the bidder's DBE achievement.
b. Determination of Amount of DBE Participation
The DBE Officer shall review the total dollar value of the work and the
percentage of the total contract bid price reported on the Bidder's DBE
Report for accuracy and shall compare it to the contract -specific goal
established for the contract.
C. Determination of Good Faith Efforts
If the amount of DBE participation does not meet the contract -specific -
goal, the DBE Officer shall review the good faith effort report
submitted by the bidder, as required by the contract document. The
DBE Officer shall determine whether the bidder has performed the
quality, quantity, and intensity of efforts that demonstrates a reasonably
active and aggressive attempt to meet the contract -specific goal in
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accordance with 49 CFR Part 26 Appendix A which is incorporated
herein by this reference.
The kinds of effort that will be considered demonstrative of "Good
Faith Efforts" include, but are not limited to, the following:
- Whether the contractor solicited through all reasonable and available
means (e.g. attendance at pre-bid meetings, advertising and/or written
notices) the interest of all certified DBEs who have the capability to
perform the work;
- Whether the contractor solicited interest within sufficient time to
allow the DBEs to respond and, if appropriate steps were taken, to
follow-up with interested DBEs;
- Whether the contractor selected portions of work to be performed by
DBEs and, where appropriate, broke -out contract work items into
economically feasible units to facilitate DBE participation even when
the prime might otherwise prefer to perform these work items with its
own forces;
- Whether the contractor negotiated in good faith with interested DBEs
(evidence includes names, addresses, and phone numbers; description
of information provided regarding plans and specifications; and
evidence as to why additional agreements could not be reached);
- Whether the contractor made efforts to assist interested DBEs in
obtaining necessary equipment, supplies, materials, or related assistance
or services;
- Whether the contractor made efforts to assist interested DBEs in
obtaining bonding, lines of credit, or insurance;
-Whether the contractor effectively used the services of available
minority/women community organizations, contractors' groups, or other
organizations to provide assistance; and
- Whether other bidders on the procurement met the DBE goal.
d. Bidder's Right to Administrative Reconsideration
In the event that the DBE Officer determines that the apparent low
bidder has not met the contract -specific goal and has not demonstrated
good faith efforts, the DBE Officer will notify the bidder in writing.
City Of Santa Clarita DBE Program
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The notification shall explain the basis and include the reasons for the
determination, and shall inform the bidder of its right to submit further
written documentation or appear before the Reconsideration Officer
prior to the time that a recommendation for award of contract is
presented to the City Council. After reconsideration, the City shall
provide the bidder with a written decision. The result of the
reconsideration process is not appealable by the bidder to the
Department of Transportation.
In the event that the Reconsideration Officer finds that the bidder has
not met the contract goal or demonstrated good faith efforts, the City
will deem said bidder not responsible and evaluate the bidder
submitting the next lowest bid.
4. Recommendation for Award of Contract with DBE Goal
Following determination of the lowest responsible bidder, the DBE Officer
shall document the lowest responsible bidder's compliance with the DBE
requirements, which may be reviewed at the time the contract award is
considered. If the City Council disagrees with the recommendation, it shall
reject all bids or refer the matter back to the Director of Administrative Services
for further evaluation and recommendation.
5. DBE Replacement
A contractor must make a good faith effort to replace a defaulting DBE
subcontractor with another certified DBE. The prime must immediately notify
the DBE Officer of the DBE's inability to perform and provide reasonable
documentation. The contractor must receive prior written approval on the
substitute DBE from the City. The contractor will provide copies of new or
amended subcontracts and a completed DBE certification application form for
each new DBE, or must provide sufficient good faith efforts documentation. If
the contractor fails or refuses to comply in the time specified, the City will issue
an order stopping all, or part of, payment/work until satisfactory action has been
taken. If the contractor still fails to comply, the City may issue a termination
for default proceeding.
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C. COUNTING AND TRACKING DBE PARTICIPATION
Only the work actually performed by a DBE will be counted towards the DBE
goal. The cost of supplies and materials obtained by the DBE or equipment
leased (except from the prime contractor or its affiliate) may also be counted.
Work that a DBE subcontracts to a non -DBE firm does not count toward DBE
goals. Expenditures may only be counted if the DBE is performing a
commercially -useful function. A DBE should perform at least 30 percent of the
total cost of its contract with its own work force. Decisions on commercially -
useful function are subject to review by the FTA, but are not administratively
appealable to DOT.
If materials or supplies are obtained from a DBE manufacturer, 100 percent of
the cost will be counted. If the materials and supplies are purchased from a
DBE regular dealer, 60 percent of the cost will be counted.
DBE achievement will not be counted toward the overall goal until the DBE
has been paid. The DBE Officer will track the participation of DBEs in
contract -specific goal contracts separately from the participation of DBEs that
are considered race -neutral. Additionally, the DBE Officer will not count that
portion of a DBE's participation that is achieved after the certification of the
DBE has been removed during the performance of a contract.
The City agrees to include the following provisions in all DOT -assisted contracts,
where appropriate:
A. Nondiscrimination Assurance
Each financial assistance agreement that the City signs with the FTA will
include the following statement:
"The recipient shall not discriminate on the basis of race, color, national origin,
or sex in the award and performance of any DOT -assisted contract, or in the
administration of its DBE Program. The recipient shall take all necessary and
reasonable steps under 49 CFR Part 26 to ensure nondiscrimination in the
award and administration of DOT -assisted contracts. The recipient's DBE
Program, as required by 49 CFR Part 26, and as approved by DOT, is
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incorporated by reference in this agreement. Implementation of this DBE
Program is a legal obligation and failure to carry out its terms shall be treated as
a violation of this agreement. Upon notification to the City of Santa Clarita of
its failure to cant' out its approved program, the Department of Transportation
and/or the Federal Transit Administration may impose sanctions as provided
for under 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. Each DOT -assisted contract the City signs with a contractor, and each
subcontract the prime contractor signs with a subcontractor, will include the
following statement:
"The contractor, subrecipient, 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 DOT -assisted contracts. Failure by the contractor
to carry out these requirements is a material breach of this contract, which may
result in termination of this contract or such other remedy as the City deems
appropriate."
B. Prompt Payment Policy and Provisions
The City shall include the following provision in each DOT -assisted contract:
"The prime contractor must pay subcontractors for satisfactory performance of
their contracts no later than 15 days from the receipt of payment made to the
prime by the City. Prompt return of retainage payments from the prime
contractor to the subcontractor will be made within 15 days after the
subcontractors work is satisfactorily completed. Any delay or postponement of
payment among the parties may take place only for good cause and with the
City's prior written approval. If the prime contractor determines the work of the
subcontractor to be unsatisfactory, it must notify the City's DBE Officer
immediately in writing and state the reasons. Failure by the prime contractor to
comply with this requirement will be construed to be a breach of contract and
subject to contract termination."
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C. Legal and Contract Compliance Mechanisms and Remedies
Legal Mechanisms and Remedies
The City will implement appropriate mechanisms to ensure compliance with
the DBE Program by all program participants under Federal, state, and local
law.
2. Contract Monitoring Mechanisms and Remedies in Contracts Using Race
Neutral Methods:
a. The DBE Officer will be notified as soon as it is determined that there will
be a solicitation for bid, proposal, or quotation for a DOT -assisted contract.
If appropriate, notices will then be sent to applicable DBEs and
minority/women organizations.
b. The DBE Officer/Purchasing Agent will obtain a list of companies that
submit bids or proposals and those that did not; and will review to
determine why responses were not submitted and any barriers that may
exist.
c. The DBE Officer/Purchasing Agent will keep records on the companies
ready, willing, and able to do business on any given solicitation.
d. The DBE Officer/Purchasing Agent will keep records on contracts that
have no contract goals and on any DBE primes and subcontractors that
receive awards and contracts.
e. Any possibilities of "unbundling," lowering bond requirements, joint
venture or mentor/protege opportunities will be noted and documented for
file.
3. Contract Monitoring Mechanisms and Remedies in Contracts Using Race
Conscious Methods:
a. When a DBE goal is set on a contract, the DBE Officer will attend the pre-
bid meeting, and will provide DBE information to contractors prior to bid
opening.
b. Once the contract is awarded, the DBE Officer will monitor the amount
actually paid by the prime to DBE subcontractors, and will require monthly
City of Santa Ciarita DBE Program
Murch 2000
reports of payments to DBEs. A letter will be sent to the DBE
subcontractors to verify the dollar amount.
c. The amount awarded to the DBE, the amount paid to the DBE as stated by
the prime, and the amount paid to the DBE as verified by the DBE, will be
tracked. The actual amount paid to DBEs will be reported by the DBE
Officer to FTA.
d. The DBE Officer will be notified when a contract change or amendment is
made, and the prime contractor and City's project manager will submit a
statement to the DBE Officer regarding how the change may affect DBE
subcontracting.
e. The project manager, in cooperation with the DBE Officer, will ensure that
work is actually being done by DBEs.
4. Other Reporting Requirements
a. The City will continue to report DBE participation and annual overall
goal -setting methods to the FTA as directed, and will maintain prescribed
statistical data.
b. Contractors performing work on the City's FTA -assisted contracts are
required to report the DBE participation on their contracts on both race -
neutral and race -conscious DBE goal achievement. Contractors are not to
count participation of a DBE subcontractor toward the prime's DBE
achievements or the overall agency DBE goal until the amount being
counted has been paid to the DBE.
The regulation provides guidance from the Small Business Administration regulations
concerning social and economic disadvantage determinations (13 CFR 124.103 and
123.104).
A. Burdens of Proof (Subpart D, Section 26.61)
In determining whether to certify a firm as eligible to participate as a DBE, the
City will apply the standards of Subpart D of the regulation. The firm seeking
certification has the burden of demonstrating to the City, by a preponderance of
City of Santa Clarna DBE Nag,=
March 2000
the evidence, that it meets the requirements concerning group membership or
individual disadvantage, business size, ownership, and control.
The City will rebuttably presume that members of the designated groups
identified herein are socially and economically disadvantaged. However,
applicants have the obligation to provide the City with information concerning
their economic disadvantage (personal net worth statement). The City will
make determinations concerning whether individuals and firms have met the
burden of demonstrating group membership, ownership, control, and social and
economic disadvantage by considering all the facts in the record, viewed as a
whole.
B. Group Membership Determinations (Section 26.63)
If the City has reason to question whether an individual is a member of a group
presumed to be socially and economically disadvantaged, the City will require
an individual to demonstrate, by a preponderance of the evidence, that he/she is
a member of a group presumed to be socially and economically disadvantaged.
In making that determination, the City will consider whether or not the person
has held himself/herself 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. The City may require the
applicant to produce appropriate documentation of group membership.
If the City determines that an individual claiming to be a member of a group
presumed disadvantaged is not a member of such group, the individual must
demonstrate social and economic disadvantage on an individual basis. The
City's decision concerning membership in a designated group will be subject to
certification appeals procedures.
C. Social and Economic Disadvantage Determination (Appendix E)
1. Social Disadvantage
Socially disadvantaged individuals are those who have been subjected
to racial or ethnic prejudice or cultural bias within American society
because of their identities as members of groups and without regard to
their individual qualities. Social disadvantage must stem from
circumstances beyond their control.
Evidence of individual social disadvantage must include at least one
objective distinguishing feature that has contributed to social
disadvantage such as race, ethnic origin, gender, disability, long-term
City of Sama Clarita DBE Program
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residence in an isolated environment, or similar causes not common to
individuals not socially disadvantaged; personal experiences of
substantial and chronic social disadvantage in American society, not in
other countries; and negative impact on entry into or advancement in
the business world because of the disadvantage.
The City will consider any relevant evidence in its assessment of this
element, and in every case the City will consider education,
employment, and business history to see if the totality of circumstances
shows disadvantage in entering into or advancing in the business world.
2. Economic Disadvantage
Economically disadvantaged individuals are socially disadvantaged
individuals whose ability to compete in the free enterprise system has
been impaired due to diminished capital and credit opportunities as
compared to others in the same or similar line of business who are not
socially disadvantaged.
The City requires submission of narrative and financial information
from each individual claiming economic disadvantage. Each such
individual must describe in a narrative statement the conditions that are
the basis for the claim, and each must also submit personal financial
information. The City will require a married individual to submit
separate financial information for his/her spouse unless they are legally
separated.
In considering diminished capital and credit opportunities, the City will
examine all factors relating to personal financial condition, including
personal income for the past two years, personal net worth, and the fair
market value of all assets. The City will also consider the financial
condition of applicants compared to financial profiles of small
businesses in the same primary industry classification(s) or similar lines
of business. The financial profiles to be compared include total assets,
net sales, pre-tax profit, sales/working capital ratio, and net worth.
The City will attribute to any individual claiming disadvantaged status
any assets that individual has transferred to an immediate family
member, trust, or beneficiary for less than the fair market value within
the prior two years of the concern's application, unless that individual
demonstrates the transfer is to or on behalf of an immediate family
member for education, medical or some other form of essential support,
excluding gifts for birthdays, graduations, anniversaries, retirements or
City (If Surra Cantu DBE Program
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other special occasions. The City will consider assets transferred by an
individual within the previous two-year period that are not considered
in evaluating the individual's assets and net worth, such as transfers to
charities.
3. Statement of Personal Net Worth (Section 26 67)
The City shall rebuttably presume 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
disadvantaged by the Small Business Administration are socially and
economically disadvantaged individuals. The City will require
applicants to submit a signed, notarized certification in a prescribed
format that each presumptively disadvantaged owner is, in fact, socially
and economically disadvantaged. The City will also require each
individual owner of a firm to submit a signed, notarized statement of
personal net worth with appropriate supporting documentation. In
determining net worth, the City will exclude an individual's ownership
interest in the applicant firm and the individual's equity in his/her
primary residence.
If the statement of personal net worth that an individual submits shows
the individual's personal net worth to exceed $750,000, the individual's
presumption of economic disadvantage will be rebutted without any
further formal proceedings. If the City 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, the City may
start a proceeding to determine whether the presumption should be
regarded as rebutted with respect to that individual. The City shall
follow the procedures set forth in VIII (E), Removal Procedures. In this
proceeding, the City has the burden of demonstrating, by a
preponderance of the evidence, that the individual is not socially and
economically disadvantaged. The City may require the individual to
produce additional information relevant to the determination of his/her
disadvantage.
When an individual's presumption of social and/or economic
disadvantage has been rebutted, his/her ownership and control of the
firm cannot be used for purposes of DBE eligibility unless and until
he/she makes an individual showing of social and/or economic
disadvantage in the future. If the basis for rebutting the presumption is
a determination that the individual's personal net worth exceeds
City of Santa Clarita DBE Program
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$750,000, the individual is no longer eligible for participation in the
program and cannot regain eligibility by making an individual showing
of disadvantage. (See page 36 for discussion of related privacy issues.)
4. U. S. Small Business Administration Section 8(a) Firms (Section
26.67(c)1
If a firm applying for certification has a current valid Section 8(a)
certification from or is recognized by the U.S. Small Business
Administration under the Section 8(a) Program, the City will accept the
firm's 8(a) certification in lieu of conducting its own certification
proceeding.
5. Individual Determinations of Social and/or Economic Disadvanta e
(Section 26.67(d))
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 be certified by the City
on a case-by-case basis. The City will determine 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 must demonstrate, 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 $750,000 will not be determined to be economically
disadvantaged. The City will use guidance in Appendix E of 49 CFR
Part 26.
D. Business Size Determinations (Section 26 65)
To be an eligible DBE, a firm (including its affiliates) must be an existing small
business as defined by SBA standards. The City will apply current SBA
business size standards found in 23 CFR Part 121 appropriate to the types of
work the firm seeks to perform in U.S. DOT -assisted contracts. Even if the
firm meets the SBA requirements, 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, over the firm's previous three fiscal
years in excess of $16.6 million, as adjusted for inflation from time to time.
City of Santa Clarha DBE Program
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E. Ownership Determinations (Section 26.69)
1. In determining whether the socially and economically disadvantaged
participants in a firm own the firm, the City will consider all the facts in
the record viewed as a whole. To be an eligible DBE, a firm must be at
least 51 percent owned by socially and economically disadvantaged
individuals. 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. In the case of a
partnership, 51 percent of each class of partnership interest must be
owned by socially and economically disadvantaged individuals and
must be reflected in the firm's partnership agreement. 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.
2. The firm's ownership by socially and economically disadvantaged
individuals must be real, substantial, and continuing, going beyond pro
forma ownership of the firm as reflected in the ownership documents.
The disadvantaged owners must enjoy the customary incidence of
ownership and share in the risks and profits commensurate with their
ownership interests, as demonstrated by the substance, not merely the
form, of arrangements.
3. All securities that constitute ownership shall be held directly by
disadvantaged persons. Except as provided in the regulation, no
securities or assets held in trust, or by any guardian for a minor, are
considered as held by disadvantaged persons in determining ownership
of a firm.
4. The contributions of capital or expertise by the socially and
economically disadvantaged owners, to acquire their ownership
interests, must be real and substantial.
5. In a situation in which an individual's expertise is relied upon as part of
a disadvantaged owner's contribution to acquire ownership, the
owner's expertise must be: in a specialized field; of outstanding quality;
in areas critical to the firm's operations; indispensable to the firm's
potential success; specific to the type of work the firm performs; and
documented in the records of the firm. The individual whose expertise
is relied upon must have a significant financial investment in the firm.
For purposes of detemuning ownership, the City will deem as held by a
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socially and economically disadvantaged individual all interests in a
business or other assets obtained by the individual:
a. As the result of a final property settlement or court order in a
divorce or legal separation; and
b. Through inheritance or otherwise because of the death of the
former owner.
6. The City will presume 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 which is:
a. Involved in the same firm for which the individual is seeking
certification, or an affiliate of that firm;
b. Involved in the same or a similar line of business; or
C. Engaged in an ongoing business relationship with the firm, or
an affiliate of the firm for which the individual is seeking
certification.
7. To overcome this presumption and permit the interests or assets to be
counted, the disadvantaged individual must demonstrate by clear and
convincing evidence that:
a. The gift or transfer was made for reasons other than obtaining
certification as a DBE; and
b. 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.
8. The City will apply the following rules in situations in which marital
assets form a basis for ownership of a firm:
a. 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 interests asserted by
one spouse, the City will deem ownership interest in the firm to
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M
have been acquired by that spouse with his/her 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. The City will 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 firm.
b. 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.
9. The City may consider the following factors in determining the
ownership of a firm, but shall not regard a contribution of capital as
failing to be real and substantial or find a firm ineligible solely because:
a. A socially and economically disadvantaged individual acquired
his/or her ownership interest as the result of a gift or transfer
without adequate consideration;
b. 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
C. 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.
9. The City will give 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.
OtY of Santa Clanta DBE Program
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30
F. Control Determinations (Section 26.71)
1. In determining whether socially and economically disadvantaged
owners control a firm, the City will consider all the facts in the record,
viewed as a whole. Only an independent business may be certified as a
DBE. An independent business is one in which its viability does not
depend on its relationship with another firm or firms. In determining
whether a potential DBE is an independent business, the City will
scrutinize relationships with non -DBE firms in such areas as personnel,
facilities, equipment, financial and/or bonding support, and other
resources. The City will consider present or recent employer/employee
relationships, the firm's relationship with prime contractors, and factors
related to the independence of a potential DBE firm. Further, the City
will consider the consistency of relationships between the potential
DBE and non -DBE firms with normal industry practice.
2. 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. 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.
3. A disadvantaged owner must hold the highest officer position in the
company (Chief Executive Officer or President). In a corporation,
disadvantaged owners must control the Board of Directors.
4. 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 may
be involved in a DBE firm as owners, managers, employees,
stockholders, officers, and/or directors. Such individuals must not
possess or exercise the power to control the firm, or be
disproportionately responsible for the operation of the firm. The
socially and economically disadvantaged owners may delegate various
areas of 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
City Of Santa CRtrna DBE Program
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31
firm's overall affairs must be such that the City can reasonably
conclude that the socially and economically disadvantaged owners
actually exercise control over the firm's operations, management, and
policy.
6. The socially and economically disadvantaged owners must have an
overall understanding of, and managerial and technical competence
directly related to, the type of business in which the firm is engaged and
the firm's operations.
If the 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. The City will consider differences in
remuneration between socially and economically disadvantaged owners
and other participants in the firm, in the context of the duties involved,
normal industry practices, and the firm's policies and practices. In
order to be viewed as controlling the firm, a socially and economically
disadvantaged owner cannot engage in outside employment or other
business interests which conflict with the management of the firm or
prevent the individual from devoting sufficient time and attention to the
affairs of the firm.
8. A socially and economically disadvantaged individual may control the
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. If the City 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 the burden
of proof concerning control even though they may participate
significantly in the firm's activities.
9. 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, the
disadvantaged individual now owning the firm must demonstrate by
clear and convincing evidence that the transfer of ownership and/or
control to the disadvantaged individual was made for reasons other than
obtaining certification as a DBE; and that the disadvantaged individual
City of Santa Clanta DBE Program
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32
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.
10. In determining whether a firm is controlled by its socially and
economically disadvantaged owners, the City will consider whether the
firm owns equipment necessary to perform its work. The City 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.
11. The City will grant 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 must demonstrate only that its socially and economically
disadvantaged owners are able to control the firm with respect to that
type of work. The City will not require that the firm be recertified or
submit a new application for certification, but will verify the
disadvantaged owner's control of the firm and the additional type of
work.
12. The City will certify a business operating under a franchise or license
agreement if it meets the standards in the regulation, and the franchiser
or licenser is not affiliated with the franchisee or licensee. In
determining whether affiliation exists, the City will not consider
restraints relating to standardized quality, advertising, accounting
format, and other provisions imposed by the franchise agreement or
license, provided the franchisee or licensee has the right to profit from
its efforts and bears the risk of loss commensurate with ownership.
13. 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, to contractually bind the
partnership or subject the partnership to contract or tort liability.
14. The socially and economically disadvantaged individuals controlling a
firm may use an employee leasing company. This does not preclude
such individuals from controlling their firm if they continue to maintain
an employer-employee relationship with the leased employees,
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kkI
including responsibility for hiring, firing, training, assigning, and
otherwise controlling on-the-job activities of the employees as well as
ultimate responsibility for wage and tax obligations related to the
employees.
G. Other Considerations (Section 26.73)
Commercially -Useful Function
The City will not consider commercially -useful function issues in any
way in making decisions about whether to certify a firm as a DBE.
Consideration of whether a firm performs a commercially -useful
function, or is a regular dealer, pertains solely to counting toward DBE
goals any participation of firms that have already been certified as
DBEs.
2. Pattern of Conduct
In making certification decisions, the City will consider 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.
Present Circumstances
The City will evaluate the eligibility of a firm on the basis of present
circumstances and will not refuse to certify a firm based solely on
historical information indicating lack of ownership or control by
socially and economically disadvantaged individuals at some time in
the past, if the firm currently meets ownership and control standards.
The City will not refuse to certify a firm solely on the basis that it is a
newly -formed firm. '
4. DBE Cooperation
The City expects DBE firms and firms seeking DBE certification to
cooperate fully with requests for information relevant to the
certification process. Failure or refusal to provide such information is a
ground for denial or removal of certification.
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5. For -Profit Firms
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.
6. Subsidiaries and Affiliates
An eligible DBE firm must be owned by individuals who are socially
and economically disadvantaged. Except as provided by this policy, 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.
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 tum, holds and controls an
operating subsidiary, the City will certify the subsidiary if it otherwise
meets all requirements of the regulation. 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. The City will certify such subsidiary only if there is
cumulatively 51 percent ownership of the subsidiary by socially and
economically disadvantaged individuals. Recognition as a business as
a separate entity for tax or corporate purposes is not sufficient to
demonstrate that a firm is an independent business.
Preaualification
The City will not require a DBE firm to be prequalified as a condition
for certification unless the City requires all firms that participate in its
contracts and subcontracts to be prequalified.
8. Tribal Organizations
The City recognizes that a firm owned by an Indian tribe, Alaska Native
Corporation, or Native Hawaiian organization as an entity, rather than
by Indians, Alaska Natives, or Native Hawaiians as individuals, may be
eligible for certification as long as such firm meets the size standards
and is controlled by socially and economically disadvantaged
individuals.
City 'If Santa Clanta DBE Progrttrn
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H. Privacy/Confidentiality (Section 26.67)
The City will ensure that any individual's personal financial information
remains confidential. Neither an individual's Personal Net Worth Statement,
nor any documentation supporting it, will be released to a third party without
the written consent of the submitter, or as otherwise required by law or court
order.
The sole exception to this confidentiality policy is in the event of a certification
appeal to the U.S. DOT in which the economic disadvantage of an individual is
at issue. In such a circumstance, the personal financial information would be
provided by the City to the U.S. DOT as part of the administrative record. The
U.S. DOT would treat the information as confidential, in accordance with 64
FR 5117; February 2, 1999.
SII;CERTOFICATIOK,,P dCEI TJI S" ..'",
A. Unified Certification Program (Section 26.81)
The City is a participant in a reciprocal regional DBE certification program. It
is the intent of the City to cooperate fully in the facilitation of a unified DBE
certification program (UCP) to be fully operational by September, 2003.
B. Initial Certification Procedures (Section 26.83)
The City will ensure that only firms certified as eligible DBEs participate as
DBEs in the DBE program. The City will determine the eligibility of firms as
DBEs consistent with standards of the regulation. The City will take the
following steps in determining whether a DBE firm meets the certification
standards of the regulation:
The City will perform an on-site visit to the offices of the firm and
interview the principal(s) of the firm and review their resumes and/or
work histories. The City may also perform visits to job sites if there are
such sites on which the firm is working at the time of the eligibility
investigation. The City may rely upon the site visit reports of any other
U.S. DOT grantee with respect to a firm applying for certification;
2. If the firm is a corporation, the City will analyze the ownership of stock
in the firm;
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4ET
The City will evaluate the bonding and financial capacity of the firm;
4. The City will evaluate the work history of the firm, including contracts
it has received, and work it has completed;
5. The City will obtain a statement from the firm of the type of work it
prefers to perform as part of the DBE program and its preferred
locations for performing the work, if any.
6. The City will obtain or compile a list of equipment owned by or
available to the firm and the licenses the firm and its key personnel
possess to perform the work it seeks to do as part of the DBE program.
The City will require potential DBEs to complete and submit an
appropriate application form. The City will require the applicant to
attest to the' accuracy and truthfulness of the information on the
application form. This shall be done either in the form of an affidavit
sworn to by the applicant before a person authorized by state law to
administer oaths, or in the form of a declaration executed under penalty
of perjury of the laws of the United States. The City will review all
information on the form prior to making a decision about the DBE
eligibility of the firm.
8. When another grantee, in connection with its consideration of the
eligibility of a firm, requests certification information the City has
obtained about that firm, the City will promptly make the information
available to the other grantee.
9. When another U.S. DOT grantee has certified a firm, the City has the
discretion to take any of the following actions:
a. Accept another grantee's certification decision;
b. Make an independent certification decision based on
documentation provided by the other grantee augmented by any
additional information the City requires the applicant to
provide; or
C. Require the applicant to go through the City's certification
process without regard to the action of the other grantee.
City offto Clarita DBE Program
Murch 2000
37
d. The City may choose to, or not to, impose an application fee for
firms to participate in the DBE certification process.
e. The City will safeguard from disclosure from unauthorized
persons all information gathered as part of the certification
process that may be regarded as proprietary or other
confidential business information, consistent with applicable
federal, state, and local laws.
Once the City has certified a firm as a DBE, it shall remain
certified for a period of at least three (3) years unless and until
its certification has been removed. The City will not require
DBEs to reapply for certification as a condition of continuing to
participate in the program during this three-year period unless
the factual basis on which the DBE certification was made
undergoes change in circumstance.
g. Once certified, a DBE firm must inform the City in writing of
any changes in circumstances affecting the firm's ability to
meet size, disadvantaged status, ownership, or control
requirements, or any material change in the information
provided in the certification application process, and attach
supporting documentation describing in detail the nature of
such changes. Changes in management responsibility among
members of a limited liability company are also covered by this
requirement. Such notice of change from the DBE firm must
take the form of an affidavit sworn to before a person
authorized by state law to administer oaths, or of a declaration
executed under penalty of perjury. The written notification
shall be provided by the DBE within thirty (30) days of
occurrence of the change(s). If the DBE fails to make timely
notification of such change(s), it will be deemed to have failed
to cooperate under the regulation.
h. The City will make attempt to make decisions on applications
for DBE certification within ninety (90) days of receiving from
the applicant firm all information required.
B. Recertification Procedures (Section 26.83)
Every firm certified by the City as a DBE must provide to the City every year
on the anniversary of the date of initial certification, an affidavit sworn to by the
City OSanta Cirita DBE Program
Murch 2000
firm's owners before a person who is authorized by state law to administer
oaths or an unsworn declaration executed under penalty of perjury of the laws
of the United States. This affidavit must affirm that there have been no changes
in the firm's circumstances affecting its ability to meet size, disadvantaged
status, ownership, or control requirements of the regulation or any material
changes to the information provided in its original application, except for
changes about which it has notified the City as required in Paragraph "g"
above. The affidavit shall specifically affirm that the DBE continues to meet
SBA business size criteria and the overall gross receipts cap, documenting this
affirmation with supporting documentation of the DBE's size and gross
receipts. If the DBE fails to provide this information in a timely manner, it will
be deemed to have failed to cooperate with the requirements of the regulation
(26.109).
C. Denials and Reapplication Procedures (Section 26.85)
When the City denies a request by a firm that is not currently certified, the City
will provide the firm a written explanation of the reasons for the denial,
specifically referencing the evidence in the record that supports each reason for
the denial. All documents and other information on which the denial is based
will be made available to the applicant firm upon request. When a firm is
denied certification, it is required to wait at least twelve (12) months before it
may reapply for DBE certification with the City. The time period for
reapplication begins on the date the explanation for denial of certification is
received by the applicant firm.
E. Removal Procedures (Decertification) (Section 26.87)
Ineligibility Complaints
Any person may file with the City a written complaint alleging that a
currently certified firm is ineligible and specify the alleged reasons why
the firm is ineligible. The City is not required to accept a general
allegation that a firm is ineligible or an anonymous complaint. The
complaint shall include any information or arguments supporting the
assertion that the firm is ineligible and should not continue to be
certified. Confidentiality of complainants' identities will be protected.
The City will review all records concerning the firm, any material
provided by the firm and the complainant, and other available
information. If the City determines, based on this review, that there is
reasonable cause to believe the firm is ineligible, the City will provide
written notice to the firm of its intention to find the firm ineligible with
Cdry elf Santa Clarita DBE Program
March 2000
39
the reasons for the proposed determination. If the City determines such
reasonable cause does not exist, the City will notify the complainant in
writing of this finding and the reasons for it. All statements of reasons
for findings on the issue of reasonable cause will specifically reference
the evidence in the records on which each reason is based.
2. City -Initiated Proceedings
Based on notification by the DBE firm of a change in its circumstances
or other information that becomes available to the City, if the City
determines there is reasonable cause to believe a currently certified firm
is ineligible, the City will provide written notice to the firm of its
intention to find the firm ineligible, setting forth the reasons for the
proposed determination. The statement of reasons for the finding of
reasonable cause will specifically reference the evidence in the record
on which each reason is based.
3. U.S. DOT Directive to Initiate Proceedin
If a U.S. DOT agency determines that information in the certification
records, or other available information, establishes reasonable cause
that a firm certified by the City does not meet eligibility criteria, the
agency may direct the City to initiate a proceeding to remove the firm's
certification. The agency must provide the City and the firm a notice
setting forth reasons for the directive, including relevant
documentation. The City will immediately commence and prosecute a
proceeding to remove the eligibility of the firm.
4. Hearing
When the City notifies a firm that there is cause to remove its eligibility
as defined above, the City will provide the fine an opportunity for an
informal hearing at which the fine may respond to the reasons for the
proposal to remove eligibility in person and offer information and
arguments concerning why it should remain certified. The hearing will
be held before an independent RCRC Appeals Review Panel composed
of representatives from agencies that did not make the eligibility
decision. (See page 9 for discussion about the RCRC Appeals Review
Panel.) In such proceeding, the City bears the burden of proving, by a
preponderance of the evidence, that the firm does not meet the
certification standards. The City will maintain a complete record of the
hearing. If there is an appeal to U.S. DOT, the City will provide a
City of Santa CRtrna DBE Program
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40
transcript of the hearing to U.S. DOT and, upon request, to the firm.
The City will retain the original record of the hearing.
The DBE firm may elect to present information and arguments in
writing without a hearing. In such event, the City bears the same
burden of proving, by a preponderance of the evidence that the firm
does not meet the certification standards.
5. Separation of Functions
The City will ensure that the decision in a proceeding to remove a
firm's eligibility is made by an office and personnel that did not take
part in actions leading to or seeking to implement the proposal to
remove the firm's eligibility and are not subject, with respect to the
matter, to direction from the office or personnel who did take part in
these actions.
6. Grounds for Decision
The City will not base a decision to remove eligibility on a re-
interpretation or changed opinion of information available to the City at
the time of its certification of the firm. The City will base such decision
only on one or more of the following: changes in the firm's
circumstances since the certification, information or evidence not
available at the time of certification, information that was concealed or
misrepresented by the firm in previous certification actions, change in
the certification standards or requirements of U.S. DOT since the firm
was certified, or a documented finding that the City's determination to
certify the firm was factually erroneous.
7. Notice of Decision
The City will provide the firm written notice of the decision and the
reasons for it, including specific references to the evidence in the record
that supports each reason for the decision. The notice will inform the
firm of the consequences of the City's decision and of the availability of
an appeal to U.S. DOT. The City will send copies of the notice to the
complainant in an ineligibility complaint or the concerned U.S. DOT
agency that directed the City to initiate the proceeding.
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8. Status of Firm During Proceeding
A firm remains an eligible DBE during the proceeding. The firm does
not become ineligible until the issuance of the notice provided for in
Paragraph 7 above.
9. E—ffects of Removal of Eli ibilit
The City will take the following action upon removing a firm's
eligibility:
a. When a prime contractor has made a commitment to use the
ineligible firm, or the City has made a commitment to use a
DBE prime contractor (but a subcontract or contract has not
been executed before issuance of the decertification notice), the
ineligible firm does not count toward the contract goal or
overall goal. The City will direct the prime contractor to meet
the contract goal with an eligible DBE or to demonstrate that it
has made a good faith effort to do so.
b. If a prime contractor has executed a subcontract with the firm
before notice of ineligibility, the prime may continue to use the
firm on the contract and may continue to receive credit toward
its DBE goal for the firm's work. When the City has let a
prime contract to the DBE later ruled ineligible, the portion of
the ineligible firm's performance of the contract remaining after
issuance of the notice shall not count toward the overall goal
but may count toward the contract goal.
C. If the DBE's ineligibility is caused solely by its having
exceeded the size standard during the performance of the
contract, the City will continue to count its participation on that
contract toward overall and contract goals.
F. Process for Certification Appeals to U.S. DOT (Section 26.89)
A firm that has been denied certification, or whose eligibility is removed, may
make an administrative appeal to the U.S. Department of Transportation. A
complainant in an ineligibility complaint to the City may appeal to U.S. DOT if
the City does not find reasonable cause to propose removing the firm's
eligibility. All appeals will be sent to the U.S. Department of Transportation,
City of Santa Ciarita DBE Progrmn
March 2000
42
Office of Civil Rights, 400 Seventh Street, S.W., Room 2401, Washington,
D.C. 20590.
Pending the U.S. DOT decision, the City's decision remains in effect. If a firm
wants to file an appeal, it must send a letter to U.S. DOT within ninety (90)
days of the date of the City's final decision, including information concerning
why the City's decision should be reversed. An appellant firm must submit a
letter with the name and address of. any other U.S. DOT grantee that currently
certifies the firm, any other grantees that may have rejected an application for
certification from the firm or removed the firm's eligibility within one year '
prior to the date of the appeal, and any other grantee with which an application
for certification or action to remove eligibility is pending.
A complainant in a third -party ineligibility complaint that appeals the City's
decision to U.S. DOT will be requested by U.S. DOT to promptly provide all
information requested. The City agrees to provide to U.S. DOT the complete,
well -organized administrative record within twenty (20) days of its request.
U.S. DOT will make its decision based solely on the entire administrative
record without conducting a hearing. When the City provides information to
U.S. DOT, the same information will be made available to the firm and to any
third -party complainant involved. U.S. DOT will affirm the City's decision
unless it determines, based on the entire administrative record, that the decision
is not supported by substantial evidence or is inconsistent with the substantive
or procedural provisions concerning certification.
If U.S. DOT determines that the City's decision was unsupported, U.S. DOT
will reverse the City's decision and will direct the City to certify the firm or to
remove its eligibility. The City will take the action directed by U.S. DOT
immediately upon receiving written notice. U.S. DOT is not required to reverse
the City's decision if it determines a procedural error did not result in
fundamental unfairness to the appellant or substantially prejudice the
opportunity of the appellant to present its case.
If it appears that the record is incomplete or unclear, U.S. DOT may remand the
record to the City with instructions seeking clarification or augmentation of the
record before making a finding. U.S. DOT will not uphold the City's decision
based on grounds not specified in the City's decision. U.S. DOT's decision
will be based on the status and circumstances of the firm on the date of the
decision which was appealed. U.S. DOT will provide written notice of its
decision to the City, the firm, and the complainant in an ineligibility complaint.
The notice will include the reasons for U.S. DOT's decision. It is U.S. DOT's
policy to make a decision within one hundred eighty (180) days of receiving the
City of Santa Clarita DBE Program
March 2000
43
complete administrative record. All decisions by U.S. DOT are
administratively final and are not subject to petitions for reconsideration.
Actions Following U.S. DOT Decision (Section 26 91)
The decisions of U.S. DOT are binding on the City. Such decisions are not
binding, however, on other U.S. DOT grantees. The City will take the
following actions after U.S. DOT decisions:
a. If U.S. DOT determines that the City erroneously certified a firm, the
City must remove the firm's eligibility on receipt of the determination
without further proceedings.
b. If U.S. DOT determines that the City erroneously failed to find
reasonable cause to remove the firm's eligibility, the City will
expeditiously commence a proceeding to determine whether the firm's
eligibility should be removed.
C. If U.S. DOT determines that the City erroneously declined to certify or
remove eligibility of the firm, the City must certify the firm effective on
the date of receipt of the written notice.
d. If U.S. DOT determines that the City erroneously determined that the
presumption of social and economic disadvantaged either should or
should not be deemed rebutted, the City must take appropriate
corrective action as determined by U.S. DOT.
e. If U.S. DOT affirms the City's determination, no further action is
necessary.
f. Where U.S. DOT has upheld the City's denial of certification or
removal of eligibility of a firm, or directed the removal of a firm's
eligibility, other grantees with which the firm is certified may
commence proceeding to remove the firm's eligibility. If the City,
receives information on a U.S. DOT decision of DBE eligibility or
ineligibility, the City will take the U.S. DOT action into account in any
certification action involving the firm.
Cityq/ Santa C[arita DBE Program
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44
A. Bidders List (Section 26.11(c))
The City will create and maintain a bidders list consisting of all firms bidding
on prime contracts and bidding or quoting subcontracts on U.S. DOT -assisted
projects. For every firm, the following information will be included: firm
name, firm address, firm status as a DBE or non -DBE, the age of the firm, and
the annual gross receipts of the firm.
B. Monitoring Payments to DBEs (Section 26.37 (b))
The City will implement appropriate mechanisms to ensure that its prime
contractors and subcontractors comply with DBE program regulatory
requirements. The City will apply legal and contract remedies available under
federal, state, and local law.
The City will also include a monitoring and enforcement mechanism to verify
that the work'committed to DBEs at contract award is actually performed by
the DBEs. This mechanism will provide for a running tally of actual DBE
attainments and include a provision ensuring that DBE participation is credited
toward overall or contract goals only when payments are actually made to DBE
firms.
C. Reporting to U.S. DOT (Section 26.11(b))
The City will continue to provide data about the DBE program to U.S. DOT, as
required.
A. Public Participation (Section 26.45 (g))
The City will provide for public participation in establishing an overall annual
DBE goal which may include: consultation with minority, women's and
general contractor groups; community organizations; and other officials or
organizations that may have information concerning the availability of DBE
and non -DBE firms; the effects of discrimination on DBE opportunities; and
efforts to establish a level playing field for DBE participation. The City will
publish a notice announcing proposed overall DBE goals, informing the public
City oJ'Santa Clarita DBE Program
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that the proposed goal and its rationale are available for inspection during
normal business hours at the City's principal office for thirty (30) days
following the date of the notice, and that the City and U.S. DOT will accept
comments on such goals for forty-five (45) days from the date of the notice.
The notice will include the City's address and will be published in general
circulation media.
B. Outreach Efforts (Section 26.5-1)
The City will meet the maximum feasible portion of its overall DBE goal by
using race -neutral efforts to facilitate DBE participation. Race -neutral efforts
may include, but are not limited to, the following:
Arranging solicitations, times for presentation of bids, quantities,
specifications, and delivery schedules in ways that facilitate DBE and
other small businesses;
2. Providing assistance in overcoming limitations such as inability to
obtain bonding or financing;
Providing technical assistance and other similar services;
4. Carrying out information and communications programs on contracting
procedures and specific contract opportunities;
5. Assisting in supportive service programs to develop and improve
immediate and long-term business management, record keeping, and
financial and accounting capability for DBEs and other small
businesses;
6. Assist DBEs and other small businesses improve long-term
development, increase opportunities to participate in a variety of kinds
of work, handle increasingly significant projects, and achieve eventual
self-sufficiency;
7. Participate in programs to assist new, start-up firms, particularly in
fields in which DBE participation has been historically low;
8. Facilitate distribution of the City's DBE data base through print and
electronic means to the widest feasible universe of potential prime
contractors; and
City of Santa Clanta DBE Program
Murch 2000
46
9. Assist DBEs and other small businesses to develop their capability to
utilize emerging technology and conduct business through electronic
media.
Ctry af'Santa CGanta DBE Program
March 2000
END OF PLAN
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