The Infrastructure Gold Rush – Opportunities for Minority Businesses

7/30/2018 | Articles & Alerts, General, Land Use, Zoning & Development

   Every four years, the American Society of Civil Engineers’ “Report Card for America’s Infrastructure” depicts the condition of our nation’s infrastructure in the familiar form of a school report card. Letter grades are assigned based on the physical condition and needed investments for improvement. Sadly, for 2017, the grade is a D+. A similar report by Pennsylvania civil engineers has found that Pennsylvania faces immense challenges in maintaining and modernizing its infrastructure. Repairs are desperately needed to roads, bridges, wastewater systems and transportation facilities. However, help may be on the way.

   Both political parties seem to (I think) agree that now is the time to rebuild and in the process, create jobs, opportunity, and growth. Substantial economic opportunities will be created for minority-owned businesses, particularly in the construction and contracting sectors. The Pennsylvania Department of Transportation (PennDOT) and Gov. Tom Wolf recently announced a $550 million outlay to improve roads and bridges around Philadelphia. The proposed work includes paving approximately 235 miles of highway and repairing or replacing 35 bridges. Similar infrastructure initiatives have been proposed or implemented throughout the country.

   This massive rebuilding of infrastructure will present golden opportunities for a minority (MBE) and disadvantaged business enterprises (DBE). For example, PennDOT has established a DBE Program in accordance with the regulations of the U. S. Department of Transportation (DOT), 49 CFR Part 26 (Part 26). PennDOT receives federal financial assistance from DOT, and as a condition of receiving this assistance, PennDOT has signed an assurance that it will comply with Part 26.   The DBE program ensures that federally assisted contracts for highway, transit, and aviation projects are made available for small business concerns owned and controlled by socially and economically disadvantaged individuals.

   The designations of minority and disadvantaged enterprises may prove confusing. MBE stands for Minority Business Enterprise. A MBE is owned, operated, and controlled by one or more members of a minority race. Similarly, WBE stands for Women Business Enterprise and is sometimes referred to as FBE or Female Business Enterprise. A WBE or FBE is owned, operated, and controlled by one or more members of the female gender. Finally, a Disadvantaged Business Enterprise (DBE) means an entity that is at least 51% owned or controlled by a socially and economically disadvantaged individual. An economically disadvantaged individual must have an initial and continued personal net worth of less than $750,000.

   While the process may prove tedious, becoming certified as an MBE and/or DBE at the federal and state levels will expose a firm to work opportunities on road and other infrastructure projects. When responding to a solicitation, contractors must provide evidence that they met the minority participation goal established in the contract by seeking out and utilizing certified MBE/DBE firms. A contractor can only receive credit toward achievement of such goals if the firm is certified as an MBE (for State-funded contracts) or DBE (for USDOT-funded contracts).

Here’s hoping that you find your share of the gold. Let me know if I can help.

If you would like additional information, please feel free to contact Neil A. Stein, Esquire (610) 941-2469 or nstein@kaplaw.com.

Related Practices: Land Use, Zoning, and Development