The U.S. Department of Transportation recently released a long-awaited Notice of Proposed Rulemaking to modernize the Disadvantaged Business Enterprise (DBE) program regulations. This blog is part of a series looking at some of the significant proposed changes. A copy of all of the proposed changes can be found here.

One proposed change is a revision to the definition listed of “Disadvantaged Business Enterprise” to mean “a for-profit small business concern engaged in transportation-related industries.” (emphasis added). Previously, the definition of Disadvantaged Business Enterprise made no mention of industry. 

The proposed regulation does not define what industries are considered “transportation-related” nor does the term “transportation-related” appear elsewhere in the regulations. While in some ways limiting the certification to industries involved in some way with transportation makes some sense (it is a U.S. Department of Transportation program, after all), the lack of a definition is likely to cause confusion. 

With dozens of certifying agencies throughout the country, the interpretation of what is included will vary widely.  There are countless potential interpretations of “transportation-related.” Companies that provide transportation. Companies that directly work on transportation projects. But what about other companies that are more on the fringes? Where will the line be drawn?  

Also, where does this leave minority-owned small businesses? Women-owned small businesses can be certified through the WOSB program, but there is no equivalent minority-owned small business program separate from the 8(a) and HubZone programs

The proposed rule changing the definition is not yet final.  You can comment on the proposed rule by going here.