What is a DBE?by Dan Olson, Minnesota Public Radio
St. Paul, Minn. — The Disadvantaged Business Enterprise, or DBE, program was created by the federal government nearly 30 years ago, to encourage businesses owned by minorities and women to bid on government contracts.
Federal law defines DBEs "as small businesses that are owned and controlled by socially and economically disadvantaged individuals who have been subjected to racial or ethnic prejudice or cultural bias, and who have limited capital and credit opportunities."
"Under the Small Business Act, African Americans, Asian Americans, Hispanic Americans, and Native Americans are presumed to be socially disadvantaged. Other business owners who do not belong to these racial or ethnic groups (such as nonminority women) can establish disadvantaged status as individuals for participation in certain federal programs."
MnDOT says as of Oct. 30, 2007, there are 373 certified DBEs in Minnesota. DBEs must be recertified every year.
When federal funds are used to pay for a construction project in Minnesota, the contractor who is hired must commit to meeting DBE goals. The company must subcontract a certain percentage of the overall contract to DBEs, or at least prove it made a good-faith effort to do so.
The federal DBE spending goal is 10 percent, set by Congress when the DBE rules were put in place in the early 1980's.
A MnDOT official says the agency's DBE goal for FY2007 is 10 percent. However, a document provided by the agency lists that goal at 6.27 percent.