7 Advantages to Working with Disadvantaged Business Enterprises (DBEs)
Public transportation is the lifeblood of most U.S. cities and metropolitan areas. Tens of millions of people rely on buses, trains, and light rail to travel.
One primary reason public transit agencies hire DBEs, and encourage subcontracting with DBEs for their large contracting opportunities, is to create employment and growth opportunities for disadvantaged groups. Public transit agencies take pride in helping their communities with a much needed service. Disadvantaged businesses are taking initiative in creating economic prosperity for themselves, their employees and in the neighborhoods they live.
Another thing to consider is that hiring DBEs also has a lot of benefits operationally. Here are 7 compelling business reasons why public transit agencies and their contractors should embrace the opportunity to partner with disadvantaged business enterprises.
1. Hiring DBE is a requirement
The federal government takes DBE participation seriously, as well as many state and municipal authorities. The DOT has set an aspirational goal of minimum of 10% DBE participation. Originally, the rule was that firms falling below 10% participation had to justify not meeting the goal. Now, the rule has been changed to reflect that 10% participation may not be possible in certain areas.
However, cities across the U.S. such as New York, Chicago, Los Angeles, Miami, and Dallas are racially, ethnically, and economically diverse. So, DBE contracting is a must in large cities across the U.S. And, while the DOT DBE regulations have adjusted over the years to allow for good faith efforts to meet the stated 10% goals, the DOT is not as likely to allow public transit agencies to get out of their responsibility to utilize DBEs in areas where diversity of business is established.
2. Get an edge in bidding for projects
Transit contractors that meet or exceed DBE requirements often get an advantage when seeking contracts supported by U.S. Department of Transportation (DOT) funding. The DOT has allowed for proof of Good Faith Efforts as an alternative to meeting the goals, however, it is often simpler and more effective to find DBE contractors to fulfill those requirements.
3. Hiring DBE is easier than casting a wider net
Congress enacted the first DBE program in 1983. The DBE program has been in place for over 30 years and there are thousands of experienced, reputable disadvantaged business enterprises serving public transit authorities across the country.
4. The track record of DBEs are better known because these contracts are under public scrutiny
Reputation matters in winning public contracts. Because these contracts and the DBE program are paid for with taxpayer money, there is greater scrutiny and transparency with contracts.
5. Infrastructure funding, including public transit, may rise
At the national level, politicians on both sides of the aisle have discussed the need for more infrastructure funding. That may mean opportunities for public transit authorities to rebuild and expand their transit fleet of trains, buses, and trolley. Increased infrastructure funding would provide additional opportunities to meet the overall goal.
6. DBEs firms have expertise in virtually every area of public transit
Established disadvantaged business enterprises are represented in virtually every area of public transit. Thus, public transit agencies and contractors can hire DBEs in most public transit operations. They work in areas from building infrastructure to supplying a skilled workforce. As examples, DBEs can provide janitorial services, supply vehicles, provide maintenance, or provide operational support. They can also supply drivers, conductors, electricians and other skilled labor.
7. Getting started in hiring DBEs is simple
There are many DBEs ready to work with transit agencies and their information is easily found. Many DBEs are included in state public transit databases, such as ones managed by Caltrans and the Florida Department of Transportation. By visiting the state DOT website or contacting the state authority, a list of quality DBEs can often be found.
