CNN sat down with Wade Henderson, the President and CEO of The Leadership Conference, a group devoted to protecting civil and human rights for all people. Mr. Henderson broke down the fundemental information one should know about Disadvantage Buisness Enterprise (DBE) programs.
WHAT ARE DBES?
- DBES are Disadvantaged Business Enterprises. These are businesses that are majority owned by socially or economically disadvantaged individuals, such as MBEs (Minority Owned Businesses) or WBEs (Women Owned Businesses). However, these can also include small businesses, businesses in rural areas, and historically underutilized businesses. All of these businesses must be certified and proven to have a definite disadvantage.
HOW DO THESE DBES WORK?
- The EPA, as do all federal agencies, gives a certain amount of federal money to states each year. Part of this money is to fulfill procurement actions that carry out agency programs (through construction, equipment purchasing, services, and supplies). In order to receive this money, states must comply with the DBE program, and ensure that 10% of this money goes to DBEs. This money can be granted to DBEs in 2 ways. The first is through outreach programs, which help DBEs with training. The second is through contracting. When states contract out, they must give a percentage of those contracts to DBEs, require a contractor to use DBEs as a percentage of their subcontractors, or make sure DBEs are involved in a group bid.
- EPA grantees must follow fair share objectives, or “goals based on the capacity and availability of qualified, certified MBEs and WBEs in the relevant geographic market.”* However, these are not quotas and “a recipient cannot be penalized for not meeting its fair share objectives.”
- DBE programs do not make the applicant pool less capable. DBE programs most often break down contracting bids or divide the requirements of a job so that more businesses can participate. All of the businesses are equally talented. The ways in which DBEs are disadvantaged is that they lack the money, resources, and connections to make the most compelling and cheap contracting bid.
- DBE programs work to make minority owned businesses more competitive in a way in which they never otherwise would have had the opportunity.
- Racism and sexism unfortunately still permeate our culture. DBEs allow our government to ensure we are a racially progressive society.
- Women and minorities face barriers such as*:
- Lack of financial capital: lower incomes, fewer assets, and less access to loans.
- Lack of social capital: limited network of resources, one of the known benefits of higher education.
- Less access to education and professional training, based on our country’s history of discrimination.
- DBEs are necessary to even out the playing field.
* EPA Office of Small Business Programs Disadvantaged Business Enterprise (DBE) Program Computer-Based Learning Series (http://www.epa.gov/osbp/)
** Urban Institute Analysis – Funded by the Department Of Justice (http://www.urban.org/publications/307416.html)