The U.S. Department of Transportation has updated its Frequently Asked Questions for the Disadvantaged Business Enterprise (DBE) and Airport Concession DBE (ACDBE) programs to reflect implementation of the Interim Final Rule (IFR) that took effect on October 3, 2025. The December 1, 2025 update builds on the original FAQs issued on October 3, 2025, adding important clarifications that affect how small businesses—especially current and prospective DBEs—navigate procurement, certification, and compliance during the transition period. This post explains what changed in the December update and what it means for small business owners. A copy of the updated FAQs can be found here.
Certification Reevaluation: What Owners Must Submit and When
The original FAQs created a reevaluation process without firm deadlines for DBEs to submit updated eligibility information. The December update sharpens that process:
- What you must submit: A currently certified DBE owner must provide a personal narrative establishing social and economic disadvantage by a preponderance of the evidence, along with a current personal net worth statement and any relevant financial information. The update reiterates the personal net worth threshold of $2,047,000 and confirms owners remain responsible for reporting changes affecting eligibility.
- What the narrative should cover: Certifiers must evaluate the narrative holistically. Owners may draw from experiences across their lives in American society that show economic hardship, systemic barriers, or denied opportunities in education, employment, or business—such as unequal access to credit, capital under unfavorable terms, or exclusion from contracting opportunities. Narratives must not rely, in whole or in part, on race or sex.
- Deadlines: The new guidance allows UCPs to set a submission date to move reevaluations forward. A UCP may notify DOT that it has completed reevaluation for firms that met the submission date. Firms that miss the date can still submit later, but they will remain ineligible for counting until recertified. This is a welcome change that eliminates circumstances where straggler DBEs hold up the certification process.
- Certification anniversary: If you are recertified through reevaluation, your annual certification anniversary remains tied to your original certification date, not the reevaluation date. This reduces administrative bunching for UCPs and helps firms maintain predictable annual filings.
- Directories, appeals, and special cases: Recipients may decide whether to keep directories live during reevaluation. Firms decertified in reevaluation may appeal under existing procedures. The update confirms unchanged treatment for Alaska Native Corporation‑owned firms and leaves the order of DBE versus ACDBE reevaluations to UCP procedures.
For owners, the practical takeaway is to prepare a thorough, evidence‑based narrative and updated financials now, watch for your UCP’s submission date, and respond promptly.
Small Business Programs Beyond DBE
The update confirms that recipients may implement race- and sex‑neutral small business enterprise programs—such as small business set‑asides—under existing rules that promote small business participation. Eligibility for such programs cannot be based on race or sex. For small businesses that are not pursuing DBE certification or are awaiting reevaluation, these programs may offer near‑term access to opportunities while DBE counting remains paused.
New Application and Reapplication Details
Beyond reevaluation, the update adds two application‑stage clarifications:
- Declaration of Eligibility form. DOT will update the DOE form to align with the IFR. Expect to use revised forms as they are released.
- Reapplications after denial. The IFR did not change the rule allowing UCPs to set a waiting period, up to 12 months, before a denied applicant may reapply. Reapplicants must meet the new standards.
Existing Conciliation Agreements
If a recipient is operating under a DBE conciliation agreement, only compliance obligations that relate to rules still valid under the IFR continue to apply. Measures tied to race‑ or sex‑based preferences eliminated by the IFR are no longer enforceable. This clarification narrows what recipients can require of contractors during the transition.
“Appropriate Action” When Reevaluation Changes Eligibility
The update reiterates that if a DBE on a contract is not recertified after reevaluation, the recipient must take “appropriate action” tailored to the situation to discontinue the effect of an unconstitutional certification. DOT may withhold payments if appropriate action is not taken. Practically, primes and subs should be prepared for case‑specific remedies where a firm’s status changes, and document all steps to mitigate disruption.
Contracting Clarifications That Affect Your Bids
The December update adds operational guidance for common scenarios:
- Good faith efforts backfill not required during reevaluation. If a DBE is terminated in compliance with the rule, primes do not have to add new DBE participation to meet a goal because DBE goals cannot be given effect while counting is paused.
- Change orders to zero out pre‑IFR contract goals are permitted. For contracts executed before October 3, 2025, recipients may issue a change order to remove the DBE goal. Any DBE termination must still meet the rule’s “good cause” and approval standards.
- Task orders and IDIQ/JOC. For on‑call, IDIQ, or job order contracts that extend past the IFR’s issuance, recipients should set DBE goals to zero until reevaluation is complete.
- ACDBE solicitations. During the transition, concession‑specific ACDBE goals should be set to zero in RFPs, RFQs, and RFIs until reevaluation under the ACDBE rule is complete.
- Shortfall reviews. For projects with pre‑IFR DBE goal shortfalls that closed before October 3, 2025, ongoing shortfall reviews and remedies tied to meeting DBE goals should be terminated if they were not completed before the IFR took effect.
These changes reduce the risk of mid‑stream goal enforcement while the program re‑sets. Small businesses should still focus on performance, payment protections, and compliance with core contract clauses.
Transit Vehicle Manufacturers and Ferry Procurements
The update extends the transition approach to transit vehicle manufacturing:
- TVMs are treated like recipients for goals and reporting—no updates to DBE goals or Uniform Reports until after reevaluation.
- Ferry procurements. Where a project‑specific goal would ordinarily be used because a certified TVM cannot be identified, recipients should set that project‑specific goal to zero until reevaluation is complete.
For small manufacturers and marine contractors, that means solicitations should proceed without DBE goals during the transition, while eligibility and listing requirements continue to be monitored by FTA.
What Small Businesses Should Do Now
Focus on readiness and resilience during the transition window. If you are a current DBE, assemble your narrative and financials and monitor your UCP’s instructions and submission date. If you are bidding, expect solicitations without DBE goals but with continued prompt payment protections and nondiscrimination clauses. If you are not a DBE or are awaiting reevaluation, explore recipient‑level small business programs that are race‑ and sex‑neutral, including small business set‑asides where available. Above all, keep strong records of subcontracting, payment, and performance to stay well‑positioned as counting resumes after reevaluation.
If your company needs assistance with DBE or ACDBE certification or recertification, please contact Danielle Dietrich, Esq. at ddietrich@potomaclaw.com or 412-449-9141.
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