As many of you know, the U.S. Department of Transportation published its Interim Final Rule (IFR) on October 3, 2025, fundamentally changing how the Disadvantaged Business Enterprise (DBE) and Airport Concession DBE (ACDBE) programs work. The IFR removed the longstanding race- and sex-based presumptions of social and economic disadvantage and now requires every applicant and currently certified firm to demonstrate disadvantage through individualized proof via a written personal narrative describing the disadvantage you have faced, along with an updated personal net worth statement showing that you meet the economic disadvantage requirements.
For small businesses that have relied on DBE or ACDBE certification, this shift has created real uncertainty. Unified Certification Programs (UCPs) across the country are reevaluating currently certified firms under the revised standards, and some owners are receiving denial or decertification decisions for the first time. If that has happened to you, it is important to understand that a denial is not the end of the road.
You Have the Right to Appeal
If your firm has been denied recertification or decertified through the reevaluation process, you are entitled to appeal that decision to the U.S. Department of Transportation under 49 CFR § 26.89. This right applies whether you are in the DBE program or the ACDBE program. The USDOT’s own FAQs on the IFR confirm that firms decertified through the § 26.111 reevaluation process have the same appeal rights as any other firm that receives an adverse certification decision.
The critical deadline to keep in mind: you must file your appeal within 45 days of the date of your denial or decertification letter. Appeals are submitted by email, as directed in the certifier’s decision. Missing this deadline could mean losing your opportunity, so calendar it immediately.
Common Reasons for Denial Under the IFR
Under the revised rules, the certifying agencies are looking at several areas when reevaluating firms. Common grounds for denial/decertification include:
- Lack of an adequate Personal Narrative. The IFR now requires every owner to submit an individualized Personal Narrative demonstrating social and economic disadvantage based on their own experiences—economic hardship, systemic barriers, and denied opportunities that impeded progress in education, employment, or business, including access to financing. Simply relying on race or sex is no longer sufficient. Writing a compelling narrative that meets these requirements can be challenging without legal guidance—it is not always clear what details to include, how to frame your experiences in regulatory terms, or how much documentation you need to support your claims.
- Personal net worth exceeding the cap. The current personal net worth (PNW) threshold under 49 CFR § 26.68 is $2,047,000. Issues with supporting financial documentation can also trigger a denial.
- Size standards or gross receipts limits. Firms must continue to meet applicable Small Business Administration size standards.
- Ownership or control issues. Under §§ 26.69 and 26.71, the socially and economically disadvantaged owner must own at least 51% of the firm in a real, substantial, and continuing manner and must hold final decision-making authority. Denials can arise where governance documents give non-disadvantaged individuals equal or greater power, require their consent for ordinary business decisions, or where the firm lacks sufficient independence.
- Failure to provide required information or documentation within the timeframe set by the UCP.
It is important to note that the USDOT’s FAQs clarify that certifiers should evaluate all evidence holistically—an owner does not have to meet every single category of hardship, barriers, and denied opportunities to qualify.
How the USDOT Appeal Process Works
If you decide to appeal, here is what you should expect. Your appeal must include a written narrative explaining fully and specifically why you believe the certifier’s decision was wrong. This means identifying what outcome-determinative facts the certifier failed to consider and what provisions of 49 CFR Part 26 the certifier may have misapplied.
Once USDOT receives your appeal, it will request the certifier’s complete administrative record, which the certifier must provide within 20 days. USDOT then reviews the record and your arguments. It is important to understand that USDOT does not conduct a brand-new hearing or reassess every eligibility requirement from scratch. Instead, USDOT evaluates whether the certifier’s decision is consistent with the regulations and supported by substantial evidence.
USDOT will affirm the decision if it meets that standard, reverse it if it does not, or remand it back to the certifier for further action. The certifier’s decision remains in effect while the appeal is pending, so time matters.
Because USDOT is reviewing the existing record rather than holding a new hearing, how you build and explain that record is critical. Your appeal should map each stated reason for denial to specific evidence in your submission and identify any factual or legal errors the certifier made. A general plea for reconsideration is unlikely to succeed.
How an Attorney Can Help
Navigating a USDOT appeal can be complex, especially under the new individualized standards introduced by the IFR. An experienced attorney can add real value by:
- Reviewing any information provided with the denial/decertification, and identify any stated basis for the decision.
- Strengthening and organizing the administrative record, including your Personal Narrative, PNW statement, corporate governance documents, tax returns, loan documents, and other supporting materials.
- Identifying specific legal and factual errors under 49 CFR Part 26 or Part 23.
- Presenting complex ownership, control, and financial issues clearly and persuasively.
- Ensuring your appeal is timely, complete, and addresses the issues DOT will actually consider.
- Communicating with the certifier or USDOT on your behalf when needed.
The goal is to make the strongest possible case within the framework DOT uses to decide appeals. While no one can guarantee a particular outcome, having knowledgeable counsel in your corner can make a meaningful difference.
We Can Help
Over the years, I have a filed a number of DBE and ACDBE related appeals with the USDOT. Hiring an attorney who is familiar with the process can be a great benefit. If your company has received a denial or decertification decision under the DBE Interim Final Rule, do not wait. The 45-day appeal deadline moves quickly, and the sooner you engage experienced counsel, the more time there is to build a strong appeal.
Are you considering an appeal of your DBE or ACDBE denial (including recertification)? Please reach out to Danielle Dietrich, Esq. at ddietrich@potomaclaw.com or 412-449-9141 to discuss how she can help with your situation.
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