Shortcuts for PNW Reapplications and Other Details on Implementation of New Disadvantaged Business Enterprise (DBE) Regulations

Preliminary Note: On Tuesday, April 9, 2024, the United States Department of Transportation issued a final rule that modernized the Disadvantaged Business Enterprise (DBE) program and the Airport Concessions DBE (ACDBE) program regulations. A copy of the final rule can be found here. The changes will go into effect on May 9, 2024. This blog is one in a series highlighting the changes and updates found in this final rule.

With any significant changes comes the possibility of confusion. The USDOT anticipated that there would be some confusion in the implementation of the newly overhauled DBE regulations, so it released guidance to be used by certifiers (and relied upon by applicants/certified firms) to clear up any confusion arising out of the transition to the new regulations. This blog will summarize three of the more interesting and important pieces of that guidance.

Applicants who were denied certification or were decertified solely due to Personal Net Worth (PNW) have some potential relief. If the PNW was more than $1.32 million but less $2.047 million (reminder: exclude retirement accounts) and they were denied or decertified after November 9, 2023, the business can shortcut the process. According to the guidance, companies in that situation can submit a new PNW statement as of May 9, 2024, and be granted certification. They do not have to wait the full year, nor must they reapply.

The guidance also clarified a point that sometimes brings confusion- certified companies must calculate, report and documentation gross receipts on a cash basis, not an accrual basis.

The guidance also offers clarifications on appeal deadlines. For companies that were denied or decertified prior to May 9, 2024, their appeal period remains 90 days. For companies denied or decertified May 9, 2024, or after, the appeal period will be 45 days. To illustrate, a firm that receives its decertification on May 8, 2024, will have 90 days to appeal, whereas a company that receive its decertification the following day will have 45 days to appeal.

As with any change, we anticipate that there will be mistakes. Applicants or companies facing decertification would be well-served to hire knowledgeable legal counsel to help guide them through the process.

If your company has questions about the new regulations, or about DBE or ACDBE certification generally, please contact Danielle Dietrich, Esq. at ddietrich@potomaclaw.com or 412-449-9141.

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