102-12 D/M/WBE UTILIZATION I. GENERAL Disadvantaged Business Enterprise (DBE) requirements apply to Federally Assisted contracts and have one goal. Minority/Women's Business Enterprise (M/WBE) requirements apply to contracts that do not have any Federal-Aid and have two separate goals, one for MBEs and one for WBEs. MBE and WBE goals cannot be combined. Firms may be certified under the Federal DBE program, the State M/WBE program, or both. There are three distinct stages of D/M/WBE utilization: goals, commitments and attainments. Goals are established prior to letting in the contract documents as a percentage of the contract bid price. After contract letting, the contract goal may also be expressed as a dollar amount. During the pre-award process and during post-award revisions, the Contractor agrees to dollar amount commitments. Attainments are measured after completion of the work in dollars paid to certified D/M/WBEs. Monitoring and reporting of D/M/WBE Utilization is performed using Department approved Civil Rights Reporting Software. The current approved software is Equitable Business Opportunities (EBO). The EBO software is a web-based system owned and maintained by the Department. Contractors do not have to purchase EBO software nor pay any fees to use EBO for Department contracts. II. D/M/WBE CERTIFICATION A. DBE Certification Only DBEs certified on the NYS Unified Certification Program are eligible to be used for goal attainment on Federal-Aid contracts. Under the UCP the certification of a DBE by any of the following agencies will be acceptable to all of the agencies: $ New York State Department of Transportation (NYSDOT) $ Metropolitan Transportation Authority (MTA) $ The Port Authority of New York and New Jersey (PANYNJ) $ Niagara Frontier Transportation Authority (NFTA) Firms are certified under NAIC codes, but the UCP also lists specific types of work (i.e. guide rail, landscaping, etc.) by work code for each agency, The NYSDOT Work Codes correspond to a core (three digit) Standard Specification Section number. A firm certified for one type of work (e.g. 606 Guide Railing) may not be certified for other work (e.g. 645 Sign can only be credited toward the goal(s) for the types of work that they are certified to perform. In order to be certified, firms must have performed that work previously. A new firm may perform as a majority subcontractor on one contract in order to gain the requisite experience, subsequently become certified, and appear on a later contract as a DBE. B. M/WBE Certification Only M/WBEs certified by Empire State Development Corporation (ESD), Division of Minority and Women's Business Development are eligible to be used for goal attainment on 100% State-funded contracts. III. SOLICITATION For Federal-aid contracts, bidders should review the on-line UCP Directory of certified DBEs to locate appropriate DBEs that may be able to perform work and the NYSDOT Work Codes are they listed to perform. If the DBE is not certified to perform the proposed work in accordance with the listed NAICS codes, the commitment cannot be approved. For 100% State funded contracts, bidders should review the ESD M/WBE Directory. If the M/WBE is not listed to perform the proposed work, the commitment cannot be approved. Prior to the Letting, Bidders should notify certified D/M/WBEs in a timely manner, with adequate information about the work requirements. Contract documents are no longer offered for sale by the Department in hard copy, and are now only available on CD. Bidders are not required to provide hard copies or CDs to D/M/WBEs. The D/M/WBEs should have sufficient time to review this information and respond. Late notification may indicate questionable Good Faith Efforts (GFE). Bidders should complete Form AAP 10 D/M/WBE Subcontractor & Supplier Solicitation Log, (See Exhibit 102-12A) and provide supporting documentation of good faith efforts as needed or requested. June 2014 New York State Department of Transportation Page 1
102-12 D/M/WBE UTILIZATION IV. PRE-AWARD REVIEW PROCESS The Low Bidder's contact person's Name and e-mail address should be in the address book for the e- mail account MO-Construction-CivilRights. Contractors or Subcontractors that do not already have access to EBO must submit an application and be vetted prior to issuance of a User Identification/ LOGIN and Password. For new Contractors or Subcontractors, this can be expedited if necessary to complete the Pre-Award review. A. EBO Initialization At bid opening (letting), the Apparent Low Bidder is identified. After the Contract Management Bureau, the Low Bidder is identified. Office of Construction will import the verified contract information (D number, description, goals, etc.) and the contract pay item list into EBO, and assign the contract to the Low Bidder. contracts will be deleted prior to import. The contract is typically available in EBO for the Contractor to enter Pre-Award D/M/WBE Utilization Package information by COB on the Friday following the letting and the Low Bidder is notified via e-mail from MO-ConstructionCivilRights@dot.ny.gov. B. D/M/WBE Utilization Pre-Award Package The Contractor is required to submit the Pre-Award D/M/WBE Utilization Package submittal 7 calendar days after the letting, or 3 calendar days after the letting for priority award contracts. The Pre-Award review is conducted by the Office of Construction Civil Rights Unit utilizing information in EBO. If the Low Bidder has not met the D/M/WBE Commitment goal, an evaluation of good faith efforts must be completed. The Apparent Low Bidder must complete Form AAP 10 D/M/WBE Subcontractor & Supplier Solicitation Log, (See Exhibit 102-12A) and provide supporting documentation of good faith efforts as needed or requested. The Contractor may be required to submit some additional information, particularly that pertaining to Good Faith Efforts (GFE), typically via scanned images. D/M/WBE Schedule Of Utilization (See Exhibit 102-12B) contains a summary of all of the utilization proposed for each D/M/WBE firm, and the total D/M/WBE commitment. D/M/WBE Utilization Worksheet (See Exhibit 102-12C) contains item descriptions of work to be performed by D/M/WBE firm, and the D/M/WBE commitment for each item. If the Low Bidder has checked the ALess Than 100% column, a description of the specific work to be performed or excluded must be attached.. The bid amount columns reflect the Low Bidder's bid price. If the amount in the bid amount column is vastly different than the figure in the Agreed Amount column, (i.e., the Subcontractor might perform part of the item and the low bidder did not indicate that) the analyst will determine why. Form AAP 22 Pre-Award D/M/WBE Material Supply Commitment Information (See Exhibit 102-12D) must be completed by the Bidder in order to assist in verifying commitments to material suppliers and to assist field staff in ensuring materials are purchased from D/M/WBEs and incorporated into the work. Pre-Award D/M/WBE Trucking Commitment Information (See Exhibit 102-12E) must be completed in EBO by the Bidder in order to assist in verifying commitments to trucking firms and to assist field staff in ensuring trucking is performed by D/M/WBE. The Office of Construction analyst will verify that proposed DBEs are certified to perform the items of work for which they are proposed using the UCP certification database. The UCP certification database contains additional information which will be useful during bid formulation, including contact information and items of work for which DBEs are certified. The Office of Construction analyst will verify that proposed M/WBEs are certified to perform the items of work for which they are proposed using the ESD M/WBE certification database. The ESD certification database contains additional information which will be useful during bid formulation, including contact information and items of work for which the M/WBE's are certified. If a D/M/WBE fails to respond to a bidder solicitation, the bidder must follow-up initial solicitations by calling the D/M/WBE to ascertain their interest (or lack thereof). If the low bidder did not enter the work type(s) being solicited, types/dates of contact or bidder action codes, the low bidder will be prompted to complete the missing information. The analyst may contact a sample of the D/M/WBEs listed on Form AAP-10 to verify that the apparent bidder has solicited bids. June 2014 New York State Department of Transportation Page 2
102-12 D/M/WBE UTILIZATION C. Pre-Award Review The Office of Construction analyst will review the D/M/WBE Schedule of Utilization, D/M/WBE Utilization Worksheets, the AAP 10 D/M/WBE Solicitation Log, Form(s) AAP 22 Pre-Award D/M/WBE Material Supply Commitment Information and Pre-Award D/M/WBE Trucking Commitment Information. Forms AAP 19 D/M/WBE Schedule of Utilization, AAP 20 D/M/WBE Utilization Worksheets, and the Pre-Award D/M/WBE Trucking Commitment Information can be printed from EBO, but generally the forms are not needed. After the Department has reviewed the Pre-Award Utilization Package and determined that the plan is acceptable, commitments must be acknowledged in EBO by the D/M/WBEs. Information verified in EBO is acceptable without hard copy signature(s). The pre-award D/M/WBE commitments are locked in EBO after pre-award approval, and can be viewed using the Pre-Award Approvals > History function. The Office of Construction analyst will verify that the proposed D/M/WBE Subcontractor has a current CCA-2 New York State Vendor Responsibility Questionnaire For Profit Construction on file with the Department. If the Subcontractor does not have a current CCA-2 on file with the Department, the Contractor and the RCS will be notified. If a D/M/WBE has previously been proposed, subsequently failed to file a CCA-2, was not approved as a Subcontractor, and is proposed as a Subcontractor again without having filed a CCA-2, that will be considered an indicator of potential fraud. If the D/M/WBE Utilization Pre-Award Package is reviewed and found acceptable, and the D/M/WBEs have acknowledged their commitments, the Pre-Award Unit Supervisor will approve the The goal for the Office of Construction is to make a civil rights award recommendation within 11 calendar days after letting. The Department must base a civil rights recommendation for award on the Contractor submitting commitments meeting the D/M/WBE goal, the Contractor submitting adequate GFE, or a combination of commitments and GFE. The analyst will post explanations, exceptions, requests for additional information, GFE,. D. Recommendation for Award If the C D/M/WBE Utilization Pre-Award Package is reviewed and found acceptable, the Deputy Chief Engineer (Construction) will make a civil rights award recommendation to the Contract Management Bureau. This recommendation is only one of the recommendations that must be received in order for the Contract Management Bureau to forward the bid package to the NYS Office of the Attorney General (AG) for approval and subsequently to the Office of the State Comptroller (OSC) for award. V. COUNTING D/M/WBE COMMITMENTS (WORK CATEGORY) A. D/M/WBE Subcontractors If the D/M/WBE is not certified to perform the items(s), then a determination must be made whether the item proposed is similar to the item(s) for which the D/M/WBE is certified. For example, a D/M/WBE is certified to perform work under Section 606 Guide Railing and the low bidder has proposed the D/M/WBE to perform Item 411.01 Stabilized Gravel Surface Course. Section 606 and Item 411.01 are not similar types of work, and the proposed D/M/WBE participation cannot be counted towards the commitment. If the low bidder proposed the same D/M/WBE to perform Item 587.1001 Box Beam Bridge Rail, One Rail, the D/M/WBE can be approved to perform this item because it is substantially similar to work performed under 606 Guide Railing, the primary difference being the location where it is installed. NYSDOT Work Codes for DBEs are a guide to assist Bidders in finding DBEs that can perform the specific work items in the contract. In order to count the DBE's participation, the proposed work must be included in the scope of NAICS codes listed for the DBE. For M/WBEs, the proposed work must be included in the scope of Commodity Codes listed for the M/WBE. If a D/M/WBE cannot be approved to perform an item, that item must be removed from the proposed utilization. For example, the low bidder intends to subcontract $100,000 worth of items to a D/M/WBE, 100% of the amount counts. Utilization = $100,000 X 1.00 = $100,000. June 2014 New York State Department of Transportation Page 3
102-12 D/M/WBE UTILIZATION B. Manufacturer/Fabricator There are very few DBEs certified as manufacturers. The more common example of a DBE that would qualify under this category is a fabricator. For example, a fabricator may take manufactured bulk steel and cut, fit and shape it for its final use. For example, the low bidder intends to purchase $75,000 worth of fabricated steel from a D/M/WBE, 100% of the amount counts. Utilization = $75,000 X 1.00 = $75,000. C. Material Supplier A Regular Dealer is a firm that owns, operates, or maintains a store, warehouse, or other establishment in which the materials, supplies, articles or equipment of the general character described by the specifications and required under the contract are bought, kept in stock, and regularly sold or leased to the public in the usual course of business. A Material Supplier must purchase and keep materials in stock, and have a method to sell those materials to the public, whether through a storefront or a website. A Material Supplier cannot supply materials fabricated specifically for a single contract (e.g. bridge beams, bridge bearings or traffic signal poles), because they are not kept in stock. A Material Supplier can supply bulk or manufactured materials. The Apparent Low Bidder must complete the Form AAP 22 Material Supplier Commitment Information (See Exhibit 102-12D) in order to allow the analyst to determine what materials are being supplied, if the designation as a Material Supplier is reasonable, and to allow field staff to monitor the utilization. One component in the identification of a Material Supplier as opposed to a Broker is to determine the business model used by the manufacturer(s) or wholesaler(s). Many manufacturers and wholesalers will not conduct retail business, and will only sell products to a retailer, in this case, the Material Supplier. If the manufacturer or wholesaler also sells the same products on a retail basis, the potential for the activity to be considered brokering is higher. A Broker could expedite a similar transaction, but would not be involved in the determination and collection of applicable sales taxes and payments would be made directly from the purchaser to the manufacturer(s) or wholesaler(s). Current established business practices often use the co physical inventories. In these cases, the most critical component of the business model is not the physical assets that the firm owns but rather information and established relationships. A Material Supplier may use an established relationship with a wholesaler to obtain materials, or may order the material directly from the manufacturer, and rather than have the materials shipped to their business, may have the materials direct shipped to the site, using a commercial shipper, particularly if the material constitutes entire vehicle loads or significant portions thereof. Under this model, a Material Supplier may not have sufficient quantity of the material in on-hand inventory of a particular item. For example, the low bidder intends to purchase $50,000 worth of drainage frames and grates from a DBE. Utilization = $50,000 X 0.60 = $30,000. (If the supplier is proposed to furnish and install the material, that would be considered a subcontract activity.) If the low bidder intends to purchase $50,000 worth of drainage frames and grates from an M/WBE. Utilization = $50,000 X 1.00 = $50,000. D A broker may offer to arrange to obtain material(s) for a Contractor for a set fee (e.g. x% of the material cost). The broker would contact a variety of sources, negotiate the price and arrange for delivery and payment terms. The payment would be made directly from the Contractor to the manufacturer, fabricator or supplier, and the broker would receive a separate payment for the agreed upon fee. For example, a broker has arranged for the low bidder to purchase $600,000 worth of fabricated steel from a majority fabricator for a 2% fee of $12,000. The entire amount of the fee counts. Utilization = $600,000 X 2% X 1.00 = $12,000 OR $12,000 X 1.00 = $12,000. June 2014 New York State Department of Transportation Page 4
102-12 D/M/WBE UTILIZATION E. Trucking The value of trucking services provided by trucks owned or leased from an established equipment leasing business open to the general public by a D/M/WBE firm will count towards the D/M/WBE commitment. The lease must indicate that the DBE has exclusive use of, and control over, the truck. Leased trucks must display the name and identification number of the DBE. The DBE must hold the appropriate license, hauling permit, etc. to transport material on public highways. The value of trucking service provided by trucks hired or rented by a D/M/WBE firm from another D/M/WBE trucking firm will count towards the D/M/WBE commitment. Hired or rented trucks may include operators. No credit will be applied for non-certified trucking services. The Pre-Award Unit maintains a list of DBE owned trucks and types, which together with Pre-Award D/M/WBE Trucking Commitment Information in EBO help evaluate trucking commitments for reasonability. Appropriate comments will be made in EBO followed by his/her initials. The Apparent Low Bidder must provide Form AAP 23 D/M/WBE Trucking Commitment Information that supports the dollar value of the proposed D/M/WBE trucking. (See Exhibit 102-12E) VI. CONTRACT AWARD After contract award, the Office of Construction will enter the date the contract was awarded by OSC into EBO. The Regional Compliance Specialist should note any contract where the pre-award approval did not meet the goals, so the can be monitored during the course of the contract. EXHIBITS A Sample Form AAP 10 D/M/WBE Solicitation Log B Sample EBO Construction Contract Screen C Sample EBO PreAward Approvals History Screen D Sample Form AAP 22 Pre-Award D/M/WBE Material Supply Commitment Information E Sample Form AAP 23 Pre-Award D/M/WBE Trucking Commitment Information June 2014 New York State Department of Transportation Page 5
June 2014 New York State Department of Transportation Exhibit 102-12A
June 2014 New York State Department of Transportation Exhibit 102-12B
June 2014 New York State Department of Transportation Exhibit 102-12C
June 2014 New York State Department of Transportation Exhibit 102-12D
June 2014 New York State Department of Transportation Exhibit 102-12E