What is a Disadvantaged Business Enterprise (DBE)?

News - Published Aug 13, 2014

In the United States, small businesses that are majority-owned by minority and/or women can get a leg up in public contracting by becoming certified as a Disadvantaged Business Enterprise (DBE). 

When state and local governments accept funding from the U.S. Department of Transportation (USDOT) for road, highway, airport, and other transportation-related projects, they are required to establish annual DBE participation goals that reflect the expected participation of minority and women businesses in their region. In an effort to meet this goal, a public agency awarding a contract that includes USDOT funding will oftentimes require that prime bidders perform a good faith effort to subcontract out a specific percentage of the contract's value to DBEs. 

With the federal transportation department mandating inclusive DBE contracting policies, it often falls to states' departments of transportation to implement DBE programs, though certification can usually be obtained through various entities. Most states have a Unified Certification Program, where approved agencies located around a state can accept and process DBE applications. 

While DOTs play a central role in DBE programs, a business does not have to be involved in the construction or transportation sectors in order to become certified or benefit from the program. In fact, as one of the most well known small and economically disadvantaged business programs, many other state and local entities apply DBE participation requirements to contracts for all kinds of goods and services. 

DBE certification can help your business get started in public contracting, but first you need to become certified. Contact your state DOT to learn more about how to become a DBE.