Step 1. Determining a Base Figure 49 CFR Part 26.45(c)
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1 Ohio Department of Transportation s Proposed Federal Transit Administration Triennial Disadvantaged Business Enterprise Federal Fiscal Years 2017, 2018, and 2019 Goal and Methodology The Ohio Department of Transportation (ODOT) submits this Disadvantaged Business Enterprise (DBE) goal and methodology to U.S. Department of Transportation s (USDOT s) Federal Transit Administration (FTA) for review and approval pursuant to 49 CFR Part The goal and methodology establishes ODOT s overall DBE goal for FTA-assisted contracts that ODOT and its subrecipients anticipate awarding in Federal Fiscal Years (FFYs) 2017, 2018, and To establish its overall DBE goal, ODOT closely followed federal regulations, including the two-step goal-setting methodology set forth in 49 CFR Part ODOT determined a step one base figure for its overall DBE goal using information from the Ohio DBE Unified Certification Program (UCP) Directory as well as from Census Bureau data. ODOT determined whether a step two adjustment was needed to the base figure using information on past DBE participation in USDOT-funded contracts in recent years, among other information. Step 1. Determining a Base Figure 49 CFR Part 26.45(c) ODOT projects that it will receive over $95 million in FTA financial assistance during FFYs 2017, 2018, and That projection is based on the grants and financial assistance that the ODOT Office of Transit received and awarded to its subrecipients during FFY 2016 ($32,648,205) and what it expects to receive in FFYs 2017, 2018, and Per 49 CFR 26.45(b), the triennial goal must be based on demonstrable evidence of the availability of ready, willing and able DBEs relative to all businesses ready, willing and able to participate on your DOT-assisted contracts ODOT began the DBE goal-setting process by determining a base figure for the relative availability of DBEs. ODOT made that determination by examining projects that included FTA financial assistance that were let in ODOT also considered the types of projects that were let in previous years. Each project was evaluated and assigned North American Industry Classification System (NAICS) codes. A majority of FTA financial assistance that ODOT awards to local subrecipients is used for project costs that do not represent contracting opportunities (e.g., internal payroll, fringe benefits, and transit vehicle purchases). ODOT removed those items as appropriate. ODOT then projected the contract dollars that it expects to award as part of FTA-assisted projects during FFYs 2017, 2018, and 2019 in each relevant NAICS code ($38.3 million). Figure 1 presents those projections. 1 ODOT considered projects let by ODOT s Office of Transit and projects let by local subrecipients that received FTA financial assistance from ODOT. PAGE 1
2 Figure 1. Projections of FTA financial assistance for FFYs 2017, 2018, and 2019 for relevant NAICS codes NAICS Code Total Triennial Projection Bus and Other Motor Vehicle Transit Systems $9,813, Interurban and Rural Bus Transportation $9,350, Special Needs Transportation $3,612, Gasoline stations with convenience stores $2,678, Other Scientific and Technical Consulting Services $1,637, General Automotive Repair $1,553, Other Management Consulting Services $1,455, Administrative Management and General Management Consulting Services $1,414, Petroleum and Petroleum Products Merchant Wholesalers $1,280, Automotive Parts and Accessories Stores $1,215, Computer software consulting services or consultants $897, Media Representatives $554, Tire Dealers $405, Commercial Printing (except Screen and Books) $385, Transportation management consulting services $279, Consumer-type electronic, software stores $274, Office Supplies and Stationery Stores $246, Janitorial equipment and supplies stores $173, Offices of Lawyers $173, Janitorial Services $143, All Other Miscellaneous Ambulatory Health Care Services $95, Radio repair and maintenance services without retailing new radios $79, Compressor, air and gas, rental or leasing $79, Uniform (except industrial) supply services $58, Automobile leasing $58, Computer Facilities Management Services $55, All Other General Merchandise Stores $52, Temporary Help Services $48, Computer and Office Machine Repair and Maintenance $43, Automotive Body, Paint, and Interior Repair and Maintenance $33, Addition, alteration and renovation, commercial and institutional building $32, Plumbing, Heating, and Air-Conditioning Contractors $22, Motor Vehicle Towing $19, Office Machinery and Equipment Rental and Leasing $18, Offices of Certified Public Accountants $18, Other Automotive Mechanical and Electrical Repair and Maintenance $16, Investigation Services $11, Car Washes $6, Exterminating and Pest Control Services $5, Landscaping Services $4, Fire extinguisher sales combined with rental and/or service, merchant wholesalers $1,319 Total $38,307,351 Page 2
3 ODOT then identified the number of ready, willing, and able DBEs working in each relevant NAICS code as well as the total number of all firms ready, willing, and able to perform work in each NAICS code. 2 ODOT used Ohio s UCP Directory of Certified Firms to identify ready, willing, and able DBEs working in relevant NAICs codes. 3 Per 49 CFR 26.81(a), ODOT serves as one of four agencies responsible for DBE certifications in the state of Ohio and maintains Ohio s UCP Directory per 49 CFR 26.81(g). ODOT used the Census Bureau s County Business Patterns database to determine the number of all firms ready, willing, and able to perform work in relevant NAICS codes. 4 ODOT then calculated the DBE availability percentage for each relevant NAICS code. To do so, ODOT divided the number of ready, willing, and able DBEs working in each NAICS code by the total number of all firms ready, willing and able to perform work in the NAICS code. The DBE availability percentages that ODOT determined for each relevant NAICS code were then multiplied by the dollar projections presented in Figure 1 to project DBE dollar availability for each relevant NAICS code. Figure 2 presents those results. As shown in Figure 2, the total projected DBE dollar availability for FFYs 2017, 2018, and 2019 is $1,485,875, or 3.9%, of the FTA financial assistance that ODOT projects that it will receive during that time (i.e., $1,485,875/ $38,307,351 = 0.039). Thus, ODOT has determined that its base figure for its overall DBE goal for FFYs 2017, 2018, and 2019 is 3.9%. Step 2. Determining if an Adjustment is Needed 49 CFR Part 26.45(d) After establishing the base figure, ODOT considered available information to determine whether any adjustment was needed to the base figure to determine its overall DBE goal and to make it as precise as possible. Current capacity of DBEs to perform work, as measured by the volume of work DBEs have performed in recent years. The United States Department of Transportation s (USDOT s) Tips for Goal- Setting suggests that agencies should examine data on past DBE participation in their USDOT-funded contracts in recent years. USDOT further suggests that agencies should choose the median level of annual DBE participation for those years as the measure of past participation: Your goal setting process will be more accurate if you use the median (instead of the average or mean) of your past participation to make your adjustment because the process of determining the median excludes all outlier (abnormally high or abnormally low) past participation percentages. 5 Figure 3 presents past DBE participation based on information collected by ODOT s Office on Transit. Median DBE participation in FTA-funded contracts from FFYs 2013 through 2015 was 9.6% 2 Although ODOT considered the state of Ohio to be the relevant geographic market area for most relevant NAICS codes, ODOT only considered firms to be available for local subrecipient projects if they were located within a limited region in which the subrecipient is located. For ODOT-let projects, ODOT considered firms located anywhere in Ohio to be available for those projects. For NAICS codes Bus and Other Motor Vehicle Transit Systems and Interurban and Rural Bus Transportation, ODOT considered Ohio and its five adjacent states Indiana, Kentucky, Michigan, Pennsylvania, and West Virginia to be the relevant geographic market area, because those services are often bid on and fulfilled by providers outside of Ohio. 3 Unified Certification Program Certification Listing Report 4 United States Census County Business Patterns 5 Section III (A)(5)(c) in USDOT s Tips for Goal-Setting in the Federal Disadvantaged Enterprise (DBE) Program. Page 3
4 Figure 2. DBE dollar availability for each relevant NAICS code NAICS Code Triennial Projection Percent DBE Availability $ Bus and Other Motor Vehicle Transit Systems $9,813, % $439, Interurban and Rural Bus Transportation $9,350, % $207, Special Needs Transportation $3,612, % $212, Gasoline stations with convenience stores $2,678, % $ Other Scientific and Technical Consulting Services $1,637, % $91, General Automotive Repair $1,553, % $ Other Management Consulting Services $1,455, % $232, Administrative Management and General Management Consulting Services $1,414, % $52, Petroleum and Petroleum Products Merchant Wholesalers $1,280, % $116, Automotive Parts and Accessories Stores $1,215, % $ Computer software consulting services or consultants $897, % $31, Media Representatives $554, % $64, Tire Dealers $405, % $ Commercial Printing (except Screen and Books) $385, % $ Transportation management consulting services $279, % $11, Consumer-type electronic, software stores $274, % $ Office Supplies and Stationery Stores $246, % $ Janitorial equipment and supplies stores $173, % $ Offices of Lawyers $173, % $ Janitorial Services $143, % $2, All Other Miscellaneous Ambulatory Health Care Services $95, % $1, Radio repair and maintenance services without retailing new radios $79, % $ Compressor, air and gas, rental or leasing $79, % $ Uniform (except industrial) supply services $58, % $ Automobile leasing $58, % $ Computer Facilities Management Services $55, % $9, All Other General Merchandise Stores $52, % $ Temporary Help Services $48, % $ Computer and Office Machine Repair and Maintenance $43, % $ Automotive Body, Paint, and Interior Repair and Maintenance $33, % $ Addition, alteration and renovation, commercial and institutional building $32, % $ Plumbing, Heating, and Air-Conditioning Contractors $22, % $ Motor Vehicle Towing $19, % $ Office Machinery and Equipment Rental and Leasing $18, % $9, Offices of Certified Public Accountants $18, % $ Other Automotive Mechanical and Electrical Repair and Maintenance $16, % $ Investigation Services $11, % $ Car Washes $6, % $ Exterminating and Pest Control Services $5, % $ Landscaping Services $4, % $ Fire extinguisher sales combined with rental and/or service, merchant wholesalers $1, % $0 Total $38,307, % $1,485,875 PAGE 4
5 Figure 3. Past DBE participation on FTA-funded contracts, FFY 2013 through 2015 Source: ODOT FFY DBE Attainment Annual DBE Goal Difference % 27.6% -20.1% % 7.7% 9.0% % 7.7% 1.9% Median past DBE participation 9.6% The information about past DBE participation supported an upward adjustment to ODOT s base figure. ODOT adjusted the DBE availability upward by averaging the base figure (3.9%) and the median past DBE participation (9.6%) (i.e., ( )/2 = ). Thus, ODOT has determined that its overall DBE goal for FFYs 2017, 2018, and 2019 is 6.75%. Information related to employment, self-employment, education, training, unions, and financing. ODOT considered research of marketplace conditions in the state of Ohio. Existing research, as well as recent analyses conducted as part of ODOT s disparity study indicate that raceand gender-based disparities exist in terms of acquiring human capital, accruing financial capital, owning businesses, and operating successful businesses. 6 Barriers in the marketplace likely have important effects on the ability of minorities and women to start businesses in the Ohio industries relevant to FTA-assisted projects and operate those businesses successfully. Any difficulties that minorities and women face in starting and operating businesses may reduce their availability for FTAassisted projects and may also reduce the degree to which they are able to successfully compete for FTAassisted projects. Race-Neutral Program Measures 49 CFR Part (c) Per 49 CFR 26.51(a) You must meet the maximum feasible portion of your triennium goal by using race-neutral means of facilitating DBE participation. ODOT will meet 100 percent of its overall DBE goal for FTA-assisted project through the use of race-neutral measures. In addition, ODOT will maximize outreach efforts to the DBE contracting community and the use of DBE supportive services to increase the utilization and support of DBEs that participate on upcoming ODOT FTA-assisted projects. Race-neutral initiatives. ODOT primarily uses technical assistance programs and prompt payment policies to encourage the participation of small businesses including minority-, woman-owned, and disadvantaged businesses in its FTA-assisted projects. Technical assistance programs. ODOT s Division of Opportunity, Diversity, & Inclusion hosts events designed to provide DBEs and other small businesses with assistance in the areas of networking, technology, business development, and training on how to do business with ODOT. ODOT s Office of Local Programs provides training in workforce development, organizational excellence, and various other topics that are available through web-based training modules to anyone interested. ODOT also offers reimbursements for various expenses including technical training, tuition, and books associated with business development programs that DBEs can apply for through ODOT s Supportive Services Program (SSP). 6 PAGE 5
6 Prompt payment policies. ODOT has policies in place to help ensure prompt payment to both prime contractors and subcontractors. Ohio state law requires state entities to pay prime contractor invoices within 30 days of receipt, but ODOT typically pays prime contractors within two weeks of receiving and approving an invoice. ODOT also enforces state-mandated prompt payment processes that require prime contractors to pay their subcontractors within 10 days of receiving payment from state entities Public Participation Public participation was a key component of ODOT s process for setting its overall DBE goal. ODOT made the following efforts to engage the public as part of the goal-setting process. To notify the public of the triennial DBE goal and methodology, 5,800 s providing notification of public outreach meetings were distributed to DBE companies and stakeholders on the following dates: May 27 th June 1 st June 10 th June 13 th June 22 nd On June 21 st, ODOT notified its subrecipients (via ) about the proposed DBE goal and methodology and requested comments. Public Outreach digital notification ads were place during the week of June 18 th June 24 th to the following news outlets. 1,104,357 digital impressions were delivered on a continual basis and was viewed by 1,727 individuals. Media Organization Online Market(s) Impressions Delivered Clicks Call and Post Cleveland Not reported - Cincinnati.com Cincinnati 100, Cleveland.com Cleveland 100, Dispatch.com Columbus 101, Limanews.com Lima 99, Morningjournal.com Lorain 100, Toledoblade.com Toledo 100, Recordpub.com Kent/Ravenna 98, Daytondailynews.com; Springfieldnewssun.com Dayton, 202, Springfield News-herald.com Willoughby 100, Vindy.com Youngstown 101, Report Totals: 1,104,357 1,727 Provided by Google analytics ODOT created a webpage devoted to the DBE goal and methodology, which provided a link to the document and its rationale, as well as a forum to allow comments to be submitted electronically. The Page 6
7 website was made available beginning on June 10, The link to the website and online document was ed to all DBE firms, ODOT s list of registered consultants, and included in the Ohio Contractor Association s newsletter. ODOT received five Public Comment Surveys on the Transit DBE goal and methodology. One of these was actually a comment on ODOT s disparity study. Four public outreach meetings were held: Date Location Registered Attendance Comment responses June 27 th Columbus June 28 th Toledo June 29 th Cleveland June 30 th Cincinnati A Summary of all comments/questions received is attached hereto as Exhibit A. Copies of all written comments/questions received are attached hereto as Exhibit B. Summary Pursuant to the requirements of 49 CFR 26.45(a)(2), ODOT submits this proposed triennial DBE Goal to FTA for review and approval. ODOT followed the requirements of 49 CFR Part 26 in setting its overall DBE goal. ODOT s overall DBE Goal of 6.75% for FFYs 2017, 2018, and 2019 is based on the availability of ready, willing, and able DBEs to participate in FTA-assisted projects and ODOT s DBE attainment on FTA-assisted projects in the recent past. ODOT anticipates race- and gender-neutral participation of 100% to meet its overall DBE goal. Page 7
8 Ohio Department of Transportation Central Office 1980 West Broad Street Columbus, OH John R. Kasich, Governor Jerry Wray, Director Exhibit A DBE Goal Setting Public Outreach Summary of Questions/Comments A few commenters asked that ODOT consider including DBE-eligible firms that are not certified in the goal to make the goal achievable for small rural subrecipients. A commenter felt the goal was very low. ODOT is an Equal Opportunity Employer and Provider of Services
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Step 1. Determining a Base Figure 49 CFR Part 26.45(c)
Ohio Department of Transportation s Proposed Federal Transit Administration Triennial Disadvantaged Business Enterprise Federal Fiscal Years 2017, 2018, and 2019 Goal and Methodology The Ohio Department
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