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December 14, 2020 Final Rule (Gross Receipts Adjustment)

The Department of Transportation issued a final rule on December 14, 2020, applicable to the Disadvantaged Business Enterprises (DBE) program. The rule, effective January 13, 2021, (1) provides an inflation adjustment to the size limit on small businesses participating in the DBE program under 49 CFR Part 26, and (2) implements a statutory change to the size standard pursuant to the FAA Reauthorization Act of 2018.

1.  The statutory gross receipts cap for certified DBEs specified in 49 CFR §26.65 is adjusted for inflation from $23.98 million to $26.29 million. This adjustment applies to the DBE program only.  If a firm’s gross receipts averaged over the firm’s previous three fiscal years exceeds $26.29 million, then it exceeds the small business size limit for participation in FHWA and FTA-assisted work under the Department’s DBE program. A DBE firm must still meet the size standard(s) appropriate to the type(s) of work the firm seeks to perform in DOT-assisted contracts. These standards vary by industry according to the NAICS code(s) defined by the Small Business Administration (SBA).

2. As of January 13, 2021, the gross receipts cap does not apply for the purpose of determining a DBE’s eligibility for FAA-assisted projects. DBE firms working on FAA-assisted projects must meet the size standard(s) appropriate to the type(s) of work based solely on the applicable NAICS code(s) size standard(s).  Your state UCP DBE/ACDBE directory should clearly indicate which firms are only eligible for counting on FAA-assisted work.

The attached rule is not applicable to firms applying for, or that are certified as Airport Concession DBEs (ACDBEs) under 49 CFR Part 23.

Regulatory Topic: 49 CFR part 26
Last updated: Wednesday, January 13, 2021