American DBE Magazine Summer 2014

VDOT Tunnels Project Spurs Economic Development

National DBE Certification Under Consideration Illinois DBELO Profile: Gustavo Giraldo DBEs Andre Gilliam and Susan Ritter with SKW DBE Compliance Manager Vincent Powell

FTA Increases Focus on Transit Vehicle Manufacturers

SUMMER 2014

Innovative Compliance Tools Help DBEs Succeed

Contents

FEATURES

VDOT Tunnels Project

14 17 18 20 24

McHugh Pays $12 Million to Settle Fraud Claims

National DBE Certificaton

Innovative Compliance Tools

NAMC Celebrates 45 Years

DEPARTMENTS 4 Publisher’s Page 6 Business Development I: ACDBE Joint Ventures 7 Business Development II: Building DBE Wealth 8 DBELO Spotlight: Gustavo Giraldo, Illinois Tollway TRANSPORTATION TRENDS: AVIATION, CIVIL/HIGHWAY AND TRANSIT 25 COMTO Celebrates Cunningham Legacy 32 AASHTO Training Symposium Boosts Collaboration ALSO IN THIS ISSUE 12 Ten Top Tips for DBE Professionals 26 FTA Focuses on Transit Vehicle Manufacturers

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FROM THE PUBLISHER

What Is A DBE? A DBE (Disadvantaged Business Enterprise) is defined by the U.S. Department of Transportation as a firm that meets the criteria to be designated as such through a certifying agency. This criteria is based on a majority business owner being a member of certain race, nationality or gender grouping; having certain ownership and control characteristics; meeting certain personal net worth thresholds; and meeting business size characteristics. This definition does more to explain who a DBE is demographically, than to explain what a DBE is as an entity.

In general, many discussions regarding what a DBE actually is originate from negative conversations related to stereotypes and common perceptions. Supporters of the DBE program often see the term as derogatory because they believe it labels firms as inferior or less than capable. Those who disagree with the program often use the term to reinforce their perceptions about the capability or equality of certain firms; or they disagree with the responsibility of government in having a role in addressing societal wrongs. However, I see the term as simply a reality.

Yes, the term “disadvantaged” is a negative term; dis-anything is not positive because it means “apart.” So the term dis-advantaged literally means apart from those that are/have been advantaged. But as an African American in American society I would be naive to not recognize that in many ways, I am apart from groups that have experienced myriad advantages that I and others haven’t had access to. One of my parents’ favorite sayings growing up was, “You have to be twice as good to get half as far.” So I learned early and often that I faced some obstacles that some others don’t have AND more importantly, I was expected to overcome these obstacles because it was in my power to do so—since the obstacles had nothing to do with me or my capabilities.

So then what is a DBE? For me it is a business that has not yet reached certain personal net worth or business revenue

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thresholds; who through no fault or deficiencies of its own, endures discrimination due to their gender, race or national origin. Although this definition does nothing for other people’s perceptions of what a DBE is or isn’t, it helps me as a DBE owner, and hopefully helps other DBE owners internalize exactly what a DBE is, and what it means to compete in the transportation industry.

It is what it is. Disparity studies and individual experiences continue to show that minority- and women-owned firms still face overt and institutional discrimination. However, we also know that these challenges are nothing new and can be overcome with patient persistence, advocacy and excellence.

This issue of American DBE celebrates the belief that one day discrimination, racism and sexism will be overcome; and our job is to not grow weary, give up or get discouraged. Transportation is a $40+ billion a year industry that has enough opportunity for businesses owned and controlled by people of all races, genders and nationalities. Let’s all be about the business of making this possibility a reality as soon as possible.

Best wishes.

Shelton A. Russell, Publisher

Subscribe to In-Depth Industry Coverage Subscribe Online at www.AmericanDBE.com Call Today!

919-234-6429 www.americandbe.com

Summer 2014 Volume 2, Issue 3 Publisher: Shelton A. Russell Managing Editors: PR PROS, LLC Creative Director: William Cash

Because “That’s The Way We’ve Always Done It” Doesn’t Work Anymore.

Digital Media: Premier Web Design Solutions Editorial: Don O’Bannon, Esq. Shelton A. Russell Philip D. Russell Amikka Smith Jordan Taylor Headquarters: 514 Daniels Street, #186 Raleigh, NC 27605 Web site: www.AmericanDBE.com Social Media:

About American DBE Magazine: PublicRelationsCopywritingSocialMediaManagementCrisisCommunicati American DBE Magazine is the premier industry for individuals and stakennect Blog Linkresource Pin Hangout Share—REPEAT—Post Tweet Publish Email Connect Blog Link Pin Hangout Share holders who work within the federal Disadvantaged Business Enterprises program lMediaManagementCrisisCommunicationsMediaCoachingBrandEnhancementMediaMonitoringDigitalMedia administration. American DBE Magazine is published quarterly and distributed in all 50 Post Tweet Publish Email Connect Blog Link Pin Hangout Share—REPEAT— states—plus Puerto Rico and the U.S. Virgin Islands—to DBE program administrators, PublicRelationsCopywritingSocialMediaManagementCrisisCommunicationsMediaCoachingBrandEnhancementM business owners, and professionals in the Aviation, Highway Construction, Public Blog Link Pin Hangout Share—REPEAT—Post Tweet Publish Email Connect Bl Post Tweet Publish Emailand Connect Transit industries.

Subscriptions: American DBE Magazine is published quarterly in Fall, Winter, Spring and Summer editions. The annual subscription rate is $19.99 including online editions, special industry reports, and four issues; single copy list price is $5.99 plus postage originating from Raleigh, North Carolina.

globalPRpros.com

Advertising Sales: editor@AmericanDBE.com (919) 234-6429 office

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Business Development In 2008, the Federal Aviation Administration issued the Airport Concessions Disadvantaged Business Enterprise Joint Venture Guidance. The FAA’s guidance sets forth the interpretation of the Department of Transportation and the FAA on the administration and implementation of the federal regulations governing joint ventures in airport concessions.

tion to the ACDBE partner. In single location awards, though sometimes difficult, the parties should carefully examine the business operations and carve out an operational component that is severable. For example, several joint ventures have given the ACDBE control and responsibility for the food-to-go or take-out portion of the business.

There are other issues such as the ACDBE’s capital contribution and the allocation of risk in the joint venture that also should be addressed in the joint venture agreement. The FAA’s guidance clearly requires that the ACDBE cannot be insulated from risk and must share both in the profits and losses of the venture. The allocation of risk in the joint venture must be commensurate, i.e. proportionate with the ACDBE’s ownership interest in the business of the joint venture.

In addition to the standard joint venture issues outlined in the FAA’s guidance, there are other issues that a potential joint venture partner should also consider before entering into any joint venture agreement. A standard provision in many joint venture agreements is a restriction on the party’s ability to participate in other potentially competing ventures. No one would argue, however, that it is unreasonable to restrict a joint venture partner’s ability to participate in competing business ventures; but the open issue is how restrictive is the scope of the agreement’s non-competition provision. For example, in a food and beverage joint venture, the language of the non-competition provision may be drafted broadly to prohibit a joint venture partner’s participation in any competing food and beverage businesses. Alternatively, the non-competition language could also be narrowly drafted to prohibit only those business activities that compete directly with the joint venture’s food and beverage business. For example, a franchise selling only burgers may include a provision that excludes a joint venture partner from investing in other fast-food burger concepts, but would allow the joint venture partner to participate in a sitdown restaurant.

The bottom line is that the provisions of a joint venture agreement have legal consequences and an ACDBE Don T. O’Bannon, Of Counsel; Bryan Cave LLP, Dallas TX. concessionaire must understand not only the FAA’s Joint Venture Guidance but also the significance of other critical provisions addressed in the parties joint venture relationship.

JOINT VENTURES and the FAA’s JOINT VENTURE GUIDANCE Although the regulations were published six years ago, the FAA’s guidance to joint ventures in concessions continues to create issues for potential joint venture partners in the negotiation and drafting of agreements that comply with the guidance. An issue that the parties often fail to fully discuss and consider is the requirement in the guidance that the “ACDBE is responsible for a distinct, clearly defined portion of the work.” The parties to a joint venture must sit down and determine the specific roles and responsibilities of the joint venture partners. The parties’ delineation of roles and responsibilities in the agreement must clearly set forth the ACDBE’s specific responsibilities. The joint venture guidance explicitly expresses a preference for the ACDBE to be involved in revenuegenerating activities. Further, the Airport must also be able to verify and quantify the contribution of the ACDBE to the operation and management of the joint venture enterprise.

In order to comply with the FAA’s guidance, the parties must have a candid and open dialogue about the operation of the joint venture and the parties’ respective roles in the preconstruction, construction and day-to-day management of the joint venture’s business operations. A description of ACDBE responsibilities that includes “participation in,” “assistance with” or that outlines shared responsibilities will not meet the letter or the spirit of the joint venture guidance.

The next and perhaps the most difficult issue for the parties in the joint venture guidance to understand is that the ACDBE partner must control the activities in the joint venture assigned to the ACDBE partner. The FAA’s joint venture guidance explains that joint ventures typically have management committees and the management committee is responsible for managing the business operations. Under this scenario, the ACDBE joint venture partner usually owns less than 51 percent of the venture, and therefore, is out-voted on most business decisions made by the joint venture. The FAA’s Joint Venture Guidance requires that the parties carve out areas of responsibility that are exclusively controlled by the ACDBE partner. In multiple store awards, the guidance’s control requirement can be met by simply turning over the “day-to-day” operation of a loca6

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Business Development

BUILDING

DBE WEALTH One of the primary goals of the DBE program is to assist firms in competing outside of the program. A key component of reaching this goal is identifying the best practices of DBEs that succeed in developing the business and financial capacity to succeed on a larger scale in the marketplace outside of the program. However, most firms that enter the DBE program never develop the business size or wealth to exceed the program’s limits and thus remain a DBE throughout the life of the business. So what does it take to grow the business and financial capacity to mature outside of the DBE program and create wealth?

Business development experts were asked to provide the most important factors to developing business and personal wealth as a DBE firm. This question was based on the idea that business and personal wealth are key attributes of a business that can effectively compete outside of the DBE program, without which a firm remains at a competitive disadvantage in the marketplace.

Be the Best

Victor Galloway, Project Director of the USDOT South Atlantic Small Business Transportation Resource Center in Durham, NC believes that a DBE firm that pursues industry leadership is in the best position to grow business and personal wealth.

He said, “Companies that can quickly align their core competency strengths with market opportunity have been the most successful.

They know who they are and what they do, and they focus on building their brand on that.

Companies that fail are those that are just chasing the market for any opportunity, where no one can identify their level of expertise because they have become generalists and not experts.” Galloway believes that the firms that not only achieve industry leadership, but commit to staying on the leading edge of their selected industry through training, education and investment, are in the best position for long-term success, growth and wealth-building.

Bow to King Cash

Jess McLamb, president and founder of The Roper Group, a bookkeeping firm with 20 years of service to small business clients believes building business and personal wealth as a DBE firm comes down to focusing on cash flow and not profits. “It all goes down to managing cash,” McLamb said. “A lot of times the mistakes DBEs make revolve around not having a credit policy, or not following the credit policy they have, and accounts receivable get out of hand. Many times businesses will focus just on profits and not the cash flow.” McLamb also believes DBEs should learn to recognize the warning signs of poor cash flow early enough to make changes before it is too late. “DBEs should look at those early warning signs and understand the things that may be a problem. Warning signs may be what customers are saying when they are not paying on time, or past due accounts going into collections may point to the need to make changes in the business.”

Invest in Your Business

Jovan Goldstein, Managing Partner of JT Goldstein Accountant and Business Advisers in Philadelphia believes that a DBE firm should re-invest business profits back into their business to grow capacity. Goldstein advises DBE firms that want to grow business and personal wealth to “invest in your business, that’s it… Invest in your business in every facet and every form; from infrastructure, to quality personnel, to technology, to facilities. Build capacity! Once you have capacity, one of two things is going to happen; you are going to develop such a wealth of great expertise that you are going to be able to leverage it, or the business will be attractive to someone else. If you can continue to leverage your expertise you can do extremely well.”

Don’t Play with Your Money

Goldstein also believes that businesses that successfully grow business and personal wealth take financial management seriously. He said, “You have to take your financial matters seriously, and you have to hire and engage people that play to your weaknesses, and let them do their job. Successful businesses are serious about that. If a successful business is cutting corners, they are not cutting corners in these two areas.”

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DBE Liaison Officer Spotlight:

Gustavo Giraldo

Natalia N. Homedi, P.E., President of Atlas Engineering Group Ltd., and Gustavo Giraldo at a professional services networking event.

Everybody In and Nobody Left Out

Embracing Illinois Governor Pat Quinn’s motto, “Everybody in and nobody left out,” Illinois Tollway Chief of Diversity and Strategic Development Gustavo Giraldo plays a pivotal role in the agency’s efforts to increase access to economic opportunities for firms of all sizes and types on the Tollway’s 15-year, $12 billion capital program, Move Illinois: The Illinois Tollway Driving the Future.

After immigrating to the United States from Colombia at 21 years old, Gustavo Giraldo has carved out a distinguished public service career spanning more than 30 years. In December 2011, Giraldo was called upon for the biggest challenge of his career by Kristi Lafleur, executive director of the Illinois Tollway. Lafleur recruited Giraldo to join the Tollway as the agency’s first chief of the newly created Department of Diversity and Business Development to lead the Tollway’s inclusion efforts, especially on the Move Illinois Program, which was approved by the Tollway’s Board of Directors in August 2011.

Giraldo welcomed the challenge and believed this new role was a perfect fit for his wide range of experiences in promoting diversity and building strategic partnerships.

Giraldo’s previous experience includes 25 years with the city of Chicago, where he served in several roles, including director of contract administration, managing deputy commissioner of workforce development and deputy procurement

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officer. Before working for the city, he served as an analyst for the Illinois Department of Transportation’s Disadvantaged Business Enterprise (DBE) Program in Springfield for nearly three years and as a bilingual school teacher for two years.

After accepting the position with the Illinois Tollway, Giraldo recognized that he would need all of the skills developed in his previous jobs to successfully engage small, minority- and women-owned firms in the Move Illinois Program. “We realized that we could not embark on a program of this magnitude without reinforcing some very strong commitments,” Giraldo said. “It was clear to the governor, our Board of Directors and the executive director that the agency needed to build upon its commitment to small and diverse firms and encourage greater opportunities in the construction industry for traditionally underplayed individuals.”

Giraldo believes that a key component of his success so far has been the steady support from Executive Director Lafleur and the Tollway Board. “This is not just a paper commitment,” Giraldo said. “I am directly accountable to the executive director and the Board. Governor Quinn’s motto is ‘Everybody in and nobody left out,’ so it is our mandate that we seek out additional opportunities for minority- and women-owned businesses, as well as small firms, to do business with the Tollway.”

The governor’s charge was not an easy undertaking from the beginning. Giraldo had to rely on his community organizing and leadership skills to get additional diversity outreach efforts moving in the right direction. His first task was engaging the DBE and prime contracting communities to gain input on the best way to increase diversity in the Move Illinois Program. “From the get-go, it was necessary for the Engineering Department and my department to have some very open and very in-depth discussions with the industry,” Giraldo said. “We wanted to hear from both DBEs and nonminority firms what they had to say about how we could implement a program that would provide true opportunities to minority-and women-owned businesses, as well as small businesses.”

Though it was at times challenging to reach consensus among such varied perspectives, Illinois Tollway leadership was able to draft a blueprint to help level the playing field for all businesses through growing competition. Key to this strategy was effectively communicating the Tollway’s new and existing diversity programs and initiatives to a broad range of audiences throughout Northern Illinois.

Those outreach efforts have been successful in bringing people together and developing a strategy for unbundling projects in the Move Illinois Program. “We could have done

this whole program with 200-300 projects, but we started an unbundling initiative where we break down some large projects to projects of less than $5 million to create opportunities for small and medium-sized firms to compete,” Giraldo said. “We broke out more than 40 projects in 2013 and have already broken out more than 20 more projects in 2014.

The large contractors win some, but smaller minority- and women-owned firms are winning some, as well.”

Since the Tollway is a user-fee system that receives no state or federal funds for maintenance and operations, its DBE program and other diversity efforts are encouraged by the governor’s commitment to inclusion. “We are doing well in terms of our DBE goals,” Giraldo said. “Our percentage of total expenditures for engineering and construction is consistently around the mid- to high 20s.”

Giraldo’s department has also developed initiatives to increase contract opportunities for small and diverse firms. That includes a Small Business Initiative that allows the Tollway to break out projects of less than $1 million exclusively for small firms with less than $10 million in revenues and establishes small business goals for select construction contracts on a project-by-project basis. To date, woman- and minorityowned firms have won approximately 25 percent of the small business set-aside projects awarded.

In addition, the Tollway has implemented several technical assistance initiatives to help small and diverse firms succeed.

For example, the agency formed a strategic alliance with the Illinois Community College Board to launch the Construction Business Development Center (CBDC). The CBDC focuses on developing flexible, customized training and technical assistance to provide small, minority- and womenowned firms in the construction industry with the skills

Gustavo Giraldo (far right) with representatives of the Suburban Minority Contractors Association at a professional services networking event.

and knowledge to help them grow and succeed. The CBDC provides one-on-one support to help businesses compete for and win opportunities to participate as subcontractors and prime contractors on Tollway construction projects.

The Tollway also partnered with the Illinois Department of Commerce and Economic Opportunity and the Illinois Hispanic Chamber of Commerce to create the Coaching crowd of construction workers join for Growth program for small AGovernor Pat Quinn in celebrating a business owners specializing major milestone in the construction of the Tri-State Tollway (I-294)/I-57 in heavy highway construction. This program is designed Interchange Project. to provide established small, minority- and women-owned construction businesses targeted training and direct, strategic business counseling in an effort to support and promote business growth and participation in Tollway contract opportunities. Through participation in the three-month program, which includes one-on-one training and a series of group workshops, participants will develop a multidisciplinary framework to increase their competitiveness, drive revenue growth and profitability.

The Tollway is also one of the partners in the Small Contractor Bridge Program. The program is partnership between the Illinois Finance Authority, the Chicago Community Loan Fund, Governor Quinn’s administration and a number of Illinois state agencies. The Small Contractor Bridge Program provides working capital loans to small contractors, including disadvantaged, minority- and women-owned businesses. The program helps small and diverse firms obtain surety bonding and get preapproved for loans to help them compete for public works projects, including work as prime contractors on Tollway construction projects.

Another program implemented by the Tollway is the Mentor/Protégé Program, which encourages professional service consultants (mentors) to assist DBEs in remaining self-sufficient, competitive and profitable businesses. The Mentor/Protégé Program provides a way for firms to receive credits toward advertised DBE goals if they serve as a mentor, providing meaningful instruction and beneficial resources to a DBE protégé.

Giraldo also has other initiatives in the planning stages, including a legal assistance and accounting assistance program, with the hopes of achieving the governor’s vision to ensure that everyone has equal access to economic opportunities and the tools necessary to succeed in Illinois.

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Becoming an effective DBE professional can be a daunting process for many program administrators. Unlike many professions, there is no textbook, class or exact course of action to move from being a DBE neophyte to becoming a true DBE professional. The effective DBE professional must not only understand the extensive DBE program regulations, but must have the diplomatic and political skills to implement the regulations in environments that are not always accepting of the program and its mission of leveling the playing field for DBE firms.

Although this is not a comprehensive list of all the actions that can help a person become an effective DBE program administrator, here are some tips that can assist in the process.

10TOP TIPS

To Be a Successful DBE Professional By: Amikka Smith Tip#1: Study Disadvantaged Business Enterprise Regulations

Study the Disadvantaged Business Enterprise (DBE) program regulations in 49 CFR Part 23, and 49 CFR Part 26. These regulations represent the overarching guidelines and structure of the DBE program. According to the Department of Transportation, there are three main objectives of the DBE program: • To ensure that small Disadvantaged Business Enterprises can compete fairly for federally funded transportation-related projects.

• To ensure that only eligible firms participate as DBEs. • To assist DBE firms in competing outside the DBE Program.

Jack Thomas, director of DBE and Community Development at the Jackson Municipal Airport Authority, said, “You have to know the regulations, there’s no way around that; you really need to know them and not just the regulations, but when the regulations are issued there’s an extensive review and public comment period you need to be involved in to really understand the reason and rationale for the final deci-

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sions that get made. Once that final ruling is published, there’s usually an extensive preamble or commentary associated with that. Those are just as important to me as the regulations themselves.”

Tip #2: Read DBE-Related Industry Research Reports

Read industry reports from the Transportation Research Board. TRB is one of the six major divisions of the National Research Council. The National Research Council is a private non-profit institution that works as the primary operating agency of the National Academies—which assists and provides advising services on science, engineering and government matters to numerous public communities. TRB fosters information exchange for many leading researchers and practicing transportation professionals. It provides an array of information about the transportation industry, and it is a great resource for DBE professionals.

Tip # 3: Review Current/Past Court Cases Related to DBE Race-Based Programs

Study current and past court cases related to DBE racebased programs and be sure to do research on the past, to assist with the present.

Specific court cases worth of attention are the Western States Paving Company, Inc. v. Washington State Department of Transportation, the City of Richmond v. J.A. Croson Company, Adarand Constructors, Inc. v. Pena and the Sherbrooke Turf v. the Minnesota Department of Transportation. Knowledge of these historic cases and staying abreast of current cases will help you follow legal trends in the DBE program.

Tip #4: Read Disparity Studies (at least read the Executive Summary)

Disparity studies compare the actual number of minorityand women-owned business enterprises (MBE/WBE) that exist in the state with the number of minority and women business enterprises that are actually being utilized in government contracts.

Disparity studies also provide access to see various state program improvements, DBE goals and program recommendations. Many transportation agencies have completed disparity studies in recent years. You can contact agencies that have completed studies to request an electronic copy.

Tip#5: Attend DBE/ACDBE Certification Training

The Federal Aviation Administration Modernization and Reform Act of 2012 mandated establishment of DBEs and Airport Concession (ACDBE) certification training. The FAA certification training allows professionals to learn all the “ins and outs” of meeting airport requirements for being certified. It offers business professionals experience to role-play real life scenarios of working in airports, and it assists them into transitioning into this capacity.

Tip #6: Complete the American Contract Compliance Association Certification

The American Contract Compliance Association is a nonprofit national organization dedicated to ensuring equal employment and contracting practices within public and private institutions. ACCA provides training to educate compliance professionals, while also supporting economic diversity.

Annually, ACCA conducts a training event, which provides industry professionals with an opportunity to become certified. During the week, courses like certification, disparity studies and economic development are taught. ACCA is the only organization that offers an industry certification process based on completing a required number of hours and courses at the annual training event. The next ACCA National Training Institute will take place from August 25-30, 2015 in West Palm Beach, Florida. Visit ACCAWEB.org for information.

Tip #7: Join the Airport Minority Advisory Council

The Airport Minority Advisory Council is the only national non-profit trade association that’s dedicated to promoting full participation from minority-owned and women-owned DBEs in airport contracting.

AMAC is a strong resource for DBEs and ACDBEs to network and build relationships within the aviation industry.

Get involved. Get online. Get connected with AMAC. (www. amac-org.com)

Tip #8: Engage Private DBE Consultants

Reach out to consultants. They can help by offering professional services to businesses and organizations. The Rhode Island Department of Transportation (RIDOT), Office of Civil Rights Administrator Vanessa Crum said her organization used a great DBE consultant to assist with marketing materials for DBE firms associated with RIDOT. Crum said, “We have a DBE sub-consultant, because our main consultant for our DBE support services is not a DBE—but they have DBEs working with them. And one of the DBEs is a marketing firm; she’s really good. As a sub for us, she said ‘Oh, we really should be doing these toolboxes where they have the sales sheets, the business cards, the whole thing’… she introduced the idea of developing that entire package.” It’s a good idea to use consultants because they can offer a different perspective and add a new level of expertise in numerous situations.

Tip #9: Check Out Industry Resources

Get up to speed by checking out industry resources and organizations like the United States Department of Transportation (USDOT), the Federal Highway Administration (FHWA) Resource Center, and the Federal Transit Administration (FTA). All of these agencies offer training to DBE program administrators. In some cases they will come to your location to conduct training on-site.

Director of Equal Employment Opportunity and Manager of the DBE program at the Triangle Transit, Sylvester Goodwin, said taking training courses in this field will enhance professional growth in the DBE industry.

Goodwin said: “If you’re new to this profession, I recommend that you take training to understand the DBE program requirements. You must know the federal regulations as they relate to transit or your business; how to administer the program; also have an understanding of DBE Certification; DBE Goals and reporting requirements. Look for seminars and training on business development strategies to help build business capacity. It’s important to have this as your foundation. In our industry, the National Transit Institute (NTI) provides specialized training and courses for public transportation professionals. Almost all of the courses are free to those who work in the transit industry.”

Tip #10: Utilize On-The-Job Training and Love the Job

Some of the best training is done on the job. There’s no substitute for learning working techniques, daily. Engage with continued on page 37

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Large transportation construction projects provide a substantial economic benefit to communities along with providing long-term economic impacts that accompany the improvement of an area’s transportation system. Disadvantaged

VDOT and the Elizabeth River Crossing Op-Co, LLC, a private company that is providing financing, construction, management and maintenance for the Elizabeth River Tunnel project. The five-year project started in 2013 and is scheduled to open in 2016. The project’s contractor is the joint venture team of SKW Contractors (SKW), which Skanska USA Civil, Kiewit Corporaand small companies often play a significant role in realizing a tion and Weeks Marine comprise. “We at ERC consider it a project’s economic benefit since these firms are often located privilege to be able to make a positive impact on the economic in the community where the project is located, and employ growth and development of the Hampton Roads region,” said workers from the immediate area. This reality often results in Greg Woodsmall, ERC CEO. “The opportunities this project increased employment and brings with it -- through business revenues by comthe many long-term and panies in the community permanent jobs created where the project is built. and the robust engageThe Elizabeth River Tunment of area DBE/ nels Project is an excelSWaM subcontractors lent example of a project will have a direct and providing direct economic lasting positive influence benefits to the surroundon the region’s economy.“ ing community through The SKW team has providing contracting embraced VDOT’s goal opportunities to small and of creating meaningful disadvantaged businesses opportunities for DBE in the Hampton Roads Reand SWAM firms on the gion. The Elizabeth River project and thus far on Tunnels project is an $890 the project has achieved DBEs Andre Gilliam and Susan Ritter with SKW DBE Compliance Manager million project that will both the DBE and Vincent Powell construct a new two-lane SWaM goals. SKW’s goal tunnel adjacent to the existing Midtown Tunnel that confor DBE firms amounts to $107.7 million, which they have nects Portsmouth, Virginia to Norfolk, Virginia. The project already surpassed based on with signed contracts with DBE will also redesign the Martin Luther King Interchange in firms totaling $108.7 million to date.

Portsmouth, and complete other rehabilitation to the existing Achieving the DBE and SWAM goals on the project has retunnel and highway system. quired an intensive and coordinated effort from VDOT, ERC The Virginia Department of Transportation (VDOT) and the SKW contracting team. This effort began with the established a 12 percent DBE goal, as well as a 23 percent goal commitment of VDOT leadership to ensure that the project for the inclusion of SWaM (Small, Women and Minority) promoted the inclusion of DBE and SWAM firms. businesses certified through the state of Virginia. These two Once VDOT leadership established the commitment to incluproject goals help ensure that small and disadvantaged firms sion on the project, this commitment was charged to ERC by primarily doing business in Virginia participate in the project way of contractual agreements outlining the expectations of and help provide the opportunity for economic development VDOT for DBEs, SWaMs and for diverse workforce inclusion. as revenues from the project are recycled in the Hampton Based on the nature of the contract and a desire for participaRoads community. tion throughout the agreement, VDOT also placed annual The project is a public private partnership (P3) between goals on the operations and maintenance portion of the

VDOT TUNNELS PROJECT

Promotes DBE Economic Development

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project. These goals were 15 percent for DBEs and 25 percent for SWaMs on the expenditure for ongoing operations and maintenance expenses like toll collections, marketing, facility maintenance and computer systems.

VDOT Civil Rights Manager Queen Crittendon is responsible for the ongoing oversight of the project. Crittendon said: “On a traditional procurement, a contractor would design, bid, and build. Since this project is a design-build project, it’s more challenging to identify all contracting opportunities and subcontractors in advance. At the time of bid, the project was only 90 percent designed. So to ensure that goals were met, the comprehensive agreement requires the submission of a DBE/SWaM Plan for VDOT approval on an annual basis to demonstrate how the goals would be achieved. In addition, per quarter ERC and SKW must provide documentation to VDOT demonstrating good faith efforts toward the established contract goals through commitments and actual payments to firms being utilized on the project. This report must be submitted within 15 days after each calendar quarter ends. In turn, VDOT will assess, confirm and communicate to ERC within 30 days after receiving each quarterly report whether the goals have been satisfied. To date, both firms have successfully demonstrated a good faith effort.”

Managing compliance on a project of this magnitude requires the ongoing involvement of a team of professionals knowledgeable on DBE program administration and the willingness to take an innovative approach to executing an effective process to achieve the desired DBE program results. VDOT’s compliance team on the project consists of VDOT Civil Rights Director Shay Ponquinette, Hampton Roads District Civil Rights Manager Queen Crittendon, and a full-time DBE compliance Specialist assigned to the project. In addition, VDOT has contracted with Southeastern Transportation Partners (STP) to support compliance efforts on the project site, which provides support to the District Civil Rights Office in augmenting its staff to further ensure compliance on the project. A team of professionals in the areas of administrative support, compliance, business development and outreach provide support and ensure that civil rights requirements are achieved on

the project.

SKW DBE Compliance Manager Vincent Powell, a former VDOT Project Manager with more than 20 years of construction engineering experience, is responsible for managing SKWs DBE program on the project. Powell’s knowledge of civil construction, VDOT policies and procedures, and the DBE program make him well qualified to guide VDOT Outreach Meeting attendees SKW through the implementation of a quality DBE effort. Powell’s role is to work directly with SKW’s procurement group to identify DBE opportunities, recruit and assist DBE firms with submitting quotes on contract opportunities, compile and submit reports to the VDOT compliance team, and monitor the work of DBEs performing on the project. Powell said: “We broke the project down in to five mini-projects with each one having its own DBE and SWaM goal. I help identify opportunities for DBEs and SWaMs based on my knowledge

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of the firms that have the interest and ability to perform on has opened some doors that we hadn’t had open in a long time. the project. This allows us to break out project and create It’s given us a great opportunity to do things like buy equipscopes of work we know DBEs can perform. I especially ment and we are now looking at buying the building that we look for companies that have been renting for years.” perform specialty trades that Another DBE firm expeyou don’t think of everyday. riencing significant growth For instance, I heard some as a result of the project is project engineers talking in Bryant-Ritter Hewitt Electric the hallway about the need Corporation. Bryant-Ritter has for a welding contractor. I more than 10 separate conwent into the hallway to let tractual commitments totaling them know of a DBE firm over $10 million to perform in the area named Metals of a variety of electrical services Distinction that does weldincluding installing electrical ing. Two weeks later our boxes, highway lighting, trafprocurement manager let me fic signals, communications know that the firm was being conduits, panel boards, and awarded a contract.” temporary electrical service In addition to DBE outworking as both a first tier reach, SKW has also instisubcontractor to SKW and as a tuted other strategies to help FHWA’s Martha Kenley speaks at the VDOT Outreach Meeting second tier sub to several larger DBEs perform successfully electrical contractors. Bryanton the project. Strategies include offering prompt payment Ritter President Susan Ritter said, “This has been a great terms to DBE subcontractors of seven to fourteen days, opportunity for us. We have been able to add new employees. utilizing an owner-insured insurance program to decrease the Since this project insurance requirements on DBEs, offering to hold retainage started we have in lieu of surety bonding on certain contracts, and allowbought three new ing the waiver of competitive bidding on contracts less than service trucks, a $250,000. mini-excavator, SKW’s strategy has worked thus far as 68 different DBE firms, a digger derrick representing more than 200 individual agreements, have been (line) truck, and awarded contracts on the project. Many of the DBE contraca lot of safety tors participating in the project are local firms that also are equipment. This contributing to the economic impact of the construction project has also project. Metals of Distinction is one of those firms. Located brought us into 25 miles from the project, the firm has seen a revitalization of the upper echelon its business since beginning work on the project. Powell said, of safety, so we “We started them off with a small contract to see how they have invested in would perform on a project of this size. They performed well both safety equipand we have been able to do more work with them.” Since the ment and safety first contract, Metals of Distinction has provided a variety of programs.” welding and metal fabrication services totaling over $1 milSKW continues VDOT District Administrator Dennis Heuer lion on the project. Company president Andre Gilliam said: to look for adspeaks to DBEs “This project has meant a great deal to our company, espeditional opporcially after the way the economy had been going, which was tunities for DBE and SWaM firms. Powell said, “We are only a great downfall for our company. But when the opportunity about 50 percent through the project, so there will be other came up Vince (Powell) gave me a phone call and asked me opportunities. We are forecasting around $130 million in to bring over a capability statement. We brought that over and total DBE contracts by the end of the project.” it has created a whole new difference for our company. It and Photos­—Construction work: Elizabeth River Crossings OpCo, LLC; Outreach meeting: VDOT

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McHugh Construction to Pay $12 Million to Settle Contract Fraud Claims by U.S. and Illinois on Seven Area Public Works Projects A Chicago-based construction company will pay the United States and the State of Illinois $12 million to resolve allegations of fraud on government programs designed to benefit women- and minority-owned sub-contractors under the terms of a civil settlement agreement announced today.

The contractor, James McHugh Construction Co., Inc., allegedly failed to abide by federal and state requirements for the participation of disadvantaged businesses in contracts to perform seven public construction projects. The work on area roads, highways, and transit lines was funded by the federal and state governments between 2004 and 2011.

The federal and state governments claimed that McHugh violated the federal and Illinois False Claims Acts by making false statements and claims for payment to government agencies regarding McHugh’s compliance with federal and state requirements to include disadvantaged businesses in the construction projects.

As a result of the $12 million settlement, the federal government will receive $7.2 million and the state government will receive $4.8 million. In a separate administrative settlement and compliance agreement, McHugh agreed to implement a corporate compliance program, appoint a compliance officer, and be subject to an independent monitor for three years, in exchange for the federal, state, and City of Chicago trans-

portation agencies and contracting authorities’ agreement not to bar McHugh from future government contracts. This allows McHugh to continue pursuing and performing public works projects while ensuring that it remains compliant with disadvantaged business regulations.

“It was more costly in the long run for McHugh to avoid its obligations to hire women- and minority-owned businesses than it would have been simply to comply with the requirements and retain disadvantaged businesses to actually participate in these public construction projects,” said Zachary T. Fardon, United States Attorney for the Northern District of Illinois. “It’s important that McHugh and other companies realize that compliance with these requirements is both a good business decision and the right thing to do,” he added.

“Our investigation revealed that McHugh Construction falsely used subcontractors to help secure bids for major construction projects funded by and for Illinois taxpayers,” Illinois Attorney General Lisa Madigan said. “The company used women-owned businesses to submit false claims to the state and federal governments for millions of dollars when in fact, those businesses never completed the level of work required by law.”

Mr. Fardon and Attorney General Madigan announced the settlement with Robert J. Holley, Special Agent in Charge of the Chicago Office of the Federal Bureau of Investigation; Michelle McVicker, Special Agent in Charge of the U.S. Department of Transportation Office of Inspector General in Chicago; and James Vanderberg, Special Agent in Charge of the U.S. Department of Labor Office of Inspector General in Chicago.

The settlement arose

from a lawsuit that was filed under seal in 2008 by Ryan Keiser, who was a project manager for Perdel Contracting Corp. and Accurate Steel Installers, Inc. (ASI), at three of the McHugh construction sites. The lawsuit, which was unsealed today, was filed under the qui tam, or whistleblower, provisions of the federal and state False Claims Acts. United States, et al., ex rel. James McHugh Construction Co., et al., No. 08 C 2443 (N.D. Ill.). continued on page 37 American DBE

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National DBE Certification Under Consideration

H

ere’s the million-dollar question: Will a national DBE Certification program succeed or fail in fulfilling the mission of the USDOT Disadvantaged Business Enterprises program to:

1. Ensure that small disadvantaged business enterprises can compete fairly for federally funded transportation-related projects.

2. Ensure that only eligible firms participate as DBEs. 3. Assist DBE firms in competing outside the DBE Program.

Across the country, more than 35,000 Disadvantaged Business Enterprises have applied for and gained state-level certifications in the U.S. Department of Transportation’s DBE program, confirming their status as viable business entities faced with the historical challenges of equitably accessing capital and contracting opportunities with the federal government.

According to USDOT, to be certified as a DBE, a firm must be a small business owned and controlled by socially and economically disadvantaged individuals. State program certifiers make the determinations based upon on-site visits, personal interviews, reviews of licenses, stock ownership, equipment, bonding capacity, work completed, resume of principal owners and financial capacity. The certification is issued by the company’s home state and is only valid for securing contracts within that state’s Department of Transportation.

Since 1983, there has been a statutory provision requiring DOT to ensure that at least 10 percent of the funds authorized for the highway and transit financial assistance programs be expended with DBEs. While the benefits of the DBE program are measureable, its limitations are significant based on the amount of time, resources and processing required by DBE program administrators and certifying agencies to fulfill program requirements. One of several national conversations

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within the DBE community is whether there should be a uniform nationally recognized DBE certification process that is equally valued and accepted nationwide within all state DOTs. Pros & Cons for National DBE Certification Pros

1. Expands opportunities for DBEs to do business on a larger scale 2. Reduces duplication of resources at the state DOT level to verify DBE status 3. Less paperwork and resources required for DBEs to obtain certification and retain DBE status Cons

1. Possible nationwide abuse of system by fraudulent DBE firms 2. Lack of state controls decreases accountability and removes the checks-and-balances system 3. Increased competition and reduced in-state opportunities for smaller DBE firms with limited resources In a May 2010 issue of the “Federal Register,” the USDOT Office of the Secretary issued the following statement about nationwide certification: “Under the current DBE rule, certification occurs on a statewide basis. The Unified Certification Program (UCP) in each state ensures “one stop shopping” for DBE applicants within that state. The UCP requirement, which came into effect in 1999, has simplified certification by making it unnecessary for recipients to apply multiple times for certification by various transit authorities, airports, and highway departments within a given state.

The present structure, however, does not address problems that occur when DBEs certified in their home state attempt to become certified in other states.

“DBEs and prime contractors have frequently expressed frustration at what they view as unnecessary obstacles to

certification by one state of firms located in other states.

They complain of unnecessarily repetitive, duplicative, and burdensome administrative processes and what they see as the inconsistent interpretation of the DOT rules by various UCPs. There have been a number of requests for nationwide reciprocity or some other system in which one certification was sufficient throughout the country.” The USDOT response goes on to state: “Federalizing certification, such as having a unitary certification system operated by DOT, would likely raise significant resource issues. Such an approach could also result in less local “on the ground” knowledge of the circumstances of applicant firms, which can be a valuable part of the certification process… We favor making interstate certification easier and reducing burdens on small businesses seeking to work in more than one state… National reciprocity or one-stop shopping for a single nationwide certification system are worthwhile goals to discuss, but the Department believes that an incremental approach is more likely to be practicable. The Department’s task is to balance, as best we can, the desire to make interstate certification less onerous for small businesses with the imperative of maintaining the integrity of the program.”

Susan Wendt, president of Wendt Productions has built her business by expanding the Susan Wendt company’s scope and scale and becoming DBE/ACDBE in 18 states. Wendt Productions sells Personal Protective Equipment, information technology hardware, electronics and strategic sourcing services to government entities. Wendt said: “Accountability and trust between certifying agencies is the biggest issue. By moving toward an electronic national database, both the initial application and renewal process would become efficient. Vetting would become uniform. The resulting financial savings to both the applicant and agency would be significant.”

Wendt said the average DBE application book for her company generates 424 printed pages, weighing an average of 9 pounds, each requiring annual renewals that total 60 to 90 pages, depending upon state requirements. In addition to its multi-state DBE certifications, Wendt Productions is also federally recognized as an EDWOSB (Economically Disadvantaged Woman Owned Small Business) by a Small Business Administration (SBA) third party certifier – a separate certification process. “Easing the redundant burden of initial application and annual renewal for firms like ours, where multiple state certifications are desirable, would be a measureable step forward in complying with the Federal Reduction of

Paperwork Act of 1995,” Wendt said.

In May 2010, the USDOT issued a notice of proposed rulemaking seeking further comment from DBEs and program administrators regarding national certification. Approximately 30 responses were received, with opinions split 50-50 for and against a national certification program. In general, DBEs favored making interstate certification less complex and most recipient state program administrators held the opposite point of view.

More recently, to address the unresolved debate, in June 2014, the USDOT Office of the Secretary issued another response to the stated concerns, clarifying points of Interstate Certification. The DBE Interstate Certification rule is found under guideline section 49 CFR 26.85, which reads: “The rule furthers several fundamental objectives of the DBE program— (1) facilitating the ability of DBE firms to compete for DOT-assisted contracting, (2) reducing administrative burdens and costs on the small businesses that seek to pursue contracting opportunities in other states, and (3) fostering greater consistency and uniformity in the application of certification requirements— while maintaining program integrity.”

Under the current rules, if a DBE firm desires to become certified in another state, the business must first seek certification in the company’s home state and then submit a copy of that certification to the second state where certification is requested and apply for an interstate certification. The second state has two options in replying to the DBE applicant: 1) Accept the certification from the DBE’s home state and certify the firm based on the information available in the original state’s DBE/ACDBE directory or obtain written confirmation from the home state. 2) The second state may request all of the information and documentation required by the home state certification process—DBEs are not required to submit additional information not included in the original home-state application process. The certifying agency must then contact the DBE’s home state within seven days and request a copy of the site visit report for the firm. Based on the information provided by the DBE and the home-state certifying agency, the recipient has 60 days to notify the DBE whether or not the request for interstate certification has been granted. Firms seeking certification in additional states must repeat the same process with each subsequent state in conjunction with their home state certification office documentation. continued on page 34 American DBE

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Both DBE firms and transportation agencies understand the time and labor intensive responsibilities involved in effective DBE program administration. However, innovative and evolving computer-based technologies are helping to streamline many of the processes involved in running a successful program; allowing administrators to refocus their efforts towards program improvement and driving the overall success of DBEs seeking transportation opportunities.

Civil rights program management tools are enabling DBEs to more efficiently complete reciprocal certification processes, manage cash flow, monitor contractor payments, and engage compliance officers to address issues more quickly. Transportation agencies across the country are looking to technology to automate processes like DBE certification, prompt payment, compliance and reporting, Continued innovations in that have historically been performed manually. By autechnology help program tomating baseline repetitive administrators better lever- processes, agencies are able age human capital for more to focus staff efforts on those activities with the greatest effective DBE programs. level of subjectivity. These areas may include conducting onsite visits, reviewing complicated certification data, investigating lower-tier subcontracting activity, and identifying potential fraud. Leveraging human capital to focus on those areas wherein independent judgment is required affords agencies the opportunity to strengthen their programs.

Tamela Lee, vice president of Business Diversity and Development at the Dallas/Fort Worth International Airport has used a compliance software system in both Dallas and in a previous role in Denver. She said: “The system has allowed us to integrate our certification process with our compliance process so that when bid proposals come in, the system can automatically populate DBE award data with the information that is already in our certified database. We used to have to manually check the certification status of all DBEs listed for participation. Implementing a computerized process was a huge improvement and eliminated a step for us.”

By decreasing the man-hours needed to manually monitor, track and report DBE program accomplishments, agency staff have more time to focus on program development and improvement. Accuracy in data collection and reporting is also enhanced due to the documentation and standardization of the processes required for program administration.

Using these tools also facilitates ease in sharing performance information with internal and external stakeholders. Lee said: “The other benefit of the software has been the reports.

I don’t care where you are, everyone wants reports on ‘what is the DBE participation? What are the commitments? Who are the primes? Who are the subs? Are they MWBE or Non-MWBE? What have they been paid?’ We can generate all these reports on a monthly basis for our board of directors, and we can separate them out. Before, we had to do all this manually.”

Compliance management tools not only improve DBE programs from administrators’ perspectives, they directly benefit DBEs as well. Today’s technology provides effective tools that can increase transparency and give real-time access to program activities. Whether monitoring goal attainment on a project-by-project basis, ensuring prompt payment requirements are met, or accessing real-time certification data, these tools when implemented correctly give DBEs a one-stop-shop for all activities related to their certification.

Philip Yelder, director of Human Relations for the City of Kansas City, MO said: “In the old days it would take months to confirm compliance on a project. For example, by the time an organization could send out a payment compliance letter and receive it back from the prime, and then confirm with the M/W/DBE subcontractors, months would have passed, and in some cases the project is over. At that point there is little opportunity for enforcement on the tail-end. This electronic reporting creates a transaction immediately. As soon as the prime/general enters a payment or is paid by the owner, the subcontractor is automatically notified, and the owning entity can see the communication between the parties. The system also is a great management tool in that the organization knows constantly if a DBE firm is being utilized on the project, or the DBE/MWBE goals are being met which then leads to compliance management during the course of the

Innovative Compliance Tools Help DBEs Succeed

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continued on page 22

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continued from page 20 project instead at the end. The goal is to get M/W/DBE firms working on these projects, not simply listed on a contract utilization plan.”

Agencies across the country have developed or purchased Internet-based tools to assist with DBE program administration. Some of these agencies have purchased off-the-shelf tools from vendors who have developed proprietary systems, while other agencies use internally-designed tools and reports designed by their information technology department or consultants.

Whether internally developed or purchased from a vendor, the innovative collection, processing and reporting of data can bring significant improvement to DBE Program administration.

Compliance tools generally work by collecting and compiling data from an organization’s certification directories, procurement activities, bid results and awarded contracts to create reports for use by DBE program administrators.

More advanced systems allow prime contractors and DBEs to enter information directly into the system, thus eliminating manual processes (prone to human error) that require the submission of paper forms or reports documenting DBE commitments, payments and compliance. Direct data entry by primes and subs also eliminates inefficiencies and errors created by duplicate data entry efforts that result from a manual document transaction process.

The collaborative nature of these systems engages stakeholders at the agency, prime, sub and lower-tier levels, which creates visibility for program activities and keeps compliance foremost in participants’ minds. The enhanced accountability also decreases agency staff time in having to research and compile data on a case-by-case basis as issues arise. Tools also continue to evolve offering audit trails, rapid reporting, single sign-on capability, and many other features that improve communication and documentation between agency compliance staff, prime contractors and the subs involved in program activities.

From a DBE perspective, these systems can drastically reduce the time and resources needed to manage certification and reporting activities. Need to update your address? Login online and submit a request. Need to request an additional NAICS code for your certification? Login online, upload your supporting documentation and submit the request.

Have an issue with a prime contractor on project? Login and 22

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file confidential communication directly with your agency’s compliance office. Has certification lapsed or is it annual update time? Login and check renewal dates; or upload and submit a no-change affidavit. One stop. One URL. One location for all communication regarding certification, subcontracts, payments and outstanding issues.

Purchasing a computer-based tool can require a significant investment, however many program administrators believe the benefits outweigh the costs. A DBE program administrator based in the Northeast said: “When improving the quality and consistency of certification, substantial cost savings can be realized. In restricted government budget environments, a substantial increase in program capacity can be achieved without an increase in staff personnel. After the initial implementation period, monitoring a DBE’s contract or purchase order or concession revenues can take a fraction of the time of transmitting and processing either hard copy documents or emailed text and scanned documents.”

Commercial off-the shelf brand names for DBE program management systems include: AASHTOWare “Project” software, which has a module for Civil Rights & Labor, B2Gnow, Prism Compliance Management, and others. While each system varies by functionality and specific tools, all of these solutions provide mechanisms for streamlining processes in DBE program management.

B2Gnow president Justin Talbot-Stern said: “I think the most important thing is the administrative burden. What I hear from people is that they are doing a lot of data entry; they’re doing a lot of data management, a lot of validation of information, just trying to make sure that what they have is good. Because people spend so much time on these activities, they don’t have the time to dig into the details to see where the issues are, or to follow up with the contractors or other staff who are not providing good information. From an administrative point of view, software tools help collect data in an automated, low-effort fashion so that at the end of the day the staff has not spent any time logging or collecting information. This (information) is being self-reported by contractors, subcontractors or project managers, so the compliance staff has time to oversee the process, to look at the contracts or the program as a whole, and analyze overall effectiveness.”

Depending on the size of an agency’s DBE program, staff resources and budget, a compliance management software tool can help to improve the overall administration of the DBE program. Agencies and DBEs across the county have experienced more efficient certification processing, compliance and participation reporting using tools that are setting a new standard in DBE program management and helping to level the playing field for disadvantaged businesses in the transportation industry.

Wendell Stemley and the Black IPO Team Express Sincere Appreciation and Congratulate NAMC on Years of Determination in Expanding Opportunities for Minority Contractors and Major Corporate Partners.

45

Wendell Stemley, CEO Black IPO, Inc. National Association of Minority Contractors Board Member and 2014 Inductee to the NAMC Hall of Fame NAMC Major Corporate Partner Projects Major Corporate Partner Balfour Beatty Hansel Phelps Hansel Phelps Swinerton Builders Whiting-­‐Turner Turner Construction Kaiser Permanente

Project Women’s Detention Center U.S. Federal Courthouse Martin Luther King Hospital Expansion Jordan High School Pre-­‐Construction South Bay Business Terminal Design/Build San Diego Downtown Library Construction School Bond Program

Major Corporate Partner Swinerton Builders Skanska Rados JV Itron Corporation MGM Grand Kitchell Construction Walsh Austin JV Barnhart Reese/Black IPO JV

Project Delta Airlines Terminal 5 Expo Metro Rail Phase II Water Meter Replacement Center City Development UCSD Medical Center Tom Bradley Terminal LAX US Border Crossing HLS, GSA

Barnhart/Balfour Beatty/Black IPO JV

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6125 Imperial Ave. • San Diego, CA 92114 • Phone: 619-527-1668 Fax: 619-527-1698 • www.blackipocm.com • Email: wrstemley@blackipocm.com

45th Annual NAMC Conference Celebrates Legacy

NAMC Hall of Fame inductees J.D. Calhoun and Wendell Stemley (at podium) are honored by other hall of famers during the awards dinner.

Members of the National Association of Minority Contractors (NAMC) from across America gathered at the Gaylord National Resort and Conference Center in National Harbor, Maryland from June 18-20 for the organization’s 45th Annual Conference. NAMC is a national organization founded in 1969 in Oakland and now has 21 chapters across the United States.

The theme for the conference was “A Legacy CelebrationNew Roads to Excellence.” NAMC President Gloria Shealey in her letter to conference attendees said the theme “salutes the achievements of the past, sets the framework for the new direction of our present, and reaffirms our commitment to a sustainable economic impact.”

The conference featured an opening address National DBE Program Manager Martha Kenley was honored for her career contributions at the NAMC

by Transportation Legacy Luncheon.

Secretary Anthony Foxx. Foxx said, “Making transportation opportunities available to small and minority-owned businesses is right in the wheelhouse of what is meant by creating ladders of

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opportunity.” ‘Ladders of Opportunity’ is the name given to the range of Obama Administration’s initiatives to help lowand middle-class citizens improve their social and economic status.

As reference for the contingent of minority contractors at the event, Foxx also discussed his longstanding connections to minority business and transportation by sharing that his great grandfather was a self-employed truck driver in Carthage, NC—who by hard work and business acumen created a legacy for his family. Foxx said “I am passionate about this issue,” and “we must be about the business of opening up the doors for small and DBE firms.”

The event also featured the NAMC Legacy Luncheon, which presented an opportunity to recognize National DBE Program Manager Martha Kenley of the Office of Civil Rights at the Federal Highway Administration. Kenley was honored for her efforts to strengthen compliance and business development efforts in the DBE program, and for her commitment for leveling the playing field for DBE firms across the nation.

The three-day event closed with the NAMC Hall of Fame Induction Dinner. NAMC established the Hall of Fame to recognize the contribution of members who have distinguished themselves through their contribution to their professions and to NAMC. The organization welcomed two new members in 2014; J.D. U.S. Transportation Secretary Anthony Calhoun and Wendell Stem- Foxx greets attendees at the 45th NAMC annual conference in Maryland. ley were inducted into the NAMC Hall of Fame during the awards ceremony. Calhoun, a retired natural gas executive in California and Nevada, was instrumental in helping to develop minority, women, and service disabled veteran business enterprises during his 39year career. Stemley, president and CEO of Black IPO, Inc., has developed business relationships between minority businesses and major corporations, generating over $500 million in minority business participation. Stemley is also a 20-year member of NAMC, a national board member, and currently the president of the Mid-California Chapter of NAMC. NAMC plans to continue to pursue new roads to excellence at its September board meeting and legislative forum at the Hyatt Regency Washington Capitol Hill on September 24-26, 2014.

Transit

COMTO Celebrates Cunningham Taking Organization from Good to Great

Keith T. Parker, AICP, General Manager/CEO of MARTA addresses conference participants at the welcome reception.

The highest form of honor to a fallen leader is to build on their legacy by continuing the efforts and initiatives they fought tirelessly to accomplish. The Conference of Minority Transportation Officials (COMTO) honored the legacy of its recently fallen leader Julie Cunningham at their 43rd National Meeting and Training Conference. Cunningham, who passed after a long illness, was honored at the COMTO event through a moving tribute during the Welcome Breakfast and through a renewed commitment to continue her work in taking the organization from good to great.

Julie Cunningham was president/CEO of COMTO until her death in June 2014. COMTO information states: “Since her 2001 appointment, Cunningham led the national trade organization in unprecedented growth – moving from a single focus of public transit to an expanded focus of multi-modalism, to include aviation, port authorities and state departments of transportation.” Cunningham leaves an impressive legacy that includes visionary leadership, the establishment of an acclaimed internship program for youth in transportation, and success in making COMTO a bridge-builder in connecting diverse businesses to opportunities in the transportation

industry. Parsons Brinkerhoff President and CEO George J. Pierson published a statement saying, “Julie was an icon and inspiration. I remember right before the first time I met Julie – I was told ‘Nobody says no to Julie’—and they were right.

Her passion, her commitment, her dedication, and most of all, her humanity are things we will all miss and strive to emulate.”

COMTO’s annual conference met in Atlanta and addressed the theme, “The Movement Continues: Developing Leaders & Building Historically Underutilized Businesses.” A major highlight of the event was an opening panel discussion featuring transportation industry leaders, including former U.S. Ambassador Andrew Young and former Transportation Secretary Rodney Slater.

Young passionately stressed the need for a bi-partisan approach to progress and transportation infrastructure investment. Young said, “I think the country is in trouble now because the Republican Party is absolutely ignorant and absolutely ignoring the realities of life. It’s almost like they want to jump off a cliff and defy the law of gravity. These are not dumb people, they are nice people but you have to sit down and talk to them and you have to help them to realize that just because they don’t like Obama - the man is smart, he’s cool, and they are not going to be able to mess with him.

So don’t mess with yourselves (Republicans) trying to mess with him. He’s going down as a great president; that’s done.

There is no way they can stop it, but they can stop being assholes. Look, I’m 82 years and been around a long time, and can’t nobody do me no harm, but they can do the country harm. And that is why I don’t hesitate to confront them. This is a great country; because everything we have done, we have done black and white, rich and poor, government and business, Democrat and Republican... We can’t let them (Republicans) forget that they are a part of progress A conference participant asks a question in America, and we don’t want during the COMTO/APTA DBE Assembly. to lose that.”

The conference also featured the COMTO/APTA DBE Assembly. The session was co-sponsored by COMTO and the American Public Transportation Association and gave leaders from USDOT agencies the opportunity to update participants on their progress in addressing the recommendations from the Office of Inspector Audit of the DBE Program. continued on page 38 American DBE

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FTA Increases Focus on DBE Program of Transit Vehicle Manufacturers Monitoring the DBE program administration of Transit Vehicle Manufacturers (TVMs) has typically flown beneath the radar of many recipients of funding from the Federal Transit Administration (FTA). However, as a result of anticipated increased transit funding from a transportation reauthorization bill and the recent DBE program audit by the Office of the Inspector General (OIG), FTA has increased its focus on DBE opportunities with TVMs. The opportunities are expected to be large when a longterm transportation bill is passed by Congress. FTA Deputy

The Federal Transit Administration has an $86 billion backlog for repairs and replacement jobs on existing transit, creating new opportunities for DBEs.

Administrator Therese McMillian recently discussed transit funding needs in the transportation bill at the Conference of Minority Transportation Officials’ (COMTO) National Conference in Atlanta. McMillian mentioned three immediate transit funding need to be addressed: an $86 billion backlog in repairs and replacement on the existing transit system; a growing demand for transit services nationwide; and creating ladders of opportunity for workers and businesses in the transportation industry.

To prepare for this anticipated growth in transit funding and address the recent recommendations of the OIG for DBE program improvement, FTA has increased its compliance and oversight activities aimed at TVMs. FTA Civil Rights Director Linda Ford addressed this topic to DBEs at the DBE 26

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Assembly session at the COMTO conference. Ford said, “Accountability is something that came through in the OIG report. We got hit over the head because we were not doing enough oversight.”

To increase accountability, Ford’s office has taken several steps to ensure that TVMs are compliant with the DBE program requirements. First, the top 50 TVMs received a letter in April 2014 acknowledging their increased efforts but also identifying “lingering concerns” needing to be addressed. The primary concern noted by FTA was the timely submission of an annual DBE goal methodology. TVMs were reminded to submit their annual DBE goal methodology by August 1, 2014. The methodology include a complete listing of DBE opportunities, proof of DBE goal consultation with the public, and proper advertising of the DBE goal in approved publications—or risk not being approved by the FTA. Another recommendation from the OIG report was increased training for DBE program administrators. To comply with this recommendation, FTA provided training to TVMs in April and May to educate and counsel TVMs on the expectations for DBE program compliance. “Yes the report was painful, but I think the outcome has been really positive,” Ford said.

FTA’s increased focus on accountability and training is working successfully. McMillian said, “FTA doubled awards to DBEs last year to $803 million.” This achievement should rise even greater in FY 2014 as TVMs increase outreach to DBE firms. Ford said, “The Grow America Act actually proposes a 350 percent increase in the bus and bus facilities program, so there are some real opportunities for DBE firms in the transit program and we really have to capitalize on that.”

DBE firms interested in pursuing business opportunities with TVMs should stay abreast of upcoming bids by local transit agencies and also consider reaching out to TVMs listed on the DBE Program page FTA’s Civil Rights website at www.fta.dot.gov/civil_rights.html.

FTA Deputy Administrator Therese McMillian discusses transit needs at the COMTO annual conference in Atlanta.

GOETHALS BRIDGE — CONSTRUCTION PARTNERING OPPORTUNITIES Partnering Opportunities

The Goethals Bridge Replacement Project is a design-build project for the Port Authority of New York & New Jersey (the Authority). The project will replace the existing Goethals Bridge which spans the Arthur Kill River on I-278 connecting Elizabeth, New Jersey and Staten Island, New York.

Kiewit-Weeks-Massman, AJV (KWM) has been selected by the Authority to design and build the new Goethals Bridge.

oncrete, Masonry, and Paving C Design/Consulting Electrical Work/Utilities Fencing and Railings Maintenance of Traffic Marine Services Quality Control Services and Supplies Surveying Trucking Miscellaneous Building and Bridge Demolition And many more!

If your DBE firm would like to apply to participate, please use our website as a resource, www.goethals-kwm.com.

Diversity Contract Manager, 470 Chestnut Ridge Road, Woodcliff Lake, NJ 07677 (201) 571-2571 KWMdivcontracting@kwmjv.com Kiewit-Weeks-Massman, AJV is An Equal Opportunity Employer

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that her husband was in the dump trucking business and that it was something I might want to look at. Being a woman of wisdom, and I was only 36 years old at the time, I thought should listen to mom—at least look into it. So I started coming to Raleigh to ride with my father-in-law and he introduced me to the daily operation and to some of the DBE truckers. After that, Wendy and I talked about it and we decided that I would enroll in truck driver training at the North Carolina Truck Driver Training School at Johnston Community College. I finished the school and got my Class A CDL license.”

During this period in 1995, Jones was entering his 19th year of military service and planned to retire at 20 years. “I talked to one of my mentors and he told me that if I bought a truck he would hire me as soon as I was out of the military,” Jones said.

Although they still had a year to go Over the past 18 years, Covenant Trucking has grown from a one-truck operation to a fleet of 24 trucks and 38 employees.

A COVENANT RELATIONSHIP An unwavering commitment to faith, family and their business permeates the offices of Covenant Trucking in Youngsville, North Carolina—located 40 miles north of Raleigh. Company president Joe Jones founded the company in 1996 after retiring from the U.S. Army after 20 years of active duty service, a tour in Desert Storm and earning a Bronze Star. (The Bronze Star is awarded to military personnel for “heroic or meritorious achievement or service.”) In 18 years, Joe and Wendy Jones have grown Covenant Trucking from a one-truck operation based at their kitchen table to a diversified organization with two separate businesses; 38 employees and a 9-acre location with an industrial building housing several offices and a 3-bay truck maintenance facility.

Joe Jones started the company along with his wife Wendy, his high school sweetheart and mate of 38 years. The initial idea for the business came from Wendy’s mother, whose husband was already in the dump trucking business. Joe Jones said: “I knew I had this entrepreneurial spirit and knew I wanted to do something. I even thought about a chain of car washes or something. But my mother-in-law mentioned

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before completing military service, Joe and Wendy began to work. They enrolled in free classes offered by the Fayetteville Tech Small Business Center and worked with representatives at the Fayetteville State University Small Business Technology Development Center to construct a business plan. “I would go out and gather information, and Wendy would put it into the business plan format,” Jones said.

Jones took the complete business plan to Wachovia Bank and was able to secure a loan for the purchase of their first dump truck. He said: “We had $10,000 saved and the first truck was $80,000 and required a 10 percent down payment.

We knew that if we put the $8,000 down that would only leave $2,000 to start the business. So we decided to ask the bank to loan us $90,000, which gave us enough money to buy a new Mack tandem dump truck and have $11,000 to start the business. Although a start-up loan of this size was unusual, they really wanted to help veterans, so I got the loan.”

“And that was the plan, just one truck,” said Wendy Jones.

He added, “She’s right, that was the plan. I figured with my retirement pay and one dump truck that was it… As a First Sergeant, I had eight supervisors reporting to me and over 150 people total and I was tired of people. I didn’t want to deal with

personalities and stuff, but God had more. God had more.”

Youngsville Truck Tires and Services, Inc., a business that In 1996, holding the keys to his new Mack truck, Jones provides retail truck tires and maintenance services to truck called his mentor Mr. McKinnon and said: “I have my truck, owners in the Youngsville area. “That was our son’s Carlton’s I picked it up and I’m ready to go to work. I have my insuridea,” Joe Jones said. “He came to us as operations manager ance and everything, and he told me, ‘let and said that we were spending a lot of me check it out and I’ll call you back.’ I money on service and tires, and we didn’t said, Mr. McKinnon it’s very important have control over our trucks being out of that I work tomorrow, if it’s no day that I service. He also thought there were other ever work, with me picking this truck up truck owners in the area that needed these today, tomorrow is very important to me services.” The new location allowed the that I get this truck out. Mr. McKinnon Joneses to move on Carlton’s idea and said, ‘Be out there at 7:00.’ And from that open a business that serves the public point on, we haven’t looked back.” during the day, and services Covenant’s Eighteen years, 30 trucks (current fleet fleet of trucks in the evening. of 24 trucks) and 38 employees later, Most recently, Covenant has been active the Joneses still aren’t looking back, and on several large highway projects in the are experiencing the “more” they believe Raleigh-Durham area. First, the company Covenant Trucking leadership team: Carlton Jones, God has for them. In 2000, the Jones’ completed multi-million dollar hauling senior operations manager; Wendy Jones, vice eldest son Carlton joined the company contracts on North Carolina’s first tollway president; Joe Jones, president; Jonathan Jones, after serving in the Air Force. Joe Jones projects; the Western Wake Freeway and production manager. said, “Carlton was living in Miami and I the Triangle Parkway in 2013. The comtold him I had a job for him. He wasn’t ready then, but about pany is currently working on a large design/build project to six months later he called. I told him that if he went to the improve the I-440 beltline around Central Raleigh. “We have NC Truck Driving School, I’d have a truck waiting for him the ability to handle large projects like that now,” Joe Jones said. when he finished. And that was our second truck.” Carlton Despite Covenant’s growth and success, the Joneses are still now serves as Covenant’s senior operations manager, where looking to the future. Their second-eldest son Jonathan joined he supervises the drivers and runs the company while Joe the company in 2012 as production manager, and youngest and Wendy take planned quarterly vacations. “It’s a lot,” said son Jeremy works part-time while in graduate school. “We Wendy. “We have the business; the 38 families of our employ- asked our sons where they would like to take the company in ees, we are very active in our community and in our church. the future. They said that they would like to grow the comWe have to get away to relax and recuperate.” pany to 50 trucks, so we haven’t finished yet.”

From two trucks in 2000, Jones added a third in 2001 and decided come out of the truck. “At that time I started noticing a lot of guys asking me for trucks; being ex-military I am going to be on the job site 20 minutes early. So when contractors would ask me if I knew where they could find more trucks when guys didn’t show up, I saw an opportunity. At that point I stopped driving, hired three drivers and started soliciting work. Pretty soon we were up to 25 subcontractors. We also got DBE certified around that time,” Jones said.

Since 2001, Covenant has grown patiently and steadily by adding capacity each year. In 2004 they moved the business out of their home with five trucks and into their first commercial property. But after growing to 13 trucks by 2007, they had outgrown their first location and needed to move again.

So they purchased a 9-acre property in Youngsville and got a loan to construct an industrial facility with several offices and a 3-bay shop for truck maintenance services. Since this move, Covenant Trucking built a larger industrial facility and launched Youngsville Truck Tires and Services Inc. to handle truck maintenance for local businesses. the company has grown to a total of 24 trucks and launched

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PROUD TO GIVE BUSINESSES A LIFT CATS is proud to provide opportunities for businesses to create local jobs through the advancement of transit projects. CATS also seeks to create an environment that gives small and socially or economically challenged local businesses the opportunity to compete for publicly funded contracts by participating in the Small Business Opportunity (SBO) and the Disadvantaged Business Enterprise (DBE) Programs.

On the LYNX Blue Line project, for example, CATS spent $42.9 million with 38 DBE firms to build the new light rail system.

As the major provider of public transportation to Charlotte and the surrounding region, CATS relies on the communities we serve to build and operate the service every day. By working together on these new opportunities, we can all keep our communities moving in the right direction.

For more information, visit ridetransit.org.

Colette Holt

& Associates YOUR EXPERT ON AFFIRMATIVE ACTION AND CONTRACT COMPLIANCE

Colette Holt & Associates Attorney at Law

• Disparity and Availability Studies • Review, Design and Implementation of Disadvantaged/Minority/Women/Small /Local Business Programs • Litigation and Expert Witness Services • Contracting Fraud Detection and Evaluation • Community Benefits Agreements and Project Labor Agreements • Trainings and Presentations

3350 Brunell Drive Oakland, CA 94602 Telephone - (773)-255-6844 Email - colette.holt@mwbelaw.com www.mwbelaw.com http://twitter.com/mwbelaw

Our Recipe for success:

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Chip Joyner

The Real Chow Baby at Hartsfield-Jackson Atlanta International Airport

HMSHost and Chip Joyner team up to bring The Real Chow Baby to Hartsfield-Jackson Atlanta International Airport.

A staple of the Atlanta restaurant scene since 2005, The Real Chow Baby partners with HMSHost to open its first concourse location at the world’s biggest airport. “HMSHost is a great company to work with. They were a mentor of mine for a number of years while I was coming up in the restaurant business. HMSHost has really been a fantastic partner,” says Chow Baby co-owner Chip Joyner. The Real Chow Baby offers a hearty menu of farm-fresh produce, meats and seasonal fish, sizzled in zesty Asian-inspired sauces. For more information, contact busdev@hmshost.com.

The Real Chow Baby co-owner Chip Joyner

www.hmshost.com Joyner_SM.indd 1

HMSHost is the recipient of six Airport Revenue News Awards for Outstanding Food & Beverage Operator.

5/15/13 1:38 PM

Civil/Highway

AASHTO Civil Rights Training Symposium Builds Collaboration Collaboration was the word of the day at the American improvements is increased accountability in the area of DBE Association of State Highway Transportation Officials business development and compliance.

Civil Rights Training Symposium in Phoenix, Ariz. earlier The AASHTO Civil Rights Subcommittee also used the this spring. The bi-annual event brings together civil rights occasion to encourage ongoing collaboration between civil program professionals from rights professionals and to across the country to conduct award civil rights practitioners training, provide program upfor excellence in the industry. dates and facilitate networking Jodi L. Peterson, Civil Rights opportunities.

Program Manager in the The theme of the event was Washington State Division “Collaboration Is Our Driver.

Office, received the Sharlene Opportunity Is Our DestiNail Meritorious Service nation.” Featured speakers Award; Attorney Colette Holt included representatives from of Colette Holt & Associseveral federal government ates received the Civil Rights agencies including the Federal Trailblazer Award; Arthur Highway Administration, Wright, Manager of the Equal Federal Aviation AdministraEmployment Opportunity OfArizona DOT Business Engagement and Compliance Office receives award for tion, and the Federal Transit fice at the Florida Department planning the 2014 Training Symposium Administration and USDOT of Transportation, received Office of the General Counsel. These speakers provided upthe Excellence in Program Administration Award; Wanda Bydates on the status of proposed DBE rule changes and update num-Ashley of the Arkansas Department of Transportation on their agency’s actions in response to the Office of Inspecreceived the Robert L. Bradley Distinguished Service Award; tor General DBE Program Audit Report issued in February and the Arizona Department of Transportation Business 2014.

Engagement and Compliance Office received an award for JoAnne Robinson, from the their outstanding leadership USDOT Office of the Genin planning the 2014 Training eral Counsel, shared that her Symposium. office is diligently working on The next bi-annual AASanalyzing comments from the HTO training symposium will recent DBE Program Notice take place in the summer of of Proposed Rule Making 2016. However, the Southern (NPRM) process and that Transportation Civil Rights her office expects to release Executive Committee will a new DBE Final Rule durhost its training symposium ing 2014. Federal Highway next year in the summer of Administration Associate 2015.

Administrator for Civil Rights Warren Whitlock discussed initiatives his office is taking to improve the DBE program and enhance supportive services to Colette Holt receives the Civil Rights Trailblazer Award from Drema Smith, DBE firms. Key among these Tyra Redus, Esq., and Grindly Johnson

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Excellence in Program Administration Award presented to Arthur Wright

by Tyra Redus, Esq., Drema Smith, and Grindly Johnson

Wanda Bynum-Ashley receives the Robert L. Bradley Distinguished Service Award from Grindly Johnson, Drema Smith, and Tyra Redus, Esq.

Disadvantaged Business Enterprise (DBE) Notice to Public The Luzerne County Transportation Authority has established a Disadvantaged Business Enterprise (DBE) program in accordance with regulations of the U.S. Department of Transportation (DOT) 49 CFR Part 26. LCTA receives federal financial assistance from the DOT, and as a condition of receiving this assistance, LCTA signed an assurance that it will comply with 49 CFR Part 26.

For more information regarding the DBE program, please contact: The LCTA DBE Liaison Officer (DBELO) 315 Northampton Street Kingston, PA 18704 (570) 288-9356

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Calendar of Events U.S. Hispanic Chamber of Commerce National Convention September 21-23, 2014, Salt Lake City, UT http://ushccconvention.com

Airport Minority Advisory Council (AMAC) 30th Anniversary Regional Forum & Gala October 3, 2014 Atlanta, GA www.amac-org.com

National Association of Minority Contractors (NAMC) September Board Meeting and Legislative Forum September 24-26, Washington, DC www.namcnational.org

National Minority Supplier Development Council (NMSDC) Conference and Business Opportunity Fair November 2-5, 2014, Orlando, FL www.nmsdc.org

Conference of Minority Transportation Officials (COMTO) 22nd Annual CBCF/COMTO Transportation Braintrust September 25, 2014, Washington, DC www.comto.org

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Certification: continued from page 19 According to the USDOT’s Interstate Certification document: The Department strongly reiterates that the ultimate purpose of the interstate certification rule is to facilitate certification of currently certified firms in other jurisdictions. Accordingly, interstate certification is not automatic reciprocity in the sense that each state must honor the other states’ certification decisions without review. Rather, the rule creates a rebuttable presumption such that a firm certified in 34

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its home state is eligible to be certified in other states in which it applies.

“States and the various agencies within states authorized to certify DBE/ACDBE candidates could save untold dollars, make a bold commitment to a green, paperless environment and free up staff through an efficient national database,” Wendt said.

Anniversary 30 10 03 14 AMAC Regional th

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Forum and Gala Atlanta Airport Marriott Gateway

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The 30th Anniversary Regional Forum and Gala at Hartsfield-Jackson Atlanta International Airport is the continuation of AMAC's goal to reinvigorate airport participation at the CEO level.

This all-day event provides a rare occasion to engage with, and influence the power players who set policy; draft and manage procurement; and have full oversight and responsibility for running one of the world's largest and most inclusive airport programs.

Proceeds from the conference go toward advancing AMAC's goal to increase diversity and eliminate barriers facing minority-owned, woman-owned, and disadvantaged business in the aviation industry through advocacy, business and professional development, and education.

Sponsorship opportunities still available.

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Fraud: continued from page 17 The similar federal and state statutes permit private individuals to sue for false claims on behalf of the government and to share in any recovery. Mr. Keiser will receive 17 percent of the $12 million settlement or $2,040,000 – $1,224,000 from the United States share, and $816,000 from Illinois’ portion of the settlement.

The settlement covers McHugh’s contracts on the following projects: the Washington/Monroe Viaducts over Interstate 90/94 for the Chicago Department of Transportation (CDOT) in 2005; the Red Line Howard Station for the Chicago Transit Authority in 2006; the North Avenue Bridge for CDOT in 2006; the Brown Line for the CTA in 2006; the Eastbound Interstate 88/Fox River Bridge for the Illinois State Toll Highway Authority in 2007; the Westbound Interstate 88/Fox River Bridge for the toll highway authority in 2008; and the Wacker Drive Viaduct Reconstruction from Randolph to Monroe streets for CDOT in 2010.

The federal and state governments contended that in bids for these contacts, in the final contracts, and in claims for payment, McHugh falsely stated that Perdel and ASI, which were both certified as “disadvantaged business enterprises” (DBE) owned by Elizabeth Perino, would perform or had performed work on the projects in satisfaction of federal and state DBE participation requirements in the contracts. The governments contended that contrary to McHugh’s statements, Perdel and ASI often functioned merely as “pass-throughs,” performing little, if any, work that would qualify for participation credit under federal and state DBE requirements. Perino, who owned Perdel and ASI in Lockport, was charged with federal mail fraud in 2011, and the case remains pending.

According to the settlement agreement, the governments also contended that Perdel and ASI’s contracted work for McHugh often exceeded the companies’ capacity and experience. Although their projects with McHugh were substantially greater in size and scope than they had previously performed, Perdel and ASI’s expertise to perform larger and more complex projects did not change correspondingly. Rather than Perdel and ASI performing, managing, or supervising the work that McHugh represented they would, McHugh frequently managed union workers they each hired.

In some cases, McHugh directed Perdel and ASI as to which union crews to hire.

McHugh, not Perdel or ASI, also selected certain suppliers on each of the contracts, determined the quantity and quality of those materials, negotiated the price, and often drafted a purchase order for Perdel or ASI to put on their letterhead, the governments contended. That kind of conduct violates federal and state provisions that are designed to give a share of the actual work of government-funded construction proj-

ects to minority- and women-owned businesses.

The settlement is neither an admission of liability by McHugh nor a concession by the state and federal governments that their contentions are not well founded, and McHugh expressly denies the claims.

The settlement was reached on behalf of the U.S. Department of Transportation, the Illinois Department of Transportation, the Illinois State Toll Highway Authority, and the Regional Transportation Authority.

The separate three-year administrative monitoring settlement and compliance agreement was reached between McHugh and the Federal Transit Administration, the Federal Highway Administration, the U.S. and Illinois Transportation Departments and their procurement officers, and the City of Chicago. In exchange for the government entities’ agreement not to pursue any suspension or debarment action against McHugh for the covered conduct, McHugh agreed to implement a corporate compliance program and appoint a compliance officer who is knowledgeable about DBE programs. The company also agreed to retain an independent monitor to evaluate McHugh’s performance and submit periodic reports to the government agencies and officials, and to make six presentations to those agencies and officials to discuss and promote compliant policies and procedures for working with DBE firms.

Assistant U.S. Attorney Donald Lorenzen represented the U.S. Attorney’s Office in the case. Assistant Illinois Attorney General Kate Pomper Costello represented the Illinois Attorney General’s office.

Reprinted with permission: U.S. Attorney’s Office

Tips: continued from page 13 Tip #10: Utilize On-The-Job Training and Love the Job

Some of the best training is done on the job. There’s no substitute for learning working techniques, daily. Engage with existing staff and network with professionals in similar fields to get the best experience.

Last, but not least, to truly be an exceptional DBE professional…“You must love what you do,” Goodwin said. “Our profession is one that is geared primarily toward helping others that have been historically denied an equal opportunity to participate fairly in the marketplace.”

Thomas summed it up saying, “The part that nobody can educate you on, is you have to have the heart and the passion to really be effective...We don’t want to record history, we want to make history.”

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COMTO: continued from page 25

From left, COMTO panelists Rhonda Briggins, Ben DeCosta, Rodney Slater, Therese McMillian, Andrew Young, Rep. Stacy Abrams and Joseph Erves gather at the conference.

Included in the panel were representatives from the USDOT Departmental Office of Civil Rights, Federal Rail Administration, Federal Aviation Administration, Federal Highway Administration, and Federal Aviation Administration. Director Camille Hazeur of the Departmental Office of

Civil Rights informed participants of the ongoing collaboration between the DBE program administrators at the various modes of transportation to address the recommendation of the Office of Inspector General in the areas of program accountability, training, analysis, business development and compliance. Hazeur said, “We just met with the Inspector General yesterday in an effort to close these recommendations because we have work to do. We understand that the I.G. is responsible for watching over us to make sure we are doing our work and I guess to some extent we are grateful because it required us to stop what we were doing and to take a deep-dive and it has created a better relationship between all of us (the modes of transportation). I want to assure you that in Washington we are watching, but we have to stay vigilant.”

COMTO recently announced its intention of selecting a new president/CEO for the organization as it prepares to move forward toward its mission of ensuring a level playing field for minorities in the transportation industry. The organization also plans to host the 22nd Annual CBCF/COMTO Transportation BrainTrust, Thursday, September 25, 2014, at the Walter E. Washington Convention Center in DC.

vossloh KIEPE

Public Notice of FY 2015 DBE Goal Vossloh Kiepe, a Transit Vehicle Manufacturer pursuing FTA-funded trolley bus contracts in the USA, announces its overall DBE goal of 1.95% for Fiscal Year 2015. The proposed goal and its methodology are available for inspection during normal business hours for 30 days following the date of this notice.

Vossloh Kiepe will accept comments on the goal for 45 days from the date of this notice.

Vossloh Kiepe is seeking DBEs certified under 49 CFR Part 26 and SBEs meeting SBA standards to submit technical and commercial proposals to us for materials and services we may require to manufacture passenger trolley buses. Potential suppliers of materials and services must have proven passenger trolley bus industry experience. All suppliers’ manufacturing facilities shall be certified or compliant with the Quality Program requirements as directed by ANSI/AQS Q9001, ISO 9001, ISO 14001, or demonstrate compliance with an equivalent program.

Interested companies should contact Vossloh Kiepe DBE Liaison Officer Kevin Kirk at k.kirk@vku.vossloh.com.

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BONDING EDUCATION PROGRAM

BONDING EDUCATION PROGRAM In Partnership with the Surety and Fidelity Association of America

HELPING SMALL BUSINESSES AND DBEs BECOME BOND READY

Benefits of Bonding Payment Assurance | Competitive Advantage | Fast-Track DBE Bonding Programs Surety Bond Claim Services | Third-Party Project Analysis Program Participant Benefits · · · · · · · · ·

Learn to run a profitable business Individualized prescriptive plan for business development One on One counseling hours Access to technical, financial, and managerial assistance Increased access to Prime Contractors and procurement opportunities Judged capable of fulfilling the obligations of a contract Claims services Economic Empowerment Job creation

USDOT is the only federal agency that has direct procurement and subcontracting procurement opportunities for small, emerging, contractors on the nation’s infrastructure in all modes of transportation. Partnering with local transportation project stakeholders, the BEP is designed to tie the participant’s bondability to the procurement opportunity.

2014 PROPOSED SCHEDULE LOCATION

SBTRC

EVENT

DATE

Spokane, Wash & Boise Idaho Baltimore, MD Shoreview, MN Miami, FL New York, NY Orlando, FL Topeka, KS

Northwest Region Mid Atlantic Central Southeastern Region Northeast Region Southeastern Region Central Region

Program Kick-Off BEP Planning BEP Kick Off BEP Kick Off BEP Kick Off BEP Kick Off BEP Kick Off

April 24, 2014 Fall 2014 Fall 2014 TBD Fall 2014 Winter 2014 Winter 2014

http://www.dot.gov/osdbu/financial-assistance/bonding-education/bonding-education-program