[Federal Register Volume 85, Number 240 (Monday, December 14, 2020)]
[Rules and Regulations]
[Pages 80646-80648]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-26549]
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DEPARTMENT OF TRANSPORTATION
Office of the Secretary
49 CFR Part 26
RIN No. 2105-AE92
Disadvantaged Business Enterprise Program; Inflationary
Adjustment
AGENCY: Office of the Secretary (OST), Department of Transportation
(DOT).
ACTION: Final rule.
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SUMMARY: The United States Department of Transportation (DOT) is
amending the small business size limit under its Disadvantaged Business
Enterprise (DBE) program, also known as the gross receipts cap, to
ensure that small businesses may continue to participate in the
Department's DBE program after taking inflation into account. This
final rule provides an inflation adjustment to the size limit on small
businesses participating in the DBE program and implements a statutory
change to the size standard pursuant to the Federal Aviation
Administration (FAA) Authorization Act of 2018.
DATES: This rule is effective January 13, 2021.
FOR FURTHER INFORMATION CONTACT: Chris Cialeo, Office of the General
Counsel (C-10), U.S. Department of Transportation, 1200 New Jersey
Avenue SE, Washington, DC 20590, (202) 366-8789,
[email protected].
SUPPLEMENTARY INFORMATION:
I. Background
The DBE program for DOT-assisted contracts is a statutory program
intended to ensure nondiscriminatory contracting opportunities for
small business concerns owned and controlled by socially and
economically disadvantaged individuals in the Department's highway,
mass transit, and airport financial assistance programs. The statutory
provision governing the DBE program in the highway and mass transit
financial assistance programs is section 1101(b) of the Fixing
America's Surface Transportation (FAST) Act (Pub. L. 114-94, Dec. 4,
2015), and the statutory provision governing the DBE program as it
relates to airport financial assistance programs is 49 U.S.C. 47113.
Under the Department's existing rules, to qualify as an eligible
DBE firm, a firm's average annual gross receipts over the preceding
three fiscal years cannot exceed a DOT-specific gross receipts cap. On
April 2, 2007, in response to direction in the Safe, Accountable,
Flexible, Efficient Transportation Equity Act: A Legacy for Users
(SAFETEA-LU) (Pub. L. 109-59, August 10, 2005) to adjust this gross
receipts cap annually for inflation, the Department published a final
rule adjusting the gross receipts cap for its DBE program in 49 CFR
part 26 from $19,570,000 to $20,410,000 (72 FR 15614). On April 3,
2009, the Department published another final rule adjusting the gross
receipts cap for its DBE program from $20,410,000 to $22,410,000 (74 FR
15222). The Moving Ahead for Progress in the 21st Century (MAP-21) Act
(Pub. L. 112-141, July 6, 2012) maintained the $22,410,000 gross
receipts cap amount set by the April 2009 final rule. On October 2,
2014, the Department issued a final rule that increased the gross
receipts cap to $23,980,000 (79 FR 59565). In 2015, The FAST Act
maintained the $23,980,000 gross receipts cap set by the October 2014
rule. Section 1101(b)(2)(A)(ii) of the FAST Act reaffirms the Secretary
of Transportation's requirement to adjust this amount annually for
inflation. Accordingly, this final rule adjusts the gross receipts cap
for inflation by increasing the gross receipts cap applicable to firms
for purposes of Federal Highway Administration (FHWA)--and Federal
Transit Administration (FTA)--assisted work to $26,290,000.
The Federal Aviation Administration (FAA) Reauthorization Act of
2018 (Pub. L. 115-254) removed the gross receipts cap for purposes of
eligibility for FAA-assisted work. Therefore, the revised rule reflects
that the gross receipts cap does not apply for purposes of determining
a firm's eligibility for FAA-assisted work.
II. Business Size Standards for the DBE Program
To make an inflation adjustment to the gross receipts figures, DOT
uses the Department of Commerce's price index for State and local
consumption expenditures (gross output of general government). The
Bureau of Economic Analysis at the Department of Commerce prepares
constant dollar estimates of State and local government purchases of
goods and services by deflating current dollar estimates by suitable
price indexes. These indexes include purchases of durable and non-
durable goods, and other services. Using these price deflators enables
the Department to adjust dollar figures for inflation from past years.
The current inflation rate on purchases by State and local
governments is calculated by dividing the price deflator for the fourth
quarter of 2019 (116.030) by 2015's fourth quarter price deflator
(105.829). See Bureau of Economic Analysis Table 3.10.4, Price Indexes
for Government Consumption Expenditures and General Government Gross
Output (January 30, 2020). The result of the calculation is 1.09639,
which represents an inflation rate of 10.9639% from the fourth quarter
of 2015. Multiplying the FAST Act's $23,980,000 standard for
disadvantaged business enterprises in DOT financial assistance programs
by 1.09639 equals $26,291,465, which will be rounded off to the nearest
$10,000 is $26,290,000. Therefore, if a firm's gross receipts averaged
over the firm's previous three fiscal years exceeds $26,290,000, it
exceeds the small business size limit for participation in FHWA and
FTA-assisted work under the Department's DBE program. The Department
will adjust this amount for inflation on an annual basis. In subsequent
years, the revised amount will be published on the Departmental Office
of Civil Rights' website.
Regulatory Analyses and Notices
Under the Administrative Procedure Act (5 U.S.C. 553(b)(B)), an
agency may waive notice and comment procedures if it finds good cause
that such procedures are impracticable, unnecessary, or contrary to the
public interest. The Department finds that notice and comment for this
rule is unnecessary because it only relates to ministerial updates of
business size standards and gross receipts caps to account for
inflation, which does not change the standards or caps in real dollar
terms. Accordingly, the Department finds good cause under 5 U.S.C.
553(b)(B) to waive notice and opportunity for public comment.
[[Page 80647]]
A. Executive Order 13771 (Reducing Regulation and Controlling
Regulatory Costs), Executive Order 12866 (Regulatory Planning and
Review), Executive Order 13563 (Improving Regulation and Regulatory
Review), and 49 CFR Part 5 (DOT Administrative Rulemaking, Guidance,
and Enforcement Procedures)
This rule is not a significant regulatory action under Executive
Order 12866, Regulatory Planning and Review, as supplemented by
Executive Order 13563, Improving Regulation and Regulatory Review. It
is also not significant within the meaning of DOT regulatory policies
and procedures. This rule is issued in accordance with the Department's
rulemaking procedures found in 49 CFR part 5 and DOT Order 2100.6.
The Department does not anticipate that this rulemaking will have
an economic impact on regulated entities. The rule is a ministerial
adjustment for inflation of a statutory small business size standard.
It will not impose burdens on any regulated parties.
This rule is not an Executive Order 13771 regulatory action because
this rule is not significant under Executive Order 12866.
B. Regulatory Flexibility Act
In compliance with the Regulatory Flexibility Act (Pub. L. 96-354,
5 U.S.C. 601-612), DOT has evaluated the effects of this action on
small entities and have determined that the action will not have a
significant economic impact on a substantial number of small entities.
The rule is a ministerial update to the size limits to define small
businesses for the Department's Financial Assistance Program for
Disadvantaged Business Enterprises. The only effect of the rule on
small entities is to allow some small businesses to continue to
participate in the DBE programs by adjusting for inflation, and to
align the regulation with a change to the part 26 size standard for
FAA-assisted work pursuant to the FAA Reauthorization Act of 2018.
Therefore, the Department certifies that this rule would not have a
significant economic impact on a substantial number of small entities.
C. Executive Order 13132 (Federalism)
This action has been analyzed in accordance with the principles and
criteria contained in Executive Order 13132 (Federalism), and the
Department has determined that this action will not have sufficient
federalism implications to warrant the preparation of a federalism
assessment. The Department has also determined that this action will
not preempt any State law or State regulation or affect the States'
ability to discharge traditional State governmental functions.
D. Executive Order 13175 (Tribal Consultation)
This rule has been analyzed in accordance with the principles and
criteria contained in Executive Order 13175 (Consultation and
Coordination with Indian Tribal Governments). Because this rule will
not significantly or uniquely affect the Indian tribal communities, and
will not impose substantial direct compliance costs, the funding and
consultation requirements of the Executive Order do not apply.
E. Unfunded Mandates Reform Act of 1995
This rule does not impose unfunded mandates as defined by the
Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4; 109 Stat. 48).
This rule will not result in the expenditure by State, local, and
tribal governments, in the aggregate, or by the private sector, of
$148.1 million or more in any one year (2 U.S.C. 1532). The definition
of ``Federal mandate'' in the Unfunded Mandates Reform Act excludes
financial assistance of the type in which State, local, or tribal
governments have authority to adjust their participation in the program
in accordance with changes made in the program by the Federal
Government. Since this rule pertains to a nondiscrimination requirement
and affects only Federal financial assistance programs, the Unfunded
Mandates Reform Act does not apply.
F. Executive Order 12372 (Intergovernmental Review)
The regulations implementing Executive Order 12372 regarding
intergovernmental consultation on Federal programs and activities do
not apply to this program.
G. Paperwork Reduction Act
Under the Paperwork Reduction Act of 1995 (PRA) (44 U.S.C. 3501),
Federal agencies must obtain approval from the Office of Management and
Budget (OMB) for each collection of information they conduct, sponsor,
or require through regulations. The Department has determined that this
rule does not contain collection of information requirements for the
purposes of the PRA.
H. National Environmental Policy Act
The agency has analyzed the environmental impacts of this action
pursuant to the National Environmental Policy Act of 1969 (NEPA) (42
U.S.C. 4321, et seq.) and has determined that it is categorically
excluded pursuant to DOT Order 5610.1C, ``Procedures for Considering
Environmental Impacts'' (44 FR 56420, October 1, 1979). Categorical
exclusions are actions identified in an agency's NEPA implementing
procedures that do not normally have a significant impact on the
environment and therefore do not require either an environmental
assessment or environmental impact statement. The purpose of this
rulemaking is to make an inflation adjustment of the size limit on
small businesses participating in the DBE program. The agency does not
anticipate any environmental impacts, and there are no extraordinary
circumstances pertaining to this rulemaking.
List of Subjects in 49 CFR Part 26
Administrative practice and procedure, Civil rights, Disadvantaged
business, Government contracts, Grant programs-transportation, Highways
and roads, Mass transportation, Minority business, Reporting and
recordkeeping requirements, Small business.
For the reasons stated in the preamble, the Department of
Transportation amends 49 CFR part 26 as follows:
PART 26--PARTICIPATION BY DISADVANTAGED BUSINESS ENTERPRISES IN
DEPARTMENT OF TRANSPORTATION FINANCIAL ASSISTANCE PROGRAMS
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1. The authority citation for part 26 is revised to read as follows:
Authority: 23 U.S.C. 324; 42 U.S.C. 2000d, et seq.; Sec.
1101(b), Pub. L. 114-94, 129 Stat. 1312, 1324; 49 U.S.C. 47113,
47123; Sec. 150, Pub. L. 115-254, 132 Stat. 3215.
0
2. In Sec. 26.65, revise paragraph (b) to read as follows:
Sec. 26.65 What rules govern business size determinations?
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(b) Even if it meets the requirements of paragraph (a) of this
section, a firm is not an eligible DBE for the purposes of Federal
Highway Administration and Federal Transit Administration-assisted work
in any Federal fiscal year if the firm (including its affiliates) has
had average annual gross receipts, as defined by SBA regulations (see
13 CFR 121.104), over the firm's previous three fiscal years, in excess
of $26.29 million. The Department will adjust this amount for inflation
on an annual basis. The adjusted amount will be published on the
Department's website in subsequent years.
* * * * *
[[Page 80648]]
Issued this 25th day of November, 2020, at Washington, DC, under
authority delegated in 49 CFR 1.27(a).
Steven G. Bradbury,
General Counsel.
[FR Doc. 2020-26549 Filed 12-11-20; 8:45 am]
BILLING CODE 4910-9X-P