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Inclusion: Diverse Business Spending

What is diverse business spending?

WSDOT is working to create an awareness of, and meet our state and federal diverse business goals. We do this by (click through the tabs to discover):


Meeting disadvantaged business enterprise (DBE) goals

How do we measure meeting disadvantaged business enterprise (DBE) goals?

We aspire to meet WSDOT’s overall Federal Highway Administration (FHWA) disadvantaged business enterprise (DBE) targets on October 1, 2018 and annually thereafter. (The target changed from 11.6% in Federal Fiscal Year 2017 to 19.0% in FFY 2018).


Achievement Progress Target
FFY2019
    
FFY2020
    
12.5% Arrow to right
    
12.2% Arrow to right
    
19% Needs improvement status icon
Needs improvement
Awards and commitments Awards and commitments
15.0% 14.0%
Utilization for completed contracts
    
Utilization for completed contracts

Why did we pick this target?

In 2017, WSDOT completed a DBE Program Disparity Study that analyzed the availability versus utilization of minority- and women-owned firms. This study is a legal requirement to implement the Disadvantaged Business Enterprise program. This study noted a 19 percent availability of Disadvantaged Business Enterprises and WSDOT chose this figure as our overall DBE goal.
In 2017, the agency implemented a white-women owned business waiver. WSDOT does not count white-women owned DBEs toward individual project goals. White-women owned DBEs currently make up 10.3 percent of the 19 percent overall DBE goal. WSDOT is currently only able to set goals for minority owned firms, available at 8.7 percent. WSDOT will be unable to meet the current overall DBE goal until the waiver is removed.





Source: WSDOT Office of Equal Opportunity.

FFY2020 (October 2019 through September 2020). Utilization for completed contracts refers to those completed within the stated time. The DBE goal changed from 11.8% in FFY2016 and FFY2017 to 19% in FFY2018. This change was based on 2017 DBE Program disparity study findings.


More about meeting DBE goals

What is a Disadvantaged Business Enterprise and why are DBE goals a priority?

According to the United States Department of Transportation, “DBEs are for-profit small business concerns where socially and economically disadvantaged individuals own at least a 51% interest and also control management and daily business operations. African Americans, Hispanics, Native Americans, Asian-Pacific and Subcontinent Asian Americans, and women are presumed to be socially and economically disadvantaged. Other individuals can also qualify as socially and economically disadvantaged on a case-by-case basis.”

DBE goals are federally-mandated targets for transportation projects that use federal aid. These goals are important because they help to ensure a level playing field and foster equal opportunity for firms owned and operated by disadvantaged individuals on USDOT-funded contracts and procurements.

How are we doing?

WSDOT is not meeting our DBE goals due to a waiver that changed the definition of the goals, instituted in June 2017. This waiver excludes white women-owned DBEs that contract with WSDOT from counting toward the DBE goals.

What are we working on?

To increase voluntary participation, WSDOT implemented a Federal Small Business Enterprise (FSBE) Program. More information is available at: www.wsdot.wa.gov/EqualOpportunity/sbe.htm

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Progressing on voluntary state goals


How do we measure progress on voluntary state goals?

WSDOT strives to meet voluntary state contracting goals for diverse businesses, including small, minority-owned, veteran-owned and women-owned businesses.


Progress Target
SFY2020
    
5.37% Arrow to right 10% Needs improvement
Minority-owned Needs improvement
2.02% Arrow to right 6% Needs improvement
Non-minority-women-owned Needs improvement
0.04% Arrow to right 5% Needs improvement
Veteran-owned Needs improvement
10.27% Arrow to right 5% On track
Small businesses On track

Why did we pick this target?

The Washington State Department of Transportation is working on a number of efforts to meet the Governor’s Diverse Business Results Washington Goals, as listed below:

For additional information about the efforts WSDOT is taking to meet the above goals, please see the State Diverse Business Roadmap (pdf, 332kb)

Source: OMWBE Supplier Diversity Reporting at https://omwbe.wa.gov/state-supplier-diversity-reporting/agency-supplier-diversity


More about progress on voluntary state goals

What are voluntary diverse business goals and why are they a priority?

Governor Jay Inslee sets voluntary diverse business goals for Washington state agencies to contract with businesses that are small or owned by minorities, women and/or veterans. These goals allow WSDOT to maintain and enjoy partnerships with diverse businesses and to provide assistance and outreach to minority, small, veteran and women-owned firms.

How are we doing?

WSDOT fell short of meeting three of four voluntary goals—while making progress on Minority-owned businesses contracting with WSDOT increased, although they still missed the WSDOT voluntary goals.

What are we working on?

WSDOT strives to meet these voluntary goals by creating and implementing a Minority, Small, Veteran and Women’s Business Enterprise (MSVWBE) Inclusion Plan. The agency is managing MSVWBE goal attainment through monthly reporting and regular dialogue between prime contractors and WSDOT project administrators. To increase voluntary MSVWBE participation, WSDOT created the Capacity Building Mentorship Program, part of the state funded contracts diversity roadmap.

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Certifying firms to do business with WSDOT


How do we measure increasing DBE participation?

WSDOT is working to increase Disadvantaged Business Enterprise (DBE) participation and the number of firms certified to do business in Washington state. Our goal is to increase certified firms by 10% annually by 2020.


Archived Progress Target
2019 2020 Annually
1,053 Arrow to right 1,146 Arrow to right 10% Needs improvement status icon
Needs improvement
Total DBE firms Total DBE firms Increase in total DBE firms

Why did we pick this target?

In an effort to meet our overall DBE goal of 19%, WSDOT is attempting to increase the number of certified firms by 10% annually. WSDOT recognizes that a 10% increase is a “stretch” goal, however to increase the number of diverse firms receiving work with WSDOT, we need to increase the pool of available certified firms.



Source: WSDOT Office of Equal Opportunity.

Note: These numbers represent a “snapshot in time” as the number of firms certified to do business fluctuates from one week to the next.


More about certifying firms to do business

Why is this a priority?

Disadvantaged Business Enterprises (DBEs) are companies that have been certified by the Office of Minority and Women’s Business Enterprises (OMWBE) as being owned by socially and economically disadvantaged individuals. WSDOT considers Inclusion in public contracting an important goal. Increasing the number of diverse firms certified to do business on projects provides WSDOT a larger pool of contractors from whom to choose.

How are we doing?

The total number of DBE firms certified to do business on federally funded projects grew 8.8% between 2019 and 2020, from 1053 to 1146. During the same time period, the number of non-minority women-owned businesses certified grew 3.1%, from 387 to 399; the number of minority women-owned businesses certified grew 24.0%, from 167 to 207, and the number of minority or other men-owned businesses certified grew 8.2%, from 499 to 540.

What are we working on?

WSDOT is working with OMWBE and the governor’s diversity subcabinet on possible strategies for outreach towards uncertified firms who qualify for DBE certification.

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Spotlight on training

Spotlight status icon Spotlight on training

WSDOT provides frequent training opportunities to help businesses understand the complexities of doing business with the government and working within the federal Disadvantaged Business Enterprise (DBE) program.

WSDOT offers training to help DBE owners
WSDOT offers training to help DBEs understand the complexities of doing business with the state.

More about DBE program training

Why is training a priority?

Small business owners can be overwhelmed by the complexities of doing business with the government and working within the federal DBE program. It can be difficult for small business owners to stay current with program changes and updates. To help fix this problem, WSDOT provides multiple training through the state on the DBE program and issues related to civil rights.

Business owners are faced with a wide variety of challenges including cash flow, regulatory compliance, and best accounting practices. These challenges disproportionately impact groups who been traditionally socially and economically disadvantaged. WSDOT has made it a priority to provide trainings and informational workshops for DBE firms.

How are we doing?

On January 8, 2020, WSDOT hosted a no-cost training focusing on essential elements of contract administration for disadvantaged businesses, led by Mary Lerdahl of Emerald Consulting Services, LLC. Participating firms received an overview of administrative specifications, with an emphasis on WSDOT specific contract special provisions. Firms were also walked through contract language review, change orders, reporting systems, subcontractor obligations, and best practices to ensure equitable and timely payment for work performed. Upcoming trainings will include additional topics, such as bonding, liens, and best contractual practices.

What are we working on?

WSDOT is assessing the feedback we received from statewide trainings; the agency will incorporate suggested improvements into future offerings. Our OEO is considering partnering with other organizations to collaborate on future trainings, while also looking into how to better market and build awareness of the trainings we offer.

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