FAA

FAA plays a critical role for outcomes of equality in concession contracts for small and disadvantaged businesses.

The Department of Transportation (DOT) is dedicated to serving the community, including businesses contracting as sponsor who receive grants for Airport Improvement Programs (AIP). The Departments Disadvantaged Business Enterprise (DBE), and Airport Concession Disadvantaged Business enterprise (ACDBE) are designed to specifically readdress the continuing effects of discrimination in airport contracts. It’s unusual, but airports that are not complaint with the DBE/ACDBE programs may have AIP funds delayed until the issues are resolved.

Title VI requires airports to designate a liaison to work with FAA to ensure compliance with their ACDBE airport nondiscrimination program. The FAA periodically conducts airport compliance reviews to assess complaints, program implementation, renovations, as well as the evaluation / performance of the concessionaires, contracts and inclusion of nondiscrimination language and practice. The industry requires more information, education and training because much of the requirements are misunderstood, poorly executed, and in some cases may be omitted, until a violation requires a remedy.

The ACDBE program is outlined in CRF 49 Part 23 (https://www.ecfr.gov/current/title-49/subtitle-A/part-23) as the mechanism to increase the participation by bona fide operators controlled by socially and economically disadvantaged individuals. One of the more common forms for executing these programs is through a joint venture agreement.

“Joint venture means an association of an ACDBE firm (i.e. DCGG) and one or more other firms to carry out a single, for-profit business enterprise, for which the parties combine their property, capital, efforts, skills and knowledge, and in which the ACDBE is responsible for a distinct, clearly defined portion of the work of the contract and whose shares in the capital contribution, control, management, risks, and profits of the joint venture are commensurate with its ownership interest. Joint venture entities are not certified as ACDBEs.”

Attachment: Joint Venture Guidance 2008

DCGG’s first-hand experience and disparity studies indicate discrimination is thriving in the awards of contracts, and subsequently in the execution of partnering contract language, loans and distributions of funds. Based on the data and Congress review, it was determined that there is a compelling need for DBE/ACDBE programs. The proactive leaders as airports sponsors, business owners and ACDBE’s are crucial to the success of the program.