[Federal Register Volume 74, Number 63 (Friday, April 3, 2009)]
[Rules and Regulations]
[Pages 15222-15225]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E9-7118]
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DEPARTMENT OF TRANSPORTATION
Office of the Secretary
49 CFR Parts 23 and 26
[Docket No. DOT-OST-2009-0074]
RIN 2105-AD79
Disadvantaged Business Enterprise Program; Inflationary
Adjustment
AGENCY: Office of the Secretary, DOT.
ACTION: Final rule.
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SUMMARY: Under the statutes governing the Department's Disadvantaged
Business Enterprise (DBE) Program, firms are not considered small
business concerns and are therefore ineligible as DBEs once their
average annual receipts over the preceding three fiscal years reach
specified dollar limits. The Department of Transportation is amending
the size limits or gross receipts caps to ensure that the opportunity
of small businesses to participate in the Department's DBE programs
remains unchanged after taking inflation into account. This final rule
provides 2009 inflation adjustment of size limits on small businesses
participating in the DOT's Disadvantaged Business Enterprise programs.
DATES: This rule is effective April 3, 2009.
FOR FURTHER INFORMATION CONTACT: Robert C. Ashby, Deputy Assistant
General Counsel for Regulation and Enforcement, Department of
Transportation, 1200 New Jersey Avenue, SE., W94-302, Washington, DC
20590, phone numbers (202) 366-9310 (voice), (202) 366-9313 (fax),
(202) 755-7687 (TTY), [email protected] (e-mail).
SUPPLEMENTARY INFORMATION:
Background
On April 2, 2007, the Department published a final rule revising 49
CFR part 23, the regulation governing the airport concessions
disadvantaged business enterprise (ACDBE) program, to require that the
Department adjust the general ACDBE gross receipts cap for inflation.
That rule also adjusted the gross receipts cap for the Department's
financial assistance programs in 49 CFR part 26. This final rule
updates the gross receipts cap for the ACDBE program and the
Department's financial assistance program for 2009.
The DBE Airport Concession and Contracting Programs
The DOT-assisted contracts DBE rule and airport concessions DBE
rule are based on different statutes. Each statute applies to a
distinct type of business that may seek DOT financial assistance. The
ACDBE program is designed to give business opportunities to certain
small business concerns that operate at airports and that are owned and
controlled by socially and economically disadvantaged individuals. The
ACDBE program is mandated by 49 U.S.C. 47107(e), originally enacted in
1987 and amended in 1992.
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 1101(b) of the Safe, Accountable,
Flexible, Efficient Transportation Equity Act: A Legacy for Users
(SAFETEA-LU), Public Law 109-59, August 10, 2005. The statutory
provision governing the DBE program as it relates to the airport
financial assistance programs is 49 U.S.C. 47113.
ACDBE Gross Receipts Size Standards
Under the current DOT rule, if the airport concessions firm's
annual gross receipts average over the preceding three fiscal years
exceed $47,780,000,
[[Page 15223]]
then, it is not considered a small business eligible to be certified as
an ACDBE. This final rule adjusts the size standards for eligibility as
an ACDBE for inflation.
This adjustment compensates for the rise in the general level of
prices over time from the third quarter of 2006 through the fourth
quarter of 2008. In order to ensure that this adjustment is made on a
timely basis in the future, the rule was amended to provide for a
similar adjustment every two years, using the same method. At two year
intervals, the Department is to publish a final rule to update the size
standard numbers. This final rule updates the ACDBE gross receipts cap
for 2009. It should be emphasized that this action does not increase
the size standard for ACDBEs in real dollar terms. It simply maintains
the status quo, adjusting to 2008 dollars.
In order to make an inflation adjustment to the gross receipts
figures, the Department of Transportation uses a Department of Commerce
price index. The Department of Commerce's Bureau of Economic Analysis
prepares constant dollar estimates of state and local government
purchases of goods and services by deflating current dollar estimates
by suitable price indexes.\1\ These indices include purchases of
durable and non-durable goods, and other services. Using these price
deflators enables the Department to adjust dollar figures for past
years' inflation. Given the nature of the Department's DBE Program and
ACDBE Program, adjusting the gross receipts cap in the same manner in
which inflation adjustments are made to the costs of state and local
government purchases of goods and services is simple, accurate, and
fair.
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\1\ See Bureau of Economic Analysis National Income and Product
Account Table; Table 3.10.4 Price Indexes for Government Consumption
Expenditures and General Government Gross Output.
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The inflation rate on purchases by state and local governments for
the current year is calculated by dividing the price deflator for the
fourth quarter of 2008 (140.964) by 2006's third quarter price deflator
(128.352). The result of the calculation is 1.0982, which represents an
inflation rate of 1.098% from the third quarter of 2006. Multiplying
the $47,780,000 figure for small business enterprises by 1.0982 equals
$52,471,996, which will be rounded off to the nearest $10,000, or
$52,470,000.
Therefore, under this new rule, if a firm's gross receipts,
averaged over the firm's previous three fiscal years, exceeds
$52,470,000, then it exceeds the airport concessions small business
size limit contained in part 23.
ACDBE Car Rental Company Size Standards
Under the existing rule, car rental companies are not eligible to
participate in the ACDBE program if their average gross receipts over
the three previous fiscal years exceed $63,710,000. This final rule
adjusts the size standard for car rental companies to reflect the
effects of inflation on the real dollar value.
The inflation rate on purchases by state and local governments for
the current year is calculated by dividing the price deflator for the
fourth quarter of 2008 (140.964) by 2006's third quarter price deflator
(128.352). The result of the calculation is 1.0982, which represents an
inflation rate of 1.098% from the third quarter of 2006. Multiplying
the $63,710,000 figure for car rental companies by 1.0982 equals
$69,966,322, which will be rounded off to the nearest $10,000, or
$69,970,000.
Therefore, under this new rule, if a car rental company's gross
receipts, averaged over the company's previous three fiscal years,
exceeds $69,970,000, then it exceeds the airport concessions car rental
company size limit contained in part 23.
Business Size Standards for the DBE DOT Financial Assistance Programs
This rule also adjusts the gross receipts cap for the Department's
financial assistance programs in 49 CFR part 26. Under the existing
rule, if a firm's average annual gross receipts, as defined by Small
Business Administration (SBA) regulations (see 13 CFR 121.402), over
the preceding three fiscal years exceed $20,410,000, then it cannot
qualify as an eligible DBE firm. SAFETEA-LU Section 1101(b)(1)(a)
instructs the Secretary of Transportation to adjust this amount
annually for inflation.
The inflation rate on purchases by state and local governments for
the current year is calculated by dividing the price deflator for the
fourth quarter of 2008 (140.964) by 2006's third quarter price deflator
(128.352). The result of the calculation is 1.0982, which represents an
inflation rate of 1.098% from the third quarter of 2005. Multiplying
the $20,410,000 figure for disadvantaged business enterprises in
Department of Transportation financial assistance programs by 1.0982
equals $22,414,262, which will be rounded off to the nearest $10,000,
or $22,410,000.
Therefore, if a firm's gross receipts, averaged over the firm's
previous three fiscal years, exceeds $22,410,000, then it exceeds the
small business size limit for participation by disadvantaged business
enterprises in Department of Transportation financial assistance
programs contained in part 26.
Regulatory Analyses and Notices
Under the Administrative Procedure Act (5 U.S.C. 553(b)), an agency
may waive the normal notice and comment requirements if it finds, for
good cause, that they are impracticable, unnecessary, or contrary to
the public interest. The Department finds that notice and comment for
this rule is unnecessary and contrary to the public interest because it
relates only 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. These updates will assist
entities attempting to be part of the Department's DBE program and
should not be unnecessarily delayed. Accordingly, the Department finds
good cause under 5 U.S.C. 553(b)(B) to waive notice and opportunity for
public comment. The Department also finds good cause under 5 U.S.C.
553(d)(3) to make this rule effective upon publication.
Executive Order 12866 (Regulatory Planning and Review) and DOT
Regulatory Policies and Procedures
This rule is nonsignificant for purposes of the Executive Order
12866 and the Department of Transportation's Regulatory Policies and
Procedures. The rule is a ministerial adjustment for inflation of a
statutory small business size standard that does not change the
standard in real dollar terms. It will not impose burdens on any
regulated parties. In addition, this rule would not create a serious
inconsistency with any other agency's action or materially alter the
budgetary impact of any entitlements, grants, user fees, or loan
programs. Consequently, a full regulatory evaluation is not required.
Regulatory Flexibility Act
In compliance with the Regulatory Flexibility Act (Pub. L. 96-354,
5 U.S.C. 601-612), we have 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.
Therefore, the Department certifies that this rule would not have a
significant economic impact on a substantial number of small entities.
The rule is a ministerial update to the dollar limits and size
limits to define small businesses for the Department's Airport
Concessions Disadvantaged
[[Page 15224]]
Business Enterprise Program and 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 ACDBE and the DBE programs by
adjusting for inflation. Therefore, the rule will not have a
significant economic impact on a substantial number of small entities.
Executive Order 13132 (Federalism Assessment)
This action has been analyzed in accordance with the principles and
criteria contained in Executive Order 13132, and the Department has
determined that this action would not have sufficient federalism
implications to warrant the preparation of a federalism assessment. The
Department has also determined that this action would not preempt any
State law or State regulation or affect the States' ability to
discharge traditional State governmental functions.
Executive Order 13084
This rule has been analyzed in accordance with the principles and
criteria contained in Executive Order 13084 (``Consultation and
Coordination with Indian Tribal Governments''). Because this rule would
not significantly or uniquely affect the Indian tribal communities, and
would not impose substantial direct compliance costs, the funding and
consultation requirements of the Executive Order do not apply.
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
$128.1 million or more in any one year (2 U.S.C. 1532). Further, in
compliance with the Unfunded Mandates Reform Act of 1995, the
Department will evaluate any regulatory action that might be proposed
in subsequent stages of the proceeding to assess the effects on State,
local, and tribal governments and the private sector. Additionally, 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 Act does not apply.
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.
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.
National Environmental Policy Act
The Department has analyzed this rule for the purpose of the
National Environmental Policy Act of 1969 (42 U.S.C. 4321-4347) and has
determined that the inflationary adjustment for dollar limits and size
limits used to define small businesses that can participate in the
Department's Disadvantaged Business Enterprises programs, would not
have any effect on the quality of the environment.
Regulation Identification Number
A regulation identification number (RIN) is assigned to each
regulatory action listed in the Unified Agenda of Federal Regulations.
The Regulatory Information Service Center publishes the Unified Agenda
in April and October of each year. The RIN contained in the heading of
this document can be used to cross reference this action with the
Unified Agenda.
List of Subjects
49 CFR Part 23
Administrative practice and procedure, Airports, Civil rights,
Concessions, Government contracts, Grant programs--transportation,
Minority businesses, Reporting and recordkeeping requirements.
49 CFR Part 26
Administrative practice and procedure, Airports, Civil rights,
Concessions, Government contracts, Grant programs--transportation,
Highways and roads, Mass transportation, Minority business, Reporting
and recordkeeping requirements.
0
For the reasons stated in the preamble, the Department of
Transportation amends 49 CFR parts 23 and 26 as follows:
PART 23--PARTICIPATION OF DISADVANTAGED BUSINESS ENTERPRISE IN
AIRPORT CONCESSIONS
0
1. The authority citation for part 23 continues to read as follows:
Authority: 49 U.S.C. 47107; 42 U.S.C. 2000d; 49 U.S.C. 322;
Executive Order 12138.
0
2. Revise Sec. 23.33 to read as follows:
Sec. 23.33 What size standards do recipients use to determine the
eligibility of ACDBEs?
(a) As a recipient, you must, except as provided in paragraph (b)
of this section, treat a firm as a small business eligible to be
certified as an ACDBE if its gross receipts, averaged over the firm's
previous three fiscal years, do not exceed $52.47 million.
(b) The following types of businesses have size standards that
differ from the standard set forth in paragraph (a) of this section:
(1) Banks and financial institutions: $1 billion in assets;
(2) Car rental companies: $69.97 million average annual gross
receipts over the firm's three previous fiscal years, as adjusted by
the Department for inflation every two years from April 3, 2009.
(3) Pay telephones: 1,500 employees;
(4) Automobile dealers: 350 employees.
(c) The Department adjusts the numbers in paragraphs (a) and (b)(2)
of this section using the Department of Commerce price deflators for
purchases by State and local governments as the basis for this
adjustment. The Department publishes a Federal Register document
informing the public of each adjustment.
PART 26--PARTICIPATION BY DISADVANTAGED BUSINESS ENTERPRISES IN
DEPARTMENT OF TRANSPORTATION FINANCIAL ASSISTANCE PROGRAMS
0
3. The authority citation for 49 CFR part 26 continues to read as
follows:
Authority: 23 U.S.C. 324; 42 U.S.C. 2000d, et seq.; 49 U.S.C
1615, 47107, 47113, 47123; Sec. 1101(b), Pub. L. 105-178, 112 Stat.
107, 113.
0
4. Revise Sec. 26.65 to read as follows:
Sec. 26.65 What rules govern business size determinations?
(a) To be an eligible DBE, a firm (including its affiliates) must
be an existing small business, as defined by
[[Page 15225]]
Small Business Administration (SBA) standards. As a recipient, you must
apply current SBA business size standard(s) found in 13 CFR part 121
appropriate to the type(s) of work the firm seeks to perform in DOT-
assisted contracts.
(b) Even if it meets the requirements of paragraph (a) of this
section, a firm is not an eligible DBE 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 121.402), over the
firm's previous three fiscal years, in excess of $22.41 million.
(c) The Department adjusts the number in paragraph (b) of this
section annually using the Department of Commerce price deflators for
purchases by State and local governments as the basis for this
adjustment.
Issued this 22nd day of March, 2009, at Washington, DC.
Ray LaHood,
Secretary of Transportation.
[FR Doc. E9-7118 Filed 4-2-09; 8:45 am]
BILLING CODE 4910-9X-P