[Code of Federal Regulations]
[Title 49, Volume 1]
[Revised as of October 1, 2003]
From the U.S. Government Printing Office via GPO Access
[CITE: 49CFR23.107]

[Page 196-197]
 
                        TITLE 49--TRANSPORTATION
 
          Subtitle A--Office of the Secretary of Transportation
 
PART 23_PARTICIPATION BY DISADVANTAGED BUSINESS ENTERPRISE IN AIRPORT CONCESSIONS
--Table of Contents
 
Subpart F_Implementation of Section 511(a)(17) of the Airport and Airway 
                   Improvement Act of 1982, as Amended
 
Sec.  23.107  Prohibition on long-term, exclusive concession agreements.

    (a) Except as provided in paragraph (b) of this section, sponsors 
shall not enter into long-term, exclusive agreements for the operation 
of concessions. For purposes of this section, a long-term agreement is 
one having a term in excess of five years. Guidelines for determining 
whether an agreement is exclusive, as used in this section, have been 
included in the FAA's ``DBE Program Development Kit for Airport Grant-
in-Aid Recipients.'' This publication can be obtained from any FAA 
Regional Civil Rights Officer or from the FAA Office of Civil Rights, 
800 Independence Avenue, SW., Washington, DC 20591, Attention, 
[chyph]ACR-4.
    (b) A long-term, exclusive agreement is permitted under this 
subpart, provided that;
    (1) Special local circumstances exist that make it important to 
enter such agreement, and
    (2) The responsible FAA regional civil rights officer approves of a 
plan for ensuring adequate DBE participation throughout the term of the 
agreement.
    (c) Approval of the plan referenced in paragraph (b)(2) of this 
section relieves the sponsor of the need to obtain an exemption under 
the procedures of Sec.  23.41(f) and the Notice of Policy (45 FR 45281, 
July 3, 1980). The Notice of Policy can be obtained from the FAA Office 
of Civil Rights at the address given in paragraph (a) of this section.
    (d) Sponsors shall submit the following information with the plan 
referenced in paragraph (b)(2) of this section:
    (1) A description of the special local circumstances that warrant a 
long-term, exclusive agreement, e.g., a requirement to make certain 
capital improvements to a leasehold facility.
    (2) A copy of the draft and final leasing and subleasing or other 
agreements. The long-term, exclusive agreement shall provide that:
    (i) One or more DBE's will participate throughout the term of the 
agreement and account for at least 10 percent of the annual estimated 
gross receipts.
    (ii) The extent of DBE participation will be reviewed prior to the 
exercise of each renewal option to consider whether an increase is 
warranted. (In some instances, a decrease may be warranted.)
    (iii) A DBE that is unable to perform successfully will be replaced 
by another DBE, if the remaining term of the agreement makes this 
feasible.
    (3) Assurances that the DBE participation will be in an acceptable 
form,

[[Page 197]]

such as a sublease, joint venture, or partnership.
    (4) Documents used by the sponsor in certifying the DBE's.
    (5) A description of the type of business or businesses to be 
operated, location, storage and delivery space, ``back-of-the-house 
facilities'' such as kitchens, window display space, advertising space, 
and other amenities that will increase the DBE's chance to succeed.
    (6) Information on the investment required on the part of the DBE 
and any unusual management or financial arrangements between the prime 
concessionaire and DBE.
    (7) Information on the estimated gross receipts and net profit to be 
earned by the DBE.