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As a condition of receiving annual capitalization grants that support Ohio’s Water Supply Revolving Loan Account (WSRLA) and Water Pollution Control Loan Fund (WPCLF), Ohio EPA negotiates a “fair share” goal for Disadvantaged Business Enterprise (DBE) participation in projects being funded through each program. The current DBE participation goals are 1.3 percent of all contracts to Minority-Owned Business Enterprises (MBEs) and 1.0 percent of all contracts to Women-Owned Business Enterprises (WBEs).

To count toward these goals, DBEs must be certified by a program accepted by U.S. EPA. Currently in Ohio, the only non-federal DBE certifications recognized by U.S. EPA are Ohio Dept. of Transportation’s (ODOT) DBE certification and Ohio Dept. of Administrative Services’ (DAS) Encouraging Diversity, Growth and Equity (EDGE) program. DAS’s separate MBE program and other local certifications do not meet U.S. EPA’s requirements, which means companies with these certifications that do not also have ODOT, EDGE, or a federal DBE certification do not count toward the goals for the loan programs.

There are times when communities and contractors may not be able to find certified DBEs to participate in their projects. For these situations, the loan recipients are required to document that a Good Faith Effort was made to encourage DBE participation. This responsibility is generally passed to the prime contractor as part of the contract requirements.

There are five elements of a Good Faith Effort that must be documented and submitted to DEFA with the bid package if the goals will not be met for a project:

  1. Ensure DBEs are made aware of contracting opportunities to the fullest extent practicable through outreach and recruitment activities; including DBEs on solicitation lists and soliciting them whenever they are potential sources.
  2. Make information on forthcoming opportunities available to DBEs and arrange time frames for contracts and establish delivery schedules, where the requirements permit, in a way that encourages and facilitates participation by DBEs in the competitive process. This includes, whenever possible, posting solicitation for bids or proposals for a minimum of 30 calendar days before the bid or proposal closing date.
  3. Consider in the contracting process whether firms competing for large contracts could be subcontracted with DBEs. This will include dividing total requirements when economically feasible into smaller tasks or quantities to permit participation by DBEs in the competitive process.
  4. Encourage contracting with a consortium of DBEs when a contract is too large for one of these firms to handle individually.
  5. Use the services and assistance of the Small Business Administration and the Minority Business Development Agency of the U.S. Department of Commerce.

You can document these elements with copies of emails or letters sent to DBE firms or organizations, screenshots of postings on electronic job posting boards frequented by DBEs, or other means showing that a Good Faith Effort was made to meet the goals for the project. Communities should keep copies of this information along with all other DBE-related information for at least five years after the project has been completed.

For more information, refer to the WSRLA or WPCLF Construction Contract Requirements document found here: epa.ohio.gov/defa/ofa#169544612-rulesdocuments. For questions about the DBE requirements for WSRLA and WPCLF loans, contact Joe Dragovich (joseph.dragovich@epa.ohio.gov) or Becky McKinney (rebecca.mckinney@epa.ohio.gov) at (614) 644-2798.