Transportation Research Board 2014 Annual Meeting Disadvantaged Business Enterprise Committee

1. Transportation Research Board2014 Annual MeetingDisadvantaged Business Enterprise Committee Identifying Successful Practices in the FHWA DBE Program National Cooperative Highway Research Project 20-95 Colette Holt & Associates 13 January 2014

2. Research Team • Colette Holt & Associates (certified DBE & MWBE) • Colette Holt, JD – Project Manager & Legal Counsel • Nationally recognized expert, educator & author on D/S/M/WBE issues • Conducted court-approved disparity studies & designed court-approved D/S/M/WBE programs for over 20 years • Expert for USDOJ in defense of the SBA 8(a) program • Expert for SDOTs & other agencies in defense of D/M/WBE programs • Co-authored National Academy of Sciences Transportation Research Board’s “Guidelines for Conducting a Disparity and Availability Study for the Federal DBE Program”

3. Research Team • Colette Holt & Associates • Robert Ashby, JD – Legal &Program Analysis, Stakeholder Outreach & Community Education • Deputy General Counsel for Regulations & Enforcement for the USDOT; counseled the Department for over 37 years • Responsible for all DOT DBE regulations; advising state, local and federal officials concerning DBE certification, goal setting and other DBE issues; and serving as liaison with the Department of Justice on DBE matters • Qualified expert witness; has offered testimony in federal courts on issues related to the USDOT DBE Program

4. Research Team • Colette Holt & Associates • Steven Pitts, Ph.D. – Economist & Statistician • Nationally recognized expert, educator & author on market issues regarding minorities for over 20 years • Associate Chair of the University of California at Berkeley’s Center for Labor Research & Education • Extensive experience using large databases, including Census Bureau files, to perform statistical analyses of labor & employment issues

5. Research Team Abaci Research & Consulting, LLC • Kim Stewart, MS – Quantitative &qualitative data collection • Most experienced researcher in the country on identifying, collecting & preparing data for statistical analysis specifically for Disparity Studies & D/M/WBE program analysis • Extensive experience identifying & collecting data from agencies, prime contractors & subcontractors 5

6. Research Objectives Identify Best Practices in the DBE Program to Facilitate • Broad participation of DBEs in SDOT contracts • Successful “graduation” from the program • Survivability outside the program Address RFP Questions Concerning Graduates • What are the numbers & percentage of DBEs who have graduated in the last 5-10 years? • What were the industry distributions of graduates? 6

7. Research Objectives, cont. • How many have graduated for exceeding the PNW vs. the size cap? • How many graduates appealed decertification? • What are successful graduates’ key characteristics? • What has been firms’ experiences since graduation? • What are the most important supportive services & what additional services would be helpful?s 7

8. Research Objectives, cont. Address RFP Questions Concerning All DBEs • What are the numbers & distribution of successful awardees by industry; size; minorities versus white females? • What are impediments & disincentives to graduate? • What are the characteristics & performance measures of successful non-graduated DBEs? • What supportive services are most important & what additional services would be helpful? 8

9. Research Objectives, cont. Address RFP Questions Concerning Primes • What are the most commonly subcontracted items? • Are primes aware of the SDOT’s DBE goal? • How many different DBEs are used? • How are subs selected? • What information, methods & incentives would encourage them to use new subs? • Does the use of DBEs vary by the prime’s size & industry? • What is the effect of graduation on the use of DBEs? 9

10. RFP Recommendation Topics Best practices to expand the participation of DBEs Effective supportive services Effective management practices & approaches to support program success DBE performance measures Effective data management practices to support programs Further research to facilitate program improvements 10

11. Research Plan Survey SDOTs to Obtain: Information about all DBEs Distribution across industries Information about gross receipts Racial, ethnic & gender breakdown of DBEs Likely DBE subcontracting industries Average DBE’s length of time in the program 11

12. Research Plan, cont. Information about graduated DBEs Number & percentage who have graduated Basis for graduation: gross receipts &/or PNW Number & rate of appeals Information about supportive services Types of services Mentor-protégé programs Participation rates Effectiveness of approaches 12

13. Research Plan, cont. Information about successful DBEs Graduated DBEs & still eligible firms Entrepreneurial success factors Industry networks Supportive services programs Bonding & capital access Access to prime contract opportunities Mentor-protégé programs Suggestions for enhancing DBE opportunities & graduation rates 13

14. Research Plan, cont. Survey DBEs to Obtain: Information about the firm Industry Size Location Years in business Racial, ethnic & gender ownership Work as prime, sub or both 14

15. Research Plan, cont. Information about graduation status Has it graduated NAICS codes Basis: gross receipts or PNW Appealed the decision Experiences since graduation If it still eligible, what factors impede graduation Experiences with supportive services Types of services Types of service providers Most & least helpful 15

16. Research Plan, cont. Program suggestions Impediments to graduation Impediments to success Suggestions for SDOTs to: Increase opportunities Encourage primes to use DBEs, unfamiliar DBEs & graduated firms 16

17. Research Plan, cont. Survey Prime Contractors & Consultants to Obtain: Information about the firm Industry Size Location Years in business Racial, ethnic & gender ownership Work as prime, sub or both 17

18. Research Plan, cont. Utilization of subcontractors DBEs & non-DBEs Scopes of work Size of contracts Criteria for subcontractor selection Experiences with the DBE program Awareness of SDOT’s overall goal Utilization of graduated DBEs Solicitation factors for DBEs, unfamiliar DBEs & graduated firms Market forces affecting DBEs, small firms & new market entrants 18

19. Research Plan, cont. Survey Supportive Services Consultants to Obtain: DBEs served Number/year Distribution by size, industry & years in business Number that have graduated during last 5 years Services offered Types Most utilized Most helpful 19

20. Research Plan, cont. Gather Data from Disparity Studies Summarize DBE utilization by industries & race, ethnicity & gender Review qualitative evidence Traits of successful DBEs Effects of graduation Barriers to graduation Access to prime contracting opportunities Barriers to using new or unfamiliar DBEs 20

21. Research Plan, cont. Review DBE program best practices Management structures Race-neutral measures Data collection & monitoring systems Program success measures Gather data from other sources TRB reports Literature on entrepreneurial success USDOT guidance, handbooks, etc. Industry presentations & reports 21

22. Research Plan, cont. Produce Interim Report Interview DBEs Selected for industry, location, race, ethnicity & gender Questions similar to surveys Interview Prime Contractors Selected for industry & location Questions similar to surveys Interview SDOT Personnel Questions similar to surveys Draft Preliminary & Final Reports 22

23. Anticipated Research Results Best Practices Expanding the industries & disadvantaged subgroups in the DBE program Enhancing the factors supporting DBEs’ success Program design, structure, resources & management Effective Business Development services Performance measures for DBE growth & success in the program & external markets Suggestions for Additional Research & Program Data Collection 23

24. Implementation Plan Identify the Specific Audience Assess Potential Impediments to Successful Adoption Identify Potential Leaders Determine Activities Necessary for Successful Implementation Develop Criteria for Measuring Progress & Success 24

25. Research Challenges Obtaining Data from SDOTs Who has “graduated” & on what basis? Who has accessed supportive services & what was the outcome? How to determine primes’ use of “new” firms, “graduated” DBEs & make comparisons with non-DBEs? Obtaining Data from DBEs How to identify firms no longer in the programs? How to create pools of firms across industries, locations, size, age, etc.? 25

26. Research Challenges Obtaining Data from Primes How to increase cooperation (“what’s in it for them?”)? How to gather data on primes’ use of “new” firms, “graduated” DBEs & comparisons with non-DBE subcontractors? How to create pools of firms across industries, locations, size, age, etc.? Obtaining Data from Supportive Services Providers What have been the SDOT’s record keeping requirements? What, if any, success rubrics have been applied? 26

27. Colette Holt 3350 Brunell Drive Oakland, CA 94602 773.255.6844 Colette.holt@mwbelaw.com www.mwbelaw.com 27