The Indiana Department of Transportation (INDOT) is the first state to ask the US DOT to waive its requirements for the Disadvantaged Business Enterprise (DBE) program since a court ruled the requirements are likely unconstitutional. The DBE program requires 10 percent of federal highway construction funds to be paid out to small businesses owned by "socially and economically disadvantaged" individuals - generally defined as women, African Americans, native Americans and Hispanic Americans, and other defined disadvantaged groups. The program is purported to help remove barriers so qualifying businesses can participate in federally assisted contracts. A U.S. District Court for the Eastern District of Kentucky last year found that the race- and gender-based presumptions used by the DOT likely violate constitutional protections. US DOT agreed with that finding.
INDOT's proposed waiver would eliminate DBE goals based on race, ethnicity or gender on its federally assisted highway construction contracts. If granted, INDOT would move to a race and gender neutral implementation strategy.
In other DBE related actions, DOT Secretary Sean Duffy raised concerns with Maryland DOT about its implementation of the federal DBE program in conjunction with its initiative to rebuild the Francis Scott Key bridge in Baltimore. In January MDDOT set a 31.5% DBE participation goal for the project. Duffy said US DOT has decided that the race- and sex-based criteria outlined in the DBE program do not align with the agency’s principles and said DOT has asked the federal district court to declare the program’s eligibility requirements unconstitutional. The department is planning to rewrite the rules associated with the program, Duffy said. Maryland, similarly, should not use race or sex to determine contract awards, he warned.