As part of determining whether a company is eligible for certification as a disadvantaged business enterprise (DBE) with the Maryland Department of Transportation (MDOT), must the company be considered an independent business?
Yes. Only an independent business may be certified as a DBE. To be an independent business, the viability of the business must not be dependent on a relationship with another company or companies.
As part of the certification application process, in determining whether a potential DBE is independent MDOT will scrutinize its relationships with non-DBE firms in areas such as personnel, facilities, equipment, financial and bonding support. Also, the potential DBE’s relationships with prime contractors are examined in order to determine whether there is a pattern of exclusive or primary dealings with the primes that would compromise its independence. However, it should be noted that MDOT, in assessing relationships between the potential DBE and non-DBE firms, does factor in and consider normal industry practices.
Certification of a business can be a viable tool for developing and maintaining business relationships. Businesses seeking certification as a DBE in Maryland may want to consider obtaining legal advice concerning eligibility requirements for certification prior to applying for certification.