OMWBE Announces New Public Works Small Business Enterprise Certification

Davis Wright Tremaine LLP

Davis Wright Tremaine LLP

Recent changes in legislation regarding Washington's Small Works Roster laws have resulted in new "PWSBE" certification

Recent changes in legislation regarding Washington's Small Works Roster laws have resulted in a new certification, Public Works Small Business Enterprise ("PWSBE"). This article provides a high-level overview of various State and Federal Certifications and the new PWSBE certification.

The Office of Minority and Women's Business Enterprises ("OMWBE") is responsible for certifying small businesses owned and controlled by minority, women, and socially and economically disadvantaged persons. Put simply, OMWBE aims to increase contracting opportunities for certified businesses with state and local governments. OMWBE offers two (2) general types of certifications.

First, Federal Certification is a program of the United States Department of Transportation ("USDOT"). Under the Federal Certification, you can apply to be a Disadvantaged Business Enterprise, Airport Concession Disadvantaged Business Enterprise, or Small Business Enterprise. The USDOT distributes funds for public infrastructure projects throughout the United States. Recipients of USDOT funds must set goals for DBE participation and monitor their results. Accordingly, if your company specializes in heavy construction for these types of federally funded projects, you may want to consider obtaining your Federal Certification. Not all businesses qualify. Applicants must satisfy a myriad of requirements pertaining to their net worth, average gross receipts, ownership, control, and other factors. Click here to learn more.

Second, the State Certification is a program of the State of Washington. Usually, the State Certification leads to participation in state-funded projects or working with other land grant institutions. The work can include a variety of different types of businesses, such as consulting, construction, material supply, etc. Under the State Certification, you can apply to be a Minority Business Enterprise, Minority Woman Business Enterprise, Woman Business Enterprise, Combination Business Enterprise, or Socially and Economically Disadvantaged Business Enterprise. The purpose of the State Certification is to enhance procurement opportunities for certified businesses participating in state-funded projects and agencies. Again, not all businesses qualify. Applicants must meet strict guidelines regarding their demographics, geography, net worth, average gross receipts, ownership, control, and other factors. Click here to learn more. Most State Certifications are conditioned on race and gender.

During the 2023 legislative session, the Washington State Legislature passed Second Substitute Senate Bill 5268, which will take effect on July 1, 2024. The new legislation changes Washington's Small Works Roster laws by: (1) updating the existing Small Works Roster requirements, (2) updating the definitions of "small business" and "state agency," (3) creating a statewide small works roster, (4) establishing the new PWSBE certification, (5) aligning financial thresholds throughout Washington State, (6) adding a direct contracting option, and (7) allowing agencies to either waive or reduce retainage bonds for projects $5,000 or more.

The PWSBE certification will be race and gender neutral and will use the same criteria for economic disadvantage as OMWBE's State Certification program. As a result, if you have not previously qualified for any of the State Certifications because your company is not primarily owned and controlled by a woman, minority, minority woman, or non-minority man who is found to be socially or economically disadvantaged, then you may want to research whether you qualify for the PSWBE certification. If you are interested in learning more, the Washington APEX Accelerator (f/k/a Washington PTAC) is hosting a webinar about the PWSBE certification on February 29, 2024, at 1:00 PM PST. Click here to register. Notably, certified businesses can opt in to get the new PWSBE certification when it launches in March 2024.

All OMWBE certification fees are waived through July 1, 2024, so we are encouraging qualified participants to apply and renew their certifications soon. Obtaining these types of certifications can help increase your company's public contracting opportunities, visibility in the construction industry, and set you apart from the competition. Also, some companies can qualify for subsidized financing options which is especially valuable in our inflationary market.

We will continue to monitor these types of certification opportunities as they develop.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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