805. RESIDENT-OWNED BUSINESS ENTERPRISE; ADDITIONAL REQUIREMENTS

805 LOCAL, SMALL AND DISADVANTAGED BUSINESS ENTERPRISES SUBCONTRACTING 805.1 When a prime contractor is certified by the Commission as an LBE, SBE or DBE, the following subcontracting requirements shall apply: (a) The prime contractor shall perform at least fifty percent (50%) of the contracting effort, excluding the cost of materials, goods and supplies, with its own organization and resources, and if it subcontracts, fifty percent (50%) of the subcontracting effort, excluding the cost of materials, goods and supplies shall be with certified LBEs, SBEs and DBEs; (b) The contract shall include a clause which incorporates the provisions of section 805.1(a); (c) If the procurement is for a construction contract of $1,000,000.00 or less, the solicitation shall require that bids or proposals include a signed certification form embodying the provisions of section 805.1 (a); and (d) For construction contracts of $1,000,000.00 or less, the prime contractor shall award at least fifty percent (50%) of the subcontracts to certified LBEs, SBEs, or DBEs. 805.2 Waiver of the subcontracting requirements of section 805.1 shall be given in writing by the contracting officer, prior to acceptance of bids or proposals, with the prior approval and consent of the Director of The Department of Human Rights and Minority Business Development (DHRMBD). 805.3 Prior to approving a request for a waiver of the requirements of this section, the contracting officer shall submit to the Director of DHRMBD a statement of the reasons which justify a waiver. 805.4 The Director of DHRMBD shall approve a waiver of the subcontracting requirements of this section, where there are no LBEs, SBEs or DBEs available to satisfy the subcontracting goals and/or the Commission finds that such a waiver is necessary to achieve the purposes of the Act and this chapter. 805.5 The Director of DHRMBD may grant a waiver or modification of an LBE or DBE subcontracting plan under this chapter upon a finding that an applicant for waiver has made a good faith effort to obtain the required LBE or DBE participation requirements of the solicitation. In making good faith determinations, the Director of DHRMBD shall consider the following factors: (a) Whether the applicant conducted any presolicitation or pre-bid conferences to inform LBEs, and DBEs of contracting and subcontracting opportunities; (b) Whether the applicant advertised in general circulation, trade association, and ethnic-focus media concerning the contracting and subcontracting opportunities; (c) Whether the applicant provided written notice to a reasonable number of specific LBEs and DBEs that their interest in the contract was being solicited in sufficient time to allow LBEs and DBEs to participate effectively; (d) Whether the applicant followed up initial solicitations of interest by conducting negotiations with LBEs and DBEs; and whether rejections of LBEs or DBEs as being unqualified were based on sound reasoning and thorough investigation of their capabilities; (e) Whether the applicant made efforts to assist interested LBEs and DBEs in obtaining bonding, lines of credit, or insurance required by the applicant; (f) Whether the applicant effectively used the services of the Commission in recruiting qualified and responsible LBEs and DBEs; (g) Whether bids submitted by LBEs and DBEs were excessive or noncompetitive based upon a review of prevailing market conditions; and (h) Any other factors which may be relevant in a particular case. SOURCE: Final Rulemaking published at 39 DCR 9052 (December 4, 1992).