REMARKS
PREPARED FOR DELIVERY
SECRETARY OF TRANSPORTATION RODNEY E. SLATER
DISADVANTAGED BUSINESS ENTERPRISE PROGRAM ROLLOUT
JANUARY 29, 1999
WASHINGTON, D.C.
Today we celebrate the promise of opportunity -- opportunity based on fairness and equality. It is at the very core of what makes this nation great.
In the new rule we announce today, we are continuing the work begun by the pioneers of equal opportunity programs. I want to pay particular tribute this morning to the Honorable Parren J. Mitchell of Baltimore, who in late 1982 introduced and secured Congressional approval of the first statute to mandate a Disadvantaged Business Enterprise Program (DBE) program for the Department of Transportation.
Last year, when a bipartisan Congress enacted TEA-21, it reaffirmed the wisdom of Congressman Mitchell's initiative. In issuing this rule, we are preserving and protecting Congressman Mitchell’s vision of DOT programs that are truly open to all American businesses.
Some of the heroes of that legislative victory are here and I want to publicly thank them for their commitment to fairness and opportunity.
Of course every member of Congress here played a huge roll in our victory. But let me recognize some old friends and stalwart civil rights leaders, Wade Henderson, Joann Payne, Tony Robinson, Nancy Zirkin and Weldon Latham.
And finally, I want to recognize a few key Congressional staff members, including Amy Dunathan with Senator Chafee; Joellen Darcy and Mike Evans with Senator Baucus; Melody Barnes with Senator Kennedy; Ward McCarragher and David Heymsfeld with Congressman Oberstar and finally Andrea Martin with Congressman Clyburn and the Congressional Black Caucus. Thank you all for your hard work and commitment to this effort.
When President Clinton promised to "mend, not end" affirmative action he was making a promise of opportunity. Today’s announcement fulfills that promise and these regulations ensure that the promise of opportunity is fulfilled fairly.
Throughout our history, when real hope, real fairness and real opportunity have been extended to Americans, they have taken up the challenge and moved our nation forward. Sadly though, these promises have not always been extended equally to all Americans.
The DBE program changes that. It seeks to tap the talents of all Americans, not just a few.
President Clinton and Vice President Gore understand that the promise of opportunity is what makes America work.
In his State of the Union address, the President announced that we are currently enjoying the largest peacetime economic expansion in the history of the United States.
The state of our Union is very, very good. As the President said, we have nearly 18 million new jobs and the lowest peacetime unemployment rate since 1957.
President Clinton also challenged us to seize the day. Today is not a time to rest but a time to build -- to build bridges of steel and bridges of good will.
We have created a government that not only looks more like America, but it serves all of America. A government that puts the American people -- all people -- first.
We have a lot to be proud of – but we can do more. Every time the President speaks about America’s prosperity, he stresses one critical point: our economy is strong and healthy, and it must be inclusive.
Our economy offers prosperity to all Americans: wages are rising at twice the rate of inflation, we have the highest rate of home ownership in history and the smallest welfare rolls in 30 years. We also have the lowest African American and Hispanic unemployment rates ever recorded.
These statistics are evidence of the power of the promise of opportunity. While real equal opportunity is still only a dream in America, we are moving steadily closer to that dream.
When President Clinton promised to mend, but not end, affirmative action he was working hard to pave the road to equal opportunity for all Americans. At the Department of Transportation, we take the business of paving roads very seriously.
I am proud of these new regulations – and I am proud of the work of my staff and many others in the business community, the civil rights community, state and local government and other federal agencies who helped to shape these regulations.
The new DBE regulations respond to almost 900 comments we received from throughout the nation. They also respond to the comments of Senators and Representatives during the extensive debate on the DBE portions of the TEA-21 legislation last year in Congress.
The defenders of the program spoke eloquently of the importance of the changes that we at DOT were planning to make in the program. They articulated the importance of these changes and their necessity in the search for fairness. And the critics of the program pointed out some things that needed changing and we have done so. Just as fire forges steel, the fight over this DBE program has made it a better program.
So what are these changes? Well, to summarize, the new DBE regulations are intended to promote fairness, with an emphasis on flexibility and efficiency, for all participants in the transportation construction industry. Let me outline some of the improvements we have made.
First, we have completely overhauled the way recipients set and attain goals that will create a level playing field. Under the new rule, it is absolutely clear that the statutory 10% national goal is neither a floor nor a ceiling for local communities. Instead local communities must set their goals based on local evidence of the actual availability of qualified DBEs. Our rule gives our recipients the flexibility to determine how they do this. The end result of the goal setting process should be a fair way to seek DBE participation at levels that we would expect in the absence of discrimination.
Once goals are established, recipients must use race-neutral methods (like outreach and technical assistance) to meet as much as possible of their overall goals. Moreover, the new rule makes it absolutely clear that bidders who make good faith efforts to obtain DBE participation will not lose contracts, nor will they be penalized if they fall short of their goals.
While we have followed the courts’ lead and have chosen not to outlaw the use of set-asides, we make absolutely clear that set-asides may only be used in the rarest of circumstances -- in cases of especially egregious discrimination where other efforts to remedy the problem have failed. Of course, as in the past, quotas are absolutely prohibited.
Second, we have clarified and streamlined the guidelines dealing with what firms are eligible to be certified as DBEs. There will be "one-stop shopping" in each state for small firms applying for DBE certification. A firm will have to apply only once to be certified as a DBE for all highway, airport, and transit recipients in the state. Moreover, recipients may establish reciprocal agreements allowing DBEs from one state to automatically qualify for certification in another. In addition, the regulation’s certification standards are clearer and more specific, resolving many difficult issues that have led to confusion and litigation in the past.
Not only is the certification process more efficient, but the guidelines applying to individual business owners have been changed to emphasize fairness and efficiency. The rule emphasizes that firms owned by socially and economically disadvantaged white males must be allowed to participate as DBEs. In addition, we have created a fairer process for these firms to be certified as DBEs.
We have also chosen to implement a personal net worth cap to be absolutely sure that the benefits of this program are extended to those who need them most. Now, just as in the SBA programs, business owners with a personal net worth of more than $750,000 (excluding the value of the primary residence and the ownership interest in the business) may not participate in the program. As before, individual firms must graduate from the program if they exceed the small business size caps established by the SBA and the TEA-21 legislation.
Finally, we have worked hard to ensure that the DBE program is responsive to local conditions and considerations. Under the new rule, recipients have the flexibility to adapt the program to local conditions, including a brand new waiver provision that allows recipients to seek DOT approval for alternative, innovative ways of running the program.
Likewise, we encourage recipients to create homegrown solutions to local problems. For instance, in order to minimize the burden on non-DBEs, recipients who determine that they have a problem with "over concentration" of DBEs in certain fields must devise strategies to address the problem that respond to their local needs.
I know there are those who say that the time to end affirmative action has come. I say they are wrong. Affirmative action is about ensuring that the promise of opportunity is extended to all Americans and now is not the time to reneg on that promise.
The Deputy Attorney General’s presence here today speaks to this Administration’s commitment to do everything in our power to ensure that our equal opportunity programs are fair and comply with the rulings of the Supreme Court – but we will not take back the promise of opportunity.
Every one of the changes I have mentioned are aimed at fulfilling the promise of opportunity for all Americans working to revitalize our nation’s transportation infrastructure.
The promise of opportunity has tremendous power. It is the essence of what drives us to be a better people and a stronger nation. I know that these new DBE regulations will make our department, our transportation system and our nation better and stronger as we move into the 21st Century. Thank you.
###