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DOT Issues Interim Final Rule to Revise Disadvantaged Business Enterprise (DBE) Program

Strategic Insights

— 2 min read

The Department of Transportation (DOT) has issued an interim final rule (IFR) on September 30, 2025, which removes race- and sex-based presumptions from the definition of "socially and economically disadvantaged individuals" under its Disadvantaged Business Enterprise (DBE) and Airport Concession Disadvantaged Business Enterprise (ACDBE) programs. Effective October 3, 2025, DBE and ACDBE business owners and applicants must demonstrate on a case-by-case basis that they satisfy the race- and sex-neutral criteria described in the newly revised 49 Code of Federal Regulations (CFR) parts 23 and 26.

The DBE program, enacted by Congress in 1983, aims to assist small business formation and growth by removing barriers to participation and promoting the use of DBEs in federally assisted contracts. The ACDBE program, established in 1987, ensures nondiscrimination in the award and administration of concession contracts at airports that receive DOT funding.

Key Takeaways:

  • The DOT's IFR removes race- and sex-based presumptions from the DBE and ACDBE programs, requiring applicants to demonstrate social or economic disadvantage on a case-by-case basis.
  • Existing certified DBEs and ACDBEs will be reevaluated and recertified under the new certification standards, with the potential for decertification if they do not meet the new criteria.
  • The IFR instructs recipients to pause implementation and enforcement of goals under the DBE and ACDBE programs until the Unified Certification Program (UCP) completes the reevaluation process.
  • The DOT will not require recipients to set or update new goals until the transition to the new process is complete.
  • Companies currently participating in the DBE and ACDBE programs should communicate with UCPs early regarding recertification and begin preparing personal narratives and supporting documentation.
  • Companies considering applying to the DBE program and/or ACDBE program should explore whether they meet the new eligibility criteria and draft personal narratives and collect supporting documentation.

Statistics:

  • The DBE program has been in effect since 1983, with the ACDBE program established in 1987.
  • The IFR was issued on September 30, 2025, and becomes effective on October 3, 2025.
  • Existing DBEs and ACDBEs will be required to demonstrate social or economic disadvantage under the new certification standards.
  • The Unified Certification Program (UCP) will reevaluate and recertify existing DBEs and ACDBEs based on the new criteria.
  • The DOT will not require recipients to set or update new goals until the transition to the new process is complete.

Sources:

  • Department of Transportation (DOT), Interim Final Rule, "Disadvantaged Business Enterprise (DBE) and Airport Concession Disadvantaged Business Enterprise (ACDBE) Program," September 30, 2025.
  • U.S. Department of Transportation, Office of Civil Rights, Guidance on DBE and ACDBE Program Changes, September 30, 2025.
  • Mid-America Milling Company LLC v. United States Department of Transportation, E.D. Ky. Case No. 3:2023-cv-00072.
  • Goodwin's Government Contracts & Grants team, "DBE and ACDBE Program Changes: What You Need to Know," 2025.

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