Criteria to Become a CERTIFIED Disadvantage Business Enterprise (DBE)

A Disadvantaged Business Enterprise can be women, minority, disabled or veteran-owned business. It is defined as being owned, capitalized, operated and controlled by a member of an identified group listed above. The business must be a for-profit enterprise which physically resides in the United States or one of it territories. For a definition of "Minority groups" please see the definitions as listed on the "Minority" page of this website.

DBE requirements are under the direct jurisdiction of the United States Department of Transportation (US DOT). DBE applications are reviewed by an applicant's state Unified Certification Program (i.e., individual state's Department of Transportation or participating regional transit authority).

To qualify as a DBE, the business must be owned and controlled by one or more socially and economically disadvantaged persons as defined by DBE Regulation 49 CFR Parts 23 and 26. Businesses must show:

  1. Minimum 51% ownership, control, and expertise of the individuals and
  2. Control of the daily management and operations of the individuals

The business size can be measured in one of two ways or a combination thereof: average annual gross receipts three previous years or number of employees. These size standards are based on the North American Industry Classification System (NAICS) code. Industry specific, these limits range from $5 million annual gross sales to $38.5 million.

Recent changes to the DBE regulations now require all applicants (each owner) to complete a Statement of Disadvantage and a Personal Financial Statement. All eligible owners must affirm that they are members of a disadvantaged group (for example, an eligible ethnic minority or female). In addition, the personal net worth of each applicant must be less than $1.32 million, not including primary residence or ownership equity in the firm.

Disclaimer: The following are the MINIMUM basic requirements for certification, and in no way guarantee your company will be a successful candidate for certification. Additionally each certifying agency may have different criteria standards and eligibility rules. Other criteria and standards exist for each industry, annual sales, number of employees, etc., etc. If you are applying to a local government entity, we have found on occasion, that the length of time it takes to acquire certification can be inconsistent and that the final status of an application can be offset by other determining factors.

As seen in Inc., Entrepreneur and Crain's Business Magazines