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Opening Statements from Chairs DeFazio, Norton and Larsen from Hearing on the U.S. Department of Transportation’s Disadvantaged Business Enterprise Program

September 23, 2020

Washington, D.C. — The following are opening remarks, as prepared for delivery, from Chair of the House Committee on Transportation and Infrastructure Peter DeFazio (D-OR), Chair of the Subcommittee on Highways and Transit Eleanor Holmes Norton (D-DC), and Chair of the Subcommittee on Aviation Rick Larsen (D-WA) during today’s hearing titled: “Driving Equity: The U.S. Department of Transportation’s Disadvantaged Business Enterprise Program.”

Chair DeFazio:

Today’s hearing is focused on the U.S. Department of Transportation’s Disadvantaged Business Enterprise, or DBE, Program. This essential program seeks to remedy discrimination and its effects on women- and minority-owned businesses as they compete for Federally-assisted transportation contracts. It seeks to ensure all businesses can compete for Federal transportation dollars on a level playing field.

I am very proud to follow in the footsteps of my friend, the former Chairman of this Committee, Jim Oberstar, who was the last Chairman to convene a hearing on this subject eleven years ago in 2009. But I am also disturbed that in the eleven years since that hearing discrimination has continued to plague women and minorities in this country and in the transportation sector.

Discrimination is still terribly real in America, and if the events of 2020 have not proven that convincingly enough, I’m confident the overwhelming evidence we have examined for this hearing will at least shut the door on the question as it relates to Federally-assisted transportation contracts.

Our Committee planned to hold this hearing over five months ago, but our plans were delayed by the rapid spread of the Covid-19 pandemic. Sadly, the continuing pandemic only underscores the need for this hearing and for the DBE program. It is increasingly clear minority communities and minority-owned businesses have been disproportionately devastated by the virus.

Almost two months ago, during debate before the passage of HR 2 on the House floor, I submitted thirty, high-quality disparity studies into the Congressional Record including many hundreds of pages of rigorous empirical evidence testifying to the reality of discrimination and its effects in the transportation sector. Today, I ask unanimous consent to insert into this Committee’s Record an additional ten studies, for a total of forty studies—only a sampling of the mountain of evidence this Committee has seen over the years—testifying to the reality of discrimination in the transportation sector.

I have repeatedly pointed to these disparity studies to demonstrate the reality of discrimination and its effects, but it is equally important to note that our Committee has received qualitative evidence of discrimination as well. Letters from DBE-certified business owners and other stakeholders from across the country have come to this committee in the last few months testifying to the importance of the program, and to the reality of discrimination faced by women and minority business owners. Some of those business owners and stakeholders are before us today to share their stories, and I thank them for being here.

The DBE program has been narrowly constructed to combat the discrimination laid out in the evidence from across this country. It is not a perfect program, and I’m sure we will hear more about that today. But I believe it is an essential program if we want to ensure a level playing field for all American businesses wishing to compete for Federal transportation dollars.

Once again, I want to thank all the witnesses for taking the time to be with us today, particularly in this virtual format. This is a profoundly important topic, and I look forward to hearing your testimony.

Chair Norton:

Thank you, Mr. Chairman. I cannot overstate the importance of this hearing on the U.S. Department of Transportation’s Disadvantaged Business Enterprise program.  I thank Chairman DeFazio, Ranking Member Graves, and all the Members participating today for your time and attention to this critical topic.

We are at a pivotal moment in our Nation’s history. We are shining a long overdue light on the lived realities for people of color in this country, despite our pledge of “liberty and justice for all”.  Over the last few months, the vulnerability of African American, Latinx, Native American, and other black and brown people has been unmistakably demonstrated as we ride wave after wave of crisis—a global pandemic, a tanking economy, and systemic racism repeatedly manifesting as physical violence.

The ways in which our Nation has failed and marginalized large populations of our citizens—while unbearable to watch over and over again—comes as no surprise to those of us who can feel the prevalence of racism in our bones. I have spent my entire career—in Congress, and as Chair of the U.S. Equal Opportunity Commission before that—fighting for equality and seeking to break down barriers so that truly all citizens have the same opportunities to participate and thrive in our economy and our society. 

One of the most powerful tools in the field of transportation and construction to assist people who have routinely been left out or left behind is the U.S. Department of Transportation’s Disadvantaged Business Enterprise (DBE) Program. This program, when properly administered and enforced, ensures that businesses owned by women and minorities have a fair chance to compete for federally assisted transportation contracts.

The need for this program is ongoing, and stronger than ever, as income inequality in this country with the pandemic helping it to grow. Today’s panel will provide mountains of statistical evidence that shows discrimination on transportation construction projects is, unfortunately, alive and well.

Mr. Wainwright’s testimony documents, through rigorous statistical analysis and survey data collected by various public agencies, the continued need for the DBE program.

We are also joined today by individual business owners who have participated in the DBE program and will share their personal stories of how this program affirmatively created opportunities that did not exist in its absence. I would like in particular to thank Ms. Lerdahl, Ms. Williams, and Ms. Boyer for sharing your experiences with the Committee.   

To provide some context for why these surveys and statistical studies matter, let me point to a 2018 study conducted for the Maryland Department of Transportation, whose geographic market area includes Washington, D.C.  The study looked at, among other things, whether prime contractors who work with minority- and women-owned firms as subcontractors on contracts with DBE-type goals ever solicit or hire those same firms to work on contracts without such goals. The answers were stark and stunning—69% of African American owned firms responded that they were seldom or never solicited to work on contracts without goals in place, and 74% of African American owned firms were seldom or never hired to work on contracts without goals.  For Hispanic Americans the results were 47% and 52%; for Asian Americans the results were 56% and 61%; for Native Americans the results were 82% and 70%; and for non-minority women, the results were 54% and 53%.  This is just one regional example but this pattern repeats itself across the country.

In closing, I remind my colleagues that this hearing presents a welcome opportunity to elevate the realities of minority and women-owned business owners.  By holding this hearing today, we ensure that the DBE program and the business owners it lifts up receive thorough consideration by this Committee. We also have the opportunity to learn what policy changes Congress should consider for the continued success of the DBE program in the future. 

I look forward to hearing from today’s witnesses, as well as my fellow Members, on the DBE program.

Chair Larsen:

Thank you, Chair DeFazio and Subcommittee Chair Norton, for holding today’s hearing on the importance of the U.S. Department of Transportation’s Disadvantaged Business Enterprise (DBE) Program.

Women and minority-owned businesses are fundamental to economic growth in Northwest Washington and the success of U.S. transportation.

I saw this firsthand when I met with Marques Warren of Warren’s News and Gifts at SeaTac Airport in Seattle.

Marques’ father, Ardie Warren, opened the family’s first store, Northwest Encounter, at SeaTac in 1994. The news and gift store has now grown to 18 locations in the airport in partnership with the Hudson Group.

To launch their business, the Warrens depended on Airport Concessions Disadvantaged Business Enterprise (ACDBE) loans, which help level the playing field for airport concessionaires.

The needs of U.S. transportation industry are as diverse as the passengers it serves.

Congress must work to improve equity in the industry and increase economic opportunity for women and minority business owners.

One of the ways Congress can support these efforts is through preserving and improving the Disadvantaged Business Enterprise (DBE) Program.

According to the American Community Survey, women and minorities significantly establish fewer businesses and earn less from those businesses than their white male counterparts.

To address these disparities, the DBE program aims to increase the participation of women and minority-owned businesses in federally funded transportation and infrastructure projects.

The Port of Seattle is one example of the DBE program’s positive impact.

According to the Port, DBE firms received more than $4.9 million for work performed on Federal Aviation Administration (FAA) funded projects, including taxiway improvements and residential noise insulation.

The Port’s Diversity in Contracting program tripled the number of women and minority-owned businesses doing business with the Port. Last year, the program met its five-year goal of increasing the amount of spend on these contracts to 15 percent.

The DBE program is key to improving economic opportunity for small businesses in U.S. transportation, but Congress can do more to meet the needs of women and minority entrepreneurs.

Last year, the Washington State Department of Transportation (WSDOT) conducted a disparity study, which found:

  • Smaller airports want more assistance from the FAA and WSDOT to increase DBE participation; and
  • Without the program, DBEs would be effectively shut out of the market with devastating impacts to these businesses, among other conclusions.

I look forward to hearing from today’s witnesses, including the Airport Minority Advisory Council (AMAC), regarding the critical need to continue the DBE program and ways to improve it for women and minority-owned businesses, particularly in aviation. 

Diversity in hiring and contracting is essential to strengthening the nation’s transportation and infrastructure, and to keep the country competitive in the global market.

Today’s witnesses are important partners in these efforts.

A livestream of today’s hearing can be found here.

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Press Contact

Andrew Postal (DeFazio)

Sharon Eliza Nichols (Norton)

Joseph Tutino (Larsen)

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