Airports are taking steps to encourage awards to new Disadvantaged Business Enterprise and Airport Concessionaire Disadvantaged Business Enterprise firms, but several major barriers remain to companies seeking airport contracts, according to a new report from the Department of Transportation Office of the Inspector General.
On the positive side for certified firms looking to make inroads in airports, the DOT OIG report outlined some of the efforts airports are making to encourage awards to new DBE/ACDBE firms. The document highlighted four effort areas undertaken by airports:
● unbundling major contracts and leases into smaller components;
● entering into direct contracts or leases with DBE/ACDBE firms;
● conducting outreach; and
● providing financial assistance.
For fiscal year 2012, researchers identified 83 new DBE/ACDBE firms that were awarded contracts and leases at the nation’s 64 largest airports. However, the airports varied in the number of new DBE/ACDBE firms, with five airports accounting for nearly half of the new entrants. In addition, the 83 new firms represented only about 5 percent of the approximately 1,600 DBE/ACDBE firms doing business at the 64 airports.
The small success percentage “is due in large part to limited construction and concession opportunities for new firms, infrequent turnover among existing firms, and financial hurdles,” the report said.
Furthermore, just five airports accounted for nearly half of the contracts awarded to new DBE/ACDBE entrants. In comparison, 33 airports had no new entrants in fiscal year 2012.
“It is important to note that the lack of new entrants at these 33 airports does not indicate a lack of support for DOT’s DBE/ACDBE program, as some of these airports awarded contracts to DBE/ACDBE firms that were not new to the program,” the report acknowledged.
The report also noted a “considerable number of errors” in airports’ DBE Office Online Reporting System data, totaling more than one-third of airport data submissions.
“FAA uses DOORS data to measure the extent to which each airport meets its DBE and ACDBE goals,” the report noted. “However, inaccuracies such as the ones we identified prevent FAA from accurately determining the extent to which these airports met their fiscal year 2012 goals.”
More in-depth coverage of the DOT OIG report will run in the August issue of Airport Revenue News.
