§ 2-9B-15. PROGRAM ELIGIBILITY.

(A)

Only Business Enterprises that meet the criteria of Minority-Owned Business Enterprises, as defined in Section 2-9B-4 ( Definitions ) or Women-Owned Business Enterprises, as defined in Section 2-9B-4 ( Definitions ) may be certified for participation. The applicant has the burden of production and persuasion by a preponderance of the evidence.

(B)

All MBEs and WBEs must be certified prior to participating in the Program.

(C)

Certifications shall be conducted and records kept by SMBR or its designee, as approved by the city council.

(D)

Only a Firm owned by a Socially and Economically Disadvantaged person(s) may be certified as a MBE/WBE.

(1)

The Firm's ownership by a Socially and Economically Disadvantaged person must be real, substantial, and continuing, going beyond pro forma ownership of the Firm as reflected in ownership documents. The owner(s) must enjoy the customary incidents of ownership and share in the risks and profits commensurate with that ownership interest.

(2)

The contributions of capital or expertise by the Socially and Economically Disadvantaged owner(s) to acquire the ownership interest must be real and substantial. If Expertise is relied upon as part of a Socially and Economically Disadvantaged owner's contribution to acquire ownership, the Expertise must be of the requisite quality generally recognized in a specialized field, in areas critical to the Firm's operations, indispensable to the Firm's potential success, specific to the type of work the Firm performs and documented in the Firm's records. The individual whose expertise is relied upon must have a commensurate financial investment in the Firm.

(E)

Only a Firm that is managed and controlled by a Socially and Economically Disadvantaged person(s) may be certified as a MBE/WBE.

(1)

A Firm must not be subject to any formal or informal restrictions that limit the customary discretion of the Socially and Economically Disadvantaged owner(s). There can be no restrictions through corporate charter provisions, by-law provisions, contracts or any other formal or informal devices that prevent the Socially and Economically Disadvantaged owner(s), without the cooperation or vote of any non-Socially and Economically Disadvantaged person, from making any business decision of the Firm, including the making of obligations or the dispersing of funds.

(2)

The Socially and Economically Disadvantaged owner(s) must possess the power to direct or cause the direction of the management and policies of the Firm and to make day-to-day as well as long-term decisions on management, policy, operations and work.

(3)

The Socially and Economically Disadvantaged owner(s) may delegate various areas of the management or daily operations of the Firm to persons who are not Socially and Economically Disadvantaged. Such delegations of authority must be revocable, and the Socially and Economically Disadvantaged owner(s) must retain the power to hire and fire any such person. The Socially and Economically Disadvantaged owner(s) must actually exercise control over the Firm's operations, work, management and policy.

(4)

The Socially and Economically Disadvantaged owner(s) must have an overall understanding of, and managerial and technical competence, experience and expertise, directly related to the Firm's operations and work. The Socially and Economically Disadvantaged owner(s) must have the ability to intelligently and critically evaluate information presented by other participants in the Firm's activities and to make independent decisions concerning the Firm's daily operations, work, management, and policymaking.

(5)

If state law or City ordinance requires the owner(s) to have a particular license or other credential to own and/or control a certain type of Firm, then the Socially and Economically Disadvantaged owner(s) must possess the required license or credential. If state law or City ordinance does not require that the owner possess the license or credential, the fact that the owner(s) lacks such license or credential is a factor in determining whether the Socially and Economically Disadvantaged owner(s) actually controls the Firm.

(6)

A Socially and Economically Disadvantaged owner cannot engage in outside employment or other business interests that conflict with the management of the Firm or prevent the owner from devoting sufficient time and attention to the affairs of the Firm to manage and control its day-to-day activities.

(F)

Only an independent Firm may be certified as a MBE/WBE. An independent Firm is one whose viability does not depend on its relationship with another Firm. Recognition of an applicant as a separate entity for tax or corporate purposes is not necessarily sufficient to demonstrate that a Firm is independent and non-Affiliated. In determining whether an applicant is an independent business, the Director will:

(1)

Scrutinize relationships with non-Certified Firms in such areas as personnel, facilities, equipment, financial and/or bonding support, and other resources.

(2)

Consider whether present or recent employer/employee relationships between the Socially and Economically Disadvantaged owner(s) of the applicant and non-Certified Firms or persons associated with non-Certified Firms compromise the applicant's independence.

(3)

Examine the applicant's relationships with non-Certified Firms to determine whether a pattern of exclusive or primary dealings with non-Certified Firm compromises the applicant's independence.

(4)

Consider the consistency of relationships between the applicant and non-Certified Firms with normal industry practice.

(G)

An applicant shall be certified only for specific types of work in which the Socially and Economically Disadvantaged owner(s) has the ability and Expertise to manage and control the Firm's operations and work.

(H)

Applications for certification shall be on standard forms prepared by SMBR and adopted by rule, and shall be designed to ensure that the criteria for participation in the Program are satisfied.

(I)

To ensure that the Program only benefits eligible Business Enterprises, the City shall also certify the eligibility of Joint Ventures involving MBEs and WBEs and non-MBE and WBE Contractors.

(J)

In lieu of conducting its own certifications, SMBR by rule may accept formal certifications of WBEs and MBEs by other entities as meeting the requirements of this chapter, provided that SMBR determines that the certification standards of such entities are comparable to those of the City. SMBR should strive to coordinate certification activities with other agencies to implement a universal certification process.

(K)

The certification status of all MBEs and WBEs may be reviewed by SMBR or its designee, as approved by city council. Prior to commencing any review, SMBR shall provide advance notice of the review to the certified Business Enterprise or Firm. The review may be conducted through examination of a sworn affidavit of continuing eligibility (including all such attachments as may be required by rule) submitted by the Business Enterprise or Firm seeking certification. MBEs and WBEs are required to seek recertification upon the fourth anniversary of their initial certification and upon the fourth anniversary of all subsequent certifications. Failure of the Business Enterprise or Firm to seek recertification by filing the necessary documentation with SMBR within 60 calendar days from the date of receipt of written notification from SMBR may result in decertification of the Business Enterprise or Firm.

(L)

The Director may move to decertify a Business Enterprise that does not continuously meet the criteria set forth in this section.

(M)

The Director may move to decertify a certified MBE/WBE that repeatedly fails to respond to requests for quotations from Bidders/Proposers who timely solicit participation on a Contract, that repeatedly fails to attend relevant pre-Bid conferences, or that repeatedly fails to honor quotations in bad faith.

(N)

Decertification by another agency shall create a prima facie case for decertification by the City. The challenged entity shall then have the burden of proving that the City certification should be maintained.

Source: Ord. 20060608-059; Ord. 20081211-061; Ord. No. 20181213-040 , Pt. 4, 12-24-18.