14.Business EnterprisesCUPERTINO
Summary
PUBLIC WORKS DEPARTMENT
AGENDA ITEM ~~ AGENDA DATE April 21. 2009
SUBJECT AND ISSUE
Adopt Resolution No. 09-0~: Authorizing the City Manager to execute a Disadvantaged
Business Enterprises Race-conscious Implementation Agreement with the California Department
of Transportation.
BACKGROUND
On March 4, 2009, Caltrans informed its local agency transportation partners that the Federal
Highway Administration (FHWA) approved Caltrans' 2009 Disadvantaged Business Enterprise
(DBE) Annual Overall Goal_ FHWA's approval requires the immediate implementation of the
new DBE Program that includes arace-conscious component (RC DBE Program). Effective
immediately, Caltrans and its local partners receiving federal-aid funds must begin transitioning
to the new RC DBE Program. Local agencies :have until June 2, 2009, to transition to the new
RC DBE Program.
The RC DBE Program replaces the Race-neutral DBE program that was implemented on May 1,
2006, by Caltrans and subsequently by local agencies, in response to a Ninth Circuit Court of
Appeals decision that established a new evidentiary standard to be met if race-conscious
measures are to be employed in awarding of federal-aid contracts. FHWA approval of Caltrans'
2009 DBE Annual Overall Goal confirms that Caltrans' DBE program has met the new
evidentiary standard.
Implementing the RC DBE Program will make the City's DBE program similar to what it was
prior to the 2006 implementation of the race-neutral program. There will again be specific DBE
participation goals incorporated into federa -aid transportation project contracts and the
requirement that contractors carry out those contracts employ verifiabie good-faith efforts to
achieve those goals_ Caltrans' 2009 Disadvant:~ged Business Enterprise (DBE) Annual Overall
Goal is 13.5%, to be achieved by 6.75% race-conscious methods and 6.75% race-neutral
methods. Staff expects the City's DBE program to have a similaz overall goal and component
methods.
FISCAL IMPACT
By executing the attached Disadvantaged Busnness Enterprises Race-Conscious Implementation
Agreement, the City will maintain its eligibilit~~ for approximately $800,OOOAO in federal funds
for infrastructure maintenance and construction projects in federal fiscal yeaz 2008-09 and
additional federal funds in future years.
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STAFF RECOMMENDATION
Staff recommends that the City Council adopt Resolution No. 09- b5$ :Authorizing the City
Manager to execute a Disadvantaged Business Enterprises Race-Conscious Implementation
Agreement with the California Department of Transportation.
Submitted by: Approved for submission to
City Council:
`-7Y~ k2.. L~LC Gc C./ 5~~~
Ralph A. Qualls, Jr. ~ David W. Knapp
Director of Public Works City Manager
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~~`
RESOLUTION NO. 09 -058
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CUPERTINO
AUTHORIZING THE CITY MANAGER TO EXECUTE A DISADVANTAGED
BUSINESS ENTERPRISE RACE-CONSCIOUS IMPLEMENTATION AGREEMENT
WITH THE CALIFORNIA DEPAR7~MENT OF TRANSPORTATION
WHEREAS, On March 4, 2009, the California Department of Transportation
(Caltrans) informed its local agency transportation partners that the Federal Highway
Administration (FHWA) approved Caitrans' 2009 Disadvantaged Business Enterprise
(DBE) Annual Overall Goal.; and
WHEREAS, Effective immediately, Caltrans and its local partners receiving
federal-aid funds must begin transitioning to the new RC DBE Program. Local agencies
have until June 2, 2009, to transition to the nevv RC DBE Program; and
WI IEREAS, FHWA's approval requires the immediate implementation of the
new DBE Program that includes arace-conscious component (RC DBE Program); and
WHEREAS, the City of Cupertino must execute the attached Disadvantaged
Business Enterprises Race-Conscious Implementation Agreement in order to continue to
be a recipient of federal transportation fund,
NOW, TIlEREFORE, BE IT RESOLVED by the City Council of the City of
Cupertino that the City Manager is hereby authorized to execute the Disadvantaged
Business Enterprises Race-Conscious Implementation Agreement with the California
Department of Transportation.
PASSED AND ADOPTED at a regular meeting of the City Council of the City of
Cupertino this 2Is` day of April 2009 by the following vote:
Vote Members of the City Council
AYES
NOES:
ABSENT:
ABSTAIN:
ATTEST:
Kimberly Smith
CITY CLERK
APPROVED:
Omn Mahoney
MAYOR
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ExhibiE 9-A Disadvantaged Business Enterprise Implementation Agreement for Local Agencies
CALIFORNIA
DEPARTMENT OF TRANSPORTATION
DISADVANTAGED BUSINESS ENTERPRISE
PROGRAM
IMPLEMENTATION AGREEMENT
FOR
LOCAL AGENCIES
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CALIFORNIA DEPARTMENT OF TRANSPORTATION
DISADVANTAGED BUSINESS ENTERPRISE IMPLEMENTATION AGREEMEIV"I'
For the City of Cupertino, hereinafter referred to as "RECIPIENT."
Definition of Ternss
The terms used in this agreement have the meanings defined in 49 CFR § 26.5.
II OBJECTIVE/POLICY STATEMENT (§26/1. 26/23)
The RECIPIENT intends to receive federal fmancial assistance from the U. S. Department of
Transportation (DOT) through the California Department of Transportation (Caltrans), and as a
condition of receiving this assistance, the RECIPIENT will sign the California Department of
Transportation Disadvantaged Business Enterprise Program Implementation Agreement
(hereinafter referred to as Agreement). The RECIPIENT agrees to implement the State of
California, Department of Transportation Disadvantaged Business Enterprise (DBE) Program
Plan (hereinafter referred to as the DBE Program Flan) as it pertains to local agencies. The DBE
Program Plan is based on U.S. Department of Transportation (DOT), 49 CFR, Part 26
requirements.
It is the policy of the RECIPIENT to ensure that DBEs, as defined in Part 26, have an equal
opportunity to receive and participate in DOT-assisted contracts. It is also their policy.
• To ensure nondiscrimination in the award and administration of DOT-assisted contracts.
• To create a level playing field on which DBE':> can compete fairly for DOT-assisted
contracts.
• To ensure that their annual overall DBE participation percentage is narrowly tailored, in
accordance with applicable law.
• To ensure that only firms that fully meet 4'9 CFR, Part 26 eligibility standazds aze
permitted to participate as DBEs.
• To help remove barriers to the participation of DBEs in DOT-assisted contracts.
• To assist the development of firms that cart compete successfully in the maz[cet place
outside the DBE Program.
III Nondiscrimination (§26.7)
RECIPIENT will never exclude any person from participation in, deny any person the benefits of,
or otherwise discriminate against anyone in connection with the award and performance of any
contract covered by 49 CFR, Part 26 on the basis e~f race, color, sex, or national origin. In
administering the local agency components of the ]DBE Program Plan, the RECIPIENT will not,
directly, or through contractual or other arrangements, use criteria or methods of administration
that have the effect of defeating or substantially impairing accomplishment of the objectives of
the DBE Program Plan with respect to individuals of a particular race, color, sex, or national
origin.
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>v Annual DBE Submittal Form (§26.21)
The RECIPIENT will provide to the Caltrans District Local Assistance Engineer (DLAE) a completed Local
tlgency DBEftnnual Submittal Form (Exhibit 9-B) by June 1 of each year for the following Federal Fiscal Year
(FFY). This form includes an Annual Anticipated DBE Participation Level (AADPL), methodology for
establishing the AADPL, the name, phone number, and electronic mailing address of the designated DBELO, and
the choice of Prompt Pay Provision to be used by the RECIPIENT for the following FFY.
V Race-Neutral Means of Meeting the Overall Statewide Annual DBE Goal (§26.51)
RECIPIENT must meet the maximum feasible portion of its AADPL by using race-neutral means of facilitating
DBE participation. Race-neutral DBE participation includes any time a DBE wins a prime contract through
customary competitive procurement procedures, is awarded a subcontract on a prime contract that does not carry a
DBE goal, or even if there is a DBE goal, wins a subcontract from a prime contractor that did not consider its
DBE status in making the award (e.g., a prime contractor that uses a strict low-bid system to award subcontracts).
Race-neutral means include, but are not limited to, the following:
1. Arranging solicitations, times for the presentation of bids, quantities, specifications, and delivery
schedules in ways that facilitate DBE, and other small businesses, participation (e.g., unbundling large
contracts to make them more accessible to small businesses, requiring or encouraging prime contractors
to subcontract portions of work that they might otherwise perform with their own forces);
2. Providing assistance in overcoming limitations such as inability to obtain bonding or financing (e.g., by
such means as simplifying the bonding process, reducing bonding requirements, eliminating the impact of
surety costs from bids, and providing services to help DBEs, and other small businesses, obtain bonding
and financing);
3. Providing technical assistance and other services;
4. Carrying out information and communication programs on contracting procedures and specific contract
opportunities (e.g., ensuring the inclusion of DBEs, and other small businesses, on recipient mailing lists
of bidders; ensuring the dissemination to bidders on prime contracts of lists of potential subcontractors;
provision of information in languages other than English, where appropriate};
5. Implementing a supportive services program to develop and improve immediate and long-term business
management, record keeping, and financial and accounting capability for DBEs and other small
businesses;
6. Providing services to help DBEs, and other small businesses, improve long-term development, increase
opportunities to participate in a variety of types of work, handle increasingly significant projects, and
achieve eventual self-sufficiency;
7. Establishing a program to assist new, start-up firms, particularly in fields in which DBE participation has
historically been low;
8. Ensuring distribution of your DBE directory, through print and electronic means, to the widest feasible
universe of potential prime contractors; and
9. Assisting DBEs, and other small businesses, to develop their capability to utilize emerging technology
and conduct business through electronic media_
is-s
VI Race Conscious Means of Meeting the Overall Statewide Annual DBE Goal (§26.51(d))
RECIPIENT must establish contract goals for Underutilized Disadvantaged Business Enterprises (UDBEs) to
meet any portion of your AADPL you do not project being able to meet using race-neutral means. UDBEs are
limited to these certified DBEs that are owned and controlled by African Americans, Native Americans, Women,
and Asian Pacific Americans.
VII Quotas (§26.43)
RECIPIENT will not use quotas or set-asides in any w.ay in the administration of the local agency component of
the DBE Program Plan.
VIII DBE Liaison Officer (DBELO) (§26.25)
RECIPIENT has designated a DBE Liaison Officer. The DBELO is responsible for implementing the DBE
Program Plan, as it pertains to the RECIPIENT, and ensures that the RECIPIENT is fully and properly advised
concerning DBE Program Plan matters. [Specify resources available to the DBELO; e.g., the DBELO has a staff
of two professional employees assigned to the DBE pr~~gram on a full-time basis and two support personnel who
devote a portion of their time to the program.] The name, address, telephone number, electronic mail address, and
an organization chart displaying the DBELO's position in the organization are found in Attachment to this
Agreement. This information will be updated annually and included on the DBE Annual Submittal Form.
The DBELO is responsible for developing, implementiing, and monitoring the RECIPIENT'S requirements of the
DBE Program Plan in coordination with other appropriate officials. Duties and responsibilities include the
following:
I. Gathers and reports statistical data and other information as required.
2. Reviews third party contracts and purchase regz~!isitions for compliance with this program.
3. Works with all departments to determine projected flnnual.4nticipated DBE Participation Level.
4. Ensures that bid notices and requests for proposals are made available to DBEs in a timely manner.
5. Analyzes DBE participation and identifies ways to encourage participation through race-neutral means_
6. Participates in pre-bid meetings.
7 fldvises the CEO/governing body on DBE matters and DBE race-neutral issues.
8. Provides DBEs with information and recommen~3s sources to assist in preparing bids, obtaining bonding
and insurance.
9. Plans and participates in DBE training seminar;r.
10. Provides outreach to DBEs and community organizations to.fully advise them of contracting opportunities.
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IX Federal Financial Assistance Agreement Assurance (§26.13)
RECIPIENT wil[ sign the following assurance, applicable to and to be included. in all DOT-assisted contracts and
their administration, as part of the program supplement agreement for each project.
The recipient shall not discriminate on the basis of race, color, national origin, or sex in the award and
performance of any DOT-assisted contract, or in the administration of its DBE Program, or the requirements of 49
CFR Part 26. The recipient shall take all necessary and reasonable steps under 49 CFR, Part 26 to ensure
nondiscrimination in the award and administration of DOT-assisted contracts. The recipient's DBE Program, as
required by 49 CFR, Part 26 and as approved by DOT, is incorporated by reference in this agreement.
Implementation of this program is a legal obligation and failure to carry out its terms shall be treated as a
violation of this agreement. Upon notification to the recipient of its failure to carry out its approved program, the
Department may impose sanctions as provided for under Part 26 and may, in appropriate cases, refer the matter
for enforcement under 18 U.S.C. 1001 and/or the Program Fraud Civil Remedies Act of 1986 (31 U.S.C. 3801 et
seq.). [Note -this language is to be used verbatim, as it is stated in §26.13(a).]
X DBE Financial Institutions (§26.27)
It is the policy of the RECIPIENT to investigate the full extent of services offered by financial institutions owned
and controlled by socially and economically disadvantaged individuals in the community to make reasonable
efforts to use these institutions, and to encourage prime contractors on DOT-assisted contracts to make use of
these institutions.
Information on the availability of such institutions can be obtained from the DBELO. The Caltrans'
Disadvantaged Business Enterprise Program may offer assistance to the DBELO.
XI Directory (§26.31)
RECIPIENT will refer interested persons to the Unified Certification Program DBE directory available from the
Caltrans Disadvantaged Business Enterprise Program's website at www.dot.ca.gov/hq/bep.
XII Required Contract Clauses (§§26.13, 26.29)
RECIPIENT ensures that the following clauses or equivalent will be included in each DOT-assisted prime
contract:
A. CONTRACT ASSURANCE
The contractor or subcontractor shall not discriminate on the basis of race, color, national origin, or sex in the
performance of this contract. The contractor shall carry out applicable requirements of 49 CFR, Part 26 in the
award and administration of DOT-assisted contracts. Failure by the contractor to carry out these requirements is a
material breach of this contract, which may result in the termination of this contract or such other remedy, as
recipient deems appropriate.
[Note -This language is to be used verbatim, as is stated in §26.13(b). See Caltrans Sample Boiler Plate Contract
Documents on the Internet at www.dot.ca_gov/hq/LocalPrograms under "Publications"]
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B. PROMPT PAYMENT
Prompt Proeress Payment to Subcontractors
The local agency shat[ require contractors and subcontractors to be timely paid as set forth in Section
7108.5 of the California Business and Professions Code concerning prompt payment to subcontractors.
The 1 O-days is applicable unless a longer peri~~d is agreed to in writing. Any delay or postponement of
payment over 30 days may take place only foi• good cause and with the agency's prior written approval.
Any violation of Section 7108.5 shall subject the violating contractor or subcontractor to the penalties,
sanctions, and other remedies of that Section. This requirement shall not be construed to limit or impair
any contractual, administrative, or judicial remedies, otherwise available to the contractor or
subcontractor in the event of a dispute invo[vi ng late payment or nonpayment by the contractor, deficient
subcontractor performance, and/or noncompliance by a subcontractor. This clause applies to both DBE
and non-DBE subcontractors.
Prompt Payment of Withheld Funds to Subcontractors
The local agency shall ensure prompt and full payment of retainage from the prime contractor to the
subcontractor within thirty (30) days after the subcontractor's work is satisfactorily completed and
accepted. This shalt be accompanied by including either (1), (2), or (3) of the following provisions [local
agency equivalent will need Ca[trans approval] in their federal-aid contracts to ensure prompt and full
payment of retainage [withheld funds] to subcontractors in compliance with 49 CFR 26:29.
1. No retainage will be held by the agency fr+~m progress payments due to the prime contractor. Prime
contractors and subcontractors are prohibitectfrom holding retainage from subcontractors. Any delay or
postponement ofpcryment may take place only for good cause and with the agency's prior written
approval. Any violation of these provisions shell subject the violating contractor or subcontractor to the
penalties, sanctions, and other remedies specified in Section 7108.5 of the California Business and
Professions Code. This requirement shall not .be construed to limit or impair any contractual,
administrative, arjudicial remedies, otherwise available to the contractor or subcontractor in the event
of a dispute involving late payment or nonpayment by the contractor, deficient subcontractor
performance, and/or noncompliance by a subcontractor. This clause applies to both DBE and non-DBE
subcontractors.
2. No retainage will be held by the agency from progress payments due the prime contractor. Any
retainage kept by the prime contractor or by a• subcon[rac[or must be paid in full to the earning
subcontractor in 30 dcrys after the subcontractor's work is satisfactorily completedL Any delay or
postponement ofpayment may take place only for good cause and wish the agency's prior written
approval. Any violation of these provisions slnarll subject the violating contractor or subcontractor to the
penalties, sanctions, and remedies specified in Section 7108.5 of the California Business and Professions
Code. This requirement shall not be construea~ to limit or impair any contractual, administrative, or
judicial remedies, otherwise available to the contractor or subcontractor in the event of a dispute
involving late payment or nonpayment by the contractor, deficient subcontractor performance, and/or
noncompliance by a subcontracoon This clause applies to both DBE and non-DBE subcontractors.
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3. The agency shall hold retainage from the prime contractor and shall make prompt
and regular incremental acceptances ofportions, as determined by the agency of the
contract work and pay retainage to the prime contractor based on these acceptances. The
prime contractor or subcontractor shall return all monies withheld in retention from all
subcontractors within 30 days after receivingpayment far work satisfactorily completed
and accepted including incremental acceptances of portions of the contract work by the
agency. flny delay or postponement ofpayment may take place only for good cause and
with the agency's prior written approval. ~Iny violation of these provisions shall subject
the violating prime contractor to the penalties, sanctions, and other remedies specifzed in
Section 7108. S of the California Business and Professions Code. This requirement shall
not be construed to limit or impair any contractual, administrative, orjudicial remedies,
otherwise available to the contractor or subcontractor in the event of.• a dispute involving
late payment or nonpayment by the contractor; deficient subcontractor performance;
and/or noncompliance by a subcontractor. This clause applies to both DBE and non-
DBE subcontractors.
XIII LocaE Assistance Procedures Manual
The RECIPIENT will advertise, award and administer DOT-assisted contracts in accordance with
the most current published Local Assistance Procedures Manual (LAPM).
XIV Transit Vehicle Manufacturers (§ 26.49)
If FTA-assisted contracts will include transit vehicle procurements, RECIPIENT will
require each transit vehicle manufacturer, as a condition of being authorized to bid or
propose on transit vehicle procurements, to certify that it has complied with the
requirements of 49 CFR Part 26, Section 49.
XV Bidders List (§26.11(c))
The RECIPIENT will create and maintain a bidders list, consisting of information about
all DBE and non-DBE firms that bid or quote on its DOT-assisted contracts. The bidders
list will include the name, address, DBE/nonDBE status, age, and annual gross receipts of
the firm.
XVI Reporting to the DLAE
RECIPIENT will promptly submit a copy of the Local Agency Bidder/Proposer-UDBE
Commitment (Consultant Contract), (Exhibit 10-0(1) "Local Agency Bidder/Proposer-DBE
Commitment (Consultant Contract)") or Exhibit 15-G(1) "Local Agency Bidder-iJDBE
Commitment (Construction Contract) to the DLAE at the time of award of the consultant or
construction contracts.
RECIPIENT will promptly submit a copy of the Local Agency Bidder-DBE Information (Exhibit
15-G(2) "Local Agency Bidder-DBE (Construction Contracts) -Information" or Exhibit 1 O-O(2)
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"Local Agency Proposer/Bidder-DBE (Consultant Contracts)-Information" of the LAPM) to the
DLAE at the time of execution of consultant or construction contract.
RECIPIENT will promptly submit a copy of the Fina[ Utilization of DBE participation to the
DLAE using Exhibit 17-F "Final Report -Utilization of Disadvantaged Business Enterprises
(DBE), First-Tier Subcontractors" of the LAPM irnmediately upon completion of the contract for
each consultant or construction contract.
XVII Certification (§26.83(x))
RECIPIENT ensures that only DBE firms currently certified by the California Unified
Certification Program will participate as DBEs on DOT-assisted contracts.
XVIII Confidentiality
RECIPIENT witl safeguard from disclosure to third parties, information that may reasonably be
regarded as confidential business information consistent with federal, state, and local laws.
By
David W. Knapp, City Manager
City of Cupertino
Phone Number: (408) 777-3212
This California Department of Transportation's Disadvantaged Business Enterprise Program
Implementation Agreement is accepted by:
Date:
[Signature of DLAE]
[Print Name of DLAE]
Distribution: (1) Original- DLAE
(2) Signed copy by the DLAE -Local Agency
(Updated: March 4, 2009)
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