[Federal Register Volume 64, Number 123 (Monday, June 28, 1999)]
[Unknown Section]
[Pages 34569-34570]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-15866]
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DEPARTMENT OF TRANSPORTATION
Office of the Secretary
49 CFR Parts 23 and 26
[Docket OST-97-2550]
RIN 2105-AB92
Participation by Disadvantaged Business Enterprises in Department
of Transportation Programs
AGENCY: Office of the Secretary, DOT.
ACTION: Final rule; correction.
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SUMMARY: In its final disadvantaged business enterprise (DBE) rule, the
Department intended to ensure the confidentiality of personal financial
information submitted to recipients by owners of DBE firms. The
Department inadvertently omitted the regulatory text language on this
point. This correction document remedies this omission. In addition,
this document corrects minor omissions concerning the threshold for
Federal Transit Administration recipients to establish DBE programs and
a requirement for transit vehicle manufacturers to have DBE programs,
removes a potentially confusing word from the rule's provisions
concerning DOT review of recipients' overall goals, clarifies language
concerning the certification and personal net worth of airport
concessionaires and others, and clarifies that a lease is viewed as a
contract for purposes of the rule.
DATES: This rule is effective June 28, 1999.
FOR FURTHER INFORMATION CONTACT: Robert C. Ashby, Deputy Assistant
General Counsel for Regulation and Enforcement, Department of
Transportation, 400 7th Street, SW., Room 10424, Washington, DC 20590,
phone numbers (202) 366-9306 (voice), (202) 366-9313 (fax), (202) 755-
7687 (TDD), bob.ashby@ost.dot.gov (email).
SUPPLEMENTARY INFORMATION:
Privacy
In discussing the requirement of the DBE final rule that owners of
DBE firms submit a statement of personal net worth, with supporting
documentation, the Department addressed commenters' concerns about the
confidentiality of the information. The preamble to the rule said the
following:
One of the primary concerns of DBE firms commenting about
submitting personal financial information is ensuring that the
information remains confidential. In response to this concern, the
rule explicitly requires that this material be kept confidential. It
may be provided to a third party only with the written consent of
the individual to whom the information pertains. This provision is
specifically intended to pre-empt any contrary application of state
or local law (e.g., a state freedom of information act that might be
interpreted to require a state transportation agency to provide to a
requesting party the personal income tax return of a DBE applicant
who had provided the return as supporting documentation for his PNW
statement). There is one exception to this confidentiality
requirement. If there is a certification appeal in which the
economic disadvantage of an individual is at issue (e.g., the
recipient has determined that he or she is not economically
disadvantaged and the individual seeks DOT review of the decision),
the personal financial information would have to be provided to DOT
as part of the administrative record. The Department would treat the
information as confidential. (64 FR 5117; February 2, 1999).
Unfortunately, through editorial error on the Department's part,
the regulatory text provision referred to was omitted from the final
rule. We regret any confusion that this omission may have caused, and
we are correcting the error by inserting the language in a new
paragraph (a)(2)(iii) of Sec. 26.67 of the rule.
FTA Requirements for DBE Programs
In Sec. 26.21(a)(2) of the rule, the Department states that FTA
recipients who receive more than $250,000 in various forms of FTA
assistance must have a DBE program. The phrase ``exclusive of transit
vehicle purchases'' was inadvertently omitted from this paragraph. This
omission has raised questions from some recipients, and we are
reinserting the omitted language to avoid confusion. In addition, this
provision did not make explicit that transit vehicle manufacturers must
have DBE programs, so we are adding language to make this clear.
Review of Overall Goals
While operating administrations review recipients' overall goal
submissions, recipients are not required to obtain prior concurrence by
operating administrations with their overall goals (see
Sec. 26.45(f)(4)).
However, as the result of an editorial oversight, Sec. 26.21(b)(1)
of the rule makes a reference to overall goals being ``approved'' by
operating administrations. Because prior concurrence is not required,
this reference is incorrect and could be misleading. Therefore, we are
removing it.
Concessionaires
In the February 2, 1999, final DBE rule, the Department removed all
of former part 23 except the portion concerning airport
concessionaires. The airport concession provisions were modified for
consistency with the new 49 CFR part 26. In one respect, however, the
amendment of the airport concessions provision failed to delete
language concerning certification procedures that referred to the (now
deleted) certification provisions of former part 23. While we have
provided guidance to airports that they should follow part 26
procedures, we believe it would be useful to delete the language
referring to former part 23's procedures. Therefore, this rule
eliminates two paragraphs in Sec. 23.95. Recipients should follow part
26 certification procedures for concessionaires as well as for other
contractors.
Airports have expressed concern that the rule is unclear concerning
the application to concessionaires of the $750,000 personal net worth
(PNW) cap and PNW statement requirements of Sec. 26.67. The Department
is currently working to complete a final rule concerning airport
concessions. The PNW cap applicable to concessionaires is one of the
matters being considered in this rulemaking. The PNW cap amount that
the Department applies to concessionaires may or may not be $750,000.
Pending completion of the final rule on airport concessions, the
Department believes it best to resolve the current uncertainty by
making the $750,000 cap amount and PNW statement requirement of
Sec. 26.67 inapplicable to airport concessionaires.
We are amending Sec. 26.67(a)(2)(i) to specify that disadvantaged
owners of airport concessionaires are not required to submit PNW
statements. Consequently, the rebuttal of the presumption of economic
disadvantage based on a PNW statement an individual is required to
submit (see Sec. 26.67(b)(1)) also does not apply to airport
concessionaires.
Definition of ``Contract''
The 49 CFR part 23 definition of ``contract'' specified that a
lease was
[[Page 34570]]
viewed as a contract. The part 26 definition inadvertently omitted this
sentence. To avoid any potential confusion on this point, this
correction document adds a sentence on leases.
Clarification Concerning Personal Net Worth Documentation
The Department has received a number of questions and expressions
of concern about the documentation it is appropriate for recipients to
require in ascertaining the personal net worth of owners of DBE firms.
The Department believes that it is important to clarify the rule to
state that this documentation, and the PNW statement itself, should not
be unduly lengthy, burdensome or intrusive.
The Department uses the Small Business Administration's
implementation of its PNW requirements as a model for recipients'
practices. SBA requires a two-page form, supported by two years' of
personal and business tax returns. With respect to the information
routinely collected from applicants or owners of currently certified
DBEs for purposes of ascertaining PNW, the Department believes that
recipients should not exceed the information sought by SBA in its
programs. Consequently, while recipients are not required to use the
SBA form verbatim, they should use a form of similar length and
content. Recipients may appropriately collect and retain copies of two
years' of the individuals personal and business tax returns.
On the other hand, the Department regards as unduly lengthy,
burdensome, or intrusive such practices as using a form significantly
longer or more complex than the SBA form (e.g., a multipage PNW form),
requiring inventories of personal property or appraisals of real
property. Such practices are contrary to part 26.
Regulatory Analyses and Notices
This set of amendments correcting part 26 is not a significant rule
under Executive Order 12866 or the Department's Regulatory Policies and
Procedures. The Department certifies that the amendments will not have
significant economic impacts on a substantial number of small entities.
This is because the amendments are technical corrections that will not
impose costs on entities, regardless of their size. They do not have
Federalism impacts sufficient to warrant the preparation of a
Federalism impact statement. They do not impose information collection
requirements.
These amendments relate to regulatory provisions that have already
been the subject of notice and comment (as part of the Department's May
1997 supplemental notice of proposed rulemaking concerning the DBE
program).
Because the amendments merely correct accidental omissions from the
regulatory text or remove a potentially confusing reference, we do not
believe that additional notice and comment would be productive.
Therefore, the Department has determined that further notice and
comment would be impracticable, unnecessary, and contrary to the public
interest. The Department has good cause to make the corrections
effective immediately in order to avoid confusion and any adverse
effects on DBEs or recipients from the absence of the omitted language.
List of Subjects
49 CFR Part 23
Administrative practice and procedure, Airports, Civil rights,
Concessions, Government contracts, Grant programs--transportation,
Minority businesses, Reporting and recordkeeping requirements.
49 CFR Part 26
Administrative practice and procedure, Airports, Civil rights,
Government contracts, Grant programs--transportation, Highways and
roads, Mass transportation, Minority businesses, Reporting and
recordkeeping requirements.
Issued this 11th day of June, 1999, at Washington, D.C.
Rodney E. Slater,
Secretary of Transportation.
For the reasons set forth in the preamble, the Department amends 49
CFR parts 23 and 26 as follows:
PART 23--[AMENDED]
1. The authority citation for part 23 continues to read as follows:
Authority: 42 U.S.C. 200d et seq.; 49 U.S.C. 47107 and 47123;
Executive Order 12138, 3 CFR, 1979 Comp., p. 393.
Sec. 23.95 [Amended]
2. In Sec. 23.95, remove and reserve paragraphs (f)(2) and (f)(3).
PART 26--[AMENDED]
3. The authority citation for part 26 is revised to read as
follows:
Authority: 23 U.S.C. 324; 42 U.S.C. 2000d, et seq.; 49 U.S.C
1615, 47107, 47113, 47123; Sec. 1101(b), Pub. L. 105-178, 112 Stat.
107, 113.
4. In the definition of the term ``Contract'' in Sec. 26.5, add a
sentence at the end of the definition, to read as follows:
Sec. 26.5 What do the terms used in this part mean?
* * * * *
Contract * * * For purposes of this part, a lease is considered to
be a contract.
* * * * *
5. In Sec. 26.21, revise paragraph (a)(2) to read as follows:
Sec. 26.21 Who must have a DBE program?
(a) * * *
(2) FTA recipients that receive $250,000 in FTA planning, capital,
and/or operating assistance in a Federal fiscal year, exclusive of
transit vehicle purchases, and transit vehicle manufacturers who must
submit an overall goal under Sec. 26.49;
* * * * *
Sec. 26.21 [Amended]
5. In Sec. 26.21(b)(1), in the parenthetical phrase, remove the
words ``and approved'' following the word ``reviewed''.
Sec. 26.45 [Amended]
6. In Sec. 26.45(c)(5), remove the words ``Subject to the approval
of the DOT operating administration, you'' and add ``You'' in its
place.
7. Amend Sec. 26.67 as follows:
a. Revise paragraph (a)(2)(i); and
b. Redesignate paragraph (a)(2)(ii) as paragraph (a)(2)(iii), and
add a new paragraph (a)(2)(ii), to read as follows:
Sec. 26.67 What rules determine social and economic disadvantage?
(a) * * *
(2)(i) You must require each individual owner of a firm applying to
participate as a DBE (except a firm applying to participate as a DBE
airport concessionaire) whose ownership and control are relied upon for
DBE certification to submit a signed, notarized statement of personal
net worth, with appropriate supporting documentation. This statement
and documentation must not be unduly lengthy, burdensome, or intrusive.
(ii) Notwithstanding any provision of state law, you must not
release an individual's personal net worth statement nor any
documentation supporting it to any third party without the written
consent of the submitter. Provided, that you must transmit this
information to DOT in any certification appeal proceeding under
Sec. 26.89 in which the disadvantaged status of the individual is in
question.
* * * * *
[FR Doc. 99-15866 Filed 6-24-99; 8:45 am]
BILLING CODE 4910-62-P
