What Small Businesses Need to Know About the New DBE Rule

The U.S. Department of Transportation (USDOT) has issued an Interim Final Rule (IFR) that took effect on October 3, 2025, introducing major changes to the Disadvantaged Business Enterprise (DBE) and Airport Concession Disadvantaged Business Enterprise (ACDBE) programs. The new guidance ensures that the U.S. Department of Transportation (USDOT) operates its Disadvantaged Business Enterprise (DBE), and Airport Concession Disadvantaged Business Enterprise (ACDBE) Programs are in line with law and the U.S. Constitution. 

Changes to the DBE program include, but are not limited to:

• Removal of Race-and-Gender Based Presumptions – Under the IFR, 49 C.F.R. Parts 23 and 26 now require a case-by-case finding of “socially and economically disadvantaged” (SED) status for every applicant. The burden is now on the applicant firm to prove their SED status. The USDOT has not issued an official definition of what constitutes “disadvantaged” under the new rules nor offered any guidance on how to write the newly required narrative. However, the General Counsel of the U.S. Department of Transportation has issued a FAQ guidance document about these changes, which you can find here – https://www.transportation.gov/sites/dot.gov/files/DBE_IFR_FAQs.pdf.
• Mandatory Reevaluation of Certified DBEs – All currently certified DBEs are required, to undergo recertification under the new eligibility standard. Certifiers must provide these firms with an opportunity to submit documentation under the new standards, determine eligibility, and issue written recertification or decertification decisions.
• Suspension of DBE Goals – All contracting goals will be suspended until a DOT funding recipient’s UCP completes all DBE and ACDBE recertifications. Until then, recipients of DOT funding cannot set contracting goals for DBEs or ACDBEs or count any participation toward overall goals.
• Immediate Effects on Contracting and Compliance – Contracts executed before Oct. 3, 2025, do not require any modification; however, DBE participation on such contracts may not, be counted toward either the contract goal or the DOT funding recipient’s overall DBE goal until the relevant UCP has fully completed the reevaluation process.

Explore these changes at the Federal Register website

This Interim Final Rule represents a major policy shift designed to bring USDOT’s DBE and ACDBE programs into compliance with recent legal developments. While the new standards introduce additional documentation requirements, they also create an opportunity for firms to strengthen their internal compliance processes and reaffirm their eligibility. Norcal APEX Accelerator will continue to monitor updates from USDOT and California’s UCP network. Our team is here to help you understand how these changes may affect your business and guide you through the recertification process confidently and effectively.

If you are looking for personalized government contracting assistance or want no-cost help to find contracting opportunities, please contact your Norcal APEX Accelerator counselor for assistance or apply for services today!