Chapter 8: Good Faith Effort Process

Section 1: Overview

Contractor Commitment Responsibilities

The apparent low bidder must submit a completed DBE Commitment Agreement (
Form SMS 4901
), DBE Trucking Commitment Agreement (
Form SMS 4901-T
), or DBE Material & Supplier Commitment Agreement (
Form SMS.4901-MS
) for each DBE he/she intends to use to satisfy the DBE goal, or a good faith effort (
Form 2603
) to explain why the goal could not be achieved.
The prime contractor must provide these forms to the LG so as to arrive no later than 5 calendar days after bid opening. No extension of the 5-calendar day timeframe will be allowed for any reason.
The LG will review commitment(s) to ensure DBE requirements are satisfied in accordance with the DBE Special Provision. If the commitment(s) include a GFE, there will be an additional review process concerning the GFE documentation.

Reviewing Commitment(s)

The LG must ensure DBE requirements are satisfied in accordance with the DBE Special Provision. Below is list of items that a LG will be tasked with verifying depending on the participation type:
  • The commitment includes the DBE firm’s signature of confirmation.
  • DBE is certified per the TUCP.
  • DBE is certified for the type of work they are performing per NAICS codes.
  • The dollar amount listed for the work the DBE is to perform corresponds to appropriate goal credit and consistent with the actual value of that work.
  • If the DBE is a manufacturer, question 1 has been completed on the DBE Material & Supplier Commitment Agreement (Form SMS.4901-MS).
  • If the DBE is a regular dealer, questions 2 thru 4 have been completed on the DBE Material & Supplier Commitment Agreement (Form SMS.4901-MS).
  • If DBE is a hauling firm, questions 1 thru 3 on the DBE Trucking Commitment Agreement (Form SMS 4901-T) have been completed; and if applicable, question 4 has been completed.
  • The prime contractor met the contract goal.
The prime contractor may be contacted during this review process, and asked to submit further information to support its commitment. It may also be required to submit additional DBE commitments or a GFE in the event that the assigned goal is found to be inadequate.
Once the LG has reviewed and approved each DBE commitment and verified that the DBE participation goal has been met, the LG will notify the prime contractor.
A DBE prime contractor is not required to submit a GFE but must report subcontractor activity for non-DBEs on DBE Prime Contractor Payments to Non-DBE Subcontractors (Form
SMS.4902
).

Good Faith Efforts

Prime contractors must make Good Faith Efforts (GFE) to meet the DBE contract goal, either by meeting the goal or by documenting GFE to meet the goal. Prime contractors should make sincere and aggressive efforts to meet the DBE goal. Attempting to obtain a contract on the basis of documented GFE should be a contractor’s last resort.
If the goal cannot be met in whole or in part, the prime contractor should document steps it has taken to satisfy GFE requirements and attach Contractors Certification of Good Faith Efforts (Form 2603) and all supporting documentation to the LG. Prime contractors should understand the list of the types of GFE found in 49 CFR, Part 26, Appendix A.
Contractors will not be penalized if they fail to meet contract DBE goals as long as they follow the good faith effort guidelines in 49 CFR, Part 26, Appendix A and submit their good faith effort to their appropriate LG DBE contract administrator for review, guidance, and approval. Contractors who fail to meet DBE goals and fail to make a good faith effort may be penalized.
The penalty may consist of:
  • Termination of the contract
  • Deduction of the dollar amount of DBE goal not accomplished, or
  • Other remedy or remedies as deemed appropriate.

Administrative Reconsideration

If the LG determines that the apparent successful bidder has failed to meet the requirements of 49 CFR Part 26.53(a), the LG, before awarding the contract, will provide the bidder an opportunity for administrative reconsideration. As part of this reconsideration, the bidder will have the opportunity to provide written documentation or argument concerning the issue of whether it met the goal or made adequate good faith efforts to do so.
The LG’s decision on reconsideration will be made by an official who did not take part in the original determination that the bidder failed to meet the goal or make adequate good faith efforts to do so.
The bidder will have the opportunity to meet in person with the LG’s reconsideration official to discuss the issue of whether it met the goal or made adequate good faith efforts to do so.
The LG will send the bidder a written decision on reconsideration, explaining the basis for finding that the bidder did or did not meet the goal or make adequate good faith efforts to do so. The result of the reconsideration process is not administratively appealable to the DOT.