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Home My WebLink About10 DBE 2002-03 APPROV 08-19-02AGENDA REPORT NO. 10 08-19-02 390-65 MEETING DATE AUGUST 19, 2002 ~ TO: FROM: SUBJECT: WILLIAM A. HUSTON, CITY MANAGER PUBLIC WORKS DEPARTMENT/ENGINEERING DIVISION APPROVAL OF DISADVANTAGED BUSINESS ENTERPRISE (DBE) PROGRAM AND OVERALL ANNUAL DBE GOAL OF 11% FOR FEDERAL FISCAL YEAR 2002/2003 SUMMARY The City's annual Disadvantaged Business Enterprise (DBE) Program has been prepared and identifies an Overall Annual DBE Goal of 11% for Federal Fiscal Year 2002/2003. The required public participation process has been completed and the final DBE Program is ready for City Council approval. RECOMMENDATION It is recommended that the City Council adopt Resolution No. 02-76 approving the Disadvantaged Business Enterprise (DBE) Program and Overall Annual DBE Goal of 11% for Federal Fiscal Year 2002/2003. .FISCAL IMPACT City Council adoption of Resolution No. 02-76 will ensure the City's continued receipt of federal funding for various Capital Improvement Projects that are partially funded through the United States Department of Transportation. BACKGROUND The attached Disadvantaged Business Enterprise (DBE) Program and Overall Annual DBE Goal for Federal Fiscal Year 2002/2003 addresses critical components and elements of recently revised Federal Department of Transportation regulations. The City of Tustin's Overall Annual DBE Goal for Federal Fiscal Year 2002/2003 is 11%. Upon approval, it will be annually calculated to maintain relevancy to local market conditions and factors impacting DBE availability. The Draft DBE Program was submitted to Caltrans on May 30, 2002 and they have determined that it complies with Federal DBE Program requirements. The required 45-day public review and comment period began June 14, 2002 and was concluded without receipt of any comments. Approval of Disadvantaged Business Enterprise (DBE) Program and Overall Annual DBE Goal of 11% for Federal Fiscal Year 2002/2003 August 19, 2002 Page 2 Since no comments were received during the public participation process the final Disadvantaged Business Enterprise (DBE) Program is ready for City Council approval. In order to ensure the City's continued receipt of federal funding for various Capital Improvement Projects, the finalized DBE Program must be approved by the City Council and submitted to Caltrans prior to September 1, 2002. Tim D. S6rle~-,' Director of Public Works/City Engineer Dana R. Kasdan Engineering Services Manager TDS:DA:Approval of DBE FY 2003 & Reso 02-76 Attachment: Resolution 02-76 Annual DBE Goal Program 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 RESOLUTION NO. 02-76 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TUSTIN, CALIFORNIA, APPROVING THE DISADVANTAGED BUSINESS ENTERPRISE (DBE) PROGRAM AND OVERALL ANNUAL GOAL OF 11% FOR FEDERAL FISCAL YEAR 2002/2003, FOR ADOPTION AND SUBMISSION TO THE CALIFORNIA DEPARTMENT OF TRANSPORTATION (CALTRANS) WHEREAS, the City of Tustin is required to develop and submit a Disadvantaged Business Enterprise (DBE) Program and Overall Annual Goal for DBE participation for United States Department of Transportation (DOT) assisted contracts, as a condition of federal financial assistance, pursuant to Title 49 Code of Federal Regulations (CFR) Part 26; Participation by Disadvantaged Business Enterprises (DBE) in DOT Programs; and WHEREAS, in accordance with new DBE regulations, the City of Tustin has developed a DBE Program and Overall Annual DBE Goal of 11% for Federal Fiscal Year 2002/2003; and WHEREAS, City Council adoption is required to ensure compliance with Department of Transportation federal funding requirements, provisions and financial responsibilities. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Tustin that the DBE Program and Overall Annual Goal for Federal Fiscal Year 2002/2003 is hereby approved. AND BE IT FURTHER RESOLVED that the City Engineer acting as the City's DBE Liaison Officer is hereby authorized to execute the Disadvantaged Business Enterprise (DBE) Program and Overall Annual Goal for Federal Fiscal Year 2002/2003, and submission to the California Department of Transportation (Caltrans) on behalf of the City for funding authority approval. PASSED AND ADOPTED at a regular meeting of the City Council of the City of Tustin held on the 19th day of August 2002. Jeffery M. Thomas, Mayor ATTEST: City Clerk Public Works / Engineering City of Tustin 300 Centennial Way Tustin, CA 92780-3715 (714) 573-3i50 FAX (714) 734-8991 ANNUAL OVERALL GOAL INFORMATION (Exhibit 9B) TO: CALTRANS. DISTRICT 12 District Local Assistance Engineer- Alan Williams The amount of overall goal, methodology, breakout of estimated race-neutral and race-conscious participation, and any DBE program updates are presented herein in accordance with Title 49 of the Code of Federal Regulations Part 26, and as described in the Local Assistance Procedures Manual. The City of Tustin submits our annual overall goal information (and any needed updates of our DBE program) for your review and comment. We established an Annual Overall DBE Goal of 11% for the Federal Fiscal Year 2002/2003, beginning on October 1~ 2002 and ending on September 30~ 2003. Methodology Refer to the Attached Overall Annual DBE Goal Setting Methodology Enclosure. Breakout of Estimated Race-Neutral and Race-Conscious Participation Refer to the Attached Overall Annual DBE Goal Setting Methodology Enclosure: DBE Program Updates: No programmatic changes to the City's DBE Program with the specified fiscal year. DBE Lim~on Officer ~e CITY OF TUSTIN Proposed Overall, Annu~ Goal Analys~s DBE FFY 2002/2003 Submitted in fulfillment of: Section 1101 of the Transportation Equity Actfor the 21st Century 49 Code of Federal Regulations Part 26 and Caltrans Local Assistance Procedures Manual * This analysis is prepared exclusively for the City of Tustin, it is non-transferable and is not to be duplicated * CITY OF TUSTIN DISADVANTAGED BUSINESS ENTERPRISE (DBE) PROGRAM OVERALL ANNUAL DBE GOAL SETTING METHODOLOGY FOR FEDERAL FISCAL YEAR (FFY) 2002/03 (For the period of October 1, 2002 through September 30, 2003) I. DOT-ASSISTED CONTRACTING PROGRAM FOR FFY 2002/03 Table 1 represents the City of Tustin's four DOT-assisted projects considered in preparing its Overall Annual DBE Goal-Setting Analysis for FFY 2002/03 by contract type. The projects anticipated to be awarded and/or expended within the fiscal year 2002/03 that have subcontracting possibilities are as follows: Table 1 Jamboree Road Rehabilitation (1-5 Freeway to Irvine Blvd) Bryan Avenue Rehabilitation (Newport Ave. to Redhill Ave.) Bryan Avenue Rehabilitation (Between Redhill Avenue and Browning Ave.) Main Street Rehabilitation (Between Stoneglass and SR-55 Freeway) $ 987,000.00 $ 400,000.00 $ 660,000.00 $ 770,000.00 $117,030.00 $ 300,000.00 $125,970.00 $ 47,515.00 Table 2 provides a'summary of the corresponding subspecialty Work grouped into one category; Highway and Street Construction utilizing ~Caltrans. Work Category Codes (WCC) and comparable 1999 Census Business Patterns North American Industry ClassifiCation System (NAICS) Work Codes. Table 2 also serves to identify the estimated Federal Dollar Share and the Percent of Federal Funding weighted in each primary work category as follows: Table 2 Construction Professional Services Materials & Supplies TOTAL Highway & Street Construction N/A N/A 23411 N/A N/A $ 873,485.00 -0- -0- 100 % -0- -0- $ 873,485.00 100% City of Tustin DBE Goal Analysis for FFY 2002/03 Page 2 of 6 II. GOAL-METHODOLOGY Step 1: Determination of a Base Figure (26.45) To establish the City of Tustin's Base Figure of'the relative availability of DBEs to all comparable firms (DBEs and Non-DBEs) available to bid or propose on the City of Tustin's FFY 2002/03 DOT-assisted contracting oppommities projected to be let, the City of Tustin followed one of the five prescribed federal goal-setting methodologies in Caltrans Local Assistance Procedures Manual. This was accomplished by accessing the Caltrans' on-line Bulletin Board System (BBS) DBE Directory of Certified Firms and the 1999 U.S. Census Bureau County Business Patterns (CBP) DatabaSe. Comparisons were made by corresponding zip codes within the City.of Tustin's market area (defined as Orange County) and by the specified industries and types of businesseS identified in Table 2. The City of Tustin made a concerted effort to ensure that the scope of businesses included in the numerator was as close as possible to the scope included in the denominator. For corresponding detail of all work category classifications grouped, refer to Attachments I .and II. The area(s) in which the substantial majority of contractors and subcontractors that the City receives bids or quotes and/or does business, and the area(s) in which the substantial majority of contracting dollars are spent determined the local market area. For the numerator: Caltrans' DBE Directory of Certified Firms For the denominator: Census Bureau's Business Pattern Database (CBP) To determine the relative availability of DBEs for each work category, the City of Tustin divided the numerator~ representing the ratio of ready, willing and able DBE firms, by the denominator2 representing all firms (DBEs and Non-DBEs) available for each of the work categories. Application of this formula yielded the following baseline information: Number of Ready, }Filling, and Able DBEs Number of All Available Firms (Including DBEs and Non-DBEs) = BASE FIGURE The Base Figure was calculated weighting the relative availability of DBEs within the major work category (Highway & Street Construction), which appropriated the weight in the work category/industry, in which the City projects to spend its DOT-assisted dollars. The Base Figure resulting from this weighted calculation is as follows: Numerator represents all DBE businesses established within City of Tustin's market area. Denominator represents all available established firms. City of Tustin DBE Goal Analysis for FFY 2002/03 Page 3 of 6 Step I: Base Figure (weighted by type of work to be performed and corresponding , contracting dollars) Base Figure =I 100 % (DBEs in WCC 1601')1 CBPs in NAICS 23411'* 1 Base Figure = (.0598) 100 = 5.98 = 6%'** * For additional Caltrans Work Category Codes, refer to Attachment !. ** For additional NAIC$ work codex, refer to Attachment II. *** Rounded to the nearest whole number. Step 2: Adjusting the Base Figure Upon establishing the Base Figure, the City of Tustin reviewed and assessed other known evidence potentially impacting the relative availability of DBEs within the City of Tustin's market area, in accordance with prescribed narrow tailoring provisions set forth under 49 CFR Part 26 DBE Goal Adjustment provisions. Evidence considered in making an adjustment to the Base Figure included the City of Tustin's Past DBE Goal Attainments on Similar Type Projects, Bidders List, Disparity Studies, and other Cities' DBE Goals and attainments within the City of Tustin's jurisdiction. A summary of. these considerations follows: A. Demonstrated Capacity of DBEs Measured by Actual Attainment The following table reflects the City of Tustin's DBE goal attainments and/or Commitments on similar projects awarded within the last two fiscal years: Walnut Avenue Rehabilitation (from Browning Avenue to Myford Road) Jamboree Road Rehabilitation (from 1350' to 2750' North of Tustin Ranch Road) 9.1% 21.3 % City of Tustin DBE Goal AnalySis for FFY 2002/03 Page 4 of 6 The City of Tustin considered an adjustment to the Base Figure based on past DBE goal attainment/commitment on two similar contracts to those contracting oppommities considered in the Overall Annual DBE Goal Setting process for this Fiscal Year. The City of Tustin adjusted the Base FigUre by deriving the City's average past participation percentage numbers for the last two years to obtain the Median Past Participation percentages (middle value of the two). The Base Figure was adjusted by adding the Median Past Participation Percentage and the Step I Base Figure, and dividing the total number by two (2). The Adjusted Base FigUre resulting from the application of this formula is as follows: Step I Base Figure + Median Past Participation = ADJUSTED BASE FIGURE Past Participation= [ 9.1% + 21.3 % 1 Past Participation = I9.1% +21.3% = 30.4 %1 Median Past earticipati°n % =130'4 = 15'2%2 Step One Base Figure Adjusted = I 6% + 15.2% = 21.2% = 2 1 % Base Figure Adjusted = 1.2~. = 10.50 *1 Adjusted Base Figure = 11% · Rounded to the nearest whole number. B. City of Tustin's Bidders List While a Bidders List would serve as quantifiable evidence of DBEs demonstrated interest and capacity, the City of Tustin has not consistently collected the Bidders List information; therefore, there is not sufficient data to date to merit consideration for an adjustment. However, the City of Tustin will cominue to capture such information from all bidders at the time of bid/proposal submission and will utilize such information in future goal-setting analysis. C. Evidence from Disparity Studies The City of Tustin is not aware of any current disparity studies within the City of Tustin's jurisdiction for consideration in the goal setting analysis and/or adjustment. City of Tustin DBE Goal Analysis for FFY 2002/03 Page 5 of 6 D. Other Agencies DBE Goals The City of Tustin surveyed other DOT-recipiems (local agencies) within its jurisdiction, with similar contracting programs to assess their DBE goals and attainments toward making an adjustment. Cities included in the survey were City of Orange, City of Lake Forest and City of Irvine. Weighted DBE Goals established for these cities for FFY 2002 ranged from 10 % to 12 %. Since the goal projections and attainments are in line with the City ofTustin's DBE Goal of 11%, no further adjustment will be made at this time. Overall Resultant Goal Adjustment After careful consideration of the above-named evidence and Other relevant factors, the Base Figure of 6% was further adjusted upward by 5%, 'therefore, the City's adjusted Base Figure is 11%. The following are the major factors/evidence considered in the adjustmem of the Base Figure: · City of Tustin's past DBE goal attainments providing demonstrable evidence of DBE availability and capacity to perform within the industries specified in the City's upcoming Federally-aided contracting program. · The types of projects the City is letting this fiscal year are the same types of projects let in recent years. · Other local agencies' goals within the City's jurisdiction. III. OVERALL ANNUAL DBE GOAL AND PROJECTION OF RACE-NEUTRAL AND RACE-CONCIOUS PARTICIPATION: The Overall Annual (FFY 2002/03) DBE Goal for the City of Tustin's DOT-assisted contracts is 11%. This goal further serves to identify the relative availability of DBEs based on evidence of ready, willing, and able DBEs to all comparable firms, which are known to be available to compete for and perform on the City's DOT-assisted contracts. The Overall Annual Goal reflects a determination of the level of DBE participation, which would be expected absent the effects of discrimination. The City projects to meet 6% of the Overall Annual DBE Goal utilizing race-neutral methods, including making efforts to assure that bidding and contract requirements facilitate participation by DBEs and other small businesses in conformance with new regulatory requirements. The City projects to meet the remaining 5% of the goal utilizing race-conscious measures, including utilizing DBE contract-specific numeric goals, as necessary to achieve the overall goal. The overall goal is expressed as a percentage of all DOT-assisted funds that the City will expend in FHWA-assisted contracts in the forthcoming fiscal year. City of Tustin DBE Goal Analysis for FFY 2002/03 Page 6 of 6 In accordance with Title 49 CFR Part 26.51, the City is priOritizing the maximum use of race- neutral measures to the feasible level to meet their Over~l Annual DBE Goal. The application of race-conscious goals on the City's DOT-assisted contracts will be used only to the extent necessary to achieve the City's .overall annual goal. The City used DBE participation attainment levels achieved on similar, past contracts, and the level of ready, willing and able DBEs in the services required, as considerations impacting the above race-neutral/race-conscious projections. IV. PUBLIC PARTICIPATION AND FACILITATION In accordance with Public Participation Regulatory Requirements of 49 CFR Part 26 and Caltrans Local Assistance Procedures Manual (LAPM), minority, women, local business chambers, and community organizations within the City of Tustin's market area will be provided an opportunity to review this goal analysis. The City of Tustin will also publish a Public Notice in general circulation media announcing the City of Tustin's proposed Overall Annual Goal for the FFY 2002/03 DOT-assisted contracts. Such Notice will inform the public that the proposed goal and its rationale is available for inspection at the City of Tustin's Public Works Department during normal business hours for 30 days following the date of the Public Notice and that the City of Tustin will accept comments on the goal analysis for 45 days from the date of the Public Notice. The required public participation provisions will be fully satisfied prior to submitting the City of Tustin's Overall Annual DBE Goal to Caltrans for final review and approval. ATTACHMENT I (revised) CITY OF TUSTIN DBE OVERALL ANNUAL GOAL ANALYSIS FOR FFY 2002~2003 # OF ESTABLISHED DBE FIRMS BY WORK CATEGORY WITHIN THE CITY OF TUSTIN'S MARKET AREA (DEFINED AS THE COUNTY OF ORANGE) 1 CONSTRUCTION: BY CORRESPONDING ZIP CODES C1601 23411,23499 C1901 23593 C1910 23411 C2201 23411 C3901 23411, 32412 C3910 23411,32412 C8406 23411,23521 C1930 23412, 23593 C4201 23411 C5620 23411 C2602 23411 C4040 23411,23571 C0683 23411,23571 C0685 23411,23521 C1940 23411,23593 C0639 32412 C5105 23412, 23571 C5135 23411 ,. 23412, 23571 C5180 23499, 23571 C6800 23411,23499 Clearing & Grubbing Roadway Excavation Grading Finishing Roadway Asphalt Concrete I Paving Asphalt Painted Traffic Stripe & Marking Backfill Groove & Grind Pavement Roadside Sign Aggregate Base Clean & Seal Pavement Joints- Rou! & Seal Cracks Guard Railings & Barriers Pavemente Markers Ditches Excavation Asphalt Minor Concrete Structure Concrete Block & Masonry Retaining Wall Sound Wall (Masonry Block ;Concrete) Subsurface Drain TOTAL NUMBER OF ESTABLISHED DBE FIRMS DATA SOURCE: Caltrans Bulletin Board System Directory of Certified DBE Firms. ATTACHMENT II (revised) CITY OF TUSTIN DBE OVERALL ANNUAL GOAL ANALYSIS FOP, FFY 2002~03 # OF ALL ESTABLISHED FIRMS (DBEs and Non-DBEs) BY WORK CATEGORY WITHIN THE CITY OF TUSTIN'S MARKET AREA (DEFINED AS THE COUNTY OF ORANGE) ~ CONSTRUCTION: Major Orange Category: 23411: HIGHWAY & STREET CONSTRUCTION County !Total . cs , , CODE NAICS DESCRIPTION 23411 Highway & Street Construction 71 71 23499 All Other Heavy Construction 140 140 23593 Excavation Contractors 121 121 32412 Asphalt paving, roofing & saturated mat mfg. 11 11 23521 Painting & Wall Covering Contractors 453 453 23412 Bridge & Tunnel Construction 5 5 23571 Concrete Contractors 252 252 ~ ~ 1053 1053 DATA SOURCE: U,S. Census Bureau: County Business Patterns utilizing, NAICS Work Category Codes