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The Oregon Administrative Rules contain OARs filed through October 15, 2014
 
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OREGON BUSINESS DEVELOPMENT DEPARTMENT

 

DIVISION 200

CERTIFICATION PROCEDURES

123-200-0005 [Renumbered to 123-200-1000]

123-200-0010 [Renumbered to 123-200-1100]

123-200-0020 [Renumbered to 123-200-1200]

123-200-0040 [Renumbered to 123-200-1300]

123-200-0090 [Renumbered to 123-200-2000]

123-200-0180 [Renumbered to 123-200-2100]

123-200-0190 [Renumbered to 123-200-2200]

123-200-1000

Purpose

(1) The purpose of OAR 123-200-1000 to 123-200-2200 is to adopt a standard application form and procedure designed to provide complete documentation for certification of businesses as minority or woman owned firms or an Emerging Small Business and to adopt a procedure for handling complaints, investigations, and issuing sanctions. Minority Business Enterprises (MBE) and Woman Business Enterprises (WBE) shall be certified under the State of Oregon certification program based on ORS 200.055. Emerging Small Businesses (ESB) shall be certified under the State of Oregon certification program based on ORS 200.170. An enterprise certified by the Office of Minority, Women, and Emerging Small Business (OMWESB) pursuant to these rules shall be considered as certified by any public contracting agency as defined in ORS 279.011(5) in the State of Oregon. Certified firms are eligible to participate on state funded projects to meet commitment requirements. Any certified firm is eligible to participate in private or non-state funded projects. The OMWESB is the sole certification agency for the State of Oregon and all political subdivisions.

(2) “Disadvantaged Business Enterprise” or DBE means a business that meets the eligibility standards for participation in United States Department of Transportation (USDOT), federally-funded projects set out in 49 CFR parts 23 and 26 (2013 Edition).

(3) These rules also cover publication of a directory, ineligibility complaints, and representation of the OMWESB in contested case hearings.

Stat. Auth.: ORS 200.055
Stats. Implemented: ORS 200.055, ORS 200.170, ORS 279.011
Hist.: OBDD 17-2010, f. 4-30-10, cert. ef. 5-1-10; Renumbered from 123-200-0005, OBDD 7-2013, f. & cert. ef. 9-3-13

123-200-1100

Definitions

As used in these rules, the following terms shall have the following definitions, unless the context requires otherwise:

(1) “Agency” means the Oregon Business Development Department.

(2) "Contribution" means a real and substantial contribution of money, tangible personal assets, and expertise to acquire ownership interest in the firm. Examples of insufficient contributions include a promise to contribute, an unsecured note payable to the firm or an owner who is not a disadvantaged individual, or mere participation in a firm's activities as an employee.

(3) "Control" or "controlled" means that operational and managerial control of all aspects of the business is true, real, and exercised by one or more socially disadvantaged individual(s) as further defined in 49 CFR § 26.71 (2013 Edition). Control must also be clearly documented in all legal documents and financial statements.

(a) In determining whether a certified firm is an independent business, the OMWESB must scrutinize relationships with non-certified firms in such areas as personnel, facilities, equipment, financial and/or bonding support, and other resources.

(b) The OMWESB must consider whether present or recent employer/employee relationships between the owner(s) of the certified firm and non-certified firms, or persons associated with non-certified firms, compromise the independence of the certified firm.

(A) The OMWESB must examine the certified firm’s relationship with prime contractors to determine whether a pattern of exclusive or primary dealings with a prime contractor compromises the independence of the certified firm.

(B) While reviewing factors related to the independence of a certified firm, the OMWESB must consider the consistency of relationships between the firm and non-certified firms with normal industry practice.

(C) Certified owners and/or firms must not be subject to any formal or informal restrictions, which limit the customary discretion of the certified owner(s). There can be no restrictions (i.e. through corporate charter provisions, by-laws, contracts, or any other formal or informal devices) preventing the certified owners from making any business decision for the firm without the cooperation or vote of any non-certified individual. This paragraph does not preclude a spousal co-signature on documents as provided for in 49 CFR § 26.69(j)(2) (2013 Edition).

(c) The certified owner(s) must possess the power to direct or cause the direction of the management and policies of the firm and to make day-to-day as well as long-term decisions on matters of management, policy, and operations.

(d) A certified owner must hold the highest officer position in the company (e.g. chief executive officer or president).

(A) In a corporation, the certified owner(s) must control the Board of Directors.

(B) In a partnership, one or more certified owner(s) must serve as general partners, with control over all partnership decisions.

(e) Individuals who are not socially disadvantaged may be involved in a MBE and WBE firm as owners, managers, employers, stockholders, officers, and/or directors. Such individuals must not, however, possess or exercise the power to control the firm or be disproportionately responsible for the operation of the firm.

(f) The certified owner(s) of the firm may delegate various areas of management, policymaking, or daily operations of the firm to other participants in the firm, regardless of whether these participants are socially disadvantaged individuals. Such delegation of authority must be revocable and the certified owner(s) must retain the power to hire and fire any person to whom they delegate such authority. The managerial role of the certified owner(s) in the firm’s overall affairs must be such that the recipient can reasonably conclude that the certified owner(s) actually exercise control over the firm’s operations, management, and policy.

(g) The certified owner(s) must have an overall understanding, managerial and technical competence, and experience directly related to the type of business in which the firm is engaged and the firm’s overall operations.

(h) If state or local law requires a person to have a particular license or other credential in order to own and/or control a certain type of firm, then the MBE,WBE, and/or ESB certified persons who own and control a firm of that type must possess the required license or credential.

(i) The OMWESB may consider differences in remuneration between the potentially certified owner(s) and other participants in the firm in determining whether to certify a firm. Such consideration shall be in the contract of the duties of the persons involved, normal industry practices, the firm’s policy, and practice concerning reinvestment of income, and any other explanations for the differences proffered by the firm.

(j) In considering a MBE and/or WBE where a non-disadvantaged individual formerly controlled the firm, the OMWESB may consider a difference between the remuneration of the former and current controller of the firm as a factor in determining control. Particularly in the circumstance where the non-disadvantaged individual remains involved with the firm and continues to receive greater compensation than the disadvantaged individual does.

(k) In order to be viewed as a controlling a firm, a certified owner(s) cannot engage in outside employment or other business interests that conflict with the management of the firm or prevent the individual from devoting sufficient time and attention to the affairs of the firm to control its activities.

(l) A socially disadvantaged individual may control a firm even though one or more of the individual’s immediate family members (who themselves are not socially disadvantaged individuals) participate in the firm as a manager, employee, owner, or in another capacity.

(m) If the OMWESB is unable to determine that the socially disadvantaged owner(s), as distinct from the family as a whole, control the firm, then the socially disadvantaged owner(s) have failed to carry their burden of proof concerning control even though they may participate significantly in the firm’s activities.

(n) Where a firm was formerly owned and/or controlled by a non-disadvantaged individual (whether or not an immediate family member), ownership and/or control were transferred to a socially disadvantaged individual, and the non-disadvantaged individual remains involved with the firm in any capacity, the disadvantaged individual now owning the firm must demonstrate to the OMWESB, by clear and convincing evidence, that:

(A) The transfer of ownership and/ or control to the disadvantaged individual was made for reasons other than obtaining certification; and

(B) The certified individual actually controls the management, policy, and operations of the firm, notwithstanding the continuing participation of a non-certified individual who formerly owned and/or controlled the firm.

(o) In determining whether a firm is controlled by its certified owner(s), the OMWESB may consider whether the firm owns equipment necessary to perform its work.

(p) The OMWESB must grant certification to a firm only for specific types of work in which the certified owner(s) have the ability to control the firm. To become certified in an additional type of work, the firm needs to demonstrate to the OMWESB only that its certified owners are able to control the firm with respect to that type of work.

(A) The types of work a firm can perform (whether on initial certification or when a new type of work is added) must be described in terms of the most specific available North American Industry Classification System (NAICS) code for that type of work.

(B) Firms and recipients must check carefully to make sure that the NAICS code cited in a certification are kept up-to-date and accurately reflect work, which the United Certification Program (UCP) has determined the firm’s owners can control. The firm bears the burden of providing detailed company information the certifying agency needs to make an appropriate NAICS code designation.

(q) OMWESB may certify a business operating under a franchise or license agreement if it meets the standards in this subpart and the franchiser or licenser is not affiliated with the franchisee or licensee.

(r) In order for a partnership to be controlled by certified individuals, any non-certified partners must not have the power, without the specific written concurrence of the certified partner(s), to contractually bind the partnership or subject the partnership to contract or tort liability.

(s) The certified individuals controlling a firm may use an employee leasing company. The use of such a company does not preclude the certified individuals from controlling their firm if they continue to maintain an employer-employee relationship with the leased employees.

(4) “Emerging Small Business” or “ESB” means an independent business:

(a) With its principal place of business located in the State of Oregon;

(b) That qualifies as a tier one or tier two firm;

(c) That is properly licensed and legally registered in the State of Oregon; and

(d) That is not a subsidiary or parent company belonging to a group of firms owned and controlled by the same individuals if, in the aggregate, the group of firms does not qualify as a tier one or tier two firm.

(5) "Independence" or "Independent" means:

(a) The business must not be dependent upon any non-disadvantaged, non-minority or non-woman owned firm.

(b) The owner(s) of the business owns or leases equipment and resources necessary to perform is the services provided. Leasing must be a normal industry practice and the lease must not involve a relationship with a prime contractor or non-disadvantaged individual that compromises the control and independence of the firm.

(6) "Management Control" or "Management" means that the socially disadvantaged individual(s) has responsibility for the critical areas of business operations and has the demonstrated ability to make independent and unilateral business decisions needed to guide the future of the business. When a firm contracts out the actual management of the business to individuals other than the owner or delegates the management to employees, those persons who have the power to hire and fire these managers exercise management control. Areas of control include, but are not limited to the following:

(a) The socially disadvantaged individual(s) must have training and/or experience in the primary field(s) of operation for which certification is sought. The socially disadvantaged individual(s) does not need to have hands on, direct control, or expertise in every aspect of the business’ affairs so long as the owner is able to intelligently use and critically evaluate information presented by employees.

(b) The socially disadvantaged individual(s) must possess sufficient knowledge about the business to enable him or her to maintain day-to-day control over the operational aspects of the business. In order to determine that the socially disadvantaged individual(s) has the technical expertise and competence to maintain operational control, the socially disadvantaged individual(s) will be required to submit proof of expertise. An individual must document expertise:

(A) The socially disadvantaged individual(s) must submit a copy of his or her essential license(s). If an individual license (e.g. engineer, electrician, plumber, or contractor, etc.) is required to provide the goods or services in areas of work in which the firm seeks certification, the owner of the business must hold the license.

(B) The socially disadvantaged individual(s) must submit a copy of his or her resume.

(7)(a) "Minority" means a person who is a citizen or lawful permanent resident of the United States and who is a:

(A) Black American includes persons having origins in any of the Black racial groups of Africa;

(B) Hispanic American includes persons of Mexican, Puerto Rican, Cuban, Central or South American or other Spanish or Portuguese culture or origin, regardless of race;

(C) Native American includes persons who are American Indians, Eskimos, Aleuts, or Native Hawaiians;

(D) Asian-Pacific American includes persons whose origin is from Japan, China, Taiwan, Korea, Vietnam, Laos, Cambodia, Thailand, Malaysia, Indonesia, the Philippines, Brunei, Samoa, Guam, the United States Trust Territories of the Pacific Islands, the Commonwealth of the Northern Marianas Islands, Macao, Fiji, Tonga, Kiribati, Tuvalu, Nauru, Federated States of Micronesia, or Hong Kong;

(E) Subcontinent Asian Americans includes persons whose origins are from India, Pakistan, Bangladesh, Bhutan, the Maldives Islands, Nepal, or Sri Lanka;

(F) Any additional groups whose members are designated as socially disadvantaged by the Small Business Administration and/or as designated under 49 CFR Part 26 (2013 Edition).

(b) Bona fide minority group membership shall be established based on evidence to support the individual's claim he or she is a member of a minority group and is so regarded by the particular minority community. However, the OMWESB is not required to accept this claim if the agency determines it to be invalid. If the minority community does not exist in Oregon, the burden of proof shifts to the applicant to prove he or she is a socially and economically disadvantaged individual.

(8) "Minority Business Enterprise" or "MBE" means a business owned and operated by a minority who meets the eligibility standards set out in OAR 123-200-1200. Women are recognized as a separate group for the purposes of these rules and not as a “minority” group.

(9) "OMWESB" means the Office of Minority, Women and Emerging Small Business in the Oregon Business Development Department.

(10) "Ownership" or "Owned" has the meaning set out in 49 CFR § 26.69 (2013 Edition).

(a) In determining whether the socially disadvantaged participants in a firm own the firm, the OMWESB must consider all the facts in record viewed as a whole.

(b) To be an eligible MBE and/or WBE, a firm must be at least 51 percent owned by a socially disadvantaged individual(s).

(A) In the case of a corporation, such individuals must own at least 51 percent of each class of voting stock outstanding and 51 percent of the aggregate of all stock outstanding.

(B) In the case of a partnership, the socially disadvantaged individual(s) must own 51 percent of each class of partnership interest. Such ownership must be reflected in the firm’s partnership agreement.

(C) In the case of a limited liability company, the socially disadvantaged individual(s) must own at least 51 percent of each class of member interest.

(c) The firm’s ownership by socially disadvantaged individual(s) must be real, substantial, and continuing, going beyond pro forma ownership of the firm as reflected in ownership documents. The socially disadvantaged owner(s) must enjoy the customary incidents of ownership, and share in the risks and profits commensurate with their ownership interest, as demonstrated by the substance, not merely the form, or arrangements.

(d) All securities that constitute ownership of a firm shall be held directly by socially disadvantaged persons. Except as provided in this paragraph (d), no securities or assets held in trust, or by any guardian for a minor, are considered as held by the socially disadvantaged persons in determining the ownership of a firm. However, securities or assets held in trust are regarded as held by a socially disadvantaged individual for purposes of determining ownership of the firm, if:

(A) The beneficial owner of securities or assets held in trust is a socially disadvantaged individual and the trustee is the same or another such individual; or

(B) The beneficial owner of a trust is a socially disadvantaged individual who, rather than the trustee, exercises effective control over the management, policymaking, and daily operational activities of the firm. Assets held in a revocable living trust may be counted only in the situation where the same socially disadvantaged individual is the sole grantor, beneficiary, and trustee.

(e) The contributions of capital or expertise by the socially disadvantaged owner(s) to acquire their ownership interests must be real and substantial. Examples of insufficient contributions include a promise to contribute capital, an unsecured note payable to the firm or an owner who is not a socially disadvantaged individual, or mere participation in a firm’s activities as an employee. Debt instruments from financial institutions or other organizations that lend funds in the normal course of their business do not render a firm ineligible, even if the debtor’s ownership interest is security for the loan.

(f) The following requirements apply to situations in which expertise is relied upon as part of a socially disadvantaged owner’s contribution to acquire ownership:

(A) The owner’s expertise must be:

(i) In a specialized field;

(ii) Of outstanding quality;

(iii) In areas critical to the firm’s operations;

(iv) Indispensable to the firm’s potential success;

(v) Specific to the type of work the firm performs; and

(vi) Documented in the records of the firm. These records must clearly show the contribution of expertise and its value to the firm.

(B) The individual whose expertise is relied upon must have a significant financial investment in the firm.

(g) The OMWESB must always deem as held by a socially disadvantaged individual, for purposes of determining ownership, all interests in a business or other assets obtained by the individual:

(A) As the result of a final property settlement or court order in a divorce or legal separation, provided that no term or condition of the agreement or divorce decree is inconsistent with this section; or

(B) Through inheritance, or otherwise because of the death of the former owner.

(h) The OMWESB must presume as not being held by a socially disadvantaged individual, for purposes of determining ownership, all interests in a business or other assets obtained by the individual as the result of a gift or transfer without adequate consideration, from any non-socially disadvantaged individual or non-MBE and/or WBE firm who is:

(A) Involved in the same firm for which the individual is seeking certification or an affiliate of that firm;

(B) Involved in the same or a similar line of business; or

(C) Engaged in an ongoing business relationship with the firm or an affiliate of the firm for which the individual is seeking certification. To overcome this presumption and permit the interests or assets to be counted, the socially disadvantaged individual must demonstrate by clear and convincing evidence that:

(i) The gift or transfer to the socially disadvantaged individual was made for reasons other than obtaining certification as a MBE and/or WBE; and

(ii) The socially disadvantaged individual actually controls the management, policy, and operations of the firm, notwithstanding the continuing participation of a non-socially disadvantaged individual who provided the gift or transfer.

(i) In situations in which marital assets form a basis for ownership of a firm, the following apply:

(A) When marital assets (other than the assets of the business in question), held jointly or as community property by both spouses, are used to acquire the ownership interest asserted by one spouse, the OMWESB must deem the ownership interest in the firm to have been acquired by that spouse with his or her own individual resources, provided that the other spouse irrevocably renounces and transfers all rights in the ownership interest in the manner sanctioned by the laws of the state in which either spouse or the firm is domiciled. The OMWESB does not count a greater portion of joint or community property assets toward ownership than state law would recognize as belonging to the socially disadvantaged owner of the applicant firm.

(B) A copy of the document legally transferring and renouncing the other spouse’s rights in the jointly owned or community asset used to acquire an ownership interest in the firm must be included as part of the firm’s application for MBE and/or WBE certification.

(j) The OMWESB may consider the following factors in determining the ownership of a firm. However, the OMWESB must not regard a contribution of capital as failing to be real and substantial, or find a firm ineligible, solely because:

(A) A socially disadvantaged individual acquired his or her ownership interest as the result of a gift or transfer without adequate consideration, other than the types set forth in paragraph (h) of this section;

(B) There is a provision for the co-signature of a spouse who is not a socially disadvantaged individual on financing agreements, contracts for the purchase or sale of real or personal property, bank signature cards, or other documents; or

(C) Ownership of the firm in question or its assets is transferred for adequate consideration from a spouse who is not a socially disadvantaged individual to a spouse who is such an individual.

(11) “Principal place of business” means the place where the firm directs, controls, and coordinates its primary, high-level business activities. It is further defined by the address used to file Federal income taxes. If the firm uses a P.O. Box, the OMWESB may request additional documentation to verify location.

(12) "Small Business" means a small business as defined pursuant to 13 CFR part 121. A small business shall not include any concern or group of concerns controlled by the same socially disadvantaged individual or individuals that have average annual gross receipts in excess of the NAICS size limit over the previous three fiscal years.

(a) Firms seeking certification must also meet current Small Business Administration (SBA) business size standard limits for each type of work the firm seeks to perform not to exceed $22,410,000. The OMWESB will utilize federal tax information, which must be submitted along with new and certification review applications, to determine annual gross receipts for the business.

(13) "Socially Disadvantaged Individuals" means individuals who are women, minorities or any other individuals found to be disadvantaged by the SBA pursuant to Section 8(a)(5) of the Small Business Act and has the meaning set out in 49 CFR § 26.5 (2013 Edition).

(a) It is a rebuttable presumption that minorities and women are socially and economically disadvantaged.

(b) The OMWESB may also determine on a case-by-case basis other individuals who are socially and disadvantaged. These individuals claiming disadvantaged status are required to submit a Socially Disadvantaged Questionnaire.

(c) Socially disadvantaged individuals are people subjected to racial or ethnic prejudice or cultural bias because of their identity as members of a group without regard to individual qualities.

(A) The social disadvantage must stem from the individual's color, national origin, gender, physical handicap, long-term residence in an environment isolated from the mainstream of American society, or other similar cause beyond the individual's control.

(B) The individual must demonstrate:

(i) He or she personally suffered the disadvantage because of treatment experienced in the United States; and

(ii) The disadvantage was chronic, long-standing, and substantial, not fleeting or insignificant.

(C) Social disadvantage does not include factors common to small business.

(14) “Timely notice” as used in ORS 200.035, shall mean at the time the state agency publicly releases the contract and bid request solicitations.

(15) "Woman Business Enterprise" or "WBE" means a business owned and operated by a woman who meets the eligibility standards set out in OAR 123-200-1200.

[Publications: Publications referenced are available from the agency.]

Stat. Auth.: ORS 200.005
Stats. Implemented: ORS 200.005
Hist.: OBDD 17-2010, f. 4-30-10, cert. ef. 5-1-10; Renumbered from 123-200-0010, OBDD 7-2013, f. & cert. ef. 9-3-13

Minority and Women Business Enterprise Certification

123-200-1200

Eligibility Standards Minority and Women Business Enterprise Certification

(1) Applicants for certification as a DBE must meet the eligibility criteria set out in 49 CFR parts 23 and 26 and any written directives, administrative guidelines, and written decisions of the US Department of Transportation.

(2) To be eligible for MBE or WBE certification, a business must meet the following criteria:

(a) The business must be in existence, operational and in business for a profit.

(b) The business must be a small business and the average annual gross receipts must not exceed $22,410,000.

(c) One or more socially disadvantaged individuals must own at least 51% of the business. OMWESB will apply the standards and criteria for ownership as set out in 49 CFR § 26.69 (2013 Edition).

(d) The business must be controlled by one or more socially disadvantaged individual(s). OMWESB will apply the standards and criteria set out in 49 CFR § 26.71 (2013 Edition).

(e) The one or more socially disadvantaged individual(s) must have made a substantial contribution of capital to the business, which is commensurate with his or her ownership interest.

(f) The business must be independent, properly licensed and registered with the Secretary of State in the State of Oregon.

(g) The socially disadvantaged individual(s) must have training and/or experience in the primary field(s) of operation. The OMWESB will evaluate the training and experience of the individual based on the examples listed below. The OMWESB does not intend the list to be all-inclusive and will take additional training and experience into consideration when making a determination regarding the owner’s qualifications.

(A) A college degree in the field of expertise.

(B) The individual currently holds the essential license in Oregon in the field in which the firm operates (e.g. electrician supervisor, plumber, engineer, or landscape architect, etc.).

(C) Experience and/or training in the primary field of expertise.

(D) Experience in project management in the primary field of expertise.

(E) The individual goes on-site, determines if work is proceeding in accordance with plans and is able to supervise filed operations, resolve problems, and answer technical questions for subordinates.

(F) Can demonstrate knowledge during the interview process.

(G) Additional training and experience related specifically to construction firms;

(i) Has ability to read and interpret blueprints and specifications.

(ii) Has independently done take offs and can prepare estimates and bids.

(iii) Can operate necessary equipment (e.g. excavator, backhoe, dump truck, etc.)

(h) The business must also have or lease sufficient machinery, equipment, and employees to operate. In making this determination, the OMWESB shall compare the operations of the certified firm to a non-certified firm in the same or similar business. If leasing, it must be a normal industry practice and the lease must not involve a relationship with a prime contractor or non-disadvantaged individual that compromises the control or independence of the firm as referenced under 123-200-1100(2).

(A) The OMWESB will utilize OAR 123-200-1000 to 123-200-2200 to make a determination regarding eligibility for certification. In addition, the OMWESB will apply written directives of the administrative guidelines, Oregon Revised Statutes, 49 CFR part 26, and written appeal decisions regarding state certification so long as they are in accord with these rules.

(B) In making determinations under this section the OMWESB shall not consider whether the business has previously performed or would be able to perform a commercially useful function. Repeated failure by a business to perform a commercially useful function may indicate, however, that the business is not independent, owned, or controlled by a socially disadvantaged individual.

[Publications: Publications referenced are available from the agency.]

Stat. Auth.: ORS 200.005 & 200.055
Stats. Implemented: ORS 200.005 & 200.055
Hist.: OBDD 17-2010, f. 4-30-10, cert. ef. 5-1-10; Renumbered from 123-200-0020], OBDD 7-2013, f. & cert. ef. 9-3-13

123-200-1300

Application and Procedure

(1) Businesses wishing to be certified must complete the Certification Application designed by the OMWESB.

(2) The completed application, together with all required supporting documentation, shall be submitted by mail or in person to the Office of Minority, Women and Emerging Small Business, 775 Summer St. NE, Suite 200, Salem OR 97301. Incomplete applications will not be processed until the applicant provides all information.

(3) The OMWESB will take action on completed applications as promptly as its resources permit. The order of priority for processing applications shall be the date the OMWESB receives the complete application including all supporting documentation.

(4) The OMWESB may conduct a phone interview or on-site investigation at the owner’s place of business and/or jobsite if applicable. The purpose of the interview and/or site visit is to verify information submitted with the application and substantiate eligibility.

(5) The OMWESB shall make a determination based on the eligibility standards included in these rules, the Oregon Revised Statutes, and the Oregon Administrative Rules. As part of its investigation, the OMWESB may require firms to provide information in addition to that requested on the application. The applicant has the burden of proving that he or she is eligible for certification. The applicant must also cooperate fully with the investigation and make available any additional information requested by the OMWESB. Applicants shall be promptly notified by mail after a decision has been made. When the OMWESB denies an application, the letter shall set forth the specific reasons for the denial.

[Publications: Publications referenced are available from the agency.]

Stat. Auth.: ORS 200.055
Stats. Implemented: ORS 200.055
Hist.: OBDD 17-2010, f. 4-30-10, cert. ef. 5-1-10; Renumbered from 123-200-0040, OBDD 7-2013, f. & cert. ef. 9-3-13

123-200-1400

Certification Review

(1) Certification is valid for three years.

(2) A “no change” statement will be sent to firms annually, approximately 30 days prior to the one-year and two-year anniversaries of the certification date. The completed statement, along with federal tax information for the previous year and documentation of any changes, must be submitted prior to the anniversary date or the firm will be decertified.

(3) A certification review notice shall be sent to certified firms approximately two months prior to a firm’s anniversary date. The firm shall promptly return the application along with any requested documentation (e.g. by-law amendments, evidence of changes in ownership, etc.). The signed application shall be reviewed by the OMWESB to determine continued eligibility. An on-site investigation may be conducted to verify information submitted.

(4) A firm owner must demonstrate that his or her business currently meets the qualifications as listed in this division. It is the responsibility of the firm to provide the information deemed necessary by the OMWESB to ascertain eligibility. Failure to return the certification review form and provide supporting documentation shall lead to decertification.

Stat Auth.: ORS 200.005
Stats Implemented: ORS 200.006
Hist.: OBDD 7-2013, f. & cert. ef. 9-3-13

123-200-1500

Denial and Decertification of Firms

(1) A firm may be denied certification or decertified at any time the OMWESB determines that the firm does not or no longer meets the eligibility standards set out in OAR 123-200-1200 and ORS 200.005. The procedure is as follows:

(a) In the case of denial of initial certification, the OMWESB will notify the applicant in writing of the denial and the reasons therefore.

(b) In the case of decertification, the OMWESB shall issue a Notice of Intent to Decertify the firm 21 days prior to the date of decertification and indicate the specific reasons.

(c) In the event of a denial or decertification, the applicant or certified firm has 21 calendar days from the date of notice in which to submit a written appeal to the manager of the OMWESB. Following the review of the applicant’s written appeal, the manager of OMWESB will issue a decision.

(d) If the applicant or certified firm does not agree with the manager’s decision, he or she may request a contested case hearing. Contested case hearings will be conducted in accordance with ORS 183.310 to 183.550. Following the contested case hearing, the Hearings Officer will forward a proposed order to the manager of the OMWESB for issuance of a final order.

(e) If the applicant or certified firm files an appeal in writing or requests a contested case hearing, the OMWESB will stay the denial or decertification pending the issuance of the final order. If the applicant or certified firm does not submit a written appeal or request for a contested case hearing to the OMWESB within the 21-day period, the denial or decertification shall be final. (2) A business firm may be decertified if the socially disadvantaged individual leaves the business or dies.

(3) An individual may withdraw his or her application or certification if he or she no longer wishes to participate in the program. The individual must complete a notarized withdrawal form provided by the OMWESB.

(4) Any business denied initial certification would be ineligible to reapply for a period of 12 months.

(5) OMWESB decisions regarding MBE/WBE firms are final.

Stat Auth.: ORS 200.055
Stats. Implemented: ORS 200.005
Hist.: OBDD 7-2013, f. & cert. ef. 9-3-13

Emerging Small Business (ESB) Certification Procedures

123-200-1600

Eligibility Standards

(1) The ESB program is race and gender neutral. To be eligible for certification as an ESB, a business must meet the following criteria:

(a) A firm must be in existence, operational, and in business for a profit.

(b) Have its principal place of business located in the State or Oregon as determined by the address used to file federal income taxes. If the business uses a P.O. Box, the OMWESB may require additional documentation to verify location.

(c) Have average, annual gross receipts over the last three years not exceeding $1,760,494.99 for tier one construction firms and $704,197.99 for non-construction firms; and $3,520,990.00 for tier two construction firms and $1,173,663.33 for non-construction firms.

(d) The business must operate independently. A parent company, subsidiary, or affiliate is not eligible for ESB certification if the combined size of the business exceeds the monetary limits set in the ESB program.

(e) Be properly licensed and legally registered with the Secretary of State in the State of Oregon: (i.e. registered as a domestic corporation, limited liability corporation, partnership, or assumed business name, etc.).

(f) If state or local law requires a person to have a particular license or other credential in order to own and/or control a certain type of firm, then the MBE, WBE, and/or ESB certified persons who own and control a firm of that type must possess the required license or credential.

(g) If state or local law requires a person to have a particular license or other credential in order to own and/or control a certain type of firm, then the ESB certified persons who own and control a firm of that type must possess the required license or credential.

(h) The owner(s) must work a minimum of 20 hours per week for the business.

(i) The business must have 19 or fewer full-time employees to qualify to tier one or have 29 or fewer full-time employees to qualify to tier two. A full-time employee is calculated as follows:

(A) Hours worked by all employees (part-time, seasonal, or full-time) shall be converted into equivalent hours; dividing the total hours worked by 2080.

(B) The owners of the business shall not be considered in the calculation of the equivalent employees.

(C) The period of calculation shall be the same as the business’ tax year.

Stat Auth.: ORS 200.055
Stats. Implemeted: ORS 200.055
Hist.: OBDD 7-2013, f. & cert. ef. 9-3-13

123-200-1700

Application Form and Procedure

(1) The OMWESB will utilize ORS 200.170 to review a business’ eligibility for certification as an ESB.

(2) A firm wishing to apply for certification in the ESB program shall complete the application provided by the OMWESB.

(3) The completed application, together with all required supporting documentation, shall be submitted to the Office of Minority, Women and Emerging Small Business at 775 Summer Street NE, Suite 200, Salem, OR 97301. Incomplete applications will not be processed until the applicant provides all information.

(4) The OMWESB will conduct a review and take action on completed applications as promptly as resources permit. The order of priority for processing applications shall be the date the OMWESB receives the completed application with all supporting documentation. Incomplete applications will not be processed.

(5) The OMWESB shall make a determination based on the eligibility standards included in this division and the applicable laws of the State of Oregon. As part of its investigation, the OMWESB may require owners to provide information in addition to that requested on the application. The applicant has the burden of proving he or she is eligible for certification and meets all the requirements of the program. If the OMWESB certifies the firm, the agency will send a confirmation letter and certificate.

(6) The applicable emerging small business size standard for each applicant set out in ORS 123-200-1600 shall be determined by the business’ primary area of work.

(7) Registration of the business with the Construction Contractors Board and/or Landscape Contractors Board will establish a firm as a construction firm. A construction-related trucking business will also be considered a construction firm for the purposes of this program.

Stat. Auth.: ORS 200.055
Stats. Implemented: ORS 200.055, 200.170
Hist.: OBDD 7-2013, f. & cert. ef. 9-3-13

123-200-1800

Certification Review

(1) Certification as an ESB is valid for three years from the date of certification.

(2) An annual “no-change” statement will be sent to the firm approximately 30 days prior to the one-year and two-year anniversaries of the certification date. The completed affidavit, along with federal tax information for the previous year and documentation of any changes, must be submitted prior to the anniversary date or the firm will be decertified.

(3) The ESB shall notify the OMWESB within 30 days of any changes, which may affect its continued eligibility in the program. Failure to notify the OMWESB may result in denial or decertification.

(4) A certification review notice and application shall be sent to certified firms 60 days prior to expiration of current certification. The firm shall promptly return the completed application along with any requested documentation (i.e. evidence of change in ownership, federal tax returns for the last year, etc.). Continued certification is not automatic. The applicant must demonstrate that his or her business still meets the criteria set out in OAR 123-200-1600 through 123-200-1700.

(5) The OMWESB staff shall review the signed application to determine the firm’s continued eligibility. The OMWESB may also request additional information to verify the firm’s continued eligibility.

(6) Failure to return the completed review application by the expiration date shall result in decertification.

(7) Firms may only be certified as an ESB for a maximum of 12 consecutive years from the original certificate date. If a firm provides compelling information showing, in the judgment of the Oregon Business Development Department, that it has not been afforded an opportunity to bid on ESB projects during the 12 years of eligibility, the OMWESB will extend the certification of the firm for one additional year. A firm may receive the extension only once.

Stat Auth.: ORS 200.055
Stats. Implemented: ORS 200.055
Hist.: OBDD 7-2013, f. & cert. ef. 9-3-13

123-200-1900

Denial and Decertification of Firms

(1) This rule applies only to the denial and decertification of a firm’s ESB status under Oregon law. The OMWESB may deny certification of decertify a firm at any time if the agency determines that the firm no longer meets eligibility standards set out in OAR 123-200-1600. The procedure is as follows:

(a) In the case of denial of initial certification, the firm will be notified in writing of the denial and the reasons therefore.

(b) In the case of decertification, the OMWESB shall issue a Notice of Intent to Decertify the firm 21 days prior to the date of decertification, and indicate the specific reasons for the decision.

(c) In the event of a denial or decertification, the applicant or certified firm has 21 calendar days from the date of notice in which to submit a written appeal to the manager of the OMWESB. Following the review of the applicant’s written appeal, the manager of OMWESB will issue a decision.

(d) If the applicant or certified firm does not agree with the manager’s decision, he or she may request a contested case hearing. Contested case hearings will be conducted in accordance with ORS 183.310 to 183.550. Following the contested case hearing, the Hearings Officer will forward a proposed order to the manager of the OMWESB for issuance of a final order.

(e) If the applicant or certified firm files an appeal in writing or requests a contested case hearing, the OMWESB will stay the denial or decertification pending the issuance of the final order. If the applicant or certified firm does not submit a written appeal or request for a contested case hearing to the OMWESB within the 21-day period, the denial or decertification shall be final.

(2) An individual may withdraw his or her application or certification if he or she no longer wishes to participate in the program. The individual must complete a notarized withdrawal form provided by the OMWESB.

(3) Any business denied initial certification would be ineligible to reapply for a period of 12 months.

(4) OMWESB decisions regarding MBE/WBE firms are final.

Stat. Auth.: ORS 200.055
Stats. Implemented: ORS 200.055, 183.310 - 183.550
Hist.: OBDD 7-2013, f. & cert. ef. 9-3-13

123-200-2000

Complaints of Ineligibility for All Programs

Complaints of Ineligibility regarding certification of an applicant or firm must be submitted to the OMWESB and will be processed according to the following procedure:

(1) Any individual or agency who believes that an applicant or certified firm does not qualify under the standards of eligibility for certification may file a complaint of ineligibility. The complainant(s) must fill out a formal complaint form provided by the OMWESB. The purpose of the complaint process is to maintain the transparency of all programs.

(2) The complaint must be submitted to the OMWESB in writing using the form provided and must set forth facts, which indicate that the applicant or certified firm is not eligible. The complaint must include copies of any supporting documents the complainant(s) may possess. The complainant(s) shall describe the facts in as much detail as possible.

(3) The OMWESB will only investigate complaints based on firsthand knowledge and those that contain allegations supported by evidence. The OMWESB will not investigate anonymous or third party complaints. Complaints based on hearsay (i.e. third person account, general assumption, word-of-mouth, and/or speculation) will not be investigated. The OMWESB does not accept general allegations. Complaints that are not properly supported or submitted will be returned to the complainant and will not be investigated.

(4) The OMWESB will notify the complainant(s) in writing when it refuses to investigate a complaint. The notification may include:

(a) The initial complaint filed by the complainant(s);

(b) Explanation of why the complaint is not being investigated; and

(c) A request for additional information, when applicable.

(5) The complainant(s) may submit a revised complaint addressing the OMWESB’s concerns.

(6) The complainant(s) must sign the complaint and give physical, mailing and email addresses and telephone number where he or she may be reached during the investigation. While responding to requests for information concerning any aspect of the programs, the OMWESB complies with provisions of the Federal Freedom of Information and Privacy Acts. The OMWESB may make available to the public any information concerning the programs not prohibited by federal or state law. Information submitted to the OMWESB is subject to public record law, ORS 192.410, 192.501, 192.502 and 192.505. Certain information in the agency’s possession may be made available for public inspection. The information may include names of the complainant. Certain other records the OMWESB may keep confidential, under certain circumstances. These may include, but are not limited to: reports from creditors, employers, customers, suppliers, financial statements, tax returns, business records, employment history and other personal data submitted by the applicant, customer lists, bids, proposals, and contracting information, production, sales or cost data, and marketing strategy information. Although the agency will attempt to keep the information submitted confidential, it cannot guarantee confidentiality in all cases.

(7) The OMWESB may keep the identity of the complainant(s) confidential, at the complainant(s) election, throughout the course of the investigation. A complainant(s) may waive this privilege of confidentiality at any time. If such confidentiality will hinder the investigation, proceeding, hearing, or result in a denial of appropriate administrative due process to other parties, the OMWESB will advise the complainant(s) that, in some circumstances, failure to waive the privilege of confidentiality may result in the closure of the investigation or dismissal of the proceeding or hearing.

(8) The OMWESB will investigate each complaint as promptly as resources allow. If preliminary investigative results show good cause for in-depth investigation, the OMWESB will notify the applicant or certified firm identified in the complaint by certified mail. The notice will summarize the grounds for the challenge and will require the applicant or certified firm to provide to the OMWESB, within a reasonable period of time, information sufficient to permit the agency to evaluate the complaint and the application or certified firm’s qualifications for the programs. The applicant, certified firm, and complainant(s) shall cooperate fully in the OMWESB's investigation.

(9) After the investigation is complete, the OMWESB will issue a written decision in the form of a rejection of the complaint, Notice of Intent to Deny, or Notice of Intent to Decertify. The decision will address each issue raised in the complaint and throughout the investigation and the reasoning for the decision. The OMWESB will mail the written decision to the applicant or certified firm and to the complainant(s). The OMWESB will not deny or decertify a firm based on a complaint without first giving the firm an opportunity to respond.

(10) The applicant or certified firm has 21 calendar days from the date of Notice of Intent to Deny or Notice of Intent to Decertify in which to submit a written appeal to the manager of the OMWESB. Following the review of the applicant’s written appeal, the manager of OMWESB will issue a decision .

(11) If the applicant or certified firm does not agree with the manager’s decision, he or she may request a contested case hearing. Contested case hearings will be conducted in accordance with ORS 183.310 to 183.550. Following the contested case hearing, the Hearings Officer will forward a proposed order to the manager of the OMWESB for issuance of a final order.

(12) If the applicant or certified firm files an appeal in writing or requests a contested case hearing, the OMWESB will stay the denial or decertification pending the issuance of the final order. If the applicant or certified firm does not submit a written appeal or request for a contested case hearing to the OMWESB within the 21-day period, the denial or decertification shall be final.

(13) The OMWESB will not consider opposing information received about an applicant prior to the initial certification as a complaint, but will consider the information in the investigation of the application for certification.

Stat. Auth.: ORS 200.055
Stats. Implemented: ORS 200.055
Hist.: OBDD 17-2010, f. 4-30-10, cert. ef. 5-1-10; Renumbered from 123-200-0090, OBDD 7-2013, f. & cert. ef. 9-3-13

123-200-2100

Directory

The OMWESB shall maintain a statewide-unified directory of certified firms as follows:

(1) Certified firms shall use the current business name as registered with the Secretary of State, Corporation Division. Businesses operating under the owner’s individual name shall use the name listed on the business license. No other name may be used in contracting business. A firm may use an Assumed Business Name for contracting purposes, but only if the name is used in conjunction with the registered business name.

(2) The directory will be maintained in an electronic format and available on-line. The directory shall indicate the certification status of each firm for all programs. The directory shall also include the firm’s telephone numbers, fax number, and mailing address and list the firm's capabilities.

(3) The OMWESB shall update the directory on a daily basis including changes in business and email addresses and phone number(s).

(4) It is the responsibility of the applicant and certified business to notify the OMWESB within 30 days of any changes in its ownership or management, which may affect eligibility. Failure to notify the OMWESB may result in denial or decertification.

Stat. Auth.: ORS 200.055
Stats. Implemented: ORS 200.055
Hist.: OBDD 17-2010, f. 4-30-10, cert. ef. 5-1-10; Renumbered from 123-200-0180, OBDD 7-2013, f. & cert. ef. 9-3-13

123-200-2200

Representation of the OMWESB by Officer or Employee in Contested Case Hearings

(1) Subject to the approval of the Attorney General, an officer or employee of the OMWESB is authorized to appear on behalf of the OMWESB in contested case hearings.

(2) The OMWESB representative may not make legal argument on behalf of the OMWESB.

(a) "Legal argument" includes arguments on:

(A) The jurisdiction of the OMWESB to hear the contested case;

(B) The constitutionality of a statute, rule, or the application of a constitutional requirement to the OMWESB; and

(C) The application of court precedent to the facts of the particular contested case proceeding.

(b) "Legal argument" does not include presentation of evidence, examination and cross-examination of witnesses, presentation of factual arguments or arguments on:

(A) The application of the facts to the statutes or rules directly applicable to the issues in the contested case;

(B) Comparison of prior actions of the OMWESB in handling similar situations;

(C) The literal meaning of the statutes or rules directly applicable to the issues in the contested case; and

(D) The admissibility of evidence of the correctness of procedures followed.

(3) When an officer or employee of the OMWESB represents the agency, the presiding officer shall advise such representative of the manner in which objections may be made and matters preserved for appeal. Such advice is of a procedural nature and does not change applicable law on waiver of the duty to make timely objection. Where such objections involve legal argument, the presiding officer shall provide reasonable opportunity for the agency officer or employee to consult legal counsel and permit such legal counsel to file written legal argument within a reasonable time after conclusion of the hearing.

Stat. Auth.: ORS 183.450(7) & 183.450(8)
Stats. Implemented: ORS 183.450(7)(b)
Hist.: OBDD 17-2010, f. 4-30-10, cert. ef. 5-1-10; Renumbered from 123-200-0190, OBDD 7-2013, f. & cert. ef. 9-3-13

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