1. 2009 National DBE Conference Federal Aviation Administration 49 CFR Part 23 Goal Setting

2. Part 23 2009 National DBE Conference 2 Federal Aviation Administration Goal-Setting – Subpart D Two Separate Goals – 23.41 –Car Rental Concessions – if gross receipts exceed $200,000 –All other Concessions – if gross receipts exceed $200,000 –Why two goals Separate goals prevent car rental participation skewing the picture for others since whole value of car may be counted – 23.53 –Why $200,000 Designed to reduce administrative burdens for small airports with little concession activity

3. Part 23 2009 National DBE Conference 3 Federal Aviation Administration Goal-Setting Best Estimate of Concession Revenue Best Estimate Sponsor project potential concession revenue three years in the future and take into account past three years Consider upcoming new opportunities –Sponsors must account for new concession opportunity arises when an estimated average annual gross revenue of $200k or greater must submit an appropriate adjustment in advance of any new concessions agreement.

4. Part 23 2009 National DBE Conference 4 Federal Aviation Administration Example of Best Estimate Average concession receipts over past three years is $1 million. Airport expects this level of revenue to continue through next three years. Airport estimates that revenues to existing concessions will grow by 5% over the next three years (e.g., inflation + increased passenger traffic). Airport does not anticipate any major changes that would markedly increase or decrease concession revenues over next three years. $1, 050,000

5. Part 23 2009 National DBE Conference 5 Federal Aviation Administration Goal-Setting Non-Car Rental – 23.45 and 23.47 Total gross receipts of concessions including goods and services –Does not include car rental receipts –Does not include management contracts/subcontracts with non-ACDBEs Numerator: Ready, willing and able ACDBE firms Denominator: All ready, willing and able firms except non-ACDBE management firms

6. Part 23 2009 National DBE Conference 6 Federal Aviation Administration Goal-Setting - Car Rentals - 23.45 and 23.49 Total gross receipts of car rental operations –Does not include gross receipts of other concessions Numerator: Ready, willing and able ACDBE car rental firms Denominator: All ready, willing and able car rental firms

7. Part 23 2009 National DBE Conference 7 Federal Aviation Administration Ready, Willing and Able ACDBEs – 23.51(b) Demonstrable evidence of ready, willing and able ACDBEs Can’t just rely on 10% national aspirational goal

8. Part 23 2009 National DBE Conference 8 Federal Aviation Administration Market Area - 23.51(b)(3) Define Market Area –Geographical area where substantial majority of firms that seek to concession business opportunities –Geographical area where substantial majority of concession-related revenue is located

9. Part 23 2009 National DBE Conference 9 Federal Aviation Administration Goal-Setting Step 1 – Develop the base figure (same as Part 26) –Methods DBE Directories and Census Bureau Data Active Participants List Disparity Study Goal of another Recipient Alternative

10. Part 23 2009 National DBE Conference 10 Federal Aviation Administration Goal-Setting Step 2 – Adjust the Base Figure (Same as Part 26) –Examine evidence to determine if adjustment needed Current capacity of ACDBEs to perform work in concessions program as measured by past participation Disparity Study Adjust for local market if use goal of another recipient Other evidence

11. Part 23 2009 National DBE Conference 11 Federal Aviation Administration Goal-Setting Sponsors must show their work - 23.51 –Description of method –Summary of evidence –Must consult with stakeholders before setting goal – 23.43 When goal may be met through car purchases, sponsor must show good faith efforts to obtain ACDBE participation by other means Sponsors may set car rental goal entirely based on purchases of goods and services if goal would be met by car purchases –Estimated dollar value of purchases from ACDBEs over –Estimated dollar value of all purchases

12. Part 23 2009 National DBE Conference 12 Federal Aviation Administration Goal-Setting – 23.45 Maximum use of Race-Neutral Measures Race-Conscious measures continue to be necessary –Sponsors must project the portions of their overall goals they propose to meet through use of race- neutral and race-conscious means. No subdivision of group-specific goals

13. Part 23 2009 National DBE Conference 13 Federal Aviation Administration Sample Non-Car Rental Goal Best Estimate of Gross Receipts $1,050,000 Step 1 – DBE Directory and Census Bureau –4 ACDBE firms (numerator) –65 All firms (denominator) –.0615 times 100 = 6.15 –6.15% Base figure Step 2 –Any grounds to adjust? No. Breakout – 0 R/N and 6.15% R/C Estimate that 6.15% of $1,050,000 should go to ACDBEs

14. Part 23 2009 National DBE Conference 14 Federal Aviation Administration Counting 23.53 and 23.55 Counted in the same way as under Part 26 –Count ACDBE participation that results from a commercially-useful function –Count only for work performed by ACDBE firms with their own forces –Count the portion of the gross receipts earned by an ACDBE under a concession agreement or sub-agreement and the total dollar value of an ACDBE management contract or subcontract –Count fees and commissions charged by an ACDBE firm

15. Part 23 2009 National DBE Conference 15 Federal Aviation Administration Counting Cont. Count value of purchases or leases from any ACDBE vendor Count purchases from ACDBE providers of goods and services Count fees and commissions charged by an ACDBE to manage a car rental concession.

16. Part 23 2009 National DBE Conference 16 Federal Aviation Administration Counting Cont. –Joint Ventures - 23.55(d) –Count only the value of the distinct, separate element of the work performed by the DBE participants with their own forces –Do not count DBE participation by equating it to the percentage of the DBE participant’s ownership in the joint venture –Civil Rights has developed Joint Venture Guidance –Regular Dealers – 23.55 –Purchases of goods through ACDBE regular dealers are counted at 100 percent of their value, as distinct from 60 percent under Part 26

17. Part 23 2009 National DBE Conference 17 Federal Aviation Administration Questions