Final Rule Removes Race- and Sex-Based Presumptions, Requires Individualized Eligibility Determinations and Establishes Reevaluation Deadlines
On September 25, 2026, the U.S. Department of Transportation (DOT) issued a final rule amending its Disadvantaged Business Enterprise (DBE) and Airport Concession Disadvantaged Business Enterprise (ACDBE) regulations under 49 C.F.R. Parts 23 and 26. Effective immediately, the rule largely finalizes the interim final rule DOT issued on October 3, 2025.
The final rule does not eliminate the DBE or ACDBE programs. It removes race- and sex-based presumptions of social and economic disadvantage and requires individualized eligibility determinations, establishes deadlines for reevaluating previously certified firms and governs when airport sponsors may resume setting goals and counting participation. The Part 26 changes also apply to other recipients of DOT financial assistance through Federal Aviation Administration (FAA), Federal Highway Administration (FHWA) or Federal Transit Administration (FTA) programs.
Individual Showing of Social and Economic Disadvantage
Under prior rules, members of certain racial and ethnic groups and women were presumed socially and economically disadvantaged. The final rule removes those presumptions. An owner seeking certification must now demonstrate social and economic disadvantage by a preponderance of the evidence.
Except for certain entities owned by Indian Tribes, Native Hawaiian Organizations and Alaska Native Corporations, an owner must submit a Personal Narrative (PN) identifying an objective basis for disadvantage, describing the economic hardship, social barriers or denied opportunities experienced and explaining the resulting economic harm. Specific experiences involving race or sex may be relevant, but eligibility cannot rest on group membership alone. The owner must also submit a current Personal Net Worth (PNW) statement. Falling below the PNW cap does not by itself establish economic disadvantage; a certifier may consider income, assets and access to capital.
Reevaluation of Existing Firms
Each state’s Unified Certification Program (UCP) is the certification system for DOT recipients, including airports. UCPs must complete reevaluations by December 24, 2026. DOT may grant one extension of up to 90-days for good cause if requested before the deadline.
As codified, firms that do not submit the required documents before the UCP completes its reevaluation will receive a final written notice to submit them by March 24, 2027, or within 90 days after an extended UCP deadline. A firm that misses the applicable deadline is automatically disqualified. A firm found ineligible after substantive review must receive a reasoned written decision and may appeal to DOT. UCPs must continue processing new applications during the reevaluation period.
Temporary Restrictions on Airport Goal Setting and Counting
Until the applicable UCP completes reevaluation and notifies DOT, an airport:
- May not set DBE contract goals or concession-specific ACDBE goals;
- May not count DBE or ACDBE participation toward any goal;
- Need not update its overall DBE or ACDBE goals; and
- Need not submit Uniform Reports.
A UCP may complete DBE and ACDBE reevaluations separately, allowing an airport to resume one program before the other. Counting resumes on the date of the applicable UCP notice. Participation from October 3, 2025 through that notice date may not be counted retroactively.
After reevaluation, airports generally must recalculate their overall goals using the revised pool of eligible firms and resume contract monitoring and commercially useful function reviews.
Existing Contracts and Concession Agreements
Airports need not amend existing construction contracts or concession agreements solely because of the rule. However, DOT considers goals established before October 3, 2025, unenforceable and states that contractors and concessionaires cannot be required to cure shortfalls under those goals.
After reevaluation, participation by firms that remain certified may be counted going forward; participation by disqualified firms may not. DOT encourages airports to work in good faith with affected concessionaires.
Next Steps for Airports
- Confirm UCP status: Determine separately whether DBE and ACDBE reevaluations are complete and document the applicable DOT notice date.
- Review solicitations and existing agreements: Remove or refrain from enforcing affected goals while preserving unrelated contractual requirements.
- Prepare revised overall goals: Coordinate with FAA on timing and methodology.
- Resume monitoring when counting resumes: Restart commercially useful function reviews, participation tracking and related compliance monitoring.
- Consider race-neutral small-business measures: Properly structured Small Business Enterprise programs may continue during the transition.
- Protect confidential information: PNs, PNW statements and related records generally must be protected from public disclosure.
Airports should coordinate with their UCPs and FAA before reinstating goals, resuming counting or acting on a firm’s reevaluation status.
Given the likelihood of protracted litigation over the rule and related program requirements, airports should preserve implementation records and be prepared to revise goals, solicitations, contracts and concession requirements as courts issue decisions.
For assistance with implementation, procurement documents, contracts or concession agreements, please contact your BBK attorney or the authors of this alert, Chandley Hayes-Crawford and Thomas Rice.