PennDOT says USDOT'issued rule forced pause and re-evaluation of DBE certifications; about 1,400 PA firms affected

Pennsylvania's transportation agency told the House appropriations committee that an unexpected federal rule forced an immediate pause and re-certification of disadvantaged business enterprise (DBE) certificates used in PennDOT procurements.

"USDOT instituted an interim final rule in October. PennDOT, as well as other DOTs, did not have any advanced notice," Corey Pellington, deputy secretary for administration, said. "It did also go into effect immediately, which required us to respond immediately."

Representative Salisbury opened the line of questioning by noting that certification reprocessing surprised many businesses and asked why the work had fallen to PennDOT. Secretary Carroll said the department considers the recertification work "critically important" and will expedite it.

PennDOT told lawmakers there are about 3,000 firms on the DBE list nationwide, of which roughly 1,400 are Pennsylvania firms. Agency staff said they have reevaluated about 7 percent of the in-state firms (about 100 firms), reported no formal rejections to date, and that 88 firms voluntarily withdrew from the process; roughly 500 firms have not responded to outreach and remain in "outstanding" status.

Pellington said the IFR removed presumptions based on race and gender and requires firm owners to submit a personal narrative demonstrating social or economic disadvantage. New applications are paused while agencies complete reevaluations for firms certified before the October rule.

"We're not allowed to consider the applications in terms of race or gender in reviewing the application," Pellington said, adding that PennDOT had issued monthly notices and was engaging firms one-on-one to walk them through the new requirements.

Lawmakers pressed about timelines and outcomes. PennDOT said there is no fixed deadline to complete reevaluations: each firm that was certified before October must be reevaluated, decertified, or withdraw before the agency restarts the DBE program for new applicants.

Why it matters: DBE certification affects which firms can compete for federal-aid transportation contracts. PennDOT officials said the pause and review aim to comply with federal rules while reengaging certified firms on procurements through other work certifications where possible.

What comes next: PennDOT said it will continue individualized outreach, provide technical guidance for personal narratives required by the IFR and resume new certifications only after completing the in-state reevaluation work. Representatives said they would continue oversight to track how many firms are ultimately recertified or decertified.