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The US Department of Transportation (USDOT) has issued new Frequently Asked Questions (FAQs) providing critical clarification on the Interim Final Rule (IFR) governing the Disadvantaged Business Enterprise (DBE) Program. These FAQs, released in late October 2025, expand upon the IFR published on October 3, 2025, and outline how the new rule affects DBE applicants, certifiers, and Unified Certification Program (UCP) administrators across the country.
Why This MattersThe IFR, issued by USDOT and supported by USDOT for implementation, introduces major procedural changes. Automatic presumptions of disadvantage based on race or gender have been eliminated. Instead, all applicants—including previously certified DBEs—must now provide a written narrative demonstrating how specific social or economic barriers have negatively affected their ability to succeed in business. The FAQs confirm that the Uniform Certification Application (UCA) process is under review nationwide until each state’s UCP releases updated procedures and forms consistent with the IFR and further guidance from USDOT. This means no new certifications or renewals will be processed until those updates are issued. Key Takeaways from the USDOT FAQ1. All Firms Must Reapply Under the New Rules Existing DBEs are not automatically “grandfathered” into the new system. Each firm will need to be re-certified using the forthcoming UCA and narrative-based format once their state’s UCP announces its transition procedures. 2. Suspension of the Current UCA The April 2024 version of the Uniform Certification Application (UCA) can no longer be used independently. Updated forms will reflect the narrative requirement and revised eligibility standards established in the IFR. 3. Required Narrative Documentation Under the IFR, applicants must provide a detailed narrative describing personal experiences of social or economic disadvantage. This must go beyond general statements—each narrative should include concrete examples, such as barriers to education, financing, business opportunities, or industry access. 4. UCP Responsibilities Each state’s Unified Certification Program will issue its own implementation plan and updated forms. Until then, agencies should not accept new DBE applications or recertifications. USDOT recommends that agencies prepare staff for consistent application of the new narrative-based criteria. 5. Legal Foundation The new rule and its requirements stem from legal challenges including Ultima Services Corp. v. USDA, which called for individualized determinations of disadvantage. The IFR and its FAQs are intended to preserve the integrity of the DBE program while ensuring compliance with current constitutional standards. Key Resources and Links
What Happens Next USDOT has confirmed that an updated UCA and procedural framework will be released by USDOT and implemented by each state's UCP, "as quickly as practicable". Until that time, all DBE goal setting and counting is suspended. RightSource Services continues to monitor updates closely and will issue plain-language summaries and training sessions for both DBE firms and agency certifiers as new information is released. The USDOT has issued new FAQs clarifying implementation of the Disadvantaged Business Enterprise (DBE) Interim Final Rule (IFR), published October 3, 2025. These updates mark one of the most significant shifts in DBE program history. According to the USDOT, the Uniform Certification Application (UCA) process is temporarily suspended nationwide until updated instructions and forms are posted. This suspension applies to both new applications and renewals. All currently certified DBEs must be re-certified under the new rule, which now requires a written narrative demonstrating how specific social or economic barriers have impacted business success. The change eliminates prior race- or gender-based presumptions of disadvantage and replaces them with individualized determinations. For certifiers, these FAQs provide some guidance on how to prepare for the upcoming transition. RightSource Services will continue tracking updates and offering training, templates, and advisory support to help agencies and small businesses navigate the rollout. 👉 Register for training webinars and updates: RightSource Services - About Us - RIGHTSOURCE SERVICES Follow us on LinkedIn: www.linkedin.com/company/z-axisfactory/ Follow us on Facebook: www.facebook.com/RightSourceServices For new/young businesses or those with less than $2M annual revenue, find information tailored to your needs at Z-axis Business Factory: Z-AXIS BUSINESS FACTORY - Home Follow on LinkedIn: www.linkedin.com/company/z-axisfactory/ #DBE #FTA #FHWA #USDOT #IFR #SupplierDiversity #Procurement #TransitAgencies #SmallBusinessSupport #RightSourceServices #ZAxisBusinessFactory #Transit
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1. Context: What’s Happening in the Public Sector Across federal, state, and local agencies, workforce reductions and restructuring are accelerating. In August, Scott Kupor, the Office of Personnel Management director, stated that he expected a reduction of 300,000 federal employees by September 30, 2025. In just one week at the end of September 2025, more than 154,000 federal employees left through buyouts, terminations, or voluntary departures — one of the fastest drawdowns in decades. Additional staff reduction in force statements are still being sent out.
By comparison, the largest historical reduction occurred during the Clinton administration, when about 430,000 positions (20%) were eliminated over eight years through gradual restructuring and modernization. While those cuts were deliberate and phased, today’s reductions are happening rapidly and with little structure, creating widespread disruption. Even with these Reductions in Force (RIFs), the total federal workforce will remain approximately 15% below pre-COVID levels — the difference is the speed and uncertainty surrounding current actions. These cuts are being executed by executive directive rather than legislative reform, meaning the laws assigning those responsibilities remain unchanged. The work hasn’t gone away; only the federal employees performing it have. For contractors, that gap represents a significant opportunity. The current administration is also following a its first term playbook: directing most federal small-business contracting through subcontracting channels and consolidating prime opportunities under Category Management and Best-in-Class (BIC) vehicles. As a result, small businesses will see fewer direct awards, while large and mid-tier primes must expand subcontractor networks to maintain compliance with small-business goals. Meanwhile, overall federal contracting remains enormous. The government awarded about $755 billion in FY 2024 contracts, only slightly below FY 2023’s $759 billion. Contractors now outnumber federal employees more than two-to-one, and that ratio continues to grow. Outsourcing isn’t new — but the speed, scope, and scale of this transition are unprecedented, creating a unique opening for agile private-sector firms to step in. 2. Why functions don’t vanish — they shift When agencies announce staffing cuts, what often happens is:
3. Why this is especially relevant now (versus a normal procurement cycle)
Your organization is uniquely positioned to:
Opportunities for Small Businesses and Diverse SuppliersWhile many large-scale contracts will flow to established primes, small businesses now have more entry points than ever — especially as subcontractors and specialized service providers. Here’s why this shift creates opportunity downstream:
RightSource’s training and cohort programs are designed to support exactly that — positioning small firms to win subcontracting work as agencies transition to contractor-led models. 5. A Roadmap: How to Build or Scale Your Contracting Team Here’s a typical strategic sequence: Phase 1 – Assess & Gap Map Identify target agencies, functions, and capability overlaps, but keep in mind that because the reductions are haphazard, it will be hard to map the functions that need to be supplemented. 👉 Conduct a landscape scan of agencies undergoing cuts; map functions (admin, reporting, compliance) likely to shift to contractors. Phase 2 – Recruit & Structure Develop your internal contracting capacity. 👉 Hire or repurpose staff into capture, proposal, program management, and compliance roles. Phase 3 – Train & Enable Strengthen your team’s federal procurement knowledge. 👉 Provide FAR/DFARS, subcontracting, and teaming training; integrate proposal templates and workflow tools. Phase 4 – Go-to-Market & Positioning Showcase readiness and value. 👉 Market to agencies and primes, publish thought leadership, and attend industry days. Phase 5 – Operationalize & Deliver Execute with reliability. 👉 Win and deliver contracts, manage compliance, measure performance, and retain institutional knowledge. Throughout this, your value proposition should stress:
6. Call to Action This isn’t just a moment. It’s a strategic inflection point. Contact RightSource Services to build or expand your contracting team — and position your organization to capture ramping demand. We offer:
What Changes to Race and Gender Presumptions Mean for YouThe U.S. Department of Transportation (USDOT) released an Interim Final Rule (IFR) on September 30, 2025, introducing significant updates to how Disadvantaged Business Enterprises (DBEs) demonstrate “social and economic disadvantage.” These updates impact both new DBE applicants and currently certified firms, aiming to strengthen the program’s fairness and legal foundation while ensuring continued support for small, minority, and women-owned businesses. What’s ChangingPreviously, certain groups — based on race, ethnicity, or gender — were automatically presumed to be socially and economically disadvantaged. This presumption applied to women, Black Americans, Hispanic Americans, Native Americans, Asian-Pacific Americans, and Subcontinent Asian Americans. Under the new rule, these automatic presumptions have been removed. Now, all applicants—regardless of race or gender—must submit a short written narrative describing personal experiences of disadvantage, bias, or discrimination that have affected their ability to succeed in business. For currently certified DBEs, your certification remains valid. However, when your renewal comes due, you may be asked to provide this same type of narrative to demonstrate continued eligibility. Why the Change?This rule reflects USDOT’s effort to ensure the DBE Program remains legally sound and compliant with recent federal court decisions that challenge race- and gender-based presumptions in contracting programs. While this may seem like a major shift, the intent is not to limit participation — it’s to protect the program’s future. By requiring each applicant to describe their individual experience, USDOT reinforces the credibility, transparency, and defensibility of the program. What This Means for Small BusinessesThe DBE program remains fully active, federally supported, and focused on equity. This is your opportunity to share your story in your own words — to show how barriers, bias, or discrimination have impacted your path to business success. A well-written narrative will help you strengthen your eligibility and create a more compelling profile for future contract opportunities. How RightSource Services Can HelpRightSource Services has helped small businesses win over $13 million in contracts in the past year and has decades of experience supporting DBE, WBE, MBE, and SBE firms nationwide. We’re here to make sure you’re prepared for the new DBE narrative requirement with:
This is your chance to stay ahead, stay certified, and stay competitive. 👉 Register for an upcoming workshop and make sure your business remains ready for the future of DBE certification - to keep informed use the popup form on this website to sign up for upcoming classes or send an email to [email protected]. 👉 Follow us on LinkedIn to get updates as they are posted (button below) What’s Next: The specific process for preparing and submitting DBE narratives has not yet been formally announced by USDOT or state Unified Certification Program (UCP) agencies. However, it is widely presumed that the process will closely mirror the Small Business Administration’s (SBA) 8(a) program adjustments following the Ultima Services Corp. v. Department of Agriculture (2023) decision. In that case, SBA required all 8(a) participants to submit individualized narratives to demonstrate social disadvantage rather than relying on automatic racial or gender presumptions. Businesses seeking DBE certification should anticipate a similar standard — one focused on personalized, experience-based documentation that reflects real-world barriers to success. RightSource Services will continue to monitor official USDOT and SBA guidance and update participants as new details are released.  Mastering the Go/No-Go Decision: How Smart Contractors Choose the Right OpportunitiesWhen entering the world of government or corporate contracting, it’s easy to feel pressure to respond to every solicitation that crosses your inbox. For many small business owners, each new Request for Proposal (RFP) or Invitation to Bid (IFB) feels like a potential golden ticket. But here’s the truth: successful contractors don’t chase every opportunity—they choose the right ones. This decision-making process is called the Go/No-Go process, and it is one of the most important strategies for increasing your win rate, preserving your resources, and positioning your business for long-term success in the procurement space. In this post, we’ll break down:
What Is the Go/No-Go Decision Process?At its core, the Go/No-Go decision is a structured approach to evaluate whether your business should pursue a specific solicitation. It helps you avoid spending time and money on proposals that aren’t aligned with your business strengths or strategic goals. This is especially important for small businesses with limited proposal writing capacity or internal resources. A well-thought-out Go/No-Go process prevents wasted effort and allows you to focus on the opportunities you’re most likely to win. Key Criteria for Evaluating an OpportunityA thorough Go/No-Go checklist should include both objective and strategic factors. Here's what we recommend evaluating before deciding whether to bid: 1. Scope of Work
2. Location & Logistics
3. Certifications & Qualifications
4. Licensing & Compliance
5. Past Performance
6. Proposal Requirements
7. Timeframe and Deadline
8. Cost of Responding
9. Strategic Fit
The Red Flags to Watch Out ForMany small businesses make the mistake of chasing every opportunity, especially when starting out. Here are a few warning signs that an opportunity might not be worth the pursuit:
Not bidding is a strategic move, not a missed opportunity. Saying “no” allows you to say “yes” to better-suited projects. Real-World Scenario: A Smart No-GoA construction company specializing in small municipal projects received a federal solicitation for a complex environmental remediation contract. The contract was outside their technical expertise, required bonding well above their limit, and demanded past performance they couldn’t demonstrate. Despite the attractive price tag, they wisely passed. Instead, they used that time to pursue three smaller projects in their wheelhouse—winning two of them. Lesson: Bidding on the “right” contract matters far more than chasing the biggest one. Making the Go/No-Go Process a HabitTo improve your decision-making over time:
Your Go/No-Go process should evolve as your business grows. What’s a “No-Go” today could become a “Go” in six months after your team expands or you gain the right credentials. Final Thoughts: Winning Starts With Wise ChoicesGovernment contracting isn’t just about who has the best proposal—it’s about who chooses the best opportunities. The Go/No-Go process is your first line of defense against wasted effort and your first step toward sustainable success. Ready to Learn More? Join Our Next Training!If you want hands-on guidance in evaluating solicitations and preparing competitive proposals, we invite you to join one of our upcoming training sessions sponsored by the Los Angeles Small Business Development Center (LA SBDC). Need One-on-One Help? Contact Us for Tailored Support at [email protected] or 888-774-2201If you’re unsure how to assess opportunities or build a custom Go/No-Go decision process for your business, we’re here to help. Our team provides personalized guidance to help small businesses navigate procurement with confidence. Demystifying Government Solicitations: Understanding RFQs, |
AuthorNuha Nazy is the President and Founder of RightSource Services. Nuha is a serial entrepreneur with extensive experience building businesses that depend on talent and intellectual property development at their core. Archives
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