Management Advisory: Suspended or Debarred Firms Are Listed on State DBE Directories as Eligible for DBE Participation
On September 24, 2013, we issued a management advisory to inform the Department of Transportation of an issue related to our recent audit of the Department’s Disadvantaged Business Enterprises (DBE) program and our ongoing audit of the Suspension and Debarment (S&D) program that warrants attention. Specifically, we identified three suspended or debarred firms that are currently listed in State DBE directories as eligible to participate in the DBE program. Federal regulations explicitly exclude suspended or debarred firms from receiving federally funded contracts. Because DOT lacks sufficient DBE guidance to help State and local transportation agencies safeguard against federally funded awards to firms that are suspended or debarred, instances like those we found point to the possibility that other ineligible firms may be listed on State DBE directories. In addition, DBE certification and oversight weaknesses further increase the risk that DBE work may be awarded to suspended or debarred firms.