Understanding the Rule Change

Last updated 04.30.2026

If you are a DBE firm owner trying to understand what the USDOT Interim Final Rule is and what it means for your business, this is the right place to start. The IFR is the federal rule that suspended every DBE certification in the country pending reevaluation. This guide explains, briefly, what changed, what it means for your firm, what it means for your contracts, and what to do next.

What happened

On October 3, 2025, the U.S. Department of Transportation issued an Interim Final Rule (the IFR) amending the federal Disadvantaged Business Enterprise program at 49 CFR Part 26 and the Airport Concession DBE program at 49 CFR Part 23. The rule went into effect immediately.

The IFR eliminated race- and sex-based presumptions of social and economic disadvantage. Until October 3, 2025, owners in certain groups were presumed to be socially and economically disadvantaged for purposes of DBE certification. After October 3, 2025, no group is presumed to be disadvantaged. Every owner whose disadvantaged status the firm relies on for certification has to demonstrate that disadvantage through individualized evidence.

What it means for your firm

Your DBE certification is suspended pending reevaluation. This applies to every currently certified DBE firm in the country, regardless of when you were certified or which state certified you. The reevaluation is not optional. Firms that do not complete it will not remain in the program.

To be reevaluated and remain certified, each owner whose disadvantaged status the firm relies on must submit two documents:

A Personal Narrative that establishes the existence of social and economic disadvantage through specific instances of economic hardship, systemic barriers, or denied opportunities that impeded the owner's progress in education, employment, or business. The narrative must not rely, in whole or in part, on race or sex.

A Personal Net Worth Statement showing that the owner's personal net worth does not exceed the federal cap of $2,047,000, excluding the owner's interest in the applicant firm and equity in their primary residence.

Each of these documents has its own guide on this site.

What it means for your contracts

Your existing contracts continue. Federally funded contracts you were already working on at the time the rule took effect remain in force under their original terms. You keep doing the work. You keep getting paid. Prompt-pay rules and termination procedures continue to apply normally. This is true whether or not your reevaluation is complete.

Future federally funded contracts are different. Until your state's reevaluation process is complete, the agencies that put new federally funded contracts out for bid in your state cannot include DBE participation goals on them. New solicitations going out the door right now do not have a DBE goal attached.

This is temporary. Once your state's UCP completes the reevaluation of all certified firms and notifies USDOT, the state's agencies can resume setting DBE goals on new contracts. How long this takes varies by state. Some states have set internal target dates; many have not. Your state's page on this site is the best source for where your state is in the process.

In the meantime: stay in touch with the prime contractors you have worked with before, keep bidding on the work you are qualified for, and complete your reevaluation as quickly as practicable so you are recertified and ready when goals come back.

What to do now

Find your state's page on this site. Each state is implementing the reevaluation on its own timeline, with its own portal, its own contacts, and in some cases its own document requirements beyond the federal default. Your state's page covers what is specifically required of you.

Read the Personal Narrative Guide before you start writing. The narrative is the heart of the reevaluation, and it is where most submissions that get sent back have failed.

Read the Personal Net Worth Statement Guide before you fill out the form. The form is short but the rules behind it are specific, and small errors can delay your reevaluation.

If you operate in more than one state, read the Multi-State Firms Guide. Interstate certification is paused in most states during reevaluation, and the order in which you handle your home state and your other states matters.