49 CFR Part 23 Goal Setting

1. 49 CFR Part 23Goal Setting

2. Goal-Setting – Subpart D Two Separate Goals – 23.41 • Car Rental Concessions – if gross receipts exceed $200,000 • All other Concessions – if gross receipts exceed $200,000 • Why two goals • Separate goals prevent car rental participation skewing the picture for others since whole value of car may be counted – 23.53 • Why $200,000 • Designed to reduce administrative burdens for small airports with little concession activity

3. Goal-Setting Best Estimate of Concession Revenue Best Estimate • Sponsor project potential concession revenue three years in the future and take into account past three years • Consider upcoming new opportunities • Sponsors must account for new concession opportunity arises • when an estimated average annual gross revenue of $200k or greater • must submit an appropriate adjustment in advance of any new concessions agreement.

4. Example of Best Estimate • Average concession receipts over past three years is $1 million. Airport expects this level of revenue to continue through next three years. • Airport estimates that revenues to existing concessions will grow by 5% over the next three years (e.g., inflation + increased passenger traffic). • Airport does not anticipate any major changes that would markedly increase or decrease concession revenues over next three years. • $1, 050,000

5. Goal-Setting Non-Car Rental – 23.45 and 23.47 • Total gross receipts of concessions including goods and services • Does not include car rental receipts • Does not include management contracts/subcontracts with non-ACDBEs Numerator: Ready, willing and able ACDBE firms Denominator: All ready, willing and able firms except non-ACDBE management firms

6. Goal-Setting - Car Rentals - 23.45 and 23.49 • Total gross receipts of car rental operations • Does not include gross receipts of other concessions Numerator: Ready, willing and able ACDBE car rental firms Denominator: All ready, willing and able car rental firms

7. Ready, Willing and Able ACDBEs – 23.51(b) • Demonstrable evidence of ready, willing and able ACDBEs • Can’t just rely on 10% national aspirational goal

8. Market Area - 23.51(b)(3) • Define Market Area • Geographical area where substantial majority of firms that seek to concession business opportunities • Geographical area where substantial majority of concession-related revenue is located

9. Goal-Setting • Step 1 – Develop the base figure (same as Part 26) • Methods • DBE Directories and Census Bureau Data • Active Participants List • Disparity Study • Goal of another Recipient • Alternative

10. Goal-Setting • Step 2 – Adjust the Base Figure (Same as Part 26) • Examine evidence to determine if adjustment needed • Current capacity of ACDBEs to perform work in concessions program as measured by past participation • Disparity Study • Adjust for local market if use goal of another recipient • Other evidence

11. Goal-Setting • Sponsors must show their work - 23.51 • Description of method • Summary of evidence • Must consult with stakeholders before setting goal – 23.43 • When goal may be met through car purchases, sponsor must show good faith efforts to obtain ACDBE participation by other means • Sponsors may set car rental goal entirely based on purchases of goods and services if goal would be met by car purchases • Estimated dollar value of purchases from ACDBEs over • Estimated dollar value of all purchases

12. Goal-Setting – 23.45 • Maximum use of Race-Neutral Measures • Race-Conscious measures continue to be necessary • Sponsors must project the portions of their overall goals they propose to meet through use of race-neutral and race-conscious means. • No subdivision of group-specific goals

13. Sample Non-Car Rental Goal • Best Estimate of Gross Receipts $1,050,000 • Step 1 – DBE Directory and Census Bureau • 4 ACDBE firms (numerator) • 65 All firms (denominator) • .0615 times 100 = 6.15 • 6.15% Base figure • Step 2 • Any grounds to adjust? No. • Breakout – 0 R/N and 6.15% R/C • Estimate that 6.15% of $1,050,000 should go to ACDBEs

14. Counting 23.53 and 23.55 • Counted in the same way as under Part 26 • Count ACDBE participation that results from a commercially-useful function • Count only for work performed by ACDBE firms with their own forces • Count the portion of the gross receipts earned by an ACDBE under a concession agreement or sub-agreement and the total dollar value of an ACDBE management contract or subcontract • Count fees and commissions charged by an ACDBE firm

15. Counting Cont. • Count value of purchases or leases from any ACDBE vendor • Count purchases from ACDBE providers of goods and services • Count fees and commissions charged by an ACDBE to manage a car rental concession.

16. Counting Cont. • Joint Ventures - 23.55(d) • Count only the value of the distinct, separate element of the work performed by the DBE participants with their own forces • Do not count DBE participation by equating it to the percentage of the DBE participant’s ownership in the joint venture • Civil Rights has developed Joint Venture Guidance • Regular Dealers – 23.55 • Purchases of goods through ACDBE regular dealers are counted at 100 percent of their value, as distinct from 60 percent under Part 26

17. Questions