1.0 DEFINITIONSFor purposes of this Directive, the following terms have the meanings specified below:
1.0 Affiliate means any business, including, but not limited to, a parent business, subsidiary business or a sibling business having any of the relationships described below:
Every business is presumed to have one or more parties directly or indirectly controlling (or having the power to control) it. For the purposes of this Subsection, the term “control” means the power to exercise a controlling influence over the management policies of a business. Control may be affirmative or negative, and it is immaterial whether that control is exercised (such as a silent partner) so long as the power to control exists. An affiliate relationship consists of any of the following:
a) Where a business directly or indirectly owns or holds, with power to vote, five percent (5%) or more of the outstanding voting securities of such other business;
b) Where five percent (5%) or more of a business outstanding voting securities are directly or indirectly owned or held with power to vote by such other business;
c) Where a business is directly or indirectly (i) controlling, (ii) controlled by or (iii) under common control with another business;
d) Where a business directly or indirectly owns or holds stock options of another business;
e) Where there is an identity of interest between or among parties such that affiliation may be found. An identity of interest arises where members of the same family or other persons have common investments in more than one business;
f) Where there as an agreement to merge (including agreements in principle) between businesses;
g) Where there is a voting trust, the purpose of which is to separate voting power from beneficial ownership of voting stock for the purpose of shifting control of (or power to control) a business so that the business may qualify as a small business;
h) Where there is common management including, but not limited to, the sharing among businesses of officers, directors or employees;
i) Where office space, facilities and/or equipment are shared, particularly where both businesses are in the same or related field of operation or where such businesses were formerly affiliated;
j) Where former officers, directors, principal stockholders, partners and/or employees of one business organize a new business in the same or related field of operation, and serve as its officers, directors, principal stockholders, owners and/or employees, and on the one concern is furnishing or will furnish the other concern with any of the following for a fee or other consideration: subcontractors; employees; financial or technical assistance; bid or performance bond indemnification; office space; facilities and/or equipment; or
k) Where one business is dependent upon another for contracts, and/or its income to such a degree that its economic viability would be in jeopardy without such contracts and/or income.
1.02 Business shall mean any association, cooperative, corporation, individual, joint venture, partnership, sole proprietorship or other legal entity.
1.03 City shall mean the City of Detroit, Michigan.
1.04 Contracting department shall mean a City department or City agency for which any of the following are sought: construction contract, purchase order contract or imprest cash purchase.
For Professional Services, a contracting department shall mean a City department or City agency for which professional services are sought.
1.05 General construction business shall mean a business that (a) is a general contractor for any of the following: industrial buildings, residential buildings, single family houses or warehouses or (b) performs heavy construction which includes, but is not limited to, the following: bridges, communications lines, elevated highways, highways, pipelines, power lines, sewer lines, streets, tunnels or water lines.
1.06 Human Rights Department (HRD) shall mean the Human Rights Department of the City.
1.07 Human Rights Director shall mean the Director of the Human Rights Department.
1.08 Invitation for bids shall mean the complete assembly of related documents, whether attached or incorporated by reference, furnished to prospective bidders for the purpose of bidding.
1.09 Minority Owned Business Enterprise shall mean a firm that has at least bona fide 51% minority ownership, and other indicia of MBE status, such as whether minorities control the business policy and operations.
1.10 Purchasing Director shall mean the Director of the Purchasing Division.
1.11 Purchasing Division shall mean the Purchasing Division of the Finance Department of the City.
1.12 Women Owned Business Enterprise shall mean a firm that has at least bona fide 51% female ownership and other indicia of WBE status, such as whether women control the business policy and operations.
2.0 CERTIFICATION PROCEDURES
2.01 A business may apply for certification as a Minority- Owned Business Enterprise (MBE), Women-Owned Business Enterprise (WBE) or both.
2.02 Only one application per year. A business may file with the HRD only one (1) application for certification every twelve (12) months. The HRD shall reject any application that is filed less than twelve (12) months after the date of the applicant business previous application.
2.03 The HRD shall have the duty to certify Minority or Women-Owned Business (MWBE). The HRD shall determine whether an applicant business satisfies the prerequisites for certification as an MBE and/or WBE.
A. The HRD shall prescribe the form of MWBE application, which also shall identify the supporting materials (e.g., tax filings, articles of incorporation and licenses) that a business is required to submit for certification in each MWBE certification category (i.e., whether the applicant business is a MBE and/or an WBE). Before issuance, the MWBE application form must be approved by both the Human Rights Director and Corporation Counsel for the City.
B. MWBE application forms shall be available in the offices of the HRD. MWBE application forms will also be distributed by the HRD to contracting departments.
C. If the HRD concludes that an applicant business qualifies as a MBE and/or WBE, it shall issue a Notice of MBE or WBE Certification that includes the following:
The inception date of the certification;
(1) The inception date of the certification;
(2) The expiration date of the certification;
(3) The MWBE certification category (i.e., whether the applicant business is a MBE and/or an WBE) and;
D. If the HRD determines that an applicant business does not satisfy the applicable requisites, it shall issue a Denial of MWBE Certification that explains the HRD’s reason(s) for its conclusion and that offers the applicant business the opportunity to informally discuss the denial with the HRD. The procedure for appealing from a Denial of MWBE Certification is described in Subsection 2.09 of this Directive.
E. Within five (5) business days of the date of its decision, the HRD shall mail to the applicant business one of the notices described in Subsections 2.03(c) and 2.03(d) by Certified Mail, Return Receipt Requested.
2.04 The HRD is to follow up on incomplete files. If the HRD determines that the applicant business file is not complete after initially reviewing said file, the HRD shall write to that business to obtain the remaining information. If the applicant business does not provide the requested information within (10) business days of the date of the HRD’s request, the HRD may, in its sole discretion, deem the application withdrawn. The HRD may close withdrawn files.
2.05 MWBE’s certifications from other governmental agencies. The city will accept MWBE certifications from other governmental agencies on a case-by-case basis.
2.06 Duration of certification. MWBE certification is valid for two (2) years. However, all certified businesses shall submit documentation to verify continued eligibility on an annual basis, (see Exhibit A). Such documentation will be determined by the HRD in a re-certification affidavit.
2.07 Monitoring of status. Once a business is certified as a MBE and/or a WBE, the HRD shall periodically monitor that business status to verify that the business continues to satisfy the requirements of certification. A certified MWBE must immediately notify the HRD about any change in its circumstances that affect either the representations that it has made in its application materials or its status as a MWBE.
2.08 Misconduct will result in decertification and disqualification as an MWBE. The HRD shall decertify any business that either obtains its certification through fraud, deceit or misrepresentation or fails to report any changes that materially affect that business qualification for certification.
2.09 Procedure for appealing from a denial of MWBE certification. This Subsection establishes the exclusive procedure for an applicant business that seeks relief from a Denial of MWBE Certification, issued pursuant to Subsection 2.03 (d). Further, the procedure set forth in this Subsection is available only to an applicant business seeking relief from a Denial of MWBE Certification. The procedure for appealing from a Denial of MWBE Certification is as follows:
A. A Claim of Appeal. The applicant business shall file a typewritten or printed Claim of Appeal with the Human Rights Director within ten (10) business days of the date of receipt of a Denial of MWBE certification. A Claim of Appeal shall satisfy all of the following requirements:
(1) Include a detailed narrative of all of the basis for reversal of the HRD=s decision to deny MWBE certification. Any basis omitted from the Claim of Appeal is waived;
(2) Include documentation supporting the applicant business claim that it satisfies the requirements for MWBE certification;
(3) Include a copy of the Denial of MWBE certification described in Subsection 2.03(d) of this Directive;
(4) Exclude any reliance on or reference to changes in the applicant business ownership, operation and/or management occurring after the date of the Denial of MWBE Certification.
B. Within fifteen (15) business days of the date that the Claim of Appeal is received by the Human Rights Director, the Human Rights Director, or designee, shall issue a written statement disposing of the appeal. This statement shall be mailed to applicant business by Certified Mail, Return Receipt Requested.
C. The decision of the Human Rights Director, or designee, is final and is not subject to further appeals pursuant to Subsection 2.09(A). The HRD shall dismiss any filing that violates the provisions of this Subsection.
3.0 CREATION OF LISTS OF CERTIFIED BUSINESSES
3.01 Creation of register of certified MWBEs. The HRD shall establish and maintain a register of all certified MWBEs. This register shall be distributed to the Purchasing Division, contracting departments and, upon request, private parties and non-City governmental agencies. The HRD may establish and collect a fee for the distribution of the certification register to non-City entities provided that such fee is approved by the City Council as required by Section 9-507 of the Detroit City Charter. (1) The Certification Register shall be updated and distributed on a quarterly basis.
3.02 Creation of MWBE vendors list. The Purchasing Division shall create, maintain and update a separate MWBE vendors list for each commodity code included in the Purchasing Division Commodity Class Catalog.
4.0 Procurement of Supplies and Services4.01 City Agencies, Developers and Contractors are encouraged to utilize certified Minority and Women-Owned Business Enterprises (MWBEs) in the procurement of supplies and services for public and private sector projects.
5.0 SUBCONTRACTING5.01 Contractors and Professional Service Providers to disclose identity of subcontractors/consultants. On any contract awarded in whole or in part, the general contractor must submit with its signed bid a completed MWBE Subcontractor Data Form, (see Exhibit B). Each subcontractor shall have been certified by the Human Rights Department at least twenty-four (24) hours before the bid is submitted. The general contractor also shall specify the total number of MWBE certified subcontractors, the total contract price, the aggregate amount of the subcontractors prices and the percentage of the total contract price that the aggregate amount of the subcontractors prices represents.
6.0 REPORTING REQUIREMENTS
6.01 The Human Rights Department (HRD) shall maintain and update statistics concerning MWBE certifications. On a bi-weekly basis, the HRD shall prepare and submit to the Mayor a report on the following areas:
- The number of applications received for certification under the MWBES;
- The total number of certifications granted and denied for the MWBES;
- The total number of MWBES applications that remain open and pending at the end of the reporting period;
6.02 The Purchasing Director shall maintain and update statistics concerning contract awards to MWBES. On a quarterly basis, the Purchasing Director shall prepare and submit to the Mayor a report on the following areas:
- The number of MWBE certified businesses awarded contracts and/or subcontracts;
- The number of contracts and subcontracts awarded wholly or partially to MWBE S.
- The total dollar value of each contract and subcontract awarded under the MWBE S;
- The aggregate total dollar value of all contracts and subcontracts awarded under the MWBE S;
- The aggregate percentage of all contracts and subcontracts awarded under the MWBE S.