Current through Register Vol. 48, No. 39, March 25, 2024
A. An
individual business that is not a targeted group business but is owned by a
socially and economically disadvantaged person, as defend in part
1230.0150, subpart 24, may be
included as a targeted group business if the division determines that inclusion
is necessary to remedy discrimination against the owner based on race, gender,
or disability in attempting to operate a business that would provide goods or
services to public agencies. The business must demonstrate that it is
encountering the effects of discrimination as evidenced by the owner lacking
adequate external support necessary to operate a competitive business
enterprise through a diminished ability to secure:
(1) long-term or working capital
financing;
(2) equipment, raw
material, or supplier trade credit;
(3) bonding and insurance; or
(4) a proportionate share of the market for
its goods and services.
B. In addition, for certification under item
A, the information in this item must be provided for the most recent fiscal
year and the preceding four years, if the applicant has operated as a business
for four years. The applicant must identify the fiscal-year reporting system
used and list in whole dollar amounts:
(1)
assets:
(a) all cash, marketplace securities,
and other near-cash items, excluding sinking funds;
(b) all accounts from trade, less allowance
for doubtful accounts;
(c) anything
constituting inventory for the business;
(d) any other current assets, not including
prepaid items;
(e) the total of all
current assets shown in units (a) to (d);
(f) all property, plant, leasehold
improvements, and equipment, less accumulated depreciation or
depletion;
(g) intangible assets,
including goodwill, trademarks, patents, catalogs, brands, copyrights,
formulas, franchises, and mailing lists, less accumulated
amortization;
(h) prepaid items and
any other noncurrent assets; and
(i) total of all items listed in units (a) to
(h);
(2) liabilities:
(a) all short-term note obligations,
including bank and commercial paper excluding trade notes payable;
(b) that portion of long-term obligations
that is due within the next fiscal year;
(c) open accounts due to the trade;
(d) income taxes, including current portion
of deferred taxes. Identify federal, state, and local income taxes in
subtotals;
(e) all other current
liabilities, including bank overdrafts and accrued expenses;
(f) total of all current liabilities listed
in units (a) to (e);
(g) all senior
debt, including bonds, debentures, bank debt, mortgages, deferred portions of
long-term debt, and capital lease obligations;
(h) all deferred taxes. Identify federal,
state, and local taxes in subtotals;
(i) any other noncurrent liabilities,
including subordinated debt and liability reserves;
(j) difference between total liabilities and
total assets, including minority interest; and
(k) total liabilities and net worth: total of
all items listed in units (a) to (j); and
(3) income data:
(a) gross sales less returns and discounts
allowed, if any;
(b) net sales less
cost of sales;
(c) all selling,
general, and administrative expenses, including depreciation, excluding
interest expense;
(d) gross profit
less operating expenses;
(e)
includes miscellaneous other income less expenses, such as interest expense,
miscellaneous expenses not included in general and administrative expenses
netted against recoveries, interest income, dividends received, and
miscellaneous income; and
(f)
operating profit minus all other expenses (net).
C. If the business seeking
certification under item A is a contractor, the information in item B must be
submitted in all categories except as modified as follows:
(1) assets:
(a) accounts receivable - progress billings:
amounts billed on current contracts excluding retention;
(b) accounts receivable - current retention:
amounts held back by customers on current contracts as retention;
(c) inventory: costs attributable to
equipment, small tools, supplies, and other deferred costs related to contracts
in progress where a portion of the cost applies to work not yet
performed;
(d) costs and estimated
earnings in excess of billings: the difference between the total of costs and
recognized estimated earnings to date and the total billings to date;
(e) total current: total of all current
assets shown and as modified, changed, or added in units (a) to (d);
and
(f) joint ventures and
investments: the total of investments and equity in joint ventures;
(2) liabilities:
(a) accounts payable - trade: open accounts
and note obligations due to the trade;
(b) accounts payable - retention: amounts
held back as retention in payments to subcontractors on current
contracts;
(c) billings in excess
of costs and estimated earnings: the difference between the total billings to
date and the total of costs and recognized estimated earnings to
date;
(d) total current
liabilities: total of current liabilities shown and as modified, changed, or
added in units (a) to (c); and
(e)
total liabilities and net worth: total of all items shown as modified, changed,
or added in units (a) to (d); and (3) income data: contract revenues: revenues
recognized under percent of completion method, in place of net sales.
D. In separate
schedules, all applicants applying under item B or C should show the amounts
attributable to depreciation, depletion, amortization, interest income,
interest expenses, officers' compensation, and miscellaneous income shown as
passive or nonpassive income. A schedule of leased assets with a brief
description of type and dollar value must be submitted. A brief outline
describing shareholders equity must be submitted, when applicable, for the type
of company organization.
In addition, supportive documentation must be submitted when
seeking certification under various provisions as follows:
(1) item A, subitem (1), for certification as
lacking adequate external support in obtaining long-term or working capital
financing, any documentation showing denial of loans or offers of loans at
terms and rates not currently normal for similar enterprises;
(2) item A, subitem (2), for certification as
lacking external support in obtaining equipment, raw materials, or supplier
trade credit, any documentation showing denial of credit or credit extended at
terms, conditions, and rates in excess of the norm expected within similar
enterprises; and
(3) item A,
subitem (3), for certification as lacking adequate external support in
obtaining bonding and insurance, any documentation showing inability to obtain
bonding or insurance at rates and terms normally expected within the industry
segment of the applicant.
In all cases, adequacy of documentation, accuracy of
financial data, and development of argument and positions with regard to an
applicant's lack of external support within any of the four categories of item
A rests with the applicant and must be submitted in writing with the
application for certification. The division retains the right of inquiry and
verification of all information submitted.
E. Denials of certification under this part
are subject to appeal under part
1230.1700, subpart 6.
