PURPOSE: This rule establishes a program by which Minority Business Enterprises (MBEs) and Women Business Enterprises (WBEs) may be certified by the division.

1. (1) The following standards shall be used by the division in determining whether an individual, business, or organization is eligible to be certified as a Minority Business Enterprise/Women Business Enterprise (MBE/WBE). The list is not meant to be all inclusive but shall serve as a guideline for certification of MBE/WBEs.

   1. (A) At least fifty-one percent (51%) of the enterprise’s ownership and control shall be held by minorities or women.
   2. (B) All securities which constitute ownership and/or control of the enterprise for purposes of establishing it as an MBE/WBE under these regulations shall be held directly by a minority or woman.
   3. (C) Securities held in trust, or by a guardian for a minor, shall not be considered as held by a minority or woman in determining the ownership or control of a corporation.
   4. (D) Ownership and control of the enterprise by the minorities/women shall be real, substantial, and continuing. The minorities/women shall enjoy the customary incidents of ownership and shall share in the risks and profits commensurate with ownership interests.
   5. (E) The minority or woman owner(s) shall possess the power to make day-to-day as well as major decisions on matters of management, policy and operation. There shall be no restrictions which limit the customary discretion of the minority or woman owner(s).
   6. (F) The contribution of capital or expertise by the minorities or women shall be real and substantial. Examples of insufficient contributions include a promise to contribute capital, participation as an employee rather than a manager, etc.

2. (2) Any individual, business, or organization desiring certification as an MBE or WBE shall submit an MBE/WBE Certification Application and required documentation to the division.

   1. (A) An MBE/WBE applicant whose principal place of business is located in a state other than Missouri must provide proof of certification by that state, if such certification is available.
   2. (B) MBE/WBE applicants which have been certified by an organization which maintains a certification memorandum of understanding with the Office of Administration may be certified by the division based upon their previous certification. In such case, the MBE/WBE must provide proof of certification.
   3. (C) Certification by another state or organization does not guarantee certification by the division.

   4. (D) All applications shall be reviewed by the division and approved or denied.

      1. 1. The division may conduct an on-site

review at the applicant’s place of business to verify status as a certifiable MBE/WBE. The state is not required to conduct on-site reviews if such review would require that the division incur unreasonable expenses to verify eligibility for certification. An example of an unreasonable expense would be travel outside the state of Missouri for an on-site review.

1. 2. The division may require the appli-

cant to submit documentation deemed necessary to determine eligibility for certification as an MBE/WBE. Examples of required documentation may include: proof of minority or female status, initial capital contribution information, income tax returns, partnership agreement, articles of incorporation, proof of ownership, etc.

1. (E) If an applicant is approved, a letter of approval and certification shall be mailed to the certified MBE/WBE.
2. (F) If an applicant is denied certification, it will be notified in writing. The notification will include reason(s) for the denial. Reasons for certification denial may include but are not limited to the following: improperly filed application, requested information not provided, failure to meet certification standards, inability to complete certification review.

1. (3) After certification, the MBE/WBE must notify the division of any changes of fact set forth in the application including, but not limited to: company ownership, officers, address, organizational structure, etc.

2. (4) All certifications, except joint ventures, shall be effective for a period not to exceed two (2) years.

   1. (A) MBE/WBEs may request recertification by submitting a recertification application prior to the expiration date of their current certification.
   2. (B) If an application for recertification is not submitted prior to the expiration date of the current certification, the business will be removed from the active certified list of vendors. In order to become recertified after the expiration date of the original certification, the applicant must submit the recertification application with an explanation of the delay.

3. (5) The division may revoke certification of an MBE/WBE. The following list shall serve as a guideline for revocation determinations (it is not intended to be all inclusive):

   1. (A) Change in the organization or ownership structure of the business entity;
   2. (B) Revocation of certification by another certifying entity; or
   3. (C) Falsification of information on applications, bids, etc.

4. (6) Any certified MBE/WBE desiring certification of a joint venture shall submit an application and required documentation to the division.

   1. (A) In order to qualify for joint venture certification the MBE/WBE partner must be responsible for a clearly defined portion of the work to be performed and share in the ownership, control, management responsibilities, risk, and profits of the joint venture.
   2. (B) The division may require the applicant to submit documentation deemed necessary to determine eligibility for certification as a joint venture. Examples of required documentation may include: copy of the joint venture agreement and copy of certification issued to MBE/WBE participant.
   3. (C) Joint venture certification shall be effective for a period not to exceed one (1) year.
   4. (D) Any changes proposed in the joint venture agreement must be filed with and approved by the division prior to the implementation of the changes in order to maintain certification.

5. (7) The applicant may appeal certification denial or revocation actions by requesting that the determination be reviewed by the commissioner of administration or designee.

   1. (A) Any request for review must be in writing and filed with the commissioner within twenty-one (21) calendar days after the date of receipt of the notice of denial or revocation. The request must set forth specific reasons why denial or revocation should be reversed. 1 CSR 40-1
   2. (B) The commissioner’s determination shall be final and shall be mailed to all parties involved.

6. (8) Third parties who have reason to believe that an enterprise has been wrongly denied or granted certification as an MBE/WBE or joint venture may file a third party challenge with the division. Challenges by third parties are not considered an appeal.

   1. (A) The third party challenge must be submitted in writing along with supporting documentation in sufficient detail to support the allegations. The division may require additional documentation from the challenger.
   2. (B) The third party challenge must contain the name, address, telephone number and signature of the challenger.
   3. (C) Third party challenges will not be considered confidential.
   4. (D) The MBE/WBE will be notified in writing that a challenge has been received by the division.
   5. (E) The division will investigate the challenge and issue a written decision.

AUTHORITY: section 37.023, RSMo Supp. 1997.* Original rule filed Oct. 20, 1997, effective May 30, 1998. *Original authority 1995.