Antidiscrimination policy guides airport contracts

Joy Latimer: Disadvantaged business targets can be hard to hit with airport concessions.

At the Springfield-Branson National Airport, as at all U.S. airports, a focus on diversity is business as usual through the disadvantaged business enterprise program.

Joy Latimer, assistant city attorney for the airport, is responsible for ensuring the airport meets targets for the Federal Aviation Administration’s civil rights program, which includes maintaining compliance with the Americans with Disabilities Act and contracting with businesses owned by qualifying disadvantaged business owners.

The DBE program is the U.S. Department of Transportation’s method of complying with Title VI of the federal Civil Rights Act of 1964, which prohibits discrimination on the basis of race, color and national origin in programs and activities receiving federal financial assistance.

The DBE program has two components, one for construction and one for airport concessions. DBE goals are part of a Title VI plan Latimer crafts every three years, and public meetings are conducted for input, Latimer said.

For construction, the DBE goal is 6%, meaning that for any federally funded construction program, 6% of funds must go to businesses that are certified as disadvantaged businesses.

Recipients of federal funds, like the airport, are required to set their own DBE goals for contractors, subcontractors and agency partners and must also monitor the results, according to the Department of Transportation.

To qualify and be certified as a DBE, the DOT states, 51% of a business must be owned by one or more people who are socially or economically disadvantaged, and the management and daily business operations of the business must be controlled by one or more of the disadvantaged business owners, which includes women and minority group members.

The DOT website characterizes the DBE program as the strongest tool it has for creating a level playing field in its distribution of a substantial amount of public funds for the Federal Highway Administration, the Federal Transit Administration and the FAA.

Airport targets
As noted, construction contractors working at the airport must be 6% DBE certified. That is the policy for any project for which the airport receives federal funds or grant money, which is anything inside the airfield, Latimer said.

“Six percent of what we pay them has to go to a registered DBE,” she said.

The airport concessions DBE program has two separate targets, she said: 0.4% for rental car companies and 2.7% for non-rental car concessionaires, including the airport coffee shop, two gift shops, two restaurants and the parking company.

The targets can be hard to hit, she said, although the airport is in compliance.

“We’ve improved on the rental car side, but we’re still struggling in the regular concessions side,” Latimer said.

She noted it doesn’t matter if a business self-identifies as disadvantaged; that status must be certified by the government through an application process to count toward the airport’s goals.

“It’s sort of out of our hands,” she said. “We don’t contract directly with anyone besides our concessionaires.”

The DOT has operated its DBE program for more than two decades. The Missouri Regional Certification Committee, which operates a unified certification program for the state’s DBE certifying agencies, including MoDOT, listed 1,338 certified DBE firms in 2022, and 917 of those had home offices within the state, according to MoDOT.

Although the coffee shop, Travellers House Coffee & Tea, is local, Latimer noted the gift shops are run by an international company, which the airport website lists as The Paradies Shops, and restaurants are operated by a national company, Tailwind Concessions.

The airport’s rental car agencies are listed on its website as Avis, Budget, Enterprise, Dollar Rent a Car, Hertz, National/Alamo, Payless and Thrifty.

When companies are not themselves DBEs, they have to meet the airport’s goals by purchasing goods from registered companies, Latimer said.

Attainable goal
Brian Hutsell, St. Louis-based senior aviation engineer with Crawford, Murphy & Tilly Inc., said for construction contracts, achieving the DBE participation target is typically attainable, depending on the type of project. Participation is commonly seen in landscaping, electrical materials and pavement accessory supply, concrete crushing and materials hauling and trucking, he said.

Occasionally, there are smaller projects that may not lend themselves to DBE participation, Hutsell said, but the three-year program maintained by airports allows for some variation in participation levels from project to project.

Hutsell said CMT works with other teams for professional services to meet the airport’s DBE requirements. Most are in St. Louis or Kansas City, with one long-term partner in Springfield.

“The 6% target has historically shown itself to be reasonable and is in line with several of our other commercial service airport clients in southern Missouri,” Hutsell said. “Each area of the state has variable demographics and different availabilities for DBE consultants, contractors and suppliers, which is why the FAA requires each airport sponsor to set their own goals independently.”

Hutsell said the federal diversity target benefits the airport by developing additional contractors and professional service providers who are familiar with the work required.

“This can ultimately lead to more qualified contractors and professional service providers for the airport’s future endeavors,” he said.

Creative opportunity
Latimer said the FAA recently announced a requirement that airports develop a small-business program for concessions. Plans are due to the agency Oct. 7.

“They told us to be creative, which is great,” she said.

Unlike the DBE programs, the small-business program does not require certification or disadvantaged status.

“It’s just general outreach to small businesses,” Latimer said. “I think it’s really neat, because it gives us an opportunity to work a little more hands-on with small businesses.”

Latimer has been hatching an idea to allow businesses to sell their merchandise at the airport, though she stressed the concept is in the very early stages. Potentially, she said, it will be a program where vendors contract with the airport directly instead of being a wholesaler or supplier to an existing concessionaire.

“I’m picturing handcrafted stuff – Springfield-specific stuff, Ozarks-specific stuff,” she said.

The model she envisions is like a farmers market, with small businesses selling their own wares. The vendors would provide their own staffing and their own point of sale.

The FAA does not allow local preference for the program, she noted, but since business owners or staff would have to come in and sell items themselves, local businesses are likely to be the ones involved.

“I doubt we’re going to get anybody flying in from Chicago,” she said. “In practicality, they will likely be local people, if my idea gets approval.”

When she spoke to Springfield Business Journal in May, Latimer was working on the idea as a class project through Drury University’s graduate certificate program for diversity, equity and inclusion.

Latimer said she has enjoyed having an opportunity to devise an idea she described as “kind of funky.”

“I’m really passionate about this stuff,” she said. “I never thought I’d go to school again after law school, but it’s been incredibly interesting.”