Minority Business Development: State MBE Certification Programs

Updated February 2016

Among minority business enterprise (MBE) development strategies, perhaps the most well-known are programs designed to encourage minority-owned business growth through facilitated participation in government procurement. MBE procurement assistance programs often include services such as technical training on government contracting and the bidding process, as well as notification of current bidding opportunities.

The application process for MBE certification often involves submitting a detailed report on the firm along with supporting documents to the certification authority. The authority may also visit the business site to verify information provided in the application. The certification process can take as little as 10 days in some states and up to 120 days in others.

Some states have “set-aside” programs where a certain percentage of government contracting is designated for minority firms. These set-asides are expressed as goals that government agencies try to meet. Some states do not treat these as enforceable quotas while others mandate that government agencies do set aside a number of designated contracts for MBEs. States with set-aside programs certify minority-owned businesses as such to ensure that participation in the program is limited to the group it was designed to assist. Examples of states with set-asides include:

• Connecticut—set-aside mandate of 25 percent for small businesses with 25 percent of that amount to be awarded to MBEs. Legislation here.
• Illinois—state set-side goal of 20 percent.
• Ohio—state target of 15 percent for MBEs. Legislation here.
• New York—state target of 30 percent for minority and women-owned businesses and a 6 percent goal for veteran with disability owned businesses. Compilation of codes here.
• New Jersey—set-aside goal of 25 percent for small businesses.

In addition to state-level programs, there are federal programs that also provide direct procurement assistance to minority owned-businesses. The U.S. Small Business Administration’s 8a, Small Disadvantaged Business and Women-Owned Small Business programs, as well as the Department of Transportation’s disadvantaged business enterprise (DBE) development program, all involve set-asides and certification for federally-funded government procurement. The U.S. Small Business Administration (SBA) reports that at least 23 percent of all federal government contracting dollars are dedicated for small businesses. In addition, targeted goals for subgroups are also established at the following levels:

• Women-Owned Small Businesses: 5 percent.
• Small Disadvantaged Businesses: 5 percent.
• Service Disabled Veteran Owned Small Business: 3 percent.

More information about federal set asides from the SBA can be found here.

At least 38 states, Washington D.C. and Puerto Rico have state-level MBE development programs involving certification for participation in state government procurement independent of existing federal DBE development programs.

The following chart contains a list of states with these programs, information on their administrative structure and links to their respective websites.

NCSL Contact: Rich Williams, Family Economic Success Program, e-mail: rich.williams@ncsl.org

NOTE: NCSL is not a MBE certification organization. This chart is for information purposes only. NCSL also does not track set aside goals for all states—please refer to program websites listed below for more information about varying programs. 

A-C | D-H | I-L | M | N | O-R | S-U | V-W | Guam, PR and USVI