Minority Business Enterprise (MBE) Certification

The business must be at least 51% independently owned and controlled by one or more socially and economically disadvantaged individuals. This ownership must be real and substantial.

The owner must also be a U.S. citizen or permanent resident.

At least 51% of the business must be owned by individuals who belong to one of these groups:

• African Americans
• Hispanic Americans
• Asian Pacific Americans
• Subcontinent Asian Americans
• Native Americans
• Women
• Disabled individuals

The owners must have an overall understanding of, and managerial and technical competence and experience directly related to, the type of business in which the firm is seeking certification.

Firms are certified in specific areas of work, defined by the North American Industry Classification System (NAICS Codes).

Owners with 51% or more of the business must have a personal net worth of no more than $2,192,035. This limit doesn’t count the business's value or the equity in their main home.

Learn how to calculate your personal net worth

All MBE-certified businesses must qualify as small, based on the standards set by the U.S. Small Business Administration (SBA). These size standards are determined by industry based on NAICS Codes.

See if your business qualifies

To meet the overall minority business procurement goals, State agencies set goals on those contracts that have subcontracting opportunities; thus, not every contract will have an MBE participation goal. Some of the factors that State agencies take into consideration when setting minority participation goals include, but are not limited to, the type of work involved; potential subcontracting items; location of the project; locations of MBE firms that are currently certified; and availability of MBE firms.

Yes. Graduation is defined as the removal of a firm's eligibility to be certified as an MBE based upon exceeding the small business size standards applicable to one or more of the North American Industry Classification System (NAICS) Codes in which the firm is certified. A firm certified in multiple codes may graduate in one or more of its NAICS Codes, depending on the size standards for each individual code.

Depending on the NAICS Codes, small business size standards are calculated based on a firm's three year average of annual gross receipts or the average number of employees for the past 12 months. If a firm's business size meets or exceeds the revenue or employee totals as specified in the U.S. Small Business Administration (SBA) regulations at 13 C.F.R. Part 121, that firm is determined to have graduated and it is no longer eligible to participate on any new State contracts as an MBE or DBE in the applicable NAICS Code.

Yes. The prime contractor must first attempt to meet the MBE participation goal established on the contract by seeking out and utilizing certified MBE firms. Once work begins, the prime contractor is responsible for all project activities including those of its subcontractors.

Regular monitoring assures that contractual items are performed in accordance with specifications, including MBE participation. Monthly reports, such as payroll, cost and time estimation and progress reports, must be submitted by the prime contractor.

Certified firms are reviewed annually to determine whether the ownership and control of the certified firm has changed. Contract compliance monitoring procedures also facilitate the identification of "front" or "pass through" firms.

No, all certified MBEs must be a for-profit business, as of July 1, 2015.