Memorial Day closure

Most City of Portland offices will be closed Monday, May 27, in observance of Memorial Day.

ADM-1.23 - Subcontractor Equity Program Administrative Rules

Administrative Rules Adopted by Bureaus Pursuant to Rule Making Authority (ARB)
Policy category
Policy number

Table of Contents

Section 1     Purpose 

Section 2     Bureaus Affected

Section 3     Jurisdiction

Section 4     Definitions

Section 5     Policy

Section 6     Submission of Required Documentation

Section 7     Contractor Changes Following Bid Submission

Section 8     Continuation of Compliance

Section 9     Penalties for Non-Compliance Submission

Section 10   Legislative Authority

1     Purpose

These rules are intended to establish practices and procedures for implementing the provisions of the Subcontractor Equity Program targeted toward providing employment opportunities for Oregon State certified Disadvantaged, Minority, Women, and Emerging Small Businesses (D/M/W/ESBs) on City of Portland public works and improvement projects in order to address historical underutilization.

2     Bureaus Affected

All City bureaus, departments or offices.

3     Jurisdiction

Portland City Code Chapters 5.34.040 Affirmative Action and 5.34.930 Social Equity Contracting and Employment Programs; and Resolution #36944 adopted by City Council July 19, 2012.

4     Definitions

4.1  Bureau means the bureaus, divisions or offices within the City of Portland.

4.2  Chief Procurement Officer means the individual in charge of the Procurement Services Division of the Bureau of Internal Business Services, or that person to whom those duties have been properly delegated.

4.3  City-Owned Projects means contracts that have $150,000 or more of Hard Construction Costs.

4.4  City Resources means funds provided by the City (regardless of the source) in the form of loans, grants or payments. City Resources also include the difference between the purchase price paid by a private entity and the fair market value of such property.

4.5  City – Sponsored Projects means contracts that provide for the disposition of the city-owned property and/or provide City Resources that result in a privately-owned project that has $150,000 or more of Hard Construction Costs.

4.6  Contract means a sale or other disposal, or a purchase, lease, rental or other acquisition, by the City of personal property, services, including personal services, Public Improvements, public works, minor alterations, or ordinary repair or maintenance necessary to preserve a Public Improvement, but does not include “grants”; the written agreement resulting from the solicitation document that sets forth the rights and obligations of the parties.

4.7  Contractor means any person or entity, in whatever legal form, that enters into a Contract with the City of Portland.

4.8  Disadvantaged Business Enterprise (DBE) means for purposes of this Administrative Rule, a for-profit small business entity where socially and economically disadvantaged individuals own at least 51% interest and also control management and daily business operations. A DBE must be properly certified within the State of Oregon.

4.9  Division means Procurement Services.

4.10  Emerging Small Business Enterprise (ESB) means, for purposes of this Administrative Rule, only those firms certified as an ESB by the State Office of Minority, Women and Emerging Small Business (OMWESB). Current program participation is restricted to Oregon-based firms with 19 or fewer employees, with average annual gross receipts over the last three years not exceeding $1.7 million for construction firms and $300,000 for non-construction-related firms. An ESB must be properly licensed, legally registered, and an independently owned Oregon firm.

4.11  Equal Employment Opportunity (EEO) means the policies and procedures of the organization to ensure non-discrimination for all employees, especially women, minorities, and persons with disabilities. All contract provisions require non-discrimination in employment by contractors and sub-consultants.

4.12  Equity as defined by the Portland Plan means when everyone has access to the opportunities necessary to satisfy their essential needs, advance their well-being, and achieve their full potential.

4.13  Good Faith Effort is when a Contractor has exhausted all reasonable means to comply with Subcontractor Equity Program requirements.

4.14  Hard Construction Costs means the cost to build improvements on a property, including all related construction labor and materials, including fixed and built-in equipment costs. Costs not directly related to the construction of an improvement, such as overhead, administration or taxes, or other professional services shall not be considered as part of the Hard Construction Costs.

4.15  Minority Owned Business Enterprise (MBE) for purposes of this document, this includes only those firms certified as a minority owned business by the State Office of Minority, Women and Emerging Small Business (OMWESB). A minority is defined to include Black American, Hispanic American, Native American, Asian Pacific American, Subcontinent Asian American. The minority representative must own at least 51% of the firm and must have control of the management and daily operations of the firm. The firm must not be inextricably associated with a non-minority owned firm.

4.16  Portland City Code (PCC) means the Code of the City of Portland, Oregon as promulgated by the Portland City Council.

4.17  Supplier (regular dealer) means the entity who owns, operates, or maintains a store, warehouse, or other establishment in which the materials or supplies required for the performance of the contract are bought, kept in stock, and regularly sold to the public in the usual course of business.

4.18  Women Owned Business Enterprise (WBE) means for purposes of this Administrative Rule, only those firms certified as women-owned businesses by the State Office of Minority, Women and Emerging Small Business (OMWESB). The woman representative must own at least 51% of the firm and must have control of the management and daily operations of the firm. The firm must not be inextricably associated with a non-woman owned firm.

5     Policy

5.1  Those bidding on City public works and improvements projects are required to comply with the provisions of the Subcontractor Equity Program and must submit documentation showing that good faith efforts have been made to contract with D/M/W/ESB Subcontractors. These rules and procedures shall apply to all City public works and improvement contracts that exceed $150,000 unless otherwise exempt. To advance utilization of D/M/W/ESB Subcontractors and Suppliers, Procurement Services shall:

5.1.1  Set aspirational goals for D/M/W/ESB subcontractor and supplier utilization as a percentage of total Hard Construction Costs, with a further goal for D/M/WBE utilization;

5.1.2  Establish a mechanism that will evaluate the Good Faith Effort required of all Bidders and assist the City in tracking Subcontractor utilization on its projects;

5.1.3  Require all Bidders to perform a Good Faith Effort on all subcontracting opportunities regardless of value; and

5.1.4  Establish metrics for program performance.

5.2  Encourage contractors to diversify their D/M/W/ESB subcontractor utilization from all available types of work.

5.3  Determine whether the Bidder meets the requirements of the Program based upon submittal documents.

6     Submission of Required Documentation

6.1  The City shall provide the D/M/W/ESB Commitment Certification and Utilization Form (Form 1), D/M/W/ESB Bids Received Log (Form 2) and Monthly Subcontractor Payment and Utilization Report (MUR) all of which will provide additional direction and procedures.

6.2  If the Bidder meets the aspirational goals, a completed and signed Subcontractor Commitment Certification (Form 1) is all that is required for submission for the Subcontractor Equity Program. Failure to complete and submit Form1 will result in the bid being non-responsive and the bid will be rejected.

6.3  Should the City find that the goal has not been met, the Bidder will be notified and required to submit additional documentation or the D/M/W/ESB Bids Received Log (Form 2). Documentation or Form 2 will be due upon request.

6.4  Contractors shall submit any additional information and provide clarification upon request. Contractor’s failure to provide the requested information pursuant to the Chief Procurement Officer’s information request shall be taken into consideration and may subject the Contractor to having its bid being rejected as being non-responsive.

6.5  If for any reason the apparent low Bidder is not awarded a contract or its bid is rejected the next apparent low Bidder’s documentation may be reviewed until a Bidder is found to be responsive to the Subcontractor Equity Program requirements.

7     Subcontractor Changes Following Bid Submission

7.1  If any Subcontractor is added or replaced after the bid is submitted, the successful Contractor shall make a Good Faith Effort to solicit bids from D/M/W/ESBs for the work to be performed.

7.2  The selected Contractor shall not add, delete, or replace any Subcontractor without prior approval by the Chief Procurement Officer.

8     Continuation of Compliance

8.1  Compliance must be maintained during the entire period of the Contract as per the Subcontractor Equity Program specifications.

8.2  In the event the City reasonably believes that a violation of the requirements of the Subcontractor Equity Program has occurred during the course of the Contract, the City may review the records and pertinent documentation to determine whether such a violation has occurred.

9     Penalties for Non-Compliance

9.1  A Contractor’s failure to meet the requirements of the Subcontractor Equity Program may constitute a breach of contract. Possible disqualification of the Bidder’s ability to bid on future contracts, and/or penalties may be assessed as outlined in the Subcontractor Equity Program specifications.

10   Legislative Authority

Nothing in these provisions shall limit the right of the City Council to waive the requirements of these rules and procedures.


Adopted by Chief Procurement Officer on October 14, 2015, filed for inclusion in PPD October 15, 2015.

Amended by Chief Procurement Officer November 6, 2015.

Search Code, Charter, Policy