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District of Columbia Official Code 2001 Edition. |
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Division I. Government of District. |
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Title 2. Government Administration. |
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Chapter 2. Contracts. |
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Subchapter IX-A. Small, Local, and Disadvantaged Business Enterprise Development and Assistance. |
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Part D. Programs for Certified Business Enterprises. |
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Subpart 2. Requirements of Programs.
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Current through October 23, 2012
(a) Local business enterprises, small business enterprises, or disadvantaged business enterprises shall receive 20% in equity participation and 20% in development participation in all development projects supported by District funds and in all development projects that take place on District-owned property.
(a-1)(1) No more than 25% of the total 20% equity participation requirement ("equal to 5%") set forth in subsection (a) of this section may be met by a certified business enterprise providing development services in lieu of a cash equity investment that will be compensated by the developer in the future at a date certain ("sweat equity contribution").
(2) The developer and the certified business enterprise shall sign a service agreement describing the following:
(A) A detailed description of the scope of work that the certified business enterprise will perform;
(B) The dollar amount that the certified business enterprise will be compensated for its services and the amount the certified business enterprise is forgoing as an investment in a project;
(C) The date or time period when the certified business enterprise will receive compensation;
(D) The return, if any, the certified business enterprise will receive on its sweat equity contribution; and
(E) An explanation of when the certified business enterprise will receive its return as compared to other team members or investors.
(3) If a developer is unable to meet the 20% equity participation requirement, including sweat equity contribution and cash equity investment, the developer shall pay to the District the outstanding cash equity amount as a fee in lieu of the unmet equity participation requirement. Any fee collected in accordance with this provision shall be deposited into the Small Business Micro Loan Fund established by § 2-218.75(b).
(4) Any administrative costs associated with subsection (a)(3) of this section shall be reimbursed through fees collected by the District as a result of unmet equity and development participation requirements. The collected fees shall be used as follows:
(A) Fifty percent shall be used to support vocational training programs benefitting District residents.
(B) The remainder shall be used to provide:
(i) Low-interest loans for small businesses located in a Main Street, Great Street, or underserved area in the District; and
(ii) Grants to small businesses negatively impacted by District subsidized construction or street-scaping projects.
(C) The prescribed uses of the Small Business Micro Loan Fund established by this paragraph shall be in addition to the uses of the Small Business Micro Loan Fund established by § 2-218.75(b).
(5) The Department of Small and Local Business Development shall:
(A) Issue a solicitation for the grant and loan applications described in paragraph (4)(B) of this subsection;
(B) Manage, receive, and review the grant and loan applications; and
(C) Determine which vocational training programs and small businesses shall receive assistance pursuant to paragraph (4)(A) and (B) of this subsection.
(b) The participation requirement shall include all development projects undertaken by government corporations and all development projects resulting from contractual relationships where District owned real property is transferred to a third party.
(c) The Mayor shall promulgate proposed rules to implement the provisions of this section within 90 days of March 2, 2007. The Mayor shall submit the proposed rules to the Council for a 45-day period of review, excluding Saturdays, Sundays, legal holidays, and days of Council recess. If the Council does not approve or disapprove the proposed rules, in whole or in part, by resolution within the 45-day review period, the proposed rules shall be deemed approved.
(d) This section shall not apply if the entity that controls the development project is an entity tax-exempt under section 501(c) of the Internal Revenue Code of 1986, approved August 16, 1954 (68A Stat. 163; 26 U.S.C. § 501(c)), or other not-for-profit entity.
(e) This section shall not apply to any development project for which a contract for purchase of one or more parcels of real property has been executed prior to March 2, 2007.
(Oct. 20, 2005, D.C. Law 16-33, § 2349a, as added Mar. 2, 2007, D.C. Law 16-192, § 2132(f), 53 DCR 6899; Apr. 20, 2010, D.C. Law 18-141, § 2(k), 57 DCR 1485; Apr. 8, 2011, D.C. Law 18-357, § 2(a), 58 DCR 763.)
HISTORICAL AND STATUTORY NOTES
Effect of Amendments
D.C. Law 18-141 rewrote subsec. (a); and added subsec. (a-1). Prior to amendment, subsec. (a) read as follows:
"(a) Local, small, and disadvantaged business enterprises shall receive 20% in equity and development participation in all development projects supported by District funds and in all development projects that take place on District owned property."
D.C. Law 18-357, in subsec. (a-1)(3), substituted "in lieu of the unmet equity participation requirement. Any fee collected in accordance with this provision shall be deposited into the Small Business Micro Loan Fund established by § 2- 218.75(b)." for "in lieu of the unmet equity participation requirement."; added subsec. (a-1)(4)(C); and, in subsec. (a-1)(5), substituted "Department of Small and Local Business Development" for "Office of the Deputy Mayor for Planning and Economic Development".
Emergency Act Amendments
For temporary (90 day) addition of section, see § 2132(f) of Fiscal Year 2007 Budget Support Emergency Act of 2006 (D.C. Act 16-477, August 8, 2006, 53 DCR 7068).
For temporary (90 day) addition of section, see § 2132(f) of Fiscal Year 2007 Budget Support Congressional Review Emergency Act of 2006 (D.C. Act 16-499, October 23, 2006, 53 DCR 8845).
For temporary (90 day) addition of section, see § 2132(f) of Fiscal Year 2007 Budget Support Congressional Review Emergency Act of 2007 (D.C. Act 17-1, January 16, 2007, 54 DCR 1165).
For temporary (90 day) amendment of section, see § 2(a) of Alternative Equity Payment Allocation Emergency Amendment Act of 2010 (D.C. Act 18-589, October 20, 2010, 57 DCR 10143).
For temporary (90 day) amendment of section, see § 2(a) of Alternative Equity Payment Allocation Congressional Review Emergency Amendment Act of 2011 (D.C. Act 19-1, February 2, 2011, 58 DCR 1236).
Legislative History of Laws
For Law 16-192, see notes following § 2-218.31.
For Law 18-141, see notes following § 2-218.02.
Law 18-357, the "Alternative Equity Payment Allocation Amendment Act of 2010", was introduced in Council and assigned Bill No. 18-1047, which was referred to the Committee on Economic Development. The Bill was adopted on first and second readings on December 7, 2010, and December 21, 2010, respectively. Signed by the Mayor on January 19, 2011, it was assigned Act No. 18-357 and transmitted to both Houses of Congress for its review. D.C. Law 18-357 became effective on April 8, 2011.
