2013 Maryland Code
STATE FINANCE AND PROCUREMENT
§ 14-301 - Definitions [Section subject to termination by § 14-309 of this subtitle]

§14-301. IN EFFECT

// EFFECTIVE UNTIL JULY 1, 2016 PER CHAPTER 154 OF 2012 //

(a) In this subtitle the following words have the meanings indicated.

(b) “Certification” means the determination that a legal entity is a minority business enterprise for the purposes of this subtitle.

(c) “Certification agency” means the agency designated by the Board of Public Works under § 14-303(b) of this subtitle to certify and decertify minority business enterprises.

(d) “Certified minority business enterprise” means a minority business enterprise that holds a certification.

(e) “Economically disadvantaged individual” means a socially disadvantaged individual whose ability to compete in the free enterprise system has been impaired due to diminished capital and credit opportunities as compared to others in the same or similar line of business who are not socially disadvantaged.

(f) (1) “Minority business enterprise” means any legal entity, except a joint venture, that is:

(i) organized to engage in commercial transactions;

(ii) at least 51% owned and controlled by 1 or more individuals who are socially and economically disadvantaged; and

(iii) managed by, and the daily business operations of which are controlled by, one or more of the socially and economically disadvantaged individuals who own it.

(2) “Minority business enterprise” includes a not for profit entity organized to promote the interests of physically or mentally disabled individuals.

(g) “Minority business enterprise participation schedule” means a schedule included in the submission of a bid or offer that identifies:

(1) the certified minority business enterprises that a bidder or offeror agrees to use in the performance of the contract; and

(2) the percentage of contract value attributed to each certified minority business enterprise.

(h) (1) Subject to paragraphs (2) and (3) of this subsection, “personal net worth” means the net value of the assets of an individual remaining after total liabilities are deducted.

(2) “Personal net worth” includes the individual’s share of assets held jointly or as community property with the individual’s spouse.

(3) “Personal net worth” does not include:

(i) the individual’s ownership interest in the applicant or a certified minority business enterprise;

(ii) the individual’s equity in his or her primary place of residence; or

(iii) up to $500,000 of the cash value of any qualified retirement savings plans or individual retirement accounts.

(i) “Race-neutral measure” means a method that is or can be used to assist all small businesses.

(j) (1) Subject to paragraphs (2) and (3) of this subsection, and in accordance with the State’s most recent disparity study, “socially and economically disadvantaged individual” means a citizen or lawfully admitted permanent resident of the United States who is:

(i) in any of the following minority groups:

1. African American - an individual having origins in any of the black racial groups of Africa;

2. American Indian/Native American - an individual having origins in any of the original peoples of North America and who is a documented member of a North American tribe, band, or otherwise has a special relationship with the United States or a state through treaty, agreement, or some other form of recognition. This includes an individual who claims to be an American Indian/Native American and who is regarded as such by the American Indian/Native American community of which the individual claims to be a part, but does not include an individual of Eskimo or Aleutian origin;

3. Asian - an individual having origins in the Far East, Southeast Asia, or the Indian subcontinent, and who is regarded as such by the community of which the person claims to be a part;

4. Hispanic - an individual of Mexican, Puerto Rican, Cuban, Central or South American, or other Spanish culture or origin, regardless of race, and who is regarded as such by the community of which the person claims to be a part;

5. physically or mentally disabled - notwithstanding the State’s most recent disparity study, an individual who has an impairment that substantially limits one or more major life activities, who is regarded generally by the community as having such a disability, and whose disability has substantially limited his or her ability to engage in competitive business; or

6. women - a woman, regardless of race or ethnicity; or

(ii) otherwise found by the certification agency to be a socially and economically disadvantaged individual.

(2) There is a rebuttable presumption that an individual who is a member of a minority group under paragraph (1)(i) of this subsection is socially and economically disadvantaged.

(3) An individual whose personal net worth exceeds $1,500,000, as adjusted annually for inflation according to the Consumer Price Index, may not be found to be economically disadvantaged.

(k) “Socially disadvantaged individual” means an individual who has been subjected to racial or ethnic prejudice or cultural bias within American society because of membership in a group and without regard to individual qualities. Social disadvantage must stem from circumstances beyond the control of the individual.

§ 14-301 - 1. Legislative findings [Section subject to termination by § 14-309 of this subtitle]

The General Assembly finds the following:

(1) the State of Maryland wishes to provide all of its citizens with equal access to business formation and business growth opportunities;

(2) the elimination of discrimination against minority- and women-owned businesses is of paramount importance to the future welfare of the State;

(3) the General Assembly has received and carefully reviewed the disparity study entitled "The State of Minority- and Women-Owned Business Enterprise: Evidence from Maryland" commissioned by the General Assembly and published on February 17, 2011 (the Study), and finds that the Study provides a strong basis in evidence demonstrating persistent discrimination against minority- and women-owned businesses;

(4) based on its review of the Study, the General Assembly finds that:

(i) there are substantial and statistically significant adverse disparities between the availability and utilization of minorities and women in the private sector in the same geographic markets and industry categories in which the State does business;

(ii) the State would become a passive participant in private sector racial and gender discrimination if it ceased or curtailed its remedial efforts, including the operation of the Minority Business Enterprise Program;

(iii) there are substantial and statistically significant adverse disparities for all racial and ethnic groups and nonminority women combined in all major contracting categories in State procurement;

(iv) there are substantial and statistically significant adverse disparities for all individual racial and ethnic groups and for nonminority women in most major industry categories in State procurement;

(v) there is ample evidence that discrimination in the private sector has depressed firm formation and firm growth among minority and nonminority women entrepreneurs; and

(vi) there is powerful and persuasive qualitative and anecdotal evidence of discrimination against minority and nonminority women business owners in both the public and private sectors;

(5) as a result of ongoing discrimination and the present day effects of past discrimination, minority- and women-owned businesses combined continue to be very significantly underutilized relative to their availability to perform work in the sectors in which the State does business;

(6) minority prime contractors also are subject to discrimination and confront especially daunting barriers in attempting to compete with very large and long-established nonminority companies;

(7) despite the fact that the State has employed, and continues to employ, numerous and robust race-neutral remedies, including aggressive outreach and advertising, training and education, small business programs, efforts to improve access to capital, and other efforts, there is a strong basis in evidence that discrimination persists even in public sector procurement where these efforts have been employed;

(8) this subtitle ensures that race-neutral efforts will be used to the maximum extent feasible and that race-conscious measures will be used only where necessary to eliminate discrimination that was not alleviated by race-neutral efforts;

(9) this subtitle continues and enhances efforts to ensure that the State limits the burden on nonminority businesses as much as possible by ensuring that all goals are developed using the best available data and that waivers are available whenever contractors make good faith efforts; and

(10) State efforts to support the development of competitively viable minority- and women-owned business enterprises will assist in reducing discrimination and creating jobs for all citizens of Maryland.