Sec. 18-101. Definitions.
For the purposes of this article, the following terms shall have the following meanings:
Bid: a quotation, bid, statement of qualifications or proposal by a bidder or contractor to perform or provide labor or materials to the City.
Bidder: any person, partnership, corporation or other business entity that submits a bid for an eligible project. The bidder can be an individual firm or a joint venture.
Certified SBE: an SBE that meets the requirements of and has been granted status as a certified small business enterprise by the City Manager.
City: City of Phoenix.
City Council: City Council of the City of Phoenix.
City Manager: City Manager of the City of Phoenix, or a person designated by the City Manager to implement any or all portions of this article delegated to the City Manager.
Commercially useful function: the performance of real and actual services in the discharge of any contractual endeavor, as stated in Code of Federal Regulations, Title 49, Part 26. An SBE subcontractor is considered to perform a commercially useful function when the subcontractor is responsible for execution of a distinct element of the work of a contract and carries out its responsibilities by actually performing, managing and supervising the work involved with its own resources. In determining whether an SBE subcontractor is performing a commercially useful function, factors including, but not limited to, the following will be considered:
1. The amount of work subcontracted;
2. Whether the amount the SBE is to be paid is commensurate with the work it will actually perform;
3. Whether the business will perform work in the trade area where experience and expertise has been demonstrated and for which it is seeking to be or has been certified;
4. Whether the business actually performs, manages and supervises the work for which it has been contracted to perform;
5. Whether the business purchases goods and/or services from a non-SBE-certified firm and simply resells goods to the City, City contractor, or other person doing business with the City for the purpose of allowing those goods to be counted towards fulfillment of SBE utilization goals; and
6. Standard industry practices.
Controlled, for purposes of determining whether a business is an SBE: the small business owner(s) shall possess and exercise the legal authority and power to manage business assets, good will and daily operations in the primary trade area for which certification is sought and apart from administrative functions and they shall actively and continuously exercise this managerial authority and power in determining the policies of and directing the day-to-day operations of the business.
Eligible project: any construction contract undertaken by the City unless otherwise precluded by law.
Good faith efforts or good faith participation: the bidder or prime contractor must show that the bidder or prime contractor took all necessary and reasonable steps to achieve an SBE goal or other requirement of this article which steps, by their scope, intensity, and appropriateness to the objective, could reasonably be expected to obtain sufficient SBE participation, even if such steps were not fully successful. A list of the types of steps that the City may consider as part of the bidder’s or prime contractor’s good faith efforts to obtain SBE participation may be found in the administrative rules published by the City Manager and the instructions to bidders for the respective project.
Joint venture: an association of two or more persons, or business organization or any combination of these entities, established to carry on a single business activity limited in scope and duration to a specific contract with the City.
Local SBE: an SBE whose principal place of business is located in Maricopa County, Arizona.
Owned, for purposes of determining whether a business is an SBE:
1. The small business owner(s) as the context requires shall possess 100 percent ownership interest in the applicant firm;
2. This ownership shall be real and continuing, and shall go beyond mere indicia of ownership of the business reflected in ownership documents; and
3. The small business owner(s) shall enjoy the customary incidents of ownership and shall share in the risks and profits commensurate with their ownership interests, as demonstrated by an examination of the substance, rather than the form, of ownership arrangements.
Personal net worth: the net value of the assets of an individual remaining after total liabilities are deducted. An individual’s personal net worth does not include: the individual’s ownership interest in an applicant or participating SBE firm; or the individual’s equity in his or her primary place of residence. An individual’s personal net worth includes only his or her own share of assets held jointly or as community property with the individual’s spouse.
Prime contractor: selected bidder that enters into a construction contract with the City and has the full responsibility for eligible project completion and delivery or a selected bidder that undertakes to perform an eligible project and may employ or manage one or more subcontractors to carry out specific parts of the contract. The prime contractor can be an individual firm or a joint venture.
Small business enterprise (SBE): a small business that is an independent and continuing enterprise for profit; that performs a commercially useful function; is owned and controlled by one or more persons each of whose personal net worth does not exceed limits identified by U.S. DOT regulations, 49 CFR, Parts 23 and 26; and meets the current small business size standard in its primary industry or trade area.
Small business size: the size standard as defined in the Small Business Administration Size Regulations, 13 CFR, Part 121. (Ord. No. G-5518, § 1, 2010; Ord. No. G-6742, § 1, 2020)