Research and Support to Implement Recommendations of the GDOT Small Business Program Evaluation

This report is designed to assist the Georgia Department of Transportation (GDOT) in implementing the recommendations of a previous study, GDOT RP 13-29, “Task A: Evaluation of GDOT’s Small Business Program,” which concluded that the most effective way for GDOT’s Small Business Program (SBP) to level the playing field for small businesses is to implement a set-aside provision for emerging small businesses (ESBs). However, to do so, the State Transportation Board must work with the State Attorney General and/or Legislature to change the current procurement guidelines. This report includes components that are designed to assist GDOT’s Transportation Board in working with the State Attorney General and Legislature to modify existing guidelines. Additionally, it includes components that are intended to improve the SBP’s efficiency and effectiveness. ESBs have the ability to perform small-valued prime contracts, but not the economies of scale to compete successfully with mid-size small businesses (MSBs) or large businesses. In 2014, large businesses made up 13 percent of GDOT’s contractors and received 42 percent of small project awards valued at $500,000 and lower. MSBs made up 21 percent of contractors and won 51 percent of small project award value. In contrast, ESBs composed 66 percent of GDOT’s contractors, but gained only 7 percent of small project award value. Four of GDOT’s five largest contractors competed successfully for projects smaller than $200,000—alongside projects over $40 million. A sample of 659 firms was drawn from GDOT’s prequalified and registered contractors. The sample comprised 88 large businesses (average revenue of $671.6 million; median revenue of $67.5 million); 128 mid-size businesses (average revenue of $2.2 million; median revenue of $8.6 million); and 443 ESBs (average revenue of $1.5 million; median revenue of $750,000). These figures reinforce the need to have a set-aside provision for ESBs. Firms with an average revenue of $1.5 million cannot compete with firms whose average revenue is $671.6 million. It is critically important to support small businesses. The researchers estimated that project awards made by GDOT to small businesses created a total economic impact of $2.115 billion between FY 2009 and FY 2014 and an estimated 34,196 new jobs. Between July 1, 2015 and December 30, 2017 GDOT’s awards to small businesses created new economic output of $6.593 billion, and 43,539 new jobs. In the state of Georgia, ESBs accounted for two thirds of the 1.5 million small business jobs, and they have consistently added more new jobs to the state’s economy than have businesses with more than 100 employees or large corporations with 500 or more workers. The report includes the following as appendices: Appendix 1. Policy Brief: Creating Opportunities for Georgia’s Emerging Small Businesses; Appendix 2. White Paper: A Proposal for Creating Opportunities for GDOT’s Small Businesses; Appendix 3. A National Review of State DOT Small Business Programs; Appendix 4. Impact Analysis of Small Businesses in the State and at GDOT; Appendix 5. GDOT’s Small Business Growth and Development Analysis; Appendix 6. Template for Submitting Quarterly Reports on GDOT’s Small Business Program; and Appendix 7. List of Firms Eligible to be Recruited into the SBP.

  • Record URL:
  • Corporate Authors:

    Georgia Institute of Technology

    790 Atlantic Drive
    Atlanta, GA  United States  30332

    Georgia Department of Transportation

    Office of Performance-based Management and Research
    600 West Peachtree St. NW
    Atlanta, GA  United States  30308

    Federal Highway Administration

    1200 New Jersey Avenue, SE
    Washington, DC  United States  20590
  • Authors:
    • Boston, Thomas D
    • Ross, Catherine L
    • Liu, Cathy Yang
    • Adebola, Olufunke
    • Huber, Grace
  • Publication Date: 2019-10-25

Language

  • English

Media Info

  • Media Type: Digital/other
  • Edition: Final Report
  • Features: Appendices; Figures; References; Tables;
  • Pagination: 120p

Subject/Index Terms

Filing Info

  • Accession Number: 01746183
  • Record Type: Publication
  • Report/Paper Numbers: FHWA-GA-20-1707
  • Contract Numbers: 0015697
  • Files: TRIS, ATRI, USDOT, STATEDOT
  • Created Date: Jul 17 2020 12:29PM