Minority business construction best practices vary significantly from state to state. A GC operating in California faces different MBE participation goals, certification agencies, and enforcement mechanisms than a GC working in Texas or New York. In 2025, 14 states updated their MBE program rules, creating new requirements that multi-state contractors must track carefully.

This guide compares MBE requirements across key states and provides actionable guidance for GCs working in multiple jurisdictions.

Why State Requirements Differ

Each state designs its MBE program based on local factors: the availability of certified minority firms, historical disparities in contract awards, political priorities, and court rulings. The result is a patchwork of programs with different names, goals, and rules.

Some states use the term MBE. Others use DBE, MWBE, HUB, or SBE. The certification criteria, participation goals, and reporting requirements differ under each designation. GCs must understand which program applies to each project based on the funding source and contracting agency.

State-by-State MBE Requirements Comparison

State	Program Name	Participation Goal	Certifying Agency	Reporting Frequency	Key Requirement
California	DVBE/SBE	3% DVBE, 25% SBE	DGS	Monthly	Must include DVBE outreach
Texas	HUB	11.2% overall	Comptroller	Monthly	HUB Subcontracting Plan required
New York	MWBE	30% (15% MBE + 15% WBE)	ESD	Monthly	Utilization plan at bid
Florida	MBE	10%	OSD	Quarterly	Annual MBE expenditure report
Illinois	MBE/WBE	20% MBE + 10% WBE	CMS	Monthly	Utilization plan within 14 days of award
Pennsylvania	MBE/WBE	Varies by contract	DGS	Monthly	Good faith effort documentation
Ohio	MBE	15%	EDGE	Monthly	Waiver process for shortfalls
Georgia	MBE	Varies by agency	GMSDC	Monthly	Monthly utilization within 10 days
Michigan	MBE	Varies by project	MDOT	Monthly	Commercially useful function audits
Virginia	SWaM	42% overall	DSBSD	Quarterly	Includes service-disabled vets
Maryland	MBE	29%	MDOT	Monthly	Highest state MBE goal nationally
New Jersey	SBE	Set-aside program	NJDOT	Monthly	Small business preference
Massachusetts	MBE/WBE	Varies by contract	SDO	Monthly	Compliance reporting through COMMBUYS
Washington	MWBE	Varies by agency	OMWBE	Quarterly	Linked to prevailing wage compliance

California: DVBE and SBE Requirements

California uses a Disabled Veteran Business Enterprise (DVBE) program alongside a Small Business Enterprise (SBE) preference. The DVBE participation goal is 3% on state-funded contracts. The SBE goal is 25%.

GCs bidding on California state contracts must document DVBE outreach in their bid submission. This includes contacting DVBE firms, advertising in trade publications, and attending outreach events.

The California Department of General Services (DGS) certifies DVBE firms. Certification is separate from the federal DBE program. A firm certified as a DBE by the California UCP does not automatically qualify as a DVBE.

For highway projects, California DOT (Caltrans) administers the federal DBE program with a 13.5% goal. GCs working on both state-funded building projects and Caltrans highway projects must track two separate programs with different goals and rules.

Texas: HUB Program

Texas uses the Historically Underutilized Business (HUB) program instead of MBE. The overall HUB goal for construction is 11.2% of contract value.

GCs must submit a HUB Subcontracting Plan (HSP) with every bid on state contracts exceeding $100,000. The HSP identifies specific HUB firms for each subcontracting opportunity. Failure to submit an HSP results in automatic bid rejection.

The Texas Comptroller certifies HUB firms. The program covers businesses owned by minorities, women, and service-disabled veterans. GCs can search the HUB directory on the Comptroller's website by commodity code and geographic area.

Texas requires prompt payment to HUB subs within 10 days of the GC receiving payment from the state. This is one of the shortest prompt payment windows in the country.

New York: MWBE Program

New York operates one of the most aggressive MWBE programs in the nation. The overall participation goal is 30%, split between 15% MBE and 15% WBE.

GCs must submit a Utilization Plan identifying MWBE firms for each subcontracting opportunity. The plan is due with the bid. The Empire State Development (ESD) Corporation reviews plans and issues waivers for shortfalls only after reviewing good faith effort documentation.

New York City has a separate MWBE program with its own certification process and participation goals. GCs working on both state and city projects must track compliance under two distinct programs.

Monthly utilization reports must be submitted through the New York State Contract System (NYSCS). Late reports can trigger payment holds on the prime contract.

Illinois: MBE/WBE Dual Goals

Illinois requires 20% MBE and 10% WBE participation on state-funded construction. These are among the highest combined minority and women-owned participation goals in the country.

The Central Management Services (CMS) agency administers the program. GCs must submit a utilization plan within 14 days of contract award. The plan must identify specific MBE and WBE firms for each subcontracting scope.

Illinois conducts commercially useful function reviews during construction. Compliance officers visit project sites to verify that MBE and WBE subs are performing work with their own forces.

Managing Multi-State MBE Compliance

GCs operating across state lines face the challenge of tracking different programs, goals, certification databases, and reporting formats simultaneously.

Standardize your internal processes. Create a master compliance template that captures requirements for every state where you work. Update it when regulations change.

Use multi-state compliance software. Platforms like SubcontractorAudit pull certification data from all state directories and generate reports in each state's required format.

Designate state-specific compliance contacts. For each state, identify the certifying agency, participation goals, reporting deadlines, and enforcement contacts. Store this information in a quick-reference document accessible to all project managers.

Track regulatory updates. Subscribe to notifications from each state's MBE program office. Many states update goals, reporting requirements, and enforcement procedures annually.

Read our minority business enterprise pillar guide for the complete framework on MBE compliance strategies.

FAQs

Which state has the highest MBE participation goal? Maryland has the highest overall MBE goal at 29% for state-funded contracts. New York's combined MWBE goal reaches 30% when MBE (15%) and WBE (15%) are counted together. Virginia's SWaM program targets 42% overall small, women-owned, and minority participation, though this includes non-minority small businesses.

Can an MBE certification from one state be used in another? Generally no. Each state has its own certification process and standards. A firm certified as an MBE in California must apply separately for certification in Texas. The exception is the federal DBE program, where certification through one state's UCP is recognized for DOT-funded projects in all states.

How often do states update their MBE participation goals? Most states review and update goals every two to three years based on availability studies. These studies analyze the number of ready, willing, and able MBE firms in each market. Some states adjust goals annually based on utilization data. GCs should check current goals before every bid submission.

What happens if a state eliminates its MBE program? Some states have faced legal challenges to race-conscious MBE programs. When a program is enjoined or eliminated, the state typically shifts to race-neutral alternatives like small business set-asides. Federal DBE requirements remain in effect regardless of state-level changes because they are tied to federal funding.

Do local government MBE requirements stack on top of state requirements? In some cases, yes. A project funded by both state and city sources may need to comply with both programs. New York City MWBE requirements are separate from New York State MWBE requirements. GCs should clarify which programs apply during pre-bid conferences.

How should a GC handle conflicting MBE requirements between jurisdictions? When project funding comes from multiple sources with different MBE requirements, meet the most stringent goal. This satisfies all applicable programs. If the requirements conflict (for example, one program counts a firm as MBE and another does not), consult the contracting officer for written guidance before bid submission.

Navigate State MBE Requirements with Confidence

SubcontractorAudit supports MBE compliance across all 50 states. The platform tracks certifications, monitors participation, and generates state-specific utilization reports. Request a demo to simplify your multi-state minority business construction compliance.