The Caltrans DVBE incentive on projects over $5 million
On non-federal-aid Caltrans projects with an estimated cost of more than $5 million there is no mandatory DVBE goal — instead, section 2-1.22C grants a DVBE incentive that can move you up the bid ranking. A few points of DVBE participation can be worth more than sharpening your price.
Who qualifies
Any bidder who achieves DVBE participation of 1 percent or greater (Mil & Vet Code §999.5; 2 CCR §1896.98 et seq.). To receive it, submit the Certified DVBE Summary form under section 2-1.33 — no later than 4 p.m. on the 4th business day after bid opening, with a copy of each DVBE’s quote.
How the incentive is calculated
The incentive is a reduction, for bid comparison only, in your submitted total bid by the lesser of:
- Your DVBE achievement percentage (rounded to 2 decimal places) of the verified total bid of the low bidder
- 5 percent of the verified total bid of the low bidder
- $250,000
Worked example
The apparent low bid is $8,000,000. You bid $8,120,000 with $240,000 of DVBE participation — 2.96% of your bid. Your incentive is the lesser of 2.96% × $8,000,000 = $236,800, 5% × $8,000,000 = $400,000, and $250,000, so $236,800. Your bid is compared as $7,883,200, which is now below the low bid.
The award is still made at your full submitted bid — the reduction is for comparison only. Caltrans applies the small business and non-small business preferences first, then the DVBE incentive, and re-ranks. A non-small business bidder cannot displace a small business bidder, but a small business bidder with a higher DVBE achievement can displace another small business bidder.
Where the dollars usually come from
Materials are the easiest lever: quoting your signs, erosion control, traffic control devices, safety supplies and jobsite consumables through a DVBE supplier adds participation without changing who self-performs the work. Use the calculator to see how much DVBE spend it takes to reach the cap on your bid.
Common questions
What is the maximum Caltrans DVBE incentive?
The lesser of your DVBE percentage of the low bid, 5% of the low bid, or $250,000. On bids above $5 million the $250,000 cap is reached at 5% DVBE participation or less.
Does the DVBE incentive change what I get paid?
No. It is a reduction for bid comparison only; the contract is awarded at the total bid you submitted.
What is the minimum DVBE participation for the incentive?
1 percent of your bid, documented on the Certified DVBE Summary.
Sources
General information for bidders, not legal advice. Always follow the Notice to Bidders and special provisions for your contract.