DVBE Good Faith Effort: Abolished in 2009 — What Applies Now
If you have been told to file a good faith effort to satisfy a California DVBE participation requirement, you have been given instructions from before 2009. There is no such thing anymore, and knowing that changes what you have to do before the bid closes.
The short version
Assembly Bill 21 of the 2009 Fourth Extraordinary Session eliminated the good faith effort as a way to satisfy DVBE participation requirements. Public Contract Code § 10115.2 now directs the awarding department to award to the lowest responsible bidder meeting these goals — there is no efforts-based alternative. The regulation that once set out the GFE steps, 2 CCR § 1896.63, was repealed effective April 1, 2013. You either document that you will meet the goal, or your bid may be rejected as non-responsive.
How we checked this
This contradicts a fair amount of published advice, so here is the trail rather than an assertion:
- ■A 2009 DGS Procurement Division broadcast bulletin announced “the elimination of the Good Faith Effort (GFE) as a means for bidders to satisfy Disabled Veteran Business Enterprise (DVBE) contract participation requirements,” attributing it to AB4X 21.
- ■PCC § 10115.2 carries the matching amendment note — Stats. 2009, 4th Ex. Sess., Ch. 19, effective July 28, 2009 — and its operative sentence has no efforts clause.
- ■2 CCR § 1896.63 is titled “Good Faith Effort” and is marked [Repealed] — repealer filed 2-14-2013, operative 4-1-2013.
- ■The phrase “good faith” appears nowhere in Military & Veterans Code §§ 999–999.9 or Public Contract Code §§ 10115–10115.5, and nowhere in the current DGS DVBE Program Requirements instruction given to bidders.
Where the confusion comes from
Good faith effort is a real mechanism — in a different program. The federal DBE program has one at 49 CFR § 26.53, with guidance in Appendix A to Part 26 describing solicitation of qualifying firms, breaking work into feasible units, and documenting the outreach. That applies to federally assisted transportation contracts, not to state DVBE requirements. Two different programs, two different agencies, one shared phrase.
And a timing note on the federal side: DBE contract goals are themselves currently suspended. 49 CFR § 26.51(h) bars recipients from setting them until the UCP covering them completes the § 26.111 reevaluation, and § 26.55(i) suspends counting participation toward goals. With no contract goal, the federal good faith efforts mechanism is not being triggered either. See our reevaluation status tracker for where that stands.
What a California bidder actually has to do
| Requirement | What it means |
|---|---|
| Meet the participation percentage | 3% minimum unless the solicitation states another figure or is exempt. Document that it will be met — not that you tried. |
| Use certified DVBEs only | The firm must be certified by the DGS Office of Small Business and DVBE Services and must perform a commercially useful function. A pass-through does not count. |
| Submit the forms | Bidder Declaration (DGS PD-05-105), DVBE Declarations (DGS PD 843), Confirmation Letter/Form, and Certification of CUF Compliance under MVC § 999.10(a)(3). The solicitation defines the exact set. |
| Certify after completion | Report amounts received, the DVBE's details, committed versus actual participation, and confirm the DVBE was paid (MVC § 999.5(d)). |
The DVBE incentive is a separate thing from the goal: an award preference for bidders who provide DVBE participation, applied unless the solicitation exempts it. Meeting a goal and earning an incentive are not the same mechanism, and solicitations can carry one, both or neither.
The part people miss: it does not end at award
The pre-award paperwork gets attention because it decides responsiveness. The post-award duties get forgotten, and they carry money:
- $$10,000 withheld from your final payment if you do not file the completion certification. After notice you get between 15 and 30 calendar days to cure; refuse, and the department deducts it permanently (MVC § 999.7).
- $$2,500 to $25,000 civil penalty for knowingly providing false information (MVC § 999.5(f)).
- $The State verifies what you submitted and opens an investigation if it finds evidence of a violation. Consequences named in the DGS instruction include contract termination, civil penalties and loss of State certifications.
If you cannot find enough DVBE subcontractors
This is the situation the good faith effort used to answer, and its removal is precisely what makes it hard. Since documenting effort no longer helps, the work has to happen earlier: identify certified firms while you are still scoping the bid, and structure the subcontract so a certified firm can actually perform a commercially useful function within it.
Certified firms are searchable through the state's own systems — see our guide to searching the certification directories. If the shortage is on your side of the table, meaning you are a veteran-owned firm that primes cannot find, the fix is certification itself: DVBE certification is free through DGS and has no size limit and no net worth cap.
Frequently Asked Questions
Does California DVBE have a good faith effort requirement?
No. The good faith effort was eliminated as a way to satisfy DVBE participation requirements by AB4X 21 in 2009. Public Contract Code 10115.2 now requires the awarding department to award to the lowest responsible bidder meeting the goal, with no efforts-based alternative, and the implementing regulation that had set out GFE steps — 2 CCR 1896.63 — was repealed effective April 1, 2013. The words "good faith" do not appear in the DVBE statutes or in the current DGS DVBE Program Requirements.
What replaced the DVBE good faith effort?
Nothing replaced it, because nothing needed to. If a solicitation carries a DVBE participation goal, you document that you will meet it. A bid that does not may be rejected as non-responsive. There is no partial-credit path for having tried.
Is there any good faith effort in California public contracting at all?
Yes, but in a different program. The federal DBE program at 49 CFR 26.53 has a good faith efforts mechanism, and it applies to federally assisted transportation contracts — not to state DVBE requirements. Note that DBE contract goals are themselves currently suspended under 49 CFR 26.51(h) pending the UCP reevaluation, so that mechanism is not being triggered in California right now either.
What is the minimum DVBE participation percentage?
3% unless the solicitation specifies a different percentage or is exempt from DVBE participation, per the DGS DVBE Program Requirements.
Which DVBE forms does a bidder have to submit?
The DGS instruction names the Bidder Declaration (DGS PD-05-105), the DVBE Declarations (DGS PD 843), a Confirmation Letter/Form, and a Certification of Commercially Useful Function Compliance under MVC 999.10(a)(3), plus anything else the solicitation requests. Check the solicitation itself — the required set is defined there.
What happens after the contract is finished?
The prime contractor must certify to the awarding department the total it received, the DVBE's name, address and contract number, the committed versus actual DVBE amounts, and that the DVBE has been paid in full (MVC 999.5(d)). Miss it and the department withholds $10,000 from your final payment, with a cure window of 15 to 30 days after notice (MVC 999.7). Knowingly false information carries a civil penalty of $2,500 to $25,000 (MVC 999.5(f)).
Sources
- Public Contract Code § 10115.2 — The operative sentence — award to the lowest responsible bidder meeting the goals — plus the amendment note (Stats. 2009, 4th Ex. Sess., Ch. 19) that records AB4X 21.
- 2 CCR § 1896.63 — Good Faith Effort [Repealed] — The regulation that once set out the GFE steps, showing the repealer filed 2-14-2013, operative 4-1-2013.
- DGS — DVBE Program Requirements — The current bidder-facing instruction: the 3% minimum, the commercially-useful-function rule, the required forms, and the non-responsive consequence. Contains no reference to good faith effort.
- Mil. & Vet. Code § 999.5 — (d) the post-completion certification a prime owes the awarding department; (f) the $2,500–$25,000 civil penalty for knowingly false information.
- Mil. & Vet. Code § 999.7 — The $10,000 withheld from final payment for non-compliance, and the 15-to-30-day cure period.
- 49 CFR 26.53 — The federal DBE good faith efforts mechanism — a different program from California DVBE, and the source of most of the confusion.
Links and cited text verified August 14, 2026. We are an independent resource, not a government agency — always confirm current requirements with your certifying agency before acting.
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