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What is Commercially Useful Function (CUF)?

CUF is a requirement of the Disadvantaged Business Enterprise (DBE) program. CUF is required and defined in Title 49, Part 26 of the Code of Federal Regulations [49 CFR 26.55(c)(1)]:

A DBE performs a commercially useful function when it is responsible for execution of the work of the contract and is carrying out its responsbilities by actually:

  • performing
  • managing and,
  • supervising
the work involved.

Regardless of whether an arrangement between the contractor and the DBE firm represent standard industry practice, if the arrangement between the Contractor and the DBE firm erodes the ownership, control or independence of the DBE firm or in any other way does not meet the commercially useful function requirement, the Contractor shall receive no credit toward the goal and may be required to backfill the participation.

A DBE firm does not perform a CUF if its role is limited to that of an extra participant in a transaction, contract, or project through which funds are passed in order to obtain the appearance of DBE firm participation.

Certification and CUF are separate and distinct issues. Even if the certification process has identified the DBE's ability to perform in their work type(s), it is important to review and determine what and how a DBE actually performs during the execution of the contract.

If you have questions or need assistance with the content of this course, please contact the NYSDOT Office of Civil Rights at 518-457-1129 or email: civilrights@dot.ny.gov

If you need technical assistance operating this online program,
please email: wldb@dot.ny.gov or call 518-457-2942.

New York State Department of Transportation
Office of Civil Rights
Workforce Learning & Development Bureau