D.C. Mun. Regs. r. 27-838

Current through Register Vol. 71, No. 24, June 14, 2024

Rule 27-838 - EQUITY AND DEVELOPMENT PARTICIPATION

838.1

Small investors, disadvantaged investors, or certified equity participants shall receive a minimum of 20% Equity Participation in any Covered Project.

(a) Small investor as defined by Section 2302 of the Act (D.C. Official Code § 2-218.02) means:

(1) An SBE pursuant to Section 2332 of the Act; or

(2) A District-domiciled individual with a personal net worth that does not exceed five (5) million dollars, excluding the value of his or her primary residence.

(b)

(1) To be a District-domiciled individual:

(A) The District of Columbia must be the present fixed place of residence of the individual to which he or she returns following temporary absences and at which he or she intends to reside indefinitely; and

(B) The District of Columbia must be the individual's only domicile.

(2) For an individual to establish that he or she is domiciled in the District, the individual must submit sufficient evidence to the Department, including providing the following:

(A) Copies of a District of Columbia deed or lease in the District of Columbia covering the twelve (12) consecutive months preceding the Department's evaluation for premises at which the individual resides;

(B) Copies of utility bills for utility services provided in the District of Columbia residence covering the twelve (12) consecutive months preceding the Department's evaluation;

(C) Copies of earnings and leave statements (i.e., pay stubs) that show residency in the District of Columbia and the withholding of District of Columbia income tax covering the twelve (12) consecutive months preceding the Department's evaluation;

(D) Certified copies of District of Columbia and federal income tax returns for the tax year preceding the Department's evaluation;

(E) Copies of voter registration, motor vehicle registration, driver's license, and non-driver's identification; and

(F) Copies of any other documents required by the Department that demonstrate that the District is the domicile of the individual.

(c)

(1) Disadvantaged investor as defined by Section 2302 of the Act (D.C. Official Code § 2-218.02) means:

(A) A disadvantaged business enterprise ("DBE") pursuant to Section 2333 of the Act (D.C. Official Code § 2-218.33); or

(B) A District-domiciled economically disadvantaged individual

(2) To be a District-domiciled economically disadvantaged individual, an individual must be:

(A) A District-domiciled individual, as defined by § 838.1(b); and

(B) Economically disadvantaged, as defined by § 804.1(b).

(d)

(1) Certified equity participant as defined by Section 2302 of the Act means a single-purpose legal entity created to participate in real estate development projects and includes members that are small investors or disadvantaged investors.

(2) The Department shall verify that each single-purpose legal entity meets the definition of certified equity participant to be designated as such.

(e) The Department will determine the manner in which the documents required in this section shall be submitted.

(f) The documents required to prove District domicile under this section must be submitted to the Department in a single submission.

(g) Each year throughout the duration of the Covered Project, each small investor and disadvantaged investor shall provide the Department in a single submission updated documents proving District-domicile status. These updated documents shall be submitted by the end of the same month as the initial submission required by § 838.1(f) (e.g., if the initial submission was in February, by the end of each February thereafter).

(h) A certified equity participant, small investor, or disadvantaged investor will retain its designation for the duration of the Covered Project in which it is an Equity Participant, as required by Section 2349a of the Act (D.C. Official Code § 2-218.49 a) and this chapter, provided the entity or individual remains in compliance with the Act and this chapter.

838.2

As appropriate, the Department may provide guidance to District agencies, business enterprises, and interested members of the public regarding the equity and development participation requirements.

838.3

An agency considering a solicitation for a Covered Project may contact the Department as needed to coordinate outreach efforts to Equity Participants and Development Participants and provide the Department with the specific details regarding the Covered Project.

838.4

With respect to public and private development (PPD) related solicitations, including Requests for Proposals ("RFPs"), Invitations for Bids ("IFBs"), Requests for Qualifications ("RFQs"), and Calls for Expressions of Interest, issued by District agencies in connection with Covered Projects, to the extent required by the Act and these rules, the solicitation shall include the Equity Participation and Development Participation requirements and a requirement that the party responding to the solicitation agrees to comply with the Equity Participation and Development Participation requirements, including submission to the Department of a separate "Service Agreement" detailing the specifics of the terms, conditions and financial requirements of the equity involvement.

838.5

Not more than one (1) business day after the issuance of any request for proposals, request for qualifications, call for expressions of interest or other similar document relating to any Covered Project, the District agency involved shall provide the Department with an electronic copy of the document, which the Department shall post on the Department's website.

D.C. Mun. Regs. r. 27-838

Final Rulemaking published at 39 DCR 9052 (December 4, 1992); as amended by Final Rulemaking published at 56 DCR 8439 (October 23, 2009), incorporating by reference text of Proposed Rulemaking published at 56 DCR 5622, 5684 (July 10, 2009); amended by Final Rulemaking published at 70 DCR 10970 (8/11/2023)

Authority: Section 2372 of the Small, Local, and Disadvantaged Business Enterprise Development and Assistance Act of 2005 (Act), effective October 20, 2005 (D.C. Law 16-33; D.C. Official Code § 2-218.72 )(2009 Supp.) and Mayor's Order 2009-58, dated April 15, 2009.