|
An April 2026 audit received by SCCA is highly critical of Caltrans’ administration of its Disadvantaged Business Enterprise (DBE) program. The investigation was made by Caltrans’ internal Independent Office of Audits and Investigations (IOAI). The office was established as part of SB 1 from 2017. The IOAI’s Inspector General is appointed by the Governor and confirmed by the California State Senate.
The audit made three findings. They are:
1. Late payments from prime contractors to subcontractors were late 37% of the time (out of a sample of 52 subcontractor payments from 20 contracts) and Caltrans lacks a process to ensure timely subcontractor payments are made despite federal regulations requiring it to do so. The 37% figure includes both DBE and non-DBE sub payments;
2. A review of 30 federally funded projects showed DBE participation at bid time totaled $42 million but actual DBE payments totaled only $15.7 million; and
3. Caltrans failed to report actual federal funds used per project, potentially skewing the DBE participation rate.
The late subcontractor payments and DBE participation rate findings have long been SCCA concerns. Those concerns have been articulated both internally to Caltrans and externally to policymakers over the years. SCCA’s Subcommittee on Transportation Policy has engaged with both the Caltrans Director as well as the IOAI Inspector General on these issues.
In response to the audit, Caltrans Director Dina El-Tawansy stated that the audit’s recommendations “are already reflected in the required actions identified by FHWA.” Her letter states the recommendations will be implemented within two years, by March 2028.
You can download the audit by clicking this link.
| 
