(a) A contractor may not substitute for or terminate a DBE subcontractor listed in the information provided under §9.227 of this subchapter (relating to Information from Bidders), without the written consent of the department.
(b) Before requesting the department's approval to terminate or substitute for a DBE, the contractor must give written notice to the listed DBE with a copy to the department of the contractor's intent to request the termination or substitution of the DBE and provide a detailed explanation for the request.
(c) The contractor must give the listed DBE five days to respond to the notice and to advise the department and the contractor of the reasons the listed DBE objects to the proposed termination or substitution. The department may provide a shorter response time if required in a particular case as a matter of public necessity.
(d) When a DBE subcontractor is terminated or fails to complete its work on the contract for any reason, the contractor shall make good faith efforts to find, as a substitute for the original DBE, another DBE to perform, at least to the extent needed to meet the established contract goal the work that the original DBE was to have performed under the contract. If the contractor cannot find another DBE to perform the work originally committed to the terminated DBE the contractor shall make good faith efforts to obtain DBEs to perform other work under the contract equal to the work originally committed to the terminated DBE.
(e) The contractor must submit for approval the name of the DBE subcontractor that is to replace the DBE subcontractor listed in the original commitment agreement. Work performed by a substitute before the department has approved the substitution will not be counted toward the DBE goal.
(f) If the department determines there is good cause for the termination or replacement the department will provide written consent for the action.
(g) Each contract will contain provisions that state the appropriate administrative remedies that apply if the contractor fails to comply with this section.

Source Note: The provisions of this §9.229 adopted to be effective September 1, 2012, 37 TexReg 5320