Wisconsin Legislature: Adm 83.12(26)

Note: Chapter Comm 104 was created by emergency rule effective February 9, 2007. Chapter Comm 104 was renumbered chapter Adm 83 under s. 13.92 (4) (b) 1., Stats., Register December 2011 No. 672.

Adm 83.10 Purpose. Pursuant to s. 16.285 (1) (c), Stats., this chapter sets forth the criteria and procedures for certification, certification renewal, recertification, and decertification of woman-owned businesses.

History: CR 06-113: cr. Register May 2007 No. 617, eff. 6-1-07; correction made under s. 13.92 (4) (b) 7., Stats., Register December 2011 No. 672.

Adm 83.12 Definitions. In this chapter:

(1) “Administrator” means the administrator of the division of enterprise operations in the department.

(2) “Affiliate” means a company effectively controlled by another, such as a branch, division, or subsidiary. As prescribed in 15 USC 80a-2, an affiliate includes a company in which there is ownership, direct or indirect, by another company, of 5% or more of the voting stock.

(3) “Appeal” means a written request by an applicant to reconsider a determination of a denial of application, certification renewal, recertification or decertification.

(4) “Applicant” means any business that applies to the department for certification as a woman-owned business enterprise under s. 16.285 (1), Stats., and this chapter, through submission of application forms.

(5) “Application” means the forms, whether paper or electronic, all documentation requested by the department, and a report of an on-site visit, if one was conducted by the department, upon which the department will base its decision to grant or deny certification, certification renewal or recertification.

(6) “Assets” means the real and personal property of a business.

(7) “Authorized shares” means the shares that a corporation is authorized to issue by its articles of incorporation.

(8) “Beneficial ownership” means ownership of the rights in a business that are the normal incidents of owning a business.

(9) “Broker” means a person who acts as an intermediary between a buyer or seller, usually charging a commission for value added.

(11) “Business” means a sole proprietorship, general partnership, corporation, limited liability company, limited liability partnership, or joint venture, organized for a profit basis — except where the context implies that this term is referring instead to buying or selling commodities or services.

(12) “Capital contribution” means the cash or property contributed to a business, and may include a financial investment in the business or the contribution of property, space, patents and copyrights.

(13) “Control” means the power to direct the day-to-day and long-term operation and management of a business.

Note: Departmental assessments of operational and managerial control will rest upon the peculiarities of the industry of which the business is a part.

(14) “Conversion rights” means any agreement, option, scheme or documents that will create any rights which, if exercised, would result in less than 51% woman ownership of the business, or less than dominant control by woman owners or both.

(15) “Corporation” means a corporation organized for profit, with capital stock.

(16) “Decertification” means the process by which the department determines that a WBE no longer meets the eligibility criteria, and then rescinds the certification status.

(17) “Denial” means the office’s reaction to an applicant that does not meet the certification eligibility requirements.

(18) “Department” means the department of administration.

(19) “Distributor” means one that markets or sells merchandise, such as a wholesaler.

(20) “Expiration” means the specified end of the WBE certification, at the close of the three-year certification period.

(21) “General partner” means a partner who participates fully in the profits, losses and management of a partnership and who is personally liable for its debts.

(22) “Industry standard” means the usual and customary practice in the delivery of products or services within a particular business sector, such as procurement, billing payment and performance.

(23) “Interest” means a right, claim, financial or legal share in a business.

(24) “Issued shares” means the shares of a corporation that have been authorized and actually sold to subscribers. They may include treasury shares.

(25) “Joint venture agreement” means a written agreement signed by each joint venture specifying the terms and conditions of the joint venture.

(26) “Limited liability company” means a company similar in structure to a partnership, but its members are not personally liable for the entity’s debts and liabilities. Its members may participate in the management of the company without risking personal liability.

(27) “Marital-property agreement” means an agreement that complies with s. 766.58, Stats.

(28) “Marital property laws” means ch. 766, Stats.

(29) “Marital-property waiver” means a form provided by the department to document separate control and management of a business under marital property laws.

(30) “Nonprofit organization” means an organization as defined in s. 108.02 (19), Stats.

(31) “Non-Wisconsin business” means a business that neither is incorporated under ch. 180, Stats., nor has its principal place of business in Wisconsin.

(31m) “Office” means the office of women’s business ombudsmen, in the department.

(32) “On-site visit” means a visit to an applicant’s physical place of business for the verification of information submitted in the application and accompanying documentation.

(33) “Parent company” means a company that has at least a majority direct-voting control over another company.

(34) “Partnership” means a contract entered into by two or more persons in which each agrees to furnish a part of the capital or labor for a business enterprise, and by which each partner shares in some fixed proportion in profits and losses.

(35) “Partnership agreement” means a written agreement signed by each partner specifying the terms and conditions of the partnership.

(36) “Partnership interest” means a partner’s share of the profits and losses of the partnership and the right to receive distributions of partnership assets.

(37) “Principal place of business” means the physical location at which or from which a business performs, is maintained, or operates the majority of its business.

(38) “Recertification” means the process by which WBE status is reestablished, prior to expiration at the close of the three-year certification period.

(39) “Renewal” means a one-year continuation of a WBE certification, at the end of each of the first two years of the three-year certification period, as subject to a review by the department.

(40) “Retailer” means the seller of goods or commodities directly to consumers at a retail price.

(41) “Secretary” means the secretary of the department.

(42) “Securities” means stocks, bonds, notes, convertible debentures, warrants or other documents that represent a share in a business, or a debt owed by a business.

(43) “Shares” means the units into which the proprietary interests in a corporation are divided.

(44) “Sole proprietorship” means a business in which one person owns all the assets of the business and is solely liable for all the debts of the business.

(45) “Stock-affirmation form” means a form provided by the department and affirmed by the applicant stating that the stock ownership of the corporation is as presented in the application, and in which the applicant agrees to notify the department in the event that additional stock is sold.

(46) “Stock certificate” means a certificate issued by a corporation certifying that the named person is the owner of a designated number of shares of stock.

(47) “Subsidiary” means a corporation in which one other corporation owns a majority of the voting shares.

(48) “Treasury shares” means the shares which have been issued but later re-acquired by a corporation and which have not been canceled or restored to the status of authorized but unissued shares.

(49) “Unissued shares” means shares which the corporation is authorized to issue but which have not yet been distributed to shareholders or subscribers.

(50) “Useful business function” means the provision of materials, supplies, equipment or services to customers in addition to this state. Acting as a conduit to transfer funds to other than a woman-owned business does not constitute a useful business function, unless doing so is a normal industry practice.

(51) “Value added” means something that is added to a product or service by a marketer or distributor which warrants a markup in the retail price.

(52) “Voting shares” means those shares that give the holder the right to vote for directors and other matters, in contrast to non-voting shares, which simply entitle the holder to dividends, if any.

(53) “Woman-owned business, woman-owned business enterprise, or WBE” means a sole proprietorship, general partnership, corporation, limited liability company, limited liability partnership, or joint venture, which is organized for a profit basis and which fulfills all of the following requirements:

(a) If privately owned, it is at least 51% owned, controlled, and actively managed by one or more women who are either U.S. citizens or lawfully admitted to the United States for permanent residence, as defined under 8 USC 1101 (a) (20).

(b) If publicly owned, at least 51% of the stock is owned and controlled by one or more women who are either U.S. citizens or lawfully admitted to the United States for permanent residence, as defined under 8 USC 1101 (a) (20); and the management and daily operations are controlled by one or more of those women.

Note: Section 8 USC 1101 (a) (20) reads as follows “The term ‘lawfully admitted for permanent residence’ means the status of having been lawfully accorded the privilege of residing permanently in the United States as an immigrant in accordance with the immigration laws, such status not having changed.”

(54) “Wholesaler” means a middle person or distributor who sells mainly to retailers, other merchants, and industrial commercial institutional users, as distinguished from consumers.

(55) “Wisconsin business” means a business that either is incorporated under ch. 180, Stats., or has its principal place of business in Wisconsin.

History: CR 06-113: cr. Register May 2007 No. 617, eff. 6-1-07; correction in (1), (4), (10), (17), (18) made under s. 13.92 (4) (b) 6., 7., Stats., and renumbering of (10) to (31m) under s. 13.92 (4) (b) 1., Stats., Register December 2011 No. 672.

Adm 83.20 Certification criteria. In order to become certified as a woman-owned business enterprise, a business shall meet all of the following eligibility standards:

(1) The business satisfies all of the criteria in the WBE definition in s. Adm 83.12 (53).

(2) If the business is a sole proprietorship, a woman owns 100% of the company assets.

(3)

(a) If the business is a partnership, 2 or more persons agree to carry on a business or venture together, upon the terms of mutual participation in the profits and losses of the business. The partnership is a contract of mutual agency, each partner acting as a principal in her or his own behalf and as agent of his or her co-partners, and general rules of law applicable to agents shall apply with equal force in determining rights and liabilities of partners.

(b) If the business is a general partnership, one or more women own at least 51% of the partnership interests.

(c) If the business is a limited partnership, one or more women general partners own at least 51% of the general partnership interest and exert at least 51% of the control among general partners. The women general partners receive at least 51% of the profits and benefits, including tax credits, deductions and postponements. In addition, the women limited partners shall own at least 51% of the limited partnership interests and receive at least 51% of the profits and benefits, including tax credits, deductions and postponements.

(4) If the business is a limited liability company, one or more women own at least 51% of membership interests in the LLC organization, and exert at least 51% of the management and control among the members. The women owners also participate in all risks and profits of the organization at a rate commensurate with their membership interests.

(5) If the business has a corporate form of organization, one or more women own at least 51% of all voting stock of the corporation. Any voting agreements among the shareholders do not dilute the beneficial ownership, the rights, or the influence of the women owners of the stock or classes of stock of the corporation. The women owners possess the right to all customary incidents of ownership, such as the ability to transfer stock, title possession, and enter binding agreements.

Note: Nonprofit corporations do not meet the requirements in sub. (5) and are therefore not eligible for certification.

(6) If the business is a joint venture, one or more woman-owned businesses hold at least 51% of the beneficial ownership interest in the joint venture, and exert at least 51% of the control and management of the joint venture. The woman-owned business partners of the joint venture are certified or are eligible for certification as woman-owned business enterprises.

(7) If the business is a subsidiary or affiliate, one or more women own at least 51% of the parent company.

History: CR 06-113: cr. Register May 2007 No. 617, eff. 6-1-07; correction in (1) made under s. 13.92 (4) (b) 7., Stats., Register December 2011 No. 672.

Adm 83.22 Documentation of gender. An applicant shall provide one of the following to verify the gender of each of the woman owners of a business:

(1) A birth certificate.

(2) A passport.

(3) A state-issued, motor vehicle operator’s license or identification card.

History: CR 06-113: cr. Register May 2007 No. 617, eff. 6-1-07.

Adm 83.24 Determination of ownership.

(1) An applicant shall meet all of the following eligibility standards:

(a)

1. The ownership by one or more women is real, substantial and continuing, going beyond the pro-forma ownership of the business as reflected in its ownership documents.

2. Each woman owner shares in all risk and profits commensurate with her ownership interest as demonstrated by a detailed examination of the substance of her business arrangements with others.

3. Each woman owner receives the customary incidents of ownership, such as salary, rights to dividends, ownership of assets and ownership of intangible assets such as copyrights and patents.

(b) The contributions of capital and expertise by the woman owner or owners to acquire their interest in the business is real and substantial, and in proportion to the interest acquired.