For Contractors: HUBZone Is A Program You Should Know
Monday, September 19, 2016
Congress is considering changes to a program that awards contracts to companies in low-income areas
HUBZone. Your contracting officer knows what it is, but do you? The Historically Underutilized Business Zone, “HUBZone” program was created almost twenty years ago to serve as an economic development tool to assist businesses in distressed communities. Unlike the WOSB and other socio-economic groups, the program is not focused on the characteristics of the owner- but rather the location of a business. The main office must be located in a HUBZone and 35 percent of employees must live in a HUBZone. While the program is similarly structured to WOSB with the ability to utilize set-asides and sole-source, the HUBZone program has an additional tool. For full and open competitive procurements, HUBZone firms can receive an up to 10 percent price evaluation preference. This means a contracting officer must accept the price offered by a HUBZone firm to be lower than the price offered by a non-HUBZone business, if it is up to 10 percent higher than the other lowest offer.
For those who qualify, the program can be utilized by WOSBs as a second certification.
The program is still yet to meet its 3% federal contracting goal, making it more of a priority for many contracting offices. The ongoing failure to meet the goal – something WIPP knows all about – is leading to Congressional review of the program. Last week, the House Small Business Committee held its first hearing in more than a decade on the program and is weighing possible changes.
A recent administrative change made by SBA to expand the program’s reach removed a limitation on the number of HUBZones per area. Women business owners should review the requirements and apply if qualified. More details are available from the SBA.