The Historically Underutilized Business Zones (HUBZone) program helps small businesses in urban and rural communities gain superior access to federal procurement prospects. With over 40 years of experience in government contract law, Malyszek & Malyszek can help you understand the regulations of the program.

The HUBZone program was enacted into law as part of the Small Business Reauthorization Act of 1997. The program falls under the sponsorships of the U.S. Small Business Administration (SBA). The program inspires economic development in historically underutilized business zones (HUBZones) through the establishment of preferences.

The primary goal of the program is to create incentives for the U.S. federal government to do contracting with businesses that operate and create jobs in communities with economic needs.

The HUBZone program is in line with the efforts of both the Administration and Congress to stimulate economic development and employment growth in distraught areas by providing access to more federal contracting opportunities.

The SBA regulates and implements the HUBZone program. SBA does the following:

• Maintains a listing of qualified HUBZone small businesses that federal agencies can use to locate vendors
• Determines which businesses are qualified to receive HUBZone contracts
• Reports to the Congress on the program's impact on employment and investment in HUBZone areas
• Resolves protests of eligibility to receive HUBZone contracts

The program’s benefits for HUBZone-certified companies include:

• Competitive and sole source contracting
• The federal government has a goal of awarding 3% of all dollars for federal prime contracts to HUBZone-certified small business concerns
• 10% price evaluation preference in full and open contract competitions

HUBZone is a United States Small Business Administration (SBA) program for small companies that operate and employ people in Historically Underutilized Business Zones (HUBZones). The HUBZone program was created in response to the HUBZone Empowerment Act created by the US Congress in 1998. Based on the Act, small businesses will be labeled as HUBZone certified if they have the following criteria:

• The firm must be a small business based on the North American Industry Classification System (NAICS) for size standards
• The business must be at least 51% owned and controlled by U.S. citizens
• The firm's principal office must be in a HUBZone
• 35% of the firm’s total workforce must reside in a HUBZone

HUBZones are determined by economic indicators and include qualified urban and suburban census tracts, non-metropolitan counties, qualified base closure areas, lands within the external boundaries of Indian reservations, and/or other designated areas.

There is a government-wide goal for most agencies to award at least three percent of their eligible federal contracting dollars to HUBZone-certified firms. Although several agencies have met or exceeded this goal over the years, it has never been achieved government-wide.

Almost all federal agencies participate in the HUBZone program. However, the provisions of the Small Business Act apply only to procurements made in the United States and most procurements made by the Federal Aviation Administration, the U.S. Postal Service, The Federal Deposit Insurance Corporation, the U.S. Congress, and procurements made through GSA schedules are excluded from the HUBZone Program.

Contact the lawyers of Malyszek & Malyszek today for a free consultation regarding matters on the HUBZone program.