HUBZone administration

The HUBZone program encourages economic development in historically underutilized business zones. The federal government's goal is to award three percent of all prime and subcontracting dollars to businesses in the HUBZone program each year.  In addition to this website, SBA offers tips for federal agency Contracting Officers (PDF) and a video tutorial.

As the contracting officer, you’re responsible for determining the type of contract to use when awarding to a HUBZone business. There are several kinds of contracts you can use:

• A competitive HUBZone set-aside contract can be awarded if the contracting officer has a reasonable expectation that at least two responsible HUBZone small businesses will submit offers and that the resulting contract can be awarded at a fair market price. You can also create set-asides for specific orders within Multiple Award Contracts that were awarded through full and open competition.
• A sole-source HUBZone contract can be awarded if the contracting officer doesn’t have a reasonable expectation that two or more qualified HUBZone small businesses will submit offers, determines that the qualified HUBZone small business is responsible, and determines that the contract can be awarded at a fair price. The government estimate cannot exceed $7 million for manufacturing requirements or $4.5 million for all other requirements.
• A full and open competition contract can be awarded with a price evaluation preference for HUBZone small businesses. The offer of a HUBZone small business must be considered lower than the offer of a non-HUBZone/non-small business, provided that the offer of the HUBZone small business is not more than 10 percent higher.

When contracts are worth at or below $250,000, they are automatically set-aside for small businesses. If possible, you can choose to to set it aside specifically for businesses in socio-economic programs like HUBZone.

You also must set aside contracts worth more than $250,000 — as long as you have a reasonable expectation that at least two small businesses will submit bids.

Both SBA’s regulations and the Federal Acquisition Regulation (FAR) require you to consider socio-economic programs first for set-aside or sole-source contracts above $250,000. There is no order of preference among the programs.

You must document the rationale you used to make your decision in the contract file. Include information about your research and documentation of the winning contractor’s certification in the System for Award Management.

If a requirement has been accepted by SBA under the 8(a) program, it must remain in the 8(a) program unless SBA agrees to its release.

As part of your market research, you can find HUBZone-certified businesses — and verify their certification — using SBA’s Dynamic Small Business Search (DSBS). Contracting officers must ensure that an apparent awardee is HUBZone certified prior to making an award under a HUBZone set-aside process or an award where a price evaluation preference was applied.

Additionally, you can:

• Get personal assistance from SBA’s government contracting area offices or from APEX Accelerators (formerly known as Procurement Technical Assistance Centers).
• Contact your agency’s Office of Small & Disadvantaged Business Utilization or your Agency Small Business Specialist
• Issue a sources sought announcement in the System for Award Management (SAM) seeking interested HUBZone small businesses
• Use the GSA Schedule program to find HUBZone small businesses

Consider using language in your sources sought announcement that specifically encourages HUBZone small businesses to respond, along with the other federal small business categories if applicable. Ask only for key pieces of information you need to make the set-aside determination and include a page limit to make it easier for interested HUBZone businesses to respond.

As with the other federal small business contracting programs, someone may challenge the HUBZone status of the apparent successful offeror. As a contracting officer, you have specific responsibilities during a protest.

A status protest is one that challenges a business’ eligibility for the HUBZone program on the grounds of the location of the principal office, 35 percent employee HUBZone residency, or ownership and control.

A size protest is one that challenges whether a business qualifies as small. The processing of size protests is outlined in Title 13 of the Code of Federal regulations (CFR) Part 121. 

Protests serve to maintain the integrity of the program. The SBA HUBZone program office will guide you through the process and help make the determination in an efficient and timely manner.

You can reference the HUBZone regulations in Title 13 Part 126 of the Code of Federal Regulations and Subpart 19.13 of the Federal Acquisition Regulation.

Contact your local government contracting area office.