Program History

The HUBZone Empowerment Contracting program was enacted into law as part of the Small Business Reauthorization Act of 1997. The program falls under the auspices of the US Small Business Administration. The program encourages economic development in historically underutilized business zones - "HUBZones" - through the establishment of preferences. SBA's HUBZone program is in line with the efforts of both the Administration and Congress to promote economic development and employment growth in distressed areas by providing access to more Federal contracting opportunities.

Historically Underutilized Business Zone

A "HUBZone" is an area that is located in one or more of the following: a qualified census tract (as defined in section 42(d)(5)(C)(i)(I) of the Internal Revenue Code of 1986); a qualified "non-metropolitan county" (as defined in section 143(k)(2)(B) of the Internal Revenue Code of 1986) with a median household income of less than 80 percent of the State median household income or with an unemployment rate of not less than 140 percent of the statewide average, based on US Department of Labor recent data; or lands within the boundaries of federally recognized Indian reservations.

Eligibility

A small business must meet all of the following criteria to qualify for the HUBZone program: it must be located in a "historically underutilized business zone" or HUBZone. it must be owned and controlled by one or more US Citizens, and at least 35% of its employees must reside in a HUBZone.

Street Legal Industries, Inc.

SLIND was incorporated in the State of Tennessee on February 17, 2000. SLI Submitted its HUBZone certification application and became certified by the SBA on May 25, 2000. Following Certification the SBA conducted a program compliance examination on August 2001. This examination resulted in confirmation of a positive HUB Zone determination.

Types of HUBZone Contracts

• A competitive HUBZone contract can be awarded if the contracting officer has a reasonable expectation that at least two qualified HUBZone small businesses will submit offers and that the contract can be awarded at a fair market price.
• A sole source HUBZone contract can be awarded if the contracting officer does not 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 $5 million for manufacturing requirements or $3 million for all other requirements.
• A full and open competition contract can be awarded with a price evaluation preference. The offer of the HUBZone small business will be considered lower than the offer of a non-HUBZone/non-small business-providing that the offer of the HUBZone small business is not more than 10 percent higher.

Goaling

The Small Business Reauthorization Act of 1997 increases the overall government wide procurement goal for small business from 20% to 23%. The statute sets the goal for HUBZone contracts as follows: 2001 - 2%; 2002 - 2.5 %; 2003; and each year thereafter - 3%.

Affected Federal Agencies:

As of October 1, 2000, all Federal agencies are subject to the requirements of the HUBZone Program. Contracting Officer's

Related Links

HUB Zone Home Page