There are many programs designed to assist minorities, women, and veterans get their fair share of the federal contracting market. However some programs are also designed to help small businesses based on their location.
The Historically Underutilized Business Zones (HUBZone) Program helps small businesses in urban and rural areas receive preferential access to federal contracting opportunities in order to stimulate economic development and employment growth in distressed regions.
Businesses are found eligible for the program primarily based on the location of the firm’s principal office and where their employees reside. Other criteria to participate in the HUBZone Program include being considered a small business according to SBA size standards and at least 51% ownership by US Citizens. Small businesses may also be owned by a Community Development Corporation, an agricultural cooperative, or an Indian tribe for eligibility purposes.
Besides receiving preferred access to competitive and sole-source contracts, HUBZone firms also receive a 10% price evaluation preference in full and open competition contracts as well as subcontracting opportunities.
The federal government has set a goal of awarding at least 3% of all prime contracting dollars to HUBZone certified small businesses every fiscal year.
The application for HUBZone certification is relatively straightforward, however it does require supporting documentation to prove eligibility. In particular, payroll and other employment records are required to verify that at least 35% of all full-time employees reside in a HUBZone. This may be no big deal for smaller firms with few employees, however companies who employ a number of employees or who do not already practice organized record keeping may find this process tedious and time consuming.
HUBZone participants must recertify every 3 years in order for the SBA to verify the firm still meets program criteria. Additionally, firms must report all material changes such as any change in ownership, business structure, principal office, or failure to meet the 35% residency requirement. Otherwise, there is no limit to the length of time a small business may participate in the HUBZone program provided they continue to meet eligibility requirements. Firms may also choose to decertify themselves from the HUBZone program; they may reapply for certification no sooner than 90 days after decertification if they are still eligible for the program.
To find out more about the HUBZone program and how to apply for certification, please call the Contractor Helpline at (877) 252-2700 ext 1.