Understanding the HUBZone Program

Minnesota District SBA Office

-- HUBZone Program --

April 30, 2014

Understanding the HUBZone Program


• Program is designed to help small firms in certain communities gain access to federal contract opportunities

• HUBZone areas: typically areas of low median household incomes or high unemployment, or both

• Three types of Historically Underutilized Business Zones or HUBZones– Rural counties– Urban areas – Census tracts– Exterior boundaries of an Indian reservation.

• There are currently about 5,700 small firms certified in the HUBZone program

• Provides federal contracting assistance to qualified small firms in designated HUBZones to:– Increase employment opportunities– Stimulate capital investment – Empower communities through economic leveraging


• SBA regulates and implements the HUBZone program– Determines which businesses are eligible– Maintains a listing of qualified HUBZone firms to fulfill procurement

opportunities– Adjudicates protests of eligibility regarding HUBZone contracts


• 3% government-wide prime and subcontracting goals• Contract set-asides• 10% price evaluation preference on certain contracts• Subcontracting goal on large business subcontracting plans.

HUBZone Help Desk… [email protected]


• Competition restricted to HUBZone small business concerns.• Sole Source:– Only one HUBZone SB available.– Requirement not currently being performed by a non-

HUBZone SB.– Anticipated price of contract (including options) is less

than $4.0M service ($6.5M manufacturing).


• Far Clause 52.219-4 included in solicitations issued under full and open competition for acquisitions expected to exceed $150K .

• The clause allows an evaluation preference of 10% for HUBZone firms when the low offer was made by a large business.


• A large business receiving a contract over $650K ($1.5M construction) must submit a subcontracting plan as part of the contract.

• Specific goals for all small business categories –including HUBZone small business concerns.

• HUBZone firms must be certified by SBA to count towards subcontracting goals.


• Small business (by SBA standards)• Owned and controlled by at least 51% U.S. citizens or a

community development corporation, an agricultural cooperative, or an Indian tribe

• Principal office must be located within a designated HUBZone• At least 35% of its employees must reside in a HUBZone• Note: Different rules apply for Tribal Governments, Alaska Native Corporations,

Community Development Corporations and small agricultural cooperatives. These are delineated in Title 13 of the Code of Federal Regulations, Part 126.


• Principal office is defines as the location where greatest number of concern's employees at any one location perform their work.

• For services or construction operations, the principal office is location where greatest number of employees perform work, but excluding those who perform work at job-site locations to fulfill specific contract obligations.


• When economic data is updated and a formerly qualified HUBZone area no longer meets the unemployment or income criteria, these areas are “grandfathered” for three years.

• These “grandfathered” areas are called redesignated areas.• The redesignated areas have and end date and HUBZone

certified firms with principal offices in the areas will be decertified when the “grandfathering” period ends.



• Wadena Income• Cass Unemployment• Clearwater Unemployment• Hubbard Unemployment• Kanabec Unemployment• Koochiching Unemployment• Mille Lacs Unemployment• Pine Unemployment


• Mahnomen October 2014• Morrison October 2015


• Most successful HUBZone firms plan for their success– Long-term and revolving strategies that define how to be and remain

competitive– Maintain principal office and 35% employee residency requirements

• Planning is everything


HUBZone CertificationApplication Process

• STEP 1. Verify eligibility compliance

• STEP 2. Gather what you need (supporting documentation)

• STEP 3. Review sample HUBZone application form

• STEP 4. Review and ask questions

• STEP 5. Access SBA’s General Login System (GLS)

• STEP 6. Complete and submit the online HUBZone application

• STEP 7. Submit requested supporting documentation


• Firm’s principal office is located in a designated HUBZone.• At least 35% of firm’s employees live in a designated

HUBZone.• Firm is a small business by SBA size standards. • Business is directly owned and controlled by at least 51% U.S.

citizens or a community development corporation, an agricultural cooperative, or an Indian tribe

• Note: Different rules apply for Tribal Governments, Alaska Native Corporations, Community Development Corporations and small agricultural cooperatives


General business information SAM profile

DUNS number Appropriate NAICS codes

Business and personal federal tax returns for the last 3 years

Proof of principal office location, such as lease agreement

Business ownership documentation – articles of incorporation, LLC, etc.

Official payroll records and other information showing employees residing

within HUBZones

Citizen documentation for owners Other information supporting HUBZone eligibility requirements


• Review a sample HUBZone application form.• Critical Step – do not attempt to complete the actual online

HUBZone application until you have reviewed the sample form and gathered all documents you need to complete it


• You don’t know what you don’t know…• Review HUBZone eligibility requirements, sample application

form and the documentation you gathered and ask questions


HUBZone Help Desk…[email protected]


• Complete and submit the online HUBZone application


• After application is submitted and reviewed, supporting documents will be requested by the SBA

• Documents must be provided to the SBA within two weeks• Requested documents will include:

– Documentation supporting ownership & control and size standards– Business and personal tax returns– Documents showing compliance with HUBZone employment and

principal office requirements



• Application “times-out”• Unable to access the GLS system• 35% of employees are not located within HUBZone areas• Requested supporting documents do not validate information

in the HUBZone application

Resources


• Interactive forum hosted by HUBZone Program Office.– Tuesdays and Thursdays 1 to 2 p.m. CST– Call 1-888-858-2144, access code 3061773#– HUBZone Program Office will discuss specific eligibility topic followed

by a general question and answer session.

• 15 minute phone appointments with HUBZone staff.– Complete appointment form at: www.sba.gov/hubzone.

http://www.sba.gov/hubzone


• Electronic newsletter used by the HUBZone program office to communicate with interested parties.

• HUBZone certified firms automatically on list.• Anyone interested can subscribe.• Go to www.sba.gov/hubzone and select Get Email Updates

http://www.sba.gov/hubzone

• Thank you for taking the time to learn about the HUBZone program

• Please contact us with any questions you may have• National: [email protected]

• Local: Randall Czaia 612-370-2314, [email protected]


mailto:[email protected]

mailto:[email protected]