Last year, SB;s HUBZone program received over 5,000 applications from small businesses hoping to gain priority in federal contracting opportunities. The program has recently streamlined processes to minimize waiting periods for new applicants and taken more action to reduce fraud.
About the HUBZone Program
Many government agencies require that a percentage of procurements are-set asid- for small or under-represented businesses, including 8(a), veteran- or woman-owned business designations. Holding one of these designations can provide a competitive advantage when your business is applying for contract opportunities.
One designation that is gaining popularity is a HUBZone certification from the Small Business Administration. The HUBZone Program helps small businesses in distressed urban and rural communities, known as Historically Underutilized Business Zones, gain access to federal set-aside and sole source contracts. It also establishes a price evaluation preference in full and open contract competitions.
Small businesses that maintain a principal office in a designated HUBZone area and employ staff who live in a HUBZone are eligible to apply for certification. As a result, the program aims to add jobs where are they are most needed, and help provide government contracting assistance to businesses in under-represented areas.
Recent Improvements to the HUBZone Program
The HUBZone Program has recently implemented several improvements to improve the application process and reduce the number of ineligible firms posing as HUBZone businesses.
Application Process: Any small business that meets the HUBZone eligibility requirements can apply for HUBZone certification. If you meet the following criteria, your business may be eligible:
- The business is a considered small business based on SBA size standards
- At least 51% of the business is owned by a U.S. citizen
- A principle office must be located in a HUBZone designated area
- 35% of employees must reside in a HUBZone designated area
The eligibility criteria have not changed, but SBA has implemented a'full documen' process for new applicants' essentially, an extensive review that proves applicants meet the qualifying criteria. Though new applicants must submit additional paperwork now, the new process actually helps cut down on the time application reviewers spend searching for additional information. As a result, applicants are now informed of a decision, on average, within 90 days of their submission.
Over the next year, the program examination will be rolled out to firms who are already certified, ensuring that all HUBZone applicants have been through the same review.
Monitoring of Certified Firms: Once your firm is certified by the HUBZone Program, you are eligible to bid on set-aside contracting opportunities with the federal government. As a result, the HUBZone certification is highly coveted and in some cases, abused by non-eligible businesses.
To help crack down on fraud, SB's regional district offices have tightened the monitoring process of certified firms. SBA district offices conduct site visits to determine whether firms are actually operating at their documented location and how many employees are working at that location. In fiscal year 2010 alone, SBA district offices conducted over 1100 site visits of certified firms, a 20% increase over the previous year.
As a result of the site visits, firms that no longer met the qualification criteria were decertified - and in some cases of penalty of perjury, turned over to the Department of Justice, as the two agencies crack down on fraud. If at any point your HUBZone certified firm becomes ineligible based on the acceptance criteria,, you may voluntarily decertify without penalty.
These improvements aim to provide a more level playing field for qualified businesses that are indeed HUBZone eligible, and to punish ineligible firms that attempt to abuse the system. Additionally, contracting agencies can be more assured that the small businesses they are working with are true certified HUBZone firms.
State Government Certification
Many state governments also provide small business certification programs that help small businesses compete for government contracts. Certification criteria at the state level are different than federal criteria. Visit the State Contracting Opportunities page to find out more about your state's certification programs.
Every state and many local governments have economic development agencies dedicated to assisting new and established businesses start, grow and succeed. These agencies often include business location and site-selection services which can help you identify local HUBZone areas.
- SBA's 8(a) Business Development Program provides assistance services that help small, disadvantaged businesses gain access the federal procurement market.
Resources to help women-owned businesses find and bid on federal government contracting opportunities.
- Contract Assistance for Women Business Owners
Tips and advice from SBA to help women-owned businesses bid on federal contracting opportunities.
Provides general business assistance, federal contracting assistance and other outreach services to help assist veteran-owned businesses compete for federal contracting opportunities.