Federal HUB Zone
The HUB Zone Empowerment Contracting Program stimulates economic development and creates jobs in urban and rural communities by providing Federal contracting preferences to small businesses. These preferences go to small businesses that obtain HUB Zone certification in part by employing staff who live in a HUB Zone. The company must also maintain a “principal office” in one of these specially designated areas. In general the company must be a small business as defined by SBA size standards; its principal office must be located within a HUB Zone; it must be owned and controlled by one or more U.S. citizens; and at least 35% of its employees must reside in a HUB Zone. Generally speaking, there are two levels of benefit. The first relates directly to Federal contracts, while the second involves specialized assistance.
Contracts can be set-aside for HUB Zone competition when the contracting officer has a reasonable expectation that at least two qualified HUBZone small business concerns (SBCs) will submit offers and that the contract will be awarded at a fair market price.
HUB Zone contracts can be awarded if the contracting officer determines that:
- only one qualified HUB Zone SBC is responsible to perform the contract,
- two or more qualified HUB Zone SBCs are not likely to submit offers and
- the anticipated award price of the proposed contract, including options, will not exceed: $5 million for a requirement within the North American Industry Classification System (NAICS) code for manufacturing or $3 million for a requirement within all other NAICS codes.
Full and open:
Competitive contracts can be awarded with a price evaluation preference. The offer of the HUB Zone small business must not be 10 percent higher than the offer of a non-small business.
All subcontracting plans for large business Federal contractors must include a HUB Zone subcontracting goal.