SBA Proposes New Rule Changes for the HUBZone Program
By Robb Wong, SBA Official,
These proposed changes will make the program a more attractive avenue for procuring agencies. While the 8(a) Business Development Program has been an integral part of SBA’s history, the HUBZone Program has the potential to be just as popular.
The problem with existing HUBZone rules and regulations is that compliance is often difficult to achieve and maintain and can change almost without warning – thereby rendering a company ineligible due to no significant fault of the business owner or its employees. Worse – this uncertainty erodes the confidence of the government buyer to use the program.
Two of the main challenges with compliance are: 1) the continuous and unpredictable movement of where a HUBZone is actually located; and 2) maintaining a mix of total employees of which at least 35% reside in a HUBZone. What makes this worse – these two challenges are often conflated.
The public is invited to read the Federal Register notice, which contains details about the proposed changes, and comment on the proposed new rules. The deadline for public comment is December 31, 2018.
The SBA is proposing three changes to the HUBZone program requirements:
1. Freezing the HUBZone maps until 2020 and then update the maps every 5 years
With the maps being updated every 5 years and the redesignation period being 3 years, that’s eight total years – almost as long as the 8(a) certification, which is nine years. And if you’re an 8(a) firm, now you have two certifications. That will increase a company’s federal contracting opportunities.
2. Amend “35% rule” regarding mixture of HUBZone/Non-HUBZone employees.
3. Fix the eligibility requirement for awards.
In summary, these proposed rules will make it easier for HUBZone companies to establish and provide long-term employment in their communities – and, more importantly, improve the quality of solutions for our government.
For more information about the HUBZone program, visit www.sba.gov/HUBZone .
About the Author:
Robb Wong is the Associate Administrator of SBA's Office of Government Contracting and Business Development (GCBD), where he advocates for small businesses and represents them on behalf of the President of the United States.
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