About Us / Classifieds / Privacy Statements / email webmaster

Please visit our sponsor's web site
sellng to the feds

Everything you need to know about landing government video contracts.

for email updates : Name:    E-mail:    Subscribe Unsubscribe
  1. Introduction
  2. Marketing to the Government
    1. Know the Rules!
    2. Selling to the Feds
      1. Calendar Concerns
      2. Procurement Vehicles
      3. Getting to Know You
    3. The Three Rules of The New Government Contracting
  3. GSA Schedule Contracts
    1. Today GSA, Tomorrow the World
    2. Placing GSA Schedule Orders
    3. What GAO is Saying About Schedule Orders
    4. Incidentally Yours
    5. Leasing Nuts and Bolts
    6. Industrial Funding Fee Update
  4. BPAs and Getting Paid
    1. BPAs 101
      1. An Introduction to Blanket Purchase Agreements
      2. GSA Schedule BPAs
      3. BPAs and the Law
    2. Getting Paid
  5. Formal Competition
    1. The New Bid Protest and Debriefing Procedures
    2. Filing a Timely Protest
    3. Bid Protests: What Happens After Filing
  6. Small Business Contracting
    1. Certifiably Small
    2. Small Business Contracting With the Government
    3. Small Business Subcontracting
    4. HUBba HUBba
  7. Special Requirements
    1. Are You a Sub?
    2. Federal Acquisition of Foreign Products
    3. Record Retention
    4. Procurement Integrity
    5. A Necessary Distance
    6. Suspension and Debarment
    7. The Freedom of Information Act
  8. Federal Links

    HUBba HUBba

    The Small Business Administration just released its final regulations governing its new HUB Zone program. HUB stands for Historically Underutilized Business. The HUB Zone program is designed to give preference to small business concerns (SBC) in economically depressed areas of the country when awarding government contracts. The HUB Zone program regulations were promulgated pursuant to the HUB Zone Act, passed by Congress in 1997.

    The HUB Zone program is limited to small businesses; large businesses may not participate in the HUB Zone program. Small business size status is determined by the SBA using the same Standard Industrial Classification (SIC) Code categories now used to determine whether a business is considered small for a government contract. The SBA will publish and update a list of HUB Zones.

    To be eligible for the HUB Zone program and become a certified HUB Zone SBC, a contractor must be a small business concern owned and controlled by U.S. citizens. The principal office of the contract must be located in the HUB Zone, and at least 35 percent of the concern’s employees must reside in a HUB Zone, a percentage which the contractor must maintain during contract performance. To be considered a resident, the employee must either have registered to vote in the HUB Zone or have resided there for at least 180 days.

    While the definition of a HUB Zone SBC may seem simple, it is fraught with definitional fine lines. For example, the SBA has decided that the term “employee” refers only to full-time employees who work at least 30 hours per week, and excludes part-time or leased employees or consultant contractors. Principal office is defined as the HUB Zone SBC’s largest office where most of its employees work.

    There are also ownership issues. The HUB Zone SBC must be 100 percent owned by U.S. citizens. A foreigner owning as little as .1 percent makes the contractor ineligible. The same result obtains if the foreigner doesn’t currently own any stock in the company but has an option to buy shares at a later date.

    To become a HUB Zone SBC, a contractor must apply to the SBA for certification. The SBA will review the application, and if granted, add the contractor to the list of certified HUB Zone SBCs. Even after certification, the HUB Zone SBC must continue to meet the eligibility requirements before entering into a HUB Zone contract. Once in the HUB Zone program, the SBA may examine a HUB Zone SBC’s eligibility to stay in the program. Contractors found lacking can be decertified. However, there is no term limit to a participant’s stay in the HUB Zone program.

    The reward for achieving HUB Zone SBC is the contractual assistance available through government contracts. An agency may award a sole source contract to a HUB Zone SBC as long as the award price does not exceed $5,000,000 for manufacturing contracts and $3,000,000 for other SIC Codes, and assuming there are no other qualified HUB Zone SBCs likely to submit offers.

    In addition, an agency may conduct a HUB Zone set-aside procurement among several HUB Zone SBCs. Finally, an agency may give a HUB Zone SBC a 10 percent price evaluation preference in unrestricted competitive acquisitions.

    During the contract, a HUB Zone SBC must perform at least 50 percent of the labor services rendered. For supply contracts, the HUB Zone SBC either be a regular dealer of the supplies, or if a manufacturer, must incur at least 50 percent of the manufacturing cost.

    Finally, interested parties can protest the award of a HUB Zone contract or a parties’ eligibility as a HUB Zone SBC.

    Large businesses can use the HUB Zone program to their benefit, too. The SBA amended the small business subcontracting regulations to include HUB Zone SBCs in large contractor’s subcontracting plans. Large businesses contractors will thus be motivated to use HUB Zone SBCs to meet the contractor’s small business subcontracting goals.

    Like any new program regulations, it will take some time for the HUB Zone program regulations to settle down, to see how they work in practice, and survive the first few protest and court challenges. The HUB Zone program, however, reflects a new mood at the SBA that itself mirrors a larger trend in the United States to move away from minority-based social programs to economically based programs where minority status is not determinative. With the SBA’s 8(a) program on the decline, the contracting community may find the HUB Zone program as a welcome, new alternative for giving businesses in economically depressed areas a leg up on their economically better-off competition.

Copyright Andrew Mohr 2000. All Rights Reserved Disclaimer:
This information in this site is for informational purposes only. It is not legal advice and may not be relied upon. For legal advice about any of the topics discussed in this book, please seek the advice of legal counsel.