15 USC 657a - HUBZone program

U.S Code last checked for updates: Nov 22, 2024

§ 657a.

HUBZone program

(a)

In general

(b)

Definitions relating to HUBZones

In this section:

(1)

Historically underutilized business zone

The terms “historically underutilized business zone” or “HUBZone” mean any area located within 1 or more—

(A)

qualified census tracts;

(B)

qualified nonmetropolitan counties;

(C)

lands within the external boundaries of an Indian reservation;

(D)

redesignated areas;

(E)

base closure areas;

(F)

qualified disaster areas; or

(G)

a Governor-designated covered area.

(2)

HUBZone small business concern

The term “HUBZone small business concern” means—

(A)

a small business concern that is at least 51 percent owned and controlled by United States citizens;

(B)

a small business concern that is—

(i)

an Alaska Native Corporation owned and controlled by Natives (as determined pursuant to section 1626(e)(1) of title 43); or

(ii)

a direct or indirect subsidiary corporation, joint venture, or partnership of an Alaska Native Corporation qualifying pursuant to section 1626(e)(1) of title 43, if that subsidiary, joint venture, or partnership is owned and controlled by Natives (as determined pursuant to section 1626(e)(2) of title 43);

(C)

a small business concern—

(i)

that is wholly owned by one or more Indian tribal governments, or by a corporation that is wholly owned by one or more Indian tribal governments; or

(ii)

that is owned in part by one or more Indian tribal governments, or by a corporation that is wholly owned by one or more Indian tribal governments, if all other owners are either United States citizens or small business concerns;

(D)

a small business concern—

(i)

that is wholly owned by one or more Native Hawaiian Organizations (as defined in section 637(a)(15) of this title), or by a corporation that is wholly owned by one or more Native Hawaiian Organizations; or

(ii)

that is owned in part by one or more Native Hawaiian Organizations, or by a corporation that is wholly owned by one or more Native Hawaiian Organizations, if all other owners are either United States citizens or small business concerns;

(E)

a small business concern that is—

(i)

wholly owned by a community development corporation that has received financial assistance under part 1 of subchapter A of the Community Economic Development Act of 1981 (42 U.S.C. 9805 et seq.); or

(ii)

owned in part by one or more community development corporations, if all other owners are either United States citizens or small business concerns; or

(F)

a small business concern that is—

(i)

a small agricultural cooperative organized or incorporated in the United States;

(ii)

wholly owned by 1 or more small agricultural cooperatives organized or incorporated in the United States; or

(iii)

owned in part by 1 or more small agricultural cooperatives organized or incorporated in the United States, if all owners are small business concerns or United States citizens.

(3)

Qualified areas

(A)

Qualified census tract

(i)

In general

(ii)

Exception

For any metropolitan statistical area in the Commonwealth of Puerto Rico, the term “qualified census tract” has the meaning given that term in section 42(d)(5)(B)(ii) of title 26 as applied without regard to subclause (II) of such section and that is reflected in the online tool described under clause (i), except that this clause shall only apply—

(I)

10 years after the date that the Administrator implements this clause, or

(II)

the date on which the Financial Oversight and Management Board for the Commonwealth of Puerto Rico created by the Puerto Rico Oversight, Management, and Economic Stability Act ceases to exist,

whichever event occurs first.

(B)

Qualified nonmetropolitan county

The term “qualified nonmetropolitan county” means any county that is reflected in the online tool described under subparagraph (A)(i) and—

(i)

that was not located in a metropolitan statistical area (as defined in section 143(k)(2)(B) of title 26) at the time of the most recent census taken for purposes of selecting qualified census tracts under section 42(d)(5)(B)(ii) of title 26; and

(ii)

in which—

(I)

the median household income is less than 80 percent of the State median household income, based on a 5-year average of the available data from the Bureau of the Census of the Department of Commerce;

(II)

the unemployment rate is not less than 140 percent of the average unemployment rate for the United States or for the State in which such county is located, whichever is less, based on a 5-year average of the available data from the Secretary of Labor; or

(III)

there is located a difficult development area, as designated by the Secretary of Housing and Urban Development in accordance with section 42(d)(5)(B)(iii) of title 26, within Alaska, Hawaii, or any territory or possession of the United States outside the 48 contiguous States.

(C)

Redesignated area

(D)

Base closure area

(i)

In general

Subject to clause (ii), the term “base closure area” means—

(I)

lands within the external boundaries of a military installation that were closed through a privatization process under the authority of—

(aa)

the Defense Base Closure and Realignment Act of 1990 (part A of title XXIX of division B of

;

(bb)

title II of the Defense Authorization Amendments and Base Closure and Realignment Act (Public Law 100–526; 10 U.S.C. 2687 note);

(cc)

section 2687 of title 10; or

(dd)

any other provision of law authorizing or directing the Secretary of Defense or the Secretary of a military department to dispose of real property at the military installation for purposes relating to base closures of redevelopment, while retaining the authority to enter into a leaseback of all or a portion of the property for military use;

(II)

the census tract or nonmetropolitan county in which the lands described in subclause (I) are wholly contained;

(III)

a census tract or nonmetropolitan county the boundaries of which intersect the area described in subclause (I); and

(IV)

a census tract or nonmetropolitan county the boundaries of which are contiguous to the area described in subclause (II) or subclause (III).

(ii)

Limitation

(iii)

Definitions

In this subparagraph:

(I)

Census tract

(II)

Nonmetropolitan county

(E)

Qualified disaster area

(i)

In general

(ii)

Duration

A census tract or nonmetropolitan county shall be considered to be a qualified disaster area under clause (i) only for the period of time ending on the date the area ceases to be a qualified census tract under subparagraph (A) or a qualified nonmetropolitan county under subparagraph (B), in accordance with the online tool prepared by the Administrator described under subsection (d)(7) and beginning—

(I)

in the case of a major disaster, on the date on which the President declared the major disaster for the area in which the census tract or nonmetropolitan county, as applicable, is located; or

(II)

in the case of a catastrophic incident, on the date on which the catastrophic incident occurred in the area in which the census tract or nonmetropolitan county, as applicable, is located.

(iii)

Definitions

In this subparagraph:

(I)

Major disaster

(II)

Other definitions

(F)

Governor-designated covered area

(i)

In general

(ii)

Petition

For a covered area to receive a designation as a Governor-designated covered area, the Governor of the State in which the covered area is wholly contained shall include such covered area in a petition to the Administrator requesting such a designation. In reviewing a request for designation included in such a petition, the Administrator may consider—

(I)

the potential for job creation and investment in the covered area;

(II)

the demonstrated interest of small business concerns in the covered area to be designated as a Governor-designated covered area;

(III)

how State and local government officials have incorporated the covered area into an economic development strategy; and

(IV)

if the covered area was a HUBZone before becoming the subject of the petition, the impact on the covered area if the Administrator did not approve the petition.

(iii)

Limitations

(iv)

Certification

(v)

Definitions

In this subparagraph:

(I)

Covered area

The term “covered area” means an area in a State—

(aa)

that is located outside of an urbanized area, as determined by the Bureau of the Census;

(bb)

with a population of not more than 50,000; and

(cc)

for which the average unemployment rate is not less than 120 percent of the average unemployment rate of the United States or of the State in which the covered area is located, whichever is less, based on the most recent data available from the American Community Survey conducted by the Bureau of the Census.

(II)

Governor

(III)

State

(4)

Qualified HUBZone small business concern

(5)

Native American small business concerns

(A)

Alaska Native Corporation

(B)

Alaska Native Village

(C)

Indian reservation

The term “Indian reservation”—

(i)

has the same meaning as the term “Indian country” in section 1151 of title 18, except that such term does not include—

(I)

any lands that are located within a State in which a tribe did not exercise governmental jurisdiction on December 21, 2000, unless that tribe is recognized after December 21, 2000, by either an Act of Congress or pursuant to regulations of the Secretary of the Interior for the administrative recognition that an Indian group exists as an Indian tribe (part 83 of title 25, Code of Federal Regulations); and

(II)

lands taken into trust or acquired by an Indian tribe after December 21, 2000, if such lands are not located within the external boundaries of an Indian reservation or former reservation or are not contiguous to the lands held in trust or restricted status on December 21, 2000; and

(ii)

in the State of Oklahoma, means lands that—

(I)

are within the jurisdictional areas of an Oklahoma Indian tribe (as determined by the Secretary of the Interior); and

(II)

are recognized by the Secretary of the Interior as eligible for trust land status under part 151 of title 25, Code of Federal Regulations (as in effect on December 21, 2000).

(6)

Agricultural commodity

(c)

Eligible contracts

(1)

Definitions

In this subsection—

(A)

the term “contracting officer” has the meaning given that term in section 2101(1) of title 41; and

(B)

the term “full and open competition” has the meaning given that term in section 107 of title 41.

(2)

Authority of contracting officer

(A)

Sole source contracts

A contracting officer may award sole source contracts under this section to any qualified HUBZone small business concern, if—

(i)

the qualified HUBZone small business concern is determined to be a responsible contractor with respect to performance of such contract opportunity, and the contracting officer does not have a reasonable expectation that 2 or more qualified HUBZone small business concerns will submit offers for the contracting opportunity;

(ii)

the anticipated award price of the contract (including options) will not exceed—

(I)

$7,000,000, in the case of a contract opportunity assigned a standard industrial classification code for manufacturing; or

(II)

$3,000,000, in the case of all other contract opportunities; and

(iii)

in the estimation of the contracting officer, the contract award can be made at a fair and reasonable price.

(B)

Restricted competition

(C)

Appeals

(3)

Price evaluation preference in full and open competitions

(A)

In general

(B)

Procurement of commodities

For purchases by the Secretary of Agriculture of agricultural commodities, the price evaluation preference shall be—

(i)

10 percent, for the portion of a contract to be awarded that is not greater than 25 percent of the total volume being procured for each commodity in a single invitation;

(ii)

5 percent, for the portion of a contract to be awarded that is greater than 25 percent, but not greater than 40 percent, of the total volume being procured for each commodity in a single invitation; and

(iii)

zero, for the portion of a contract to be awarded that is greater than 40 percent of the total volume being procured for each commodity in a single invitation.

(C)

Procurement of commodities for international food aid export operations

(D)

Treatment of preference

(4)

Relationship to other contracting preferences

(d)

Eligibility requirements; enforcement

(1)

Certification

In order to be eligible for certification by the Administrator as a qualified HUBZone small business concern, a HUBZone small business concern shall submit documentation to the Administrator stating that—

(A)

at the time of certification and at each examination conducted pursuant to paragraph (4), the principal office of the concern is located in a HUBZone and not fewer than 35 percent of its employees reside in a HUBZone;

(B)

the concern will attempt to maintain the applicable employment percentage under subparagraph (A) during the performance of any contract awarded to such concern on the basis of a preference provided under subsection (c); and

(C)

the concern will ensure that the requirements of section 657s of this title are satisfied with respect to any subcontract entered into by such concern pursuant to a contract awarded under this section.

(2)

Verification

In carrying out this section, the Administrator shall establish procedures relating to—

(A)

the filing, investigation, and disposition by the Administration of any challenge to the eligibility of a HUBZone small business concern to receive assistance under this section (including a challenge, filed by an interested party, relating to the veracity of documentation provided to the Administration by such a concern under paragraph (1)); and

(B)

verification by the Administrator of the accuracy of any documentation provided by a HUBZone small business concern under paragraph (1).

(3)

Timing

(4)

Recertification

(5)

Examinations

(6)

Loss of certification

(7)

HUBZone online tool

(A)

In general

The Administrator shall develop a publicly accessible online tool that depicts HUBZones. Such online tool shall be updated—

(i)

with respect to HUBZones described under subparagraphs (A) and (B) of subsection (b)(3), beginning on January 1, 2020, and every 5 years thereafter;

(ii)

with respect to a HUBZone described under subsection (b)(3)(C), immediately after the area becomes, or ceases to be, a redesignated area; and

(iii)

with respect to HUBZones described under subparagraphs (D), (E), and (F) of subsection (b)(3), immediately after an area is designated as a base closure area, qualified disaster area, or Governor-designated covered area, respectively.

(B)

Data

(C)

Notification of update

(8)

List of qualified HUBZone small business concerns

The Administrator shall establish and publicly maintain on the internet a list of qualified HUBZone small business concerns that shall—

(A)

to the extent practicable, include the name, address, and type of business with respect to such concern;

(B)

be updated by the Administrator not less than annually; and

(C)

be provided upon request to any Federal agency or other entity.

(9)

Provision of data

(10)

Penalties

(e)

Performance metrics

(1)

In general

(2)

Collecting and managing HUBZone data

(3)

Report

Not later than 90 days after the last day of each fiscal year, the Administrator shall submit to the Committee on Small Business and Entrepreneurship of the Senate and the Committee on Small Business of the House of Representatives a report analyzing the data from the performance metrics established under this subsection and including—

(A)

the number of HUBZone small business concerns that lost certification as a qualified HUBZone small business concern because of the results of an examination performed under subsection (d)(5); and

(B)

the number of those concerns that did not submit documentation to be recertified under subsection (d)(6).

(f)

Authorization of appropriations

(Pub. L. 85–536, § 2[31], as added Pub. L. 105–135, title VI, § 602(b)(1)(B), Dec. 2, 1997, 111 Stat. 2629; amended Pub. L. 106–554, § 1(a)(9) [title V, § 503(b), title VI, § 612(a)], Dec. 21, 2000, 114 Stat. 2763, 2763A–695, 2763A–699; Pub. L. 108–447, div. K, title I, §§ 153, 154, Dec. 8, 2004, 118 Stat. 3458; Pub. L. 111–240, title I, § 1347(b)(1), (c), Sept. 27, 2010, 124 Stat. 2547; Pub. L. 114–92, div. A, title VIII, § 866(c), Nov. 25, 2015, 129 Stat. 932; Pub. L. 115–91, div. A, title XVII, § 1701(a)(1), (2), (b)–(e), (g), (h), Dec. 12, 2017, 131 Stat. 1795–1798, 1800; Pub. L. 116–283, div. A, title VIII, § 864(2), Jan. 1, 2021, 134 Stat. 3784.)

cite as: 15 USC 657a