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U.S. Ninth Circuit Court of Appeals
Jan I I, 2006


The Court says:
Congressional intent 'clear and explicit' for priority of
HUBZone concerns in Federal contracting over small
business set-asides.

  • Used phrase 'unequivocal terms' that contracts be

designated as a HUBZone set-aside when criteria met:

  • Cited SBA regulations and current FAR that contracting

officer 'must set aside the requirement for competition
restricted to qualified HUBZone

    • (1) Expects two or more HUBS will compete; and
    • (2) Fair market price

    There is no statutory percentage HUBZone goal for subcontracting.
    Agencies tend to agree on 3% as annual goal
    For most large contracts over $500,000 or $1 million, large business contractors must create a subcontracting plan reflecting HUBZone firm participation

    Four Common Myths That Severely Impact
    HUBZone Contract Opportunities

      • MYTH #1. It's difficult to identify HUBZone firms when conducting market research to establish a basis for a HUBZone set-aside.
      • Reality: ft's actually quite simple to identify HUBZone firms through the following sources:
      • HUBZone Home Page http://www.sbaonline.sba.gov/hubzone/

      Four Common Myths Severely Impacting
      HWBZone Contract Opportunities

      MYTH #2. The HUBZone portfolio is composed of small, undercapitalized, low-tech service and construction firms.

        • Reality: The HURZone portfolio of over 13,000 firms includes capability in virtually every NAICS code procured by the Federal Government. HUBZone Portfolio includes:
        • 931 forms with annual revenue of $10 mullion+
        • 620 firms with over 100 employees
        • 141 clothing manufacturers
        • 498 machine shops
        • 1,177 computer service firms

         

          • MYTH #3. The 'HUBZone Rule of Two' does not apply to procurement actions that were formerly set-aside for small business (aka -- historical small business set-asides)

            • Reality: There is no exemption to the HUBZone Rule of Two' for historical small business set-asides. The HUBZone Rule of Two' is based upon specific language found in The HUBZone Act of 1997, the FAR, SBA's regulations, Federal Court rulings and GAO decisions. All historical small business set-asides are subject to the 'HUBZone Rule of Two' requirement.

              • MYTH #4. Movement of a historical small business set-aside to a HUBZone set-aside cannot be accomplished until a small business impact study is conducted. If it is determined that the proposed HUBZone set-aside will "impact" a small business (former contract awardee), then the requirement cannot be issued as a HUBZone set-aside.

               

              • Reality: Unlike the 8(a) Program, there is no requirement to conduct an impact study when a procurement is moved from a small business set-aside to a HUBZone set-aside