Legislation to extend the length of time small businesses can participate in the federal Historically Underutilized Business Zone Empowerment Contracting (HUBZone) program, which is designed to help small businesses in economically distressed rural and urban regions.
The HUBZone program provides qualified companies with preferential treatment in federal contracting in the form of “set-asides,” sole-source awards, and price-evaluation preferences. Companies can remain in the program until the area no longer qualifies as a HUBZone, based on improved economic data, and for three years thereafter.
The HUBZone Investment Protection Act of 2017 would extend the three-year transition or “designation period” to seven years, giving communities and businesses more time to develop. The three-year transition period deters small businesses from investing in HUBZones, because such a short time period is not sufficient to justify the financial risk of locating or relocating in a HUBZone.
“This bill would extend HUBZone status from three years to seven for re-designated areas across the state, thereby providing greater opportunities for contracting assistance that helps these small businesses grow and thrive,” said Sen. Jim Risch (R-ID), who co-sponsored the bill along with Sens. Ben Cardin (D-MD), Jeanne Shaheen (D-NH), Mazie Hirono (D-HI), and Chris Van Hollen (D-MD).
“Across America, small businesses continue to be responsible for creating two out of every three new jobs, but this success is still is not reaching every corner of every state,” Cardin said. “The HUBZone program gives a boost to rural and urban regions that have been slow to realize economic recovery and growth.”
Shaheen said giving HUBZone businesses and communities more certainty and time will help them grow.
“Small businesses are the backbone of our economy, and the HUBZone program has the potential to provide a boost to small businesses in struggling areas by helping them compete for federal contracts,” Shaheen said.