Government Support for Wealth Building Strategies The HUBZone

Government Support for Wealth Building Strategies The HUBZone Act and HUBZone Program Implementation A Community Based Program to Stimulate Empowerment, Enterprise, and Employment March 2000

HUBZone History • Public Law 105 -135 - The HUBZone Act of 1997, as well as the Small Business Reauthorization Act • Mandates Federal contracting with qualified small business concerns located in Historically Underutilized Business (HUB) Zones • HUBZones are distressed communities, those areas with high unemployment and/or low income – based upon counties in rural areas and census tracts in urban areas – includes Indian reservations

HUBZone Areas

Requirements to be a Qualified HUBZone Business Concern • Must be a small business - based upon Standard Industrial Classification (SIC) Code • Concern must be owned and controlled only by U. S. citizens • The Principal office of the concern must be located in a HUBZone • At least 35% of the concern’s employees must reside in a HUBZone

HUBZone Contracting Goals A percentage of the total value of all Federal prime contracts is to be awarded to certified HUBZone Businesses –FY 1999 - 1. 0% - $2, 000, 000 –FY 2000 - 1. 5% - $3, 000, 000 –FY 2001 - 2. 0% - $4, 000, 000 –FY 2002 - 2. 5% - $5, 000, 000 –FY 2003+ - 3. 0% - $6, 000, 000

Contract Awards • These are contract awards to procure goods and services from HUBZone areas; they are not grants • Prime contracts – “Set aside” awards – Sole source awards – Price evaluation adjustment (PEA) on qualified full and open competitions • Subcontracts from “large” Federal contractors

Participants - Federal and Commercial As of FY 1999 - 10 Federal agencies: Department of Agriculture Department of Defense Department of Energy Department of Health & Human Services Department of Housing & Urban Development Department of Transportation Department of Veteran’s Affairs Environmental Protection Agency General Services Administration National Aeronautics & Space Administration As of FY 2000 – Three additional agencies: Commerce, Justice, and State – Full and open competitions conducted by all agencies require HUBZone Subcontracting plans As of FY 2001 (October 1, 2000), the HUBZone program will apply to all Federal departments and agencies

HUBZone Certification • Web-based application at SBA site • SBA processing time is 30 days from receipt of a complete package • Certified HUBZone Businesses nationwide, as of: April 1, 1999 - 0 October 1, 1999 - 383 February 1, 2000 - 726 March 15, 2000 - 926 • Efforts are currently underway to revise some aspects of the rule

Challenges and Solutions • Challenge: The Federal agencies are lagging behind in meeting their goals • Solution: Alert Congress • Challenge: Many HUBZone residents comprise a “hard-to-employ” workforce • Solution: Workforce training/preparedness programs and employment opportunities

Challenges and Solutions • Challenge: Most HUBZone area businesses are not knowledgeable of the HUBZone program and how to penetrate the Federal marketplace • Solution: Education and technical assistance

Our Solution: Create a D. C. HUB Zone Revitalization Program Center D. C. HUBZone Businesses • HUBZone Application Assistance • Prime and Subcontract Business Plan Development • Lead Identification and Development • Access to Federal and Local Program Information • Access to HUBZone Resident Labor Resources D. C. HUBZone Revitalization Program Center Government Support Services · Federal Agencies/Programs · District Agencies/Programs Major Federal Contractors Workforce Development Programs & Educational Institutions

Serve as a Knowledge Transfer Facilitator