HUBZone construction contracts: set-asides and the price evaluation preference
HUBZone certification helps construction firms two ways: HUBZone-only set-asides, and a price evaluation preference that applies even when the work is competed full and open.
Eligibility
A HUBZone firm must be small, have its principal office in a Historically Underutilized Business Zone, and have at least 35 percent of its employees living in a HUBZone. SBA certifies HUBZone firms and the maps change, so recheck your office and employee addresses when the maps are updated.
The price evaluation preference
In full and open competitions, 10 percent is added to the prices of offerors that are not HUBZone firms for evaluation, though the preference is not applied against an otherwise successful offer from a small business. On large construction solicitations that can be decisive.
Set-asides and goals
The government-wide HUBZone goal is 3 percent of prime contract dollars, and agencies regularly miss it — which makes HUBZone set-asides an easier argument for a contracting officer to accept when the market research supports one.
Limits on subcontracting
On any small business, SDVOSB, 8(a), HUBZone or WOSB set-aside, the prime must do a real share of the work itself: a general construction contractor may not pay more than 85 percent of the amount paid by the government to firms that are not similarly situated, and a specialty trade contractor may not pay more than 75 percent. Cost of materials is excluded from the calculation.
Other guides: Small business · SDVOSB · 8(a) · WOSB
General information, not legal advice. Confirm eligibility and current thresholds with SBA and the solicitation.
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