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HUBZones: Will Your City Get Its Fair Share of $6 Billion in Federal Contracts?

Nearly every community has an area that seems to resist the most well-intentioned effort to break the cycle of poverty or improve lackluster economic performance.

There is a new option, a new development tool that can be used. It's the U.S. Small Business Administration's (SBA) HUBZone Empowerment Contracting Program, making available up to $6 billion in annual federal contract awards to small business operations located in distressed communities.

The new HUBZone program is designed to spur economic development and create jobs in places that haven't fully participated in our nation's booming economic prosperity.

HUBZone stands for "historically underutilized business zones." They are defined by an area's economic activity, which usually translates into either low income or high unemployment, and sometimes both.

Today, there are more that 8,000 areas that qualify as HUBZones, including more than 7,000 urban census tracts, 900 rural counties and every federally recognized Native American reservation.

The program is structured to give firms located in HUBZones and employing people who live in HUBZones a leg up on competing for federal contracts.

Overall, the federal government spends about $200 billion per year buying goods and services.

The goal is to annually channel into these HUBZone areas at least three percent of overall federal contracting by 2003, or about $6 billion if present spending patterns continue.

It is easy to find out if your locality qualifies as a HUBZone.

The Small Business Administration has created an interactive website that provides detailed information and identifies HUBZones by state, county and specific address.

Simply go to the SBA website at, then select from the menu or type in an address.

The same website also provides the small business operator with an application needed to obtain certification. To qualify, a small business' principal office must be located in a HUBZone, 35 percent of the firm's workforce must reside within any HUBZone and the company must be owned and operated by U.S. citizens.

As Administrator of the SBA, I am strongly committed to getting the word out about this program and the benefits it can bring to a community. Recently, I traveled to Detroit and Flint, Mich., to participate in HUBZone events with mayors Dennis Archer and Woodrow Stanley.

Over the course of the next 12 months, I will visit at least two empowerment zones each month with the goal of spreading the word on this powerful and important program.

I want to enter into a new and vibrant partnership with the nation's local elected officials to promote small business expansion and the creation of new jobs.

I want to ensure that all members of the National League of Cities are aware of and actively involved in the HUDZone program.

Together, we will forge a partnership between the Small Business Administration and the nation's cities, towns, and villages that will last beyond my tenure as Administrator.

Small businesses are the economic engines that will drive our country's `economy in the new millennium.

Currently, there are 24 million small businesses in the U.S., including millions of self-employed individuals. Almost a quarter of U.S. households are either starting a business, own one, or are investing in someone else's business.

Small business development holds the key to job creation in our communities.

Mayors and city council members know this, so now is the time to develop a solid partnership between your community and the Small Business Administration.

HUBZones are a good place to start. With your help, together we will succeed in lifting up the communities that have been left behind. making this a reality.

Aida Alvarez is Administrator of the U.S. Small Business
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Author:Alvarez, Aida
Publication:Nation's Cities Weekly
Article Type:Brief Article
Geographic Code:1USA
Date:Nov 22, 1999
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