HUBZone Program Examination

Welcome back to our blog.  Our topic today is on the HUBZone Program Examination. Subjects covered include:  When does the Small Business Administration (SBA) conduct examinations?  What documents will SBA check?. By what means, does SBA conduct a program audit? Now, let's talk about who conducts the HUBZone Program Examination.

Who Conducts SBA HUBZone Program Examinations?

Of course,  SBA Headquarters is responsible for HUBZone Program Examinations.   However, the local SBA District Office may be tasked to visit you. If the local district office is not able to visit, they may ask a resource partner to complete the visit.  Who are SBA Resource Partners?  They are the Small Business Development Centers (SBDC), SCORE, and Woman Business Centers (WBC).  Normally, this will only happen if there is a time constraint or your office is greater than 200 miles from the local SBA office.  For more information on these resource partners, see my blog.

Each year, SBA determines the number of businesses to review.  Important to realize that program examinations can be part of an application, recertification, or protest. In addition, SBA has added businesses that received HUBZone contracts.  They have established criteria to select businesses. It is important to realize that why SBA is selecting these businesses. SBA wants to ensure you qualified HUBZone businesses have opportunities to compete on these contract. So, if you win HUBZone contracts you can expect SBA to pay you a visit.  Are HUBZone Program Examinations a bad thing?  No. SBA is protecting the HUBZone program.  Thus ensuring that only qualified HUBZone businesses receive these contracts.  

Most HUBZone certified businesses are glad that SBA pays them a visit.  This is a chance for the local business to ask questions and get help from the SBA.  These businesses are grateful to SBA for ensuring that only qualified businesses can compete on these contracts.

Next, let's look at the definition of a HUBZone Program Examination.

What is a HUBZone Program Examination?

A HUBZone Program Examination is an investigation by SBA to verify the accuracy of any HUBZone certification, application or protest.   As part of the program examination, SBA may review the following:  financial documents, payroll listings, corporate documents, property tax, public utilities, postal records, and other documents. The HUBZone Program reviewer will verify the information contained in your application, recertification or protest.  Also, SBA can review these documents if you are successful in winning HUBZone contracts.

In a moment, I will explain when SBA performs Program Examination.

Where Will the HUBZone Program Examination Take Place?

SBA will visit all business locations.  This will include locations outside a HUBZone area.  However, SBA Headquarter employees conduct the program examination.  That does not mean that the local district office will not participate in the examination.  Normally, the local district office will only perform the HUBZone site visit. Yet, the local district office may perform program examinations.  Don't worry.  The SBA employee that visits your office will explain the process to you if you ask.

You must keep all documents used to support your HUBZone qualifications for a period of six years.  It is up to you to meet this requirement.

Without delay, let's discuss when the HUBZone Program Examination takes place.

When is a HUBZone Program Examination Performed?

SBA may conduct a program examination at any time.  There is not a specific time period for these reviews.  Program Examination is based on workload and coordination with SBA Headquarters.  You can expect a visit by SBA at any time.

In the meantime, let's look at how SBA gauges HUBZone Program success.

How Does SBA Gauge Success?

For SBA to determine if the HUBZone program is successful they will look at the number of employees, financial documents, number of HUBZone contracts award and total HUBZone dollars awarded.  These reports can be easily obtained from the Federal Procurement Data System (FPDS) website.   Next, we will look at how a HUBZone business maintains its eligibility.

How Does a Small Business Maintain HUBZone Eligibility?

This is a great question.  There are a few steps that you need to do to maintain your eligibility.  The first is to recertify our eligibility every three years.  In order to do this, you must recertify to SBA within 30 days after your third anniversary and each three-year period thereafter.  Unfortunately, if you do not do this SBA can initiate decertification proceedings.  Once decertified, you will again have to submit a new application.  Your re-certification must be in writing addressed to SBA HUBZone Director.  Also, include a statement in the letter that there have not been any material changes in your eligibility.

Next, our discussion is on HUBZone businesses obligations to SBA.

What are HUBZone business obligations to SBA?

This question has been answered already in this article, but we will go over the requirements again.  A HUBZone business must notify SBA immediately of any changes that may affect your eligibility.  What changes?  SBA considers the following a material change:

You changed your ownership; Business structure change; The principal office relocated; and Not meeting the 35% HUBZone residency requirement.

Remember to submit your written request to the Director of HUBZone.  Failure to do so can result in your business being removed from the HUBZone listing. Not only that but you will no longer be eligible for HUBZone contracts!  In fact, SBA can impose penalties on companies that do not comply.  Don't let that happen to you. Remember to contact your local SBA office if your business is no longer on the HUBZone listing. They can assist you in this matter.

In Conclusion

In conclusion, there is nothing to fear from SBA performing a HUBZone Program Examination.  This should set your mind at ease by knowing that you follow HUBZone Program requirements.

We hope that you are enjoying our articles, consider going to our blog.

Website:  dsbs.sba.gov for list of HUBZone certified businesses.

www.sba.gov/hubzone for SBA HUBZone program and maps

 

Contact Nancy at [email protected]