U.S. SBA Final Rule on HUBZone eligibility goes into effect

News - Published Jan 20, 2025

Following the publication of a Final Rule on the matter in December of 2024, the U.S. Small Business Administration's (SBA) new regulations relating to eligibility for its "Historically Underutilized Business Zone" (or HUBZone) certification program have gone into effect as of January 16, 2025.

The changes to the eligibility criteria include clarifying that a "principal office" (which must reside in certain geographic HUBZone areas) cannot be a virtual office or PO Box or similar, but must be a dedicated space for that business, even if it is located in a co-working space or similar; requiring at least 35 percent of a business's employees to reside in the HUBZone area; requiring employees of HUBZone firms (for eligibility purposes, relating to the above 35 percent requirement) to work for at least 10 hours per week over four-week period; removing provisions allowing employees (for eligibility purposes) to be paid in "in-kind contributions"; requiring HUBZone firms to be already certified as HUBZones on the date of offer for eligiblity for HUBZone contracts; changing the recertification period for HUBZone firms from annually to triennially; and other changes and definitional clarifications.

Read the Final Rule at https://www.federalregister.gov/documents/2024/12/17/2024-29393/hubzone-program-updates-and-clarifications-and-clarifications-to-other-small-business-programs.