[House Report 117-326]
[From the U.S. Government Publishing Office]
117th Congress } { Report
HOUSE OF REPRESENTATIVES
2d Session } { 117-326
======================================================================
HUBZONE PRICE EVALUATION PREFERENCE CLARIFICATION ACT OF 2021
_______
May 17, 2022.--Committed to the Committee of the Whole House on the
State of the Union and ordered to be printed
_______
Ms. Velazquez, from the Committee on Small Business, submitted the
following
R E P O R T
[To accompany H.R. 5879]
The Committee on Small Business, to whom was referred the
bill (H.R. 5879) to amend the Small Business Act to clarify the
application of the price evaluation preference for qualified
HUBZone small business concerns to certain contracts, and for
other purposes, having considered the same, reports favorably
thereon without amendment and recommends that the bill do pass.
CONTENTS
I. Purpose and Bill Summary......................................... 1
II. Background and Need for Legislation.............................. 2
III. Hearings......................................................... 3
IV. Committee Consideration.......................................... 3
V. Committee Votes.................................................. 3
VI. Section-by-Section for H.R. 5879................................. 3
VII. Congressional Budget Cost Estimate............................... 4
VIII.New Budget Authority, Entitlement Authority, and Tax Expenditures 4
IX. Committee Oversight Findings and Recommendations................. 4
X. Statement of General Performance Goals and Objectives............ 4
XI. Duplication of Federal Programs.................................. 4
XII. Congressional Earmarks, Limited Tax Benefits, and Limited Tariff
Benefits......................................................... 4
XIII.Federal Mandates Statement....................................... 4
XIV. Federal Advisory Committee Statement............................. 5
XV. Applicability to Legislative Branch.............................. 5
XVI. Changes in Existing Law Made by the Bill, As Reported............ 5
I. Purpose and Bill Summary
The purpose of H.R. 5879, the ``HUBZone Price Evaluation
Preference Clarification Act of 2021'', is to clarify that the
HUBZone price evaluation preference does apply to orders.
II. Background and Need for Legislation
H.R. 5879 was introduced by Representatives Marie Newman
(D-IL) and Maria Salazar (R-FL) on November 4, 2021.
Most federal agencies and prime contractors fall short of
meeting the three percent spending goal for HUBZone firms. In
fact, the HUBZone prime contracting goal has never been met
government-wide. While the U.S. Small Business Administration
(``SBA'') and Congress have taken several steps to improve the
HUBZone program, more still needs to be done to help federal
agencies and prime contractors increase their spending to
ensure the program accomplishes its objectives of incentivizing
the development of underutilized business zones.
The HUBZone price evaluation preference helps to level the
playing field for HUBZone firms in full-and-open competitions
and allows federal agencies greater opportunity to devote
federal spending to HUBZone firms. Currently, the HUBZone price
evaluation preference is not widely used because some agencies
have incorrectly interpreted that the preference does not apply
to orders. As the Federal Government increasingly drives its
spending through indefinite delivery, indefinite quantity
(IDIQ) contracts, a significant opportunity for HUBZone
spending is being lost because the HUBZone price evaluation is
not being applied in the award of orders.
The price evaluation preference language in the Small
Business Act is broad and does not exclude orders. It states
that ``in any case in which a contract is to be awarded on the
basis of full and open competition, the price offered by a
qualified HUBZone small business concern shall be deemed as
being lower than the price offered by another offeror . .
.''\1\ The only exception in the Small Business Act for the
application of the HUBZone price evaluation preference is for
procurements of agricultural commodities.
---------------------------------------------------------------------------
\1\15 U.S.C. Sec. 657a(c)(3)(A) (Emphasis Added).
---------------------------------------------------------------------------
The fact that Congress explicitly provided one exception
but did not provide an exception for orders indicates Congress
did not intend there to be an exception for orders. Moreover,
the price evaluation preference applies to orders because
orders are contracts.\2\ Given the broad language in the
statute, the fact that there is only one explicit exception and
that orders are contracts, the HUBZone price evaluation
preference should be applied as broadly as possible.
---------------------------------------------------------------------------
\2\See FAR 2.101.
---------------------------------------------------------------------------
However, some agencies are not applying the price
evaluation preference to orders based on FAR 19.1304, which
states that ``this subpart'' does not apply to orders under
indefinite-delivery contracts and orders under Federal Supply
Schedule contracts. This interpretation is contrary to the
Small Business Act. FAR 19.1304(b) and (c) state that the
HUBZone provisions in FAR Subpart 19.13 do not apply to orders
under indefinite-delivery contracts or Federal Supply Schedule
contracts--unless those orders are set aside. If the task
orders are set aside, FAR Subpart 19.13 would apply. Thus, the
appropriate exception in FAR 19.1304 is from the HUBZone set-
aside/eligibility components of FAR subpart 19.13, not the
entirety of subpart 19.13. In other words, the intent of FAR
19.1304 is not to exempt application of the HUBZone price
evaluation preference to orders and nothing in FAR 19.1304
explicitly creates such an exception.
III. Hearings
On October 13, 2021, the Subcommittee on Contracting and
Infrastructure held a hearing on growing the small business
supplier base in government contracting. Mr. Victor P. Holt,
President, V-Tech Solutions, Inc., testified at the hearing on
behalf of the HUBZone Contractors National Council. Mr. Holt
stated in his testimony that the HUBZone price evaluation
preference helps create a more equitable system and allows
federal agencies greater opportunity to devote spending to
HUBZone firms. He raised concerns that federal agencies have
failed to apply price evaluation preferences to task orders. He
added that applying price preferences to task orders would
benefit HUBZone firms and the underserved communities they
serve. Mr. Holt urged Congress to pass a bill that clarifies
that the price evaluation preference applies to task orders.
IV. Committee Consideration
The Committee on Small Business met in open session, with a
quorum being present, on May 11, 2022, and ordered H.R. 5879
favorably reported to the House of Representatives. During the
markup, no amendments were offered.
V. Committee Votes
Clause 3(b) of rule XIII of the Rules of the House of
Representatives requires the Committee to list the recorded
votes on the motion to report legislation and amendments
thereto. The Committee voted by voice vote to favorably report
H.R. 5879 to the House at 11:05 A.M.
VI. Section-by-Section for H.R. 5879
Section 1. Short title
This section designates the short title as the ``HUBZone
Price Evaluation Preference Clarification Act of 2021''.
Section 2. Application of price evaluation preference for qualified
HUBZone Small Business Concerns to Certain Contracts
Subsection (a)--In General.
This subsection amends section 31(c)(3) of the Small
Business Act (15 U.S.C. Sec. 657a(c)(3)) by adding
subparagraph (E), which explicitly states that the HUBZone
price evaluation preference applies to unrestricted (that is,
not set aside) orders under an unrestricted multiple award
contract or the unrestricted portion of a contract that is
partially set-aside.
Subsection (b)--Rulemaking.
This subsection requires the SBA to revise any relevant
rules or guidance within 90 days of the enactment of this Act
to implement the requirements of this section.
VII. Congressional Budget Cost Estimate
The Committee has requested but not received a cost
estimate from the Director of the Congressional Budget Office.
VIII. New Budget Authority, Entitlement Authority, and Tax Expenditures
Pursuant to clause 3(c)(2) of rule XIII of the Rules of the
House of Representatives and section 308(a) of the
Congressional Budget Act of 1974, the Committee provides the
following opinion and estimate with respect to new budget
authority, entitlement authority, and tax expenditures. While
the Committee has not received an estimate of new budget
authority contained in the cost estimate prepared by the
Director of the Congressional Budget Office pursuant to Sec.
402 of the Congressional Budget Act of 1974, the Committee does
not believe that there will be any additional costs
attributable to this legislation.
IX. Committee Oversight Findings and Recommendations
In accordance with clause 3(c)(1) of rule XIII and clause
2(b)(1) of rule X of the Rules of the House of Representatives,
the oversight findings and recommendations of the Committee on
Small Business with respect to the subject matter contained in
the H.R. 5879 are incorporated into the descriptive portions of
this report.
X. Statement of General Performance Goals and Objectives
With respect to the requirements of clause 3(c)(4) of rule
XIII of the Rules of the House of Representatives, the
performance goals and objectives of H.R. 5879 are to eliminate
any uncertainty within the contracting community and ensure the
HUBZone price evaluation preference is consistently applied to
orders.
XI. Duplication of Federal Programs
Pursuant to clause 3(c)(5) of rule XIII of the Rules of the
House of Representatives, no provision of H.R. 5879 is known to
be duplicative of another Federal program, including any
program that was included in a report to Congress pursuant to
section 21 of Public Law 111-139 or the most recent Catalog of
Federal Domestic Assistance.
XII. Congressional Earmarks, Limited Tax Benefits, and Limited Tariff
Benefits
With respect to clause 9 of rule XXI of the Rules of the
House of Representatives, the Committee finds that the bill
does not contain any congressional earmarks, limited tax
benefits, or limited tariff benefits as defined in clause 9(e),
9(f), or 9(g) of rule XXI of the Rules of the House of
Representatives.
XIII. Federal Mandates Statement
An estimate of Federal mandates prepared by the Director of
the Congressional Budget Office pursuant to section 423 of the
Unfunded Mandates Reform Act was not made available to the
Committee in time for the filing of this report. The Chairwoman
of the Committee shall cause such estimate to be printed in the
Congressional Record upon its receipt by the Committee.
XIV. Federal Advisory Committee Statement
No advisory committees within the meaning of section 5(b)
of the Federal Advisory Committee Act were created by this
legislation.
XV. Applicability to Legislative Branch
The Committee finds that the legislation does not relate to
the terms and conditions of employment or access to public
services or accommodations within the meaning of section
102(b)(3) of the Congressional Accountability Act.
XVI. Changes in Existing Law Made by the Bill, as Reported
In compliance with clause 3(e) of rule XIII of the Rules of
the House of Representatives, changes in existing law made by
the bill, as reported, as shown as follows: existing law
proposed to be omitted is enclosed in black brackets, new
matter is printed in italic, and existing law in which no
change is proposed is shown in roman:
Changes in Existing Law Made by the Bill, as Reported
In compliance with clause 3(e) of rule XIII of the Rules of
the House of Representatives, changes in existing law made by
the bill, as reported, are shown as follows (new matter is
printed in italics and existing law in which no change is
proposed is shown in roman):
SMALL BUSINESS ACT
* * * * * * *
SEC. 31. HUBZONE PROGRAM.
(a) In General.--There is established within the
Administration a program (to be known as the HUBZone program)
to be carried out by the Administrator to provide for Federal
contracting assistance, including promoting economic
development in economically distressed areas (as defined in
section 7(m)(11)), to qualified HUBZone small business concerns
in accordance with this section.
(b) Definitions Relating to HUBZones.--In this section:
(1) Historically underutilized business zone.--The
terms ``historically underutilized business zone'' or
``HUBZone'' mean any area located within 1 or more--
(A) qualified census tracts;
(B) qualified nonmetropolitan counties;
(C) lands within the external boundaries of
an Indian reservation;
(D) redesignated areas;
(E) base closure areas;
(F) qualified disaster areas; or
(G) a Governor-designated covered area.
(2) Hubzone small business concern.--The term
``HUBZone small business concern'' means--
(A) a small business concern that is at least
51 percent owned and controlled by United
States citizens;
(B) a small business concern that is--
(i) an Alaska Native Corporation
owned and controlled by Natives (as
determined pursuant to section 29(e)(1)
of the Alaska Native Claims Settlement
Act (43 U.S.C. 1626(e)(1))); or
(ii) a direct or indirect subsidiary
corporation, joint venture, or
partnership of an Alaska Native
Corporation qualifying pursuant to
section 29(e)(1) of the Alaska Native
Claims Settlement Act (43 U.S.C.
1626(e)(1)), if that subsidiary, joint
venture, or partnership is owned and
controlled by Natives (as determined
pursuant to section 29(e)(2)) of the
Alaska Native Claims Settlement Act (43
U.S.C. 1626(e)(2)));
(C) a small business concern--
(i) that is wholly owned by one or
more Indian tribal governments, or by a
corporation that is wholly owned by one
or more Indian tribal governments; or
(ii) that is owned in part by one or
more Indian tribal governments, or by a
corporation that is wholly owned by one
or more Indian tribal governments, if
all other owners are either United
States citizens or small business
concerns;
(D) a small business concern--
(i) that is wholly owned by one or
more Native Hawaiian Organizations (as
defined in section 8(a)(15)), or by a
corporation that is wholly owned by one
or more Native Hawaiian Organizations;
or
(ii) that is owned in part by one or
more Native Hawaiian Organizations, or
by a corporation that is wholly owned
by one or more Native Hawaiian
Organizations, if all other owners are
either United States citizens or small
business concerns;
(E) a small business concern that is--
(i) wholly owned by a community
development corporation that has
received financial assistance under
part 1 of subchapter A of the Community
Economic Development Act of 1981 (42
U.S.C. 9805 et seq.); or
(ii) owned in part by one or more
community development corporations, if
all other owners are either United
States citizens or small business
concerns; or
(F) a small business concern that is--
(i) a small agricultural cooperative
organized or incorporated in the United
States;
(ii) wholly owned by 1 or more small
agricultural cooperatives organized or
incorporated in the United States; or
(iii) owned in part by 1 or more
small agricultural cooperatives
organized or incorporated in the United
States, if all owners are small
business concerns or United States
citizens.
(3) Qualified areas.--
(A) Qualified census tract.--
(i) In general.--The term ``qualified
census tract'' means a census tract
that is covered by the definition of
``qualified census tract'' in section
42(d)(5)(B)(ii) of the Internal Revenue
Code of 1986 and that is reflected in
an online tool prepared by the
Administrator described under
subsection (d)(7).
(ii) Exception.--For any metropolitan
statistical area in the Commonwealth of
Puerto Rico, the term ``qualified
census tract'' has the meaning given
that term in section 42(d)(5)(B)(ii) of
the Internal Revenue Code of 1986 as
applied without regard to subclause
(II) of such section and that is
reflected in the online tool described
under clause (i), except that this
clause shall only apply--
(I) 10 years after the date
that the Administrator
implements this clause, or
(II) the date on which the
Financial Oversight and
Management Board for the
Commonwealth of Puerto Rico
created by the Puerto Rico
Oversight, Management, and
Economic Stability Act ceases
to exist,
whichever event occurs first.
(B) Qualified nonmetropolitan county.--The
term ``qualified nonmetropolitan county'' means
any county that is reflected in the online tool
described under subparagraph (A)(i) and--
(i) that was not located in a
metropolitan statistical area (as
defined in section 143(k)(2)(B) of the
Internal Revenue Code of 1986) at the
time of the most recent census taken
for purposes of selecting qualified
census tracts under section
42(d)(5)(B)(ii) of the Internal Revenue
Code of 1986; and
(ii) in which--
(I) the median household
income is less than 80 percent
of the State median household
income, based on a 5-year
average of the available data
from the Bureau of the Census
of the Department of Commerce;
(II) the unemployment rate is
not less than 140 percent of
the average unemployment rate
for the United States or for
the State in which such county
is located, whichever is less,
based on a 5-year average of
the available data from the
Secretary of Labor; or
(III) there is located a
difficult development area, as
designated by the Secretary of
Housing and Urban Development
in accordance with section
42(d)(5)(B)(iii) of the
Internal Revenue Code of 1986,
within Alaska, Hawaii, or any
territory or possession of the
United States outside the 48
contiguous States.
(C) Redesignated area.--The term
``redesignated area'' means any census tract
that ceases to be qualified under subparagraph
(A) and any nonmetropolitan county that ceases
to be qualified under subparagraph (B) for a
period of 3 years after the date on which the
census tract or nonmetropolitan county ceased
to be so qualified.
(D) Base closure area.--
(i) In general.--Subject to clause
(ii), the term ``base closure area''
means--
(I) lands within the external
boundaries of a military
installation that were closed
through a privatization process
under the authority of--
(aa) the Defense Base
Closure and Realignment
Act of 1990 (part A of
title XXIX of division
B of Public Law 101-
510; 10 U.S.C. 2687
note);
(bb) title II of the
Defense Authorization
Amendments and Base
Closure and Realignment
Act (Public Law 100-
526; 10 U.S.C. 2687
note);
(cc) section 2687 of
title 10, United States
Code; or
(dd) any other
provision of law
authorizing or
directing the Secretary
of Defense or the
Secretary of a military
department to dispose
of real property at the
military installation
for purposes relating
to base closures of
redevelopment, while
retaining the authority
to enter into a
leaseback of all or a
portion of the property
for military use;
(II) the census tract or
nonmetropolitan county in which
the lands described in
subclause (I) are wholly
contained;
(III) a census tract or
nonmetropolitan county the
boundaries of which intersect
the area described in subclause
(I); and
(IV) a census tract or
nonmetropolitan county the
boundaries of which are
contiguous to the area
described in subclause (II) or
subclause (III).
(ii) Limitation.--A census tract or
nonmetropolitan county described in
clause (i) shall be considered to be a
base closure area for a period
beginning on the date on which the
Administrator designates such census
tract or nonmetropolitan county as a
base closure area and ending on the
date on which the base closure area
ceases to be a qualified census tract
under subparagraph (A) or a qualified
nonmetropolitan county under
subparagraph (B) in accordance with the
online tool prepared by the
Administrator described under
subsection (d)(7), except that such
period may not be less than 8 years.
(iii) Definitions.--In this
subparagraph:
(I) Census tract.--The term
``census tract'' means a census
tract delineated by the United
States Bureau of the Census in
the most recent decennial
census that is not located in a
nonmetropolitan county and does
not otherwise qualify as a
qualified census tract.
(II) Nonmetropolitan
county.--The term
``nonmetropolitan county''
means a county that was not
located in a metropolitan
statistical area (as defined in
section 143(k)(2)(B) of the
Internal Revenue Code of 1986)
at the time of the most recent
census taken for purposes of
selecting qualified census
tracts and does not otherwise
qualify as a qualified
nonmetropolitan county.
(E) Qualified disaster area.--
(i) In general.--Subject to clause
(ii), the term ``qualified disaster
area'' means any census tract or
nonmetropolitan county located in an
area where a major disaster has
occurred or an area in which a
catastrophic incident has occurred if
such census tract or nonmetropolitan
county ceased to be qualified under
subparagraph (A) or (B), as applicable,
during the period beginning 5 years
before the date on which the President
declared the major disaster or the
catastrophic incident occurred.
(ii) Duration.--A census tract or
nonmetropolitan county shall be
considered to be a qualified disaster
area under clause (i) only for the
period of time ending on the date the
area ceases to be a qualified census
tract under subparagraph (A) or a
qualified nonmetropolitan county under
subparagraph (B), in accordance with
the online tool prepared by the
Administrator described under
subsection (d)(7) and beginning--
(I) in the case of a major
disaster, on the date on which
the President declared the
major disaster for the area in
which the census tract or
nonmetropolitan county, as
applicable, is located; or
(II) in the case of a
catastrophic incident, on the
date on which the catastrophic
incident occurred in the area
in which the census tract or
nonmetropolitan county, as
applicable, is located.
(iii) Definitions.--In this
subparagraph:
(I) Major disaster.--The term
``major disaster'' means a
major disaster declared by the
President under section 401 of
the Robert T. Stafford Disaster
Relief and Emergency Assistance
Act (42 U.S.C. 5170).
(II) Other definitions.--The
terms ``census tract'' and
``nonmetropolitan county'' have
the meanings given such terms
in subparagraph (D)(iii).
(F) Governor-designated covered area.--
(i) In general.--A ``Governor-
designated covered area'' means a
covered area that the Administrator has
designated by approving a petition
described under clause (ii).
(ii) Petition.--For a covered area to
receive a designation as a Governor-
designated covered area, the Governor
of the State in which the covered area
is wholly contained shall include such
covered area in a petition to the
Administrator requesting such a
designation. In reviewing a request for
designation included in such a
petition, the Administrator may
consider--
(I) the potential for job
creation and investment in the
covered area;
(II) the demonstrated
interest of small business
concerns in the covered area to
be designated as a Governor-
designated covered area;
(III) how State and local
government officials have
incorporated the covered area
into an economic development
strategy; and
(IV) if the covered area was
a HUBZone before becoming the
subject of the petition, the
impact on the covered area if
the Administrator did not
approve the petition.
(iii) Limitations.--Each calendar
year, a Governor may submit not more
than 1 petition described under clause
(ii). Such petition shall include all
covered areas in a State for which the
Governor seeks designation as a
Governor-designated covered area,
except that the total number of covered
areas included in such petition may not
exceed 10 percent of the total number
of covered areas in the State.
(iv) Certification.--If the
Administrator grants a petition
described under clause (ii), the
Governor of the Governor-designated
covered area shall, not less frequently
than annually, submit data to the
Administrator certifying that each
Governor-designated covered area
continues to meet the requirements of
clause (v)(I).
(v) Definitions.--In this
subparagraph:
(I) Covered area.--The term
``covered area'' means an area
in a State--
(aa) that is located
outside of an urbanized
area, as determined by
the Bureau of the
Census;
(bb) with a
population of not more
than 50,000; and
(cc) for which the
average unemployment
rate is not less than
120 percent of the
average unemployment
rate of the United
States or of the State
in which the covered
area is located,
whichever is less,
based on the most
recent data available
from the American
Community Survey
conducted by the Bureau
of the Census.
(II) Governor.--The term
``Governor'' means the chief
executive of a State.
(III) State.--The term
``State'' means each of the
several States, the District of
Columbia, the Commonwealth of
Puerto Rico, the United States
Virgin Islands, Guam, the
Commonwealth of the Northern
Mariana Islands, and American
Samoa.
(4) Qualified HUBZone small business concern.--The
term ``qualified HUBZone small business concern'' means
a HUBZone small business concern that has been
certified by the Administrator in accordance with the
procedures described in this section.
(5) Native american small business concerns.--
(A) Alaska native corporation.--The term
``Alaska Native Corporation'' has the same
meaning as the term ``Native Corporation'' in
section 3 of the Alaska Native Claims
Settlement Act (43 U.S.C. 1602).
(B) Alaska native village.--The term ``Alaska
Native Village'' has the same meaning as the
term ``Native village'' in section 3 of the
Alaska Native Claims Settlement Act (43 U.S.C.
1602).
(C) Indian reservation.--The term ``Indian
reservation''--
(i) has the same meaning as the term
``Indian country'' in section 1151 of
title 18, United States Code, except
that such term does not include--
(I) any lands that are
located within a State in which
a tribe did not exercise
governmental jurisdiction on
the date of the enactment of
this paragraph, unless that
tribe is recognized after that
date of the enactment by either
an Act of Congress or pursuant
to regulations of the Secretary
of the Interior for the
administrative recognition that
an Indian group exists as an
Indian tribe (part 83 of title
25, Code of Federal
Regulations); and
(II) lands taken into trust
or acquired by an Indian tribe
after the date of the enactment
of this paragraph if such lands
are not located within the
external boundaries of an
Indian reservation or former
reservation or are not
contiguous to the lands held in
trust or restricted status on
that date of the enactment; and
(ii) in the State of Oklahoma, means
lands that--
(I) are within the
jurisdictional areas of an
Oklahoma Indian tribe (as
determined by the Secretary of
the Interior); and
(II) are recognized by the
Secretary of the Interior as
eligible for trust land status
under part 151 of title 25,
Code of Federal Regulations (as
in effect on the date of the
enactment of this paragraph).
(6) Agricultural commodity.--The term ``agricultural
commodity'' has the same meaning as in section 102 of
the Agricultural Trade Act of 1978 (7 U.S.C. 5602).
(c) Eligible Contracts.--
(1) Definitions.--In this subsection--
(A) the term ``contracting officer'' has the
meaning given that term in section 27(f)(5) of
the Office of Federal Procurement Policy Act
(41 U.S.C. 423(f)(5)); and
(B) the term ``full and open competition''
has the meaning given that term in section 4 of
the Office of Federal Procurement Policy Act
(41 U.S.C. 403).
(2) Authority of contracting officer.--
(A) Sole source contracts.--A contracting
officer may award sole source contracts under
this section to any qualified HUBZone small
business concern, if--
(i) the qualified HUBZone small
business concern is determined to be a
responsible contractor with respect to
performance of such contract
opportunity, and the contracting
officer does not have a reasonable
expectation that 2 or more qualified
HUBZone small business concerns will
submit offers for the contracting
opportunity;
(ii) the anticipated award price of
the contract (including options) will
not exceed--
(I) $7,000,000, in the case
of a contract opportunity
assigned a standard industrial
classification code for
manufacturing; or
(II) $3,000,000, in the case
of all other contract
opportunities; and
(iii) in the estimation of the
contracting officer, the contract award
can be made at a fair and reasonable
price.
(B) Restricted competition.--A contract
opportunity may be awarded pursuant to this
section on the basis of competition restricted
to qualified HUBZone small business concerns if
the contracting officer has a reasonable
expectation that not less than 2 qualified
HUBZone small business concerns will submit
offers and that the award can be made at a fair
market price.
(C) Appeals.--Not later than 5 days from the
date the Administration is notified of a
procurement officer's decision not to award a
contract opportunity under this section to a
qualified HUBZone small business concern, the
Administrator may notify the contracting
officer of the intent to appeal the contracting
officer's decision, and within 15 days of such
date the Administrator may file a written
request for reconsideration of the contracting
officer's decision with the Secretary of the
department or agency head.
(3) Price evaluation preference in full and open
competitions.--
(A) In general.--Subject to subparagraph (B),
in any case in which a contract is to be
awarded on the basis of full and open
competition, the price offered by a qualified
HUBZone small business concern shall be deemed
as being lower than the price offered by
another offeror (other than another small
business concern), if the price offered by the
qualified HUBZone small business concern is not
more than 10 percent higher than the price
offered by the otherwise lowest, responsive,
and responsible offeror.
(B) Procurement of commodities.--For
purchases by the Secretary of Agriculture of
agricultural commodities, the price evaluation
preference shall be--
(i) 10 percent, for the portion of a
contract to be awarded that is not
greater than 25 percent of the total
volume being procured for each
commodity in a single invitation;
(ii) 5 percent, for the portion of a
contract to be awarded that is greater
than 25 percent, but not greater than
40 percent, of the total volume being
procured for each commodity in a single
invitation; and
(iii) zero, for the portion of a
contract to be awarded that is greater
than 40 percent of the total volume
being procured for each commodity in a
single invitation.
(C) Procurement of commodities for
international food aid export operations.--The
price evaluation preference for purchases of
agricultural commodities by the Secretary of
Agriculture for export operations through
international food aid programs administered by
the Farm Service Agency shall be 5 percent on
the first portion of a contract to be awarded
that is not greater than 20 percent of the
total volume of each commodity being procured
in a single invitation.
(D) Treatment of preference.--A contract
awarded to a HUBZone small business concern
under a preference described in subparagraph
(B) shall not be counted toward the fulfillment
of any requirement partially set aside for
competition restricted to small business
concerns.
(E) Application to certain contracts.--The
requirements of subparagraph (A) shall apply to
an unrestricted order issued under an
unrestricted multiple award contract or the
unrestricted portion of a contract that is
partially set aside for competition restricted
to small business concerns.
(4) Relationship to other contracting preferences.--A
procurement may not be made from a source on the basis
of a preference provided in paragraph (2) or (3), if
the procurement would otherwise be made from a
different source under section 4124 or 4125 of title
18, United States Code, or the Javits-Wagner-O'Day Act
(41 U.S.C. 46 et seq.).
(d) Eligibility Requirements; Enforcement.--
(1) Certification.--In order to be eligible for
certification by the Administrator as a qualified
HUBZone small business concern, a HUBZone small
business concern shall submit documentation to the
Administrator stating that--
(A) at the time of certification and at each
examination conducted pursuant to paragraph
(4), the principal office of the concern is
located in a HUBZone and not fewer than 35
percent of its employees reside in a HUBZone;
(B) the concern will attempt to maintain the
applicable employment percentage under
subparagraph (A) during the performance of any
contract awarded to such concern on the basis
of a preference provided under subsection (c);
and
(C) the concern will ensure that the
requirements of section 46 are satisfied with
respect to any subcontract entered into by such
concern pursuant to a contract awarded under
this section.
(2) Verification.--In carrying out this section, the
Administrator shall establish procedures relating to--
(A) the filing, investigation, and
disposition by the Administration of any
challenge to the eligibility of a HUBZone small
business concern to receive assistance under
this section (including a challenge, filed by
an interested party, relating to the veracity
of documentation provided to the Administration
by such a concern under paragraph (1)); and
(B) verification by the Administrator of the
accuracy of any documentation provided by a
HUBZone small business concern under paragraph
(1).
(3) Timing.--The Administrator shall verify the
eligibility of a HUBZone small business concern using
the procedures described in paragraph (2) within a
reasonable time and not later than 60 days after the
date on which the Administrator receives sufficient and
complete documentation from a HUBZone small business
concern under paragraph (1).
(4) Recertification.--Not later than 3 years after
the date that such HUBZone small business concern was
certified as a qualified HUBZone small business
concern, and every 3 years thereafter, the
Administrator shall verify the accuracy of any
documentation provided by a HUBZone small business
concern under paragraph (1) to determine if such
HUBZone small business concern remains a qualified
HUBZone small business concern.
(5) Examinations.--The Administrator shall conduct
program examinations of qualified HUBZone small
business concerns, using a risk-based analysis to
select which concerns are examined, to ensure that any
concern examined meets the requirements of paragraph
(1).
(6) Loss of certification.--A HUBZone small business
concern that, based on the results of an examination
conducted pursuant to paragraph (5) no longer meets the
requirements of paragraph (1), shall have 30 days to
submit documentation to the Administrator to be
eligible to be certified as a qualified HUBZone small
business concern. During the 30-day period, such
concern may not compete for or be awarded a contract
under this section. If such concern fails to meet the
requirements of paragraph (1) by the last day of the
30-day period, the Administrator shall not certify such
concern as a qualified HUBZone small business concern.
(7) Hubzone online tool.--
(A) In general.--The Administrator shall
develop a publicly accessible online tool that
depicts HUBZones. Such online tool shall be
updated--
(i) with respect to HUBZones
described under subparagraphs (A) and
(B) of subsection (b)(3), beginning on
January 1, 2020, and every 5 years
thereafter;
(ii) with respect to a HUBZone
described under subsection (b)(3)(C),
immediately after the area becomes, or
ceases to be, a redesignated area; and
(iii) with respect to HUBZones
described under subparagraphs (D), (E),
and (F) of subsection (b)(3),
immediately after an area is designated
as a base closure area, qualified
disaster area, or Governor-designated
covered area, respectively.
(B) Data.--The online tool required under
subparagraph (A) shall clearly and
conspicuously provide access to the data used
by the Administrator to determine whether or
not an area is a HUBZone in the year in which
the online tool was prepared.
(C) Notification of update.--The
Administrator shall include in the online tool
a notification of the date on which the online
tool, and the data used to create the online
tool, will be updated.
(8) List of qualified hubzone small business
concerns.--The Administrator shall establish and
publicly maintain on the internet a list of qualified
HUBZone small business concerns that shall--
(A) to the extent practicable, include the
name, address, and type of business with
respect to such concern;
(B) be updated by the Administrator not less
than annually; and
(C) be provided upon request to any Federal
agency or other entity.
(9) Provision of data.--Upon the request of the
Administrator, the Secretary of Labor, the
Administrator of the Federal Emergency Management
Agency, the Secretary of Housing and Urban Development,
and the Secretary of the Interior (or the Assistant
Secretary for Indian Affairs), shall promptly provide
to the Administrator such information as the
Administrator determines to be necessary to carry out
this subsection.
(10) Penalties.--In addition to the penalties
described in section 16(d), any small business concern
that is determined by the Administrator to have
misrepresented the status of that concern as a
``qualified HUBZone small business concern'' for
purposes of this section shall be subject to liability
for fraud, including section 1001 of title 18, United
States Code, and sections 3729 through 3733 of title
31, United States Code.
(e) Performance Metrics.--
(1) In general.--Not later than 1 year after the date
of the enactment of this subsection, the Administrator
shall publish performance metrics designed to measure
the success of the HUBZone program established under
this section in meeting the program's objective of
promoting economic development in economically
distressed areas (as defined in section 7(m)(11)).
(2) Collecting and managing hubzone data.--The
Administrator shall develop processes to incentivize
each regional office of the Administration to collect
and manage data on HUBZones within the geographic area
served by such regional office.
(3) Report.--Not later than 90 days after the last
day of each fiscal year, the Administrator shall submit
to the Committee on Small Business and Entrepreneurship
of the Senate and the Committee on Small Business of
the House of Representatives a report analyzing the
data from the performance metrics established under
this subsection and including--
(A) the number of HUBZone small business
concerns that lost certification as a qualified
HUBZone small business concern because of the
results of an examination performed under
subsection (d)(5); and
(B) the number of those concerns that did not
submit documentation to be recertified under
subsection (d)(6).
(f) Authorization of Appropriations.--There is authorized to
be appropriated to carry out the program established by this
section $10,000,000 for each of fiscal years 2020 through 2025.
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