[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.

           *       *       *       *       *       *       *


                                  [all]