[Federal Register Volume 89, Number 182 (Thursday, September 19, 2024)]
[Proposed Rules]
[Pages 76751-76752]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-21362]


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SMALL BUSINESS ADMINISTRATION

13 CFR Part 126


Clarification to HUBZone Program Updates and Clarifications and 
Potential Reforms

AGENCY: U.S. Small Business Administration.

ACTION: Clarification to proposed rule.

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SUMMARY: The U.S. Small Business Administration (SBA or Agency) 
publishes this document to clarify the scope of a proposed rule 
published on August 23, 2024. The proposed rule is intended to clarify 
and improve policies implemented as part of a comprehensive revision to 
the Historically Underutilized Business Zone (HUBZone) program 
regulations in 2019; to propose several changes to SBA's size and 8(a) 
Business Development (BD) regulations, and technical changes to the 
Women-Owned Small Business (WOSB) and Veteran Small Business 
Certification (VetCert) programs; and to move program-specific 
recertification requirements to a new section that would cover all size 
and status recertification requirements. The proposed rule does not 
address the exclusion from affiliation available to mentor-
prot[eacute]g[eacute] joint ventures or the applicability of the 
HUBZone price evaluation preference to HUBZone joint ventures formed 
under the Mentor-Prot[eacute]g[eacute] Program. Those issues are 
outside the scope of the proposed rule.

DATES: Comments on the proposed rule published at 89 FR 68274 (Aug. 23, 
2024) must be received on or before October 7, 2024.

ADDRESSES: You may submit comments, identified by Docket No. SBA-2024-
0007 or RIN 3245-AH68, by any of the following methods:
     Federal eRulemaking Portal: https://www.regulations.gov 
and follow the instructions for submitting comments.
     Mail (for paper submissions): Laura Maas, HUBZone Program, 
409 Third Street SW, Washington, DC 20416.
    Instructions: All submissions received must include the agency name 
and docket number or Regulatory Information Number (RIN) for this 
rulemaking. All comments received will be posted on https://www.regulations.gov. If you wish to submit confidential business 
information (CBI) as defined in the User Notice at https://www.regulations.gov, please submit the comments to Laura Maas and 
highlight the information that you consider to be CBI and explain why 
you believe this information should be held confidential. SBA will make 
a final determination as to whether the comments will be published or 
not.

FOR FURTHER INFORMATION CONTACT: Laura Maas, Deputy Director, Office of 
HUBZone, [email protected], (202) 205-7341.

SUPPLEMENTARY INFORMATION: SBA issued a proposed rule concerning the 
HUBZone program regulations under RIN 3245-AH68. 89 FR 68274 (Aug. 23, 
2024). The proposed rule is intended to clarify and improve several 
regulatory provisions, including those governing HUBZone contract 
eligibility. The proposed rule would also make several changes to SBA's 
size and 8(a) Business Development (BD) program regulations. In 
particular, the rulemaking would consolidate and redesignate the 
separate recertification requirements for SBA's size, 8(a) BD, HUBZone, 
Woman-Owned Small Business, and Service-Disabled Veteran-Owned Small 
Business programs to a new section to reduce confusion and to ensure 
consistent application of the size and status recertification 
requirements.

[[Page 76752]]

Additionally, the proposed rule would make several clarifications and 
changes to the Mentor-Prot[eacute]g[eacute] Program. First, it would 
clarify that mentors must be organized as for-profit business concerns. 
Second, the rule also proposed to establish consequences and options 
following the acquisition of a firm that is currently participating as 
a mentor in SBA's Mentor-Prot[eacute]g[eacute] Program. Third, the 
proposed rule would revise the Mentor-Prot[eacute]g[eacute] Program 
regulations to make clear that a business concern cannot be a 
prot[eacute]g[eacute] for a total of more than 12 years. The proposed 
rule has a 45-day comment period, with comments due on or before 
October 7, 2024.
    Pursuant to the Agency's Tribal Consultation Policy, SBA consults 
with Tribes, Alaska Native Corporations (ANC), and other Native 
communities prior to implementing regulatory or policy changes with a 
direct and substantial effect on their participation in the HUBZone and 
8(a) BD programs. SBA recognizes that regular communication and 
collaboration between the SBA and its Tribal and ANC stakeholders are 
vital to improving their program participation experience and 
maximizing the benefits to Native American communities, even where SBA 
is not actively considering program policy changes. SBA therefore makes 
efforts to consult Native communities periodically to obtain input on 
how the SBA could improve its programs. To these ends, SBA announced 
that it was holding Tribal consultations concerning the proposed rule 
and the following two matters. 89 FR 59010 (July 22, 2024).
    First, the proposed rule explained that SBA was seeking input on 
how best to implement Executive Order (E.O.) 14112, Reforming Federal 
Funding and Support for Tribal Nations To Better Embrace Our Trust 
Responsibilities and Promote the Next Era of Tribal Self-Determination, 
which directed agencies to identify and execute policy reforms designed 
to promote accessible, equitable, and flexible administration of 
Federal funding and support programs for Tribal Nations to better live 
up to the Federal Government's trust responsibilities and help address 
the needs of all Tribal Nations. The Agency requested comments on 
several potential opportunities for reform as well as one change SBA 
had already made to address the business and economic development needs 
of Tribal Nations.
    Second, SBA requested comments on prospective policy changes 
addressing joint venture participation in SBA programs. Specifically, 
SBA requested input on the perception that mentor-prot[eacute]g[eacute] 
joint ventures are winning an inordinate number of orders issued under 
small business multiple award contracts and suggestions on how to 
incentivize a more equitable marketplace for individual small 
businesses who compete against mentor-prot[eacute]g[eacute] joint 
ventures for multiple award, small business contracts. SBA also sought 
comments on the perception that small businesses often enter joint 
ventures to seek multiple award contract awards because procuring 
agency past performance and experience requirements make it difficult 
for many small businesses to qualify for the awards individually. SBA 
explained it was considering whether to propose eliminating the 
exception to affiliation between an SBA-approved mentor and its 
prot[eacute]g[eacute] for multiple award contracts to address this 
concern. In the alternative, the Agency might consider proposing a rule 
that would allow an exclusion from affiliation for a joint venture 
between a prot[eacute]g[eacute] firm and its mentor only for contracts 
or orders that do not exceed five years. Lastly, the proposed rule 
stated SBA was considering steps to eliminate the applicability of the 
HUBZone price evaluation preference to HUBZone joint ventures formed 
under the Mentor-Prot[eacute]g[eacute] Program.
    This document clarifies that the above-referenced possible 
prospective policy change to eliminate or restrict the exclusion from 
affiliation available to mentor-prot[eacute]g[eacute] joint ventures is 
outside the scope of the proposed rule published on August 23, 2024. 
Additionally, SBA is not addressing the applicability of the HUBZone 
price evaluation preference to HUBZone joint ventures formed under the 
Mentor-Prot[eacute]g[eacute] Program as part of this proposed rule. To 
the extent SBA decides to propose amendments to its mentor-
prot[eacute]g[eacute] joint venture policies beyond those outlined in 
the rulemaking published on August 23, 2024, the Agency would do so 
through a separate proposed notice and comment rulemaking action in 
which all interested SBA stakeholders may participate.

Jaqueline Robinson-Burnette,
Associate Administrator, Office of Government Contracting and Business 
Development.
[FR Doc. 2024-21362 Filed 9-18-24; 8:45 am]
BILLING CODE 8026-09-P