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News | Oct. 14, 2021

DLA exceeds small business goal for ninth consecutive year, expands access in underutilized business zones

By Dianne Ryder DLA Public Affairs

Defense Logistics Agency small business officials have reached a significant milestone in a challenging category: historically underutilized business zones.

Congress mandates that government contracting agencies attempt to award at least 3% of all contracting dollars to HUBZone-certified small businesses each year. This is the first year DLA has met – and exceeded – the goal in more than 10 years, DLA Small Business Deputy Director Chris Hall said.  

DLA finished fiscal 2021 at about 3.75% with DLA HUBZone contracts valued at more than $1 billion. 

The HUBZone program is one of four small business socioeconomic contracting programs that also include women-owned small businesses; service-disabled, veteran-owned small businesses; and small disadvantaged businesses. 

“We reserve certain contracts exclusively for competition among HUBZone Program participants and we have the authority to make sole source awards under the program. HUBZone firms also receive a 10% price evaluation preference in procurements not reserved for small business,” Hall said. 

The U.S. Small Business Administration designates HUBZones based on unemployment, income and other criteria to help qualified small businesses increase employment opportunities and grow. HUBZone businesses must be small according to SBA standards, be at least 51% owned and controlled by U.S. citizens, have their principal office located in a HUBZone and have at least 35% of their employees living in a HUBZone. 

“Participants re-certify for the HUBZone program once a year, but there is no limit to the length of time a firm can participate as long as it continues to qualify,” Hall said.

DLA Procurement Technical Assistance Program Manager Sherry Savage said it’s often difficult for small businesses to qualify for the HUBZone Program. 

“Not all small businesses are capable of becoming HUBZone-certified, so it’s very hard for DLA to issue awards to HUBZone businesses and to meet the goal,” she said. 

Because a certain number of the businesses’ employees must live in the HUBZone, Savage said a small business could lose their certification if their employees move outside the HUBZone geographic area.

Savage manages DLA’s Procurement Technical Assistance Centers, whose staff members advise small business owners. Savage said SBA statistics have shown that business applications submitted with PTAC assistance are higher quality than those who applied without PTAC support. 

Hall said the SBA has partnered with PTACs to provide expedited reviews of applications for HUBZone certification.

“SBA created a checklist for the PTACs to use when assisting HUBZone businesses with their applications, and we refer small businesses located in HUBZones to the PTACs for this specialized assistance,” he said.

Small business owners can view the PTAP website for more information and to locate PTACs in their area. 
To build on the momentum of exceeding the HUBZone goal and to further engage with small businesses, DLA Small Business hosted a webinar Oct. 6 and to educate vendors and encourage eligible suppliers to participate. 

“On Oct. 6, we highlighted contract opportunities for HUBZone and other small businesses via DLA’s supply chains,” Hall said. “As a follow up, we’ll reserve time on Oct 27 for attendees to connect with major subordinate command representatives for one-on-one conversations about DLA requirements.”  

DLA Small Business hosts monthly outreach efforts to focus on recruiting viable participants and diversifying the vendor base to meet agency goals, but the October sessions are the first that specifically target HUBZone participation. 

“Maintaining an open and regular dialog with the small business community is a nested level of effort in the DLA Strategic Plan,” Hall said. “We proactively engage with the small business community to increase their knowledge of the DLA mission, requirements and opportunities to expand equity and access into the defense industrial base.”

The HUBZone program is one of the best tools to help fuel small business growth and promotes employment in distressed areas, he added.

“We implement the HUBZone Program to achieve our small business goals and support a strong, dynamic and robust small business defense sector, which is critical to the health of our economy and our nation’s effort to meet challenges from our competitors and adversaries,” he said.