WASHINGTON – The head of a national advocacy organization for HUBZone contractors warned that funding for the Native-friendly bidding preference on tribal projects will dry up if either of two bills passes the Senate.
All of Indian country is defined as a HUBZone. The bidding preference program provides an edge to economically-underdeveloped areas in the competitive field of contract work for the federal government. Ron Newlan, president and chairman of the HUBZone Contractors National Council and an accomplished veteran of the federal contracting process, urged the Native business community to resist language in the bills that would lower the so-called priority preference order of HUBZone projects. In effect, the bills as they now stand would forbid procurement officers from accepting a HUBZone bid on a government project if any contract bidder from the higher-priority categories could also do the work.
“If any entity in priority one [or two] can do the work, that alone will decimate the HUBZone program,” Newlan told National Indian Business Association conferees Sept. 11. “Anything at priority two or lower will dry up” in terms of federal procurement contracts.
HUBZone bids now share top priority preference for certain contracting advantages with “8(a)” project bids. Bids under 8(a) (shorthand for the popular minority preference program) would remain a top priority under the bills, but HUBZone projects would bump down to third priority after a service-disabled veterans priority in H.R. 1460, the Veterans Entrepreneurship and Benefits Improvement Act of 2003. The other bill, H.R. 2802, the Small Business Administration Reauthorization Act, contains “the same deadly priority program,” Newlan said.
John Ahmie, president and chief executive officer of Laguna Industries Inc., said Newlan’s concerns are valid. Often, he explained, prime contractors can offer tribal subcontractors million-dollar projects because of the HUBZone preference, the advantages of which can be structured into the prime contractors’ bid on federal procurements. The business edge provided by HUBZone can often make the difference between a successful and a rejected bid. A lower priority for HUBZone projects could certainly eliminate that edge for Indian businesses in many cases, Ahmie said. He added that it is one of the few such edges left to Indian businesses that graduate from 8(a) programs, as they must after nine years. As such it can fulfill an important “transition” function before tribal businesses enter a fully competitive free market without federal preferences.
Newlan said H.R. 1460 and 2802 could both be voted on before the next Congressional recess, scheduled for October.
