IG: SBA’s 2020 HUBZone, SDB rules threaten SBA’s “integrity”
HUBZone residency rule said against “legislative intent”; Inability to protest SDB disadvantage a “regulatory void”
In a new report, the Small Business Administration’s Inspector General Hannibal “Mike” Ware had some strong criticisms of two SBA final rules put into place in 2020 that he believes are threatening the “integrity” of SBA’s government contracting programs.
He identifies the problematic rules in his Oct. 15 report on Top Management and Performance Challenges Facing the SBA in Fiscal 2022.
One is a HUBZone final rule in 2020 that in some cases allows small businesses to remain eligible for HUBZone set-asides even though they have no employees who are living in the zone.
“HUBZone businesses could have no employees residing in the HUBZone at all and still qualify,” he wrote. “The requirements of the rule are clearly inconsistent with legislative intent.”
The second is SBA’s 2020 direct final rule in May 2020 that removed nearly all regulation of Small Disadvantaged Businesses under the claim of removing redundant or obsolete rules. That action created a “regulatory void,”...more....
