By Jheri Hardaway
Staff Writer
Raleigh, NC — The Historically Underutilized Businesses (HUB) program works to increase the number and types of businesses competing for state contracts, helping the government get the best value for taxpayer dollars. The HUB Office was originally established by law during the 2001 Legislative Session to educate and encourage women-owned and minority-owned businesses on how to compete for contracts with state and local government agencies.
The HUB Office was established to educate HUB firms on how to do business with the state of North Carolina and help eliminate barriers that reduce access to opportunities for HUB firms to participate in the marketplace, so that companies may bid for state government contracts. Additionally, the HUB office was charged with implementing strategies to increase the amount of goods and services acquired by state agencies from certified HUB firms; encourages purchasing officers and capital project coordinators within the state agencies, departments, universities, and community colleges to identify and utilize HUB vendors, contractors, and service providers; and provides resources for HUB firms. The aspirational goal was 10%.
Tammie Hall-Roberts, the former Assistant Secretary and Director of the Office for Historically Underutilized Businesses, emphasised, "The strength of North Carolina's economy depends on ensuring that businesses have the opportunity to compete. The HUB Program has always been about expanding competition, strengthening supply chains, and helping taxpayers receive the best value through a broader, more competitive marketplace. When more businesses are equipped to participate in public contracting, communities benefit through business growth, job creation, and increased economic activity. Regardless of policy changes, investing in the competitiveness and capacity of small businesses remains essential to North Carolina's long-term economic success."
With these efforts halting, not only are businesses in a delicate position, but so are the jobs of more than ten employees and contractors working for the North Carolina Department of Administration in the HUB program. The role of the community now is to create opportunities that can assist HUB’s evolve and become more competitive. Trying to destroy the competitive edge is detrimental to our collective success.
Although this has been painted as an African American avenue to business traction, the last disparity study demonstrates that white females are the largest beneficiaries of HUB resources. Certification as a HUB vendor provides greater exposure for business opportunities in state procurement and contracting. The names of HUB firms are listed in the Vendor Link System, which is widely used by state agencies, universities, community colleges, local schools, local governments, institutions, and the public to locate historically underutilized businesses for goods, services, and construction.
The NC Department of Administration's Office for Historically Underutilized Businesses (HUB) hired Griffin & Strong, P.C (GSPC) to conduct a disparity study on the availability and utilization of minority and women-owned business enterprises and examine relevant evidence of race or gender-based discrimination in Department of Administration contracting. In 2021, the GSPC study found statistically significant underutilization of minority and woman-owned firms in all five (5) Industry Categories of NC State Agency contracting. Support for this statistical data was further reinforced by anecdotal reports and documented marketplace inequities.
The recommendations from the report concluded to first, strengthen the HUB Program by including full-time HUB Coordinators within each Agency, and strengthen the HUB Office’s enforcement authority. Next, review and revise Home Rule Requirements to give local jurisdictions more flexibility in applying Good Faith Effort and establishing Small Business Reserve programs. Lastly, institute MWBE Subcontracting Goals in addition to Annual Goals based upon Availability.
The North Carolina Medical Society reported, “The state of North Carolina allocated $1 million for the NC DOA Disparity Study. In the 2021 legislative budget, $500,000 in recurring funds alongside a $175,000 nonrecurring allocation were directed to the Office for Historically Underutilized Businesses (HUB) to implement the study's recommendations.” As the North Carolina Legislature decided to ignore these recommendations, no state or federal elected official has spoken out about the job loss or the opportunity cost related to this blow to HUB contractors.
