FAR 19.1306—HUBZone sole-source awards.
Plain-English Summary
FAR 19.1306 explains when a contracting officer may make a HUBZone small business concern award on a sole-source basis instead of using a competition or a small business set-aside. It covers the required order of consideration, the threshold dollar limits for manufacturing and non-manufacturing requirements, the need to confirm that no other HUBZone competition is reasonably expected, the prohibition on using this authority when the requirement is already being performed by or has been accepted for the 8(a) program, the responsibility determination, and the requirement that the price be fair and reasonable. The section also points to the statutory and regulatory authority for sole-source awards and notes that the Small Business Administration may appeal a contracting officer’s decision not to make a HUBZone sole-source award. In practice, this means the contracting officer must document a careful eligibility and market assessment before bypassing competition, and must be prepared to justify both the decision to use or not use the HUBZone sole-source authority and the resulting price. For contractors, this section identifies when a HUBZone firm may receive a direct award opportunity and when the agency must instead consider other acquisition methods.
Key Rules
Consider sole source first
Before considering a small business set-aside, the contracting officer must consider whether a HUBZone sole-source award is appropriate, as long as none of the exclusions in FAR 19.1304 apply. This makes HUBZone sole source a priority consideration in the acquisition planning sequence.
No reasonable expectation of two offers
The contracting officer must not have a reasonable expectation of receiving offers from two or more HUBZone small business concerns. If the market suggests at least two capable HUBZone firms are likely to compete, sole-source authority is not available.
Dollar thresholds apply
The anticipated price, including options, must not exceed $8.5 million for manufacturing NAICS codes or $5.5 million for all other NAICS codes. These caps are a hard eligibility limit for using the HUBZone sole-source authority.
8(a) work blocks use
The requirement cannot currently be performed by an 8(a) participant under subpart 19.8, and it cannot have been accepted by SBA as an 8(a) requirement. If the work is in the 8(a) program, HUBZone sole source is not available.
Responsibility must be established
The HUBZone small business concern must be determined to be a responsible contractor for performance. The contracting officer still must make the normal responsibility determination before award.
Price must be fair and reasonable
Award may be made only if the contracting officer can determine the price is fair and reasonable. Sole source status does not eliminate the need for price analysis or negotiation.
SBA may appeal non-award
If the contracting officer decides not to make a HUBZone sole-source award, SBA has the right to appeal that decision under 13 CFR 126.610. This creates external oversight of the decision not to use the authority.
Responsibilities
Contracting Officer
Assess HUBZone sole-source eligibility before considering a small business set-aside, verify that none of the exclusions in FAR 19.1304 apply, determine whether there is a reasonable expectation of two or more HUBZone offers, confirm the applicable dollar threshold is not exceeded, ensure the requirement is not in the 8(a) program, make a responsibility determination, and establish that the price is fair and reasonable. The contracting officer must also document the basis for using or declining HUBZone sole-source authority.
HUBZone Small Business Concern
Demonstrate eligibility for HUBZone consideration and be prepared to show it is a responsible contractor capable of performing the requirement. If selected for sole-source award, the firm must be able to support a fair and reasonable price and meet all contract performance obligations.
SBA
Monitor the contracting officer’s use of HUBZone sole-source authority and may appeal a decision not to make a HUBZone sole-source award under the cited SBA regulation. SBA also serves as the program authority for HUBZone eligibility and oversight.
Agency Acquisition Officials
Support market research, acquisition planning, and documentation needed to determine whether HUBZone sole-source award is appropriate. They should ensure the requirement is not improperly routed to HUBZone sole source when another socioeconomic program or competition requirement applies.
Practical Implications
This section matters because it gives agencies a direct-award path to HUBZone firms, but only when the market and dollar-value conditions are met. Contracting officers should treat it as a structured exception, not a default shortcut.
A common pitfall is skipping the market research needed to support the finding that there is no reasonable expectation of two or more HUBZone offers. If that finding is weak, the sole-source decision is vulnerable to challenge.
Another frequent issue is overlooking the 8(a) restriction. If the requirement is already being performed by, or has been accepted into, the 8(a) program, HUBZone sole source is not available even if the HUBZone firm is otherwise eligible.
The price analysis still matters. Agencies must be able to explain why the sole-source price is fair and reasonable, especially because there is no competitive price comparison.
Because SBA can appeal a decision not to use HUBZone sole source, contracting officers should document the rationale for both positive and negative decisions carefully. Clear records help defend the acquisition strategy and reduce protest or appeal risk.
Official Regulatory Text
(a) A contracting officer shall consider a contract award to a HUBZone small business concern on a sole-source basis (see 6.302-5 (b)(5)) before considering a small business set-aside (see 19.203 and subpart 19.5 ), provided none of the exclusions at 19.1304 apply; and- (1) The contracting officer does not have a reasonable expectation that offers would be received from two or more HUBZone small business concerns; (2) The anticipated price of the contract, including options, will not exceed- (i) $8.5 million for a requirement within the North American Industry Classification System (NAICS) codes for manufacturing; or (ii) $5.5 million for a requirement within all other NAICS codes; (3) The requirement is not currently being performed by an 8(a) participant under the provisions of subpart 19.8 or has been accepted as a requirement by SBA under subpart 19.8 ; (4) The HUBZone small business concern has been determined to be a responsible contractor with respect to performance; and (5) Award can be made at a fair and reasonable price. (b) The SBA has the right to appeal the contracting officer’s decision not to make a HUBZone sole-source award (see 13 CFR 126.610 ).