The U.S. Small Business Administration recently approved a Governor-designated request from the State of Minnesota to expand SBA’s HUBZone program to cover the entirety of Otter Tail County and certain Census tracts in the counties of Becker, Carlton, Chisago, Isanti, Mille Lacs, and Roseau. This designation enables small businesses in high-unemployment, low-income areas to get HUBZone certified and be eligible for special set-aside federal government contracts.

“The expansion of the HUBZone program into Otter Tail County and the addition of 13 other Census tracts across Minnesota makes a significant opportunity for our small business community,” said Brian McDonald, District Director of the SBA Minnesota District Office. “HUBZone certification opens the door for small businesses to compete more effectively for federal contracts, bringing critical investment and job creation to historically underserved areas. This expansion reinforces our commitment to driving economic growth and ensuring that entrepreneurs in rural and low-income communities have the tools they need to succeed.”

Launched in 1999, HUBZones, or Historically Underutilized Business Zones, fuel the development of distressed communities by providing preferential access to federal government contracts for small businesses that operate and employ people within the designated HUBZone. The program’s benefits include competitive and sole source contracting, a 10 percent price evaluation preference in full and open contract competitions, as well as subcontracting opportunities. The federal government has a goal of awarding 3 percent of all dollars (that’s about $15 billion) for federal prime contracts to HUBZone-certified small businesses.

In rural areas, 96.3 percent of establishments are considered small businesses, which employ fewer than 500 people. Small businesses play a critical role in rural communities, where they employ 56.6 percent of total employees.

By the Numbers: Minnesota HUBZone Contracting and Impact* 

57 HUBZone Certified Businesses in Minnesota

315 HUBZone contracts awarded

$25.9 Million in federal contracts in fiscal year 2024

*Based on the place of performance which could be outside the state of Minnesota.

“We are happy to work with the Minnesota SBA in supporting the start and growth of small businesses throughout Minnesota.  A key partnership is the SBDC, which provides no cost consulting. 

For more information on government contracting and small business resources for Minnesota entrepreneurs, visit sba.gov/mn.” Stated Neela Mollgaard, Executive Director, Office of Small Business and Innovation at the Minnesota Department of Employment and Economic Development (DEED).

Christina Nebel-Dickerson, MN APEX Accelerator Program Director added, “Expanding the HUBZone program in Minnesota is another way to support the federal supply chain. Our APEX Accelerator is excited for the prospect of working with even more small businesses to find success in government contracting.”

The U.S. Small Business Administration’s Minnesota District Office, in partnership with the West Central Minnesota Small Business Development Center, is empowering small businesses through a specialized training session on Wednesday, May 22, in Fergus Fall, Minn. This event offers a valuable opportunity for small business owners to learn about the recent HUBZone program expansion and how it can open new doors to federal contracting opportunities across Minnesota.  Those interested in attending may register at SBA Certifications Overview: HUBZone.