Small Business Pecking Order

By Robert Brodsky

The hierarchy in small business federal contracting has been thrown into chaos as the U.S. Court of Federal Claims ruled last week that HUBZone small businesses "take priority" in procurement awards above firms owned by socially or economically disadvantaged individuals or service-disabled veterans.

The court's ruling , which was unsealed on March 2, would create a pecking order in small business contracting, with HUBZone companies, which operate in low-income urban and rural neighborhoods, at the top of the food chain. The decision states that agencies must now consider whether HUBZone companies can compete for a contract before awarding it under another small business program or on a sole-source basis.

The decision by Chief Judge Emily Hewitt supports an earlier ruling by the Government Accountability Office and essentially rebukes guidance issued last summer by the Office of Management and Budget and the Justice Department.

We'll have more on this story later today.