WASHINGTON D.C. –United States Senate Committee on Small Business and Entrepreneurship Ranking Member Olympia J. Snowe (R-Maine) released the following statement regarding the Small Business Administration (SBA) issuing a final rule in the Federal Register clarifying and amending the definition of an employee in meeting the 35 percent employment requirement of HUBZone residents as part of eligibility to participate in the program.  The new rule will no longer use a full-time equivalent formula as a measure for determining the number of employees; rather, the employee determination will be simplified to include individuals employed on a full-time, part-time, or other basis, so long as that individual works a minimum of 40 hours per month.  It also makes clear that volunteers are not considered employees.

“I applaud the SBA for promulgating this final rule to clarify the definition of eligible individuals at companies participating in the HUBZone program, a welcome step forward in strengthening this crucial small business contracting program which targets job creation and economic growth in financially distressed areas,” said Ranking Member Snowe.  “The Government Accountability Office has issued several disconcerting reports highlighting fraud and abuse in the program, and I am pleased that the SBA is responding to these concerns in a serious and substantive manner.  Given that the Federal government contracted for over $500 billion in goods and services in Fiscal Year 2009 alone, a properly functioning HUBZone program is all the more critical toward putting Americans back to work, growing our economy, and increasing involvement of small businesses in the Federal contracting process.” 

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