Texas Freezes HUB Certifications, What It Means for Small Businesses in Government Contracting
In a move that’s already sending shockwaves through the small business community, the Texas Comptroller has frozen all new and renewed certifications under the Historically Underutilized Business (HUB) program. That means no new HUB certifications will be issued, and expiring ones won’t be renewed, effectively putting the brakes on one of the largest state-level programs supporting minority-, women-, and disabled veteran–owned businesses in public procurement.
If you rely on HUB status to compete for state contracts, this isn’t just a policy shift, it’s a full stop sign.
Let’s break down what happened, what’s at stake, and what you should be doing right now.
The Comptroller’s office announced the freeze on October 28, 2025, just days before the Texas Tribune broke the story wide. According to Acting Comptroller Kelly Hancock, the pause is a “temporary” measure to ensure the HUB program complies with both the U.S. and Texas Constitutions, as well as Governor Greg Abbott’s Executive Order GA-55 banning race- or sex-based preferences in state agencies. The freeze affects any new applications or renewals, so even if your certification is set to expire soon, you won’t be able to extend it.
The official rationale: this is about legal compliance and constitutional alignment. But politically, it’s part of a broader DEI (Diversity, Equity, and Inclusion) rollback across Texas government. Hancock made his stance clear, stating, “We must END ALL DEI in Texas.”
The freeze doesn’t outright kill the HUB program, Hancock doesn’t have that authority. Texas law, dating back to the 1990s, created the HUB framework. Repealing it would require either a legislative vote or a court decision ruling it unconstitutional. But while the law remains on the books, the freeze has an immediate chilling effect on new entrants and expiring participants.
So what does this mean for you if you’re a small business in government contracting?
First, if you’re a woman-, minority-, or disabled veteran–owned firm doing business with Texas state agencies or public universities, your certification status just became a moving target. And without that HUB stamp, you may no longer count toward subcontracting goals or receive targeted solicitations from agencies.
Here’s how it hits:
New applicants can’t get certified, no matter how qualified.
Expiring HUBs will fall off the active directory, losing visibility and outreach advantages.
Prime contractors will struggle to meet subcontracting plan goals, limiting teaming options for small businesses.
Agencies will be unable to meet HUB participation targets, likely skewing contract awards toward incumbents.
Texas has over 16,000 HUB-certified firms. In FY2025 alone, HUB businesses captured about $2 billion in contract awards, that’s 11% of the state’s total procurement spending. Nearly 76% of those awards went to either women-owned or Hispanic-owned businesses. With the certification pipeline shut down, this number is almost certain to drop, fast.
And let’s be clear: this freeze disproportionately hurts smaller, less-established firms. Large primes with long-standing subcontracting networks can adjust. But the freeze slams the door shut on new, emerging HUB vendors looking to build their past performance, visibility, and pipeline.
Even more concerning is the erosion of what HUB status represents: a door-opener, not a guarantee. As small business advisor Julie Irvin Hartman put it, “It gets you into doors you might not have been aware of. But you must have the qualification, capability and capacity to perform.” Without the HUB directory as a platform, those doors are a lot harder to find, or open.
If you’re a government contracting business affected by this, don’t wait for the Legislature to act. Here’s what to do right now:
Check your HUB expiration date. If your cert is set to expire soon, get proactive with your agency contacts. Leverage your existing work history and performance in lieu of formal certification.
Double down on other certifications. If you qualify for SBA 8a certification, women owned small business certification, or disabled veteran small business certification, now’s the time to pursue them. These federal contracting certifications can open new doors, even as state ones close.
Update your contractor NAICS code and profiles. Make sure your business is listed accurately in the Centralized Master Bidders List (CMBL), SAM.gov, and any relevant agency directories. Your presence online matters more than ever.
Explore local teaming options. If you were planning to leverage HUB status to team with primes, consider pivoting to SBIR grant assistance, micro-purchase engagements, or agency outreach via marketing capability statements.
Start documenting your outreach efforts. Agencies still have HUB participation targets on paper. You may still be able to qualify under “good faith effort” subcontracting plans, even without certification.
For small businesses looking to grow in the state and federal markets, the larger message is clear: government procurement policy is shifting, and you need to be nimble. Whether that means repositioning for SBA 8a contracts services or beefing up your Government Contract Proposal Writing capabilities, don’t let this pause turn into paralysis.
This situation also underscores the importance of understanding the government contracting certification process, and having backup strategies ready when the rules change overnight. Stay informed, stay certified where you can, and keep knocking on doors, even if they look closed.
Want more insight on how certifications play into your growth strategy? Check out our post: Certifications & Set-Asides in the SLED Market: What You Need to Know Before You Bid
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