Texas Suspends HUB Certification Program Amid Legal Review

Texas has halted the certification process for its Historically Underutilized Business (HUB) program, a move Acting Texas Comptroller Kelly Hancock said was driven by constitutional concerns and a directive from Gov. Greg Abbott’s office.

The decision follows Abbott’s January Executive Order GA-55, which directs all Texas state agencies to “treat people equally regardless of membership in any racial group,” and prohibits the use of race-based preferences in agency rules, policies, employment practices, communications and the awarding of government benefits. The order also explicitly calls for the elimination of race-based criteria from public programs, citing constitutional provisions and recent Supreme Court rulings regarding race-conscious admissions practices.

According to the Comptroller’s office, the freeze aims to align the HUB program with both the U.S. and Texas constitutions, as well as GA-55, by eliminating race- and sex-based criteria from procurement processes. While the suspension is in place, the state will continue to collect business participation data and begin a rulemaking process to revise the program’s standards to be race- and sex-neutral.

“Texans deserve a level playing field where government contracts are earned by performance and best value — nothing more, nothing less,” Hancock said in a statement. He emphasized the agency’s goal to protect taxpayer funds and ensure equal opportunity for all businesses competing for state contracts.

The HUB program has long served as a mechanism to increase contracting opportunities for minority-, women- and service-disabled veteran-owned businesses. These certifications are commonly used by vendors to qualify for subcontracting goals on state contracts or to receive direct consideration in procurement solicitations.

While no existing HUB certifications or active contracts are being revoked under the suspension, the change could have implications for businesses that rely on HUB status for visibility or competitive advantage in bidding. Affected vendors may still compete for contracts and register through the Centralized Master Bidders List, but without the HUB designation during the review period.