City fights for HUBzone

ESCANABA – Area officials are joining forces to counteract the federal government’s withdrawal of Delta County from a program that encourages economic development. The issue was discussed during the Escanaba City Council meeting Thursday.

Delta County and 13 other counties in the Upper Peninsula are currently designated as HUBZones. This stands for Historically Underutilized Business Zones which give preference to rural companies to be eligible for federal business contracts, explained Amy Berglund, from U.S. Senator Carl Levin’s U.P. office.

Because of eligibility requirements determined by an area’s unemployment and median household income in the 2010 census, Delta County will be dropped from the program by October, Berglund explained. Unemployment decreased, while the median household income rose.

There are 14 companies in the county that qualify for federal contracts through the Small Business Administration which oversees the program, stated Vicki Schwab, director of the Delta County Economic Development Alliance (EDA).

For example, there are small companies in the county where their customer base comes from government contracts such as manufacturing parts for the defense department, Schwab explained.

The local EDA is seeking an extension of the county’s HUBZone to help these businesses, many which depend on federal contracts to keep their workers employed and their businesses operating, she said.

Berglund said the U.S. Senate Committee on Small Business and Entrepreneurship is considering adjusting the program’s requirements to allow more counties to qualify as HUBZones and to re-qualify Delta County.

“The Senate is looking for a more fair way of qualifying,” she said, adding an act of Congress would be required to make any changes in the program.

According to Don Makowski, a representative of the Procurement Technical Assistance Center at the Job Force Board in Escanaba, only four of the 14 U.P. counties now designated as HUBZones will remain in the program this fall. This would include Schoolcraft, Ontonagon, Baraga and Keweenaw counties.

“We’re hoping the Senate can address this issue,” Makowski said.

The Escanaba City Council approved a letter of support to the Senate committee asking for a waiver or an appeals process to re-designate Delta County as a HUBZone.

The letter states, “This program has provided tremendous value to our community and enabled many of our businesses to expand and grow and ultimately create jobs.”

In addition to the Senate committee, the letter will be sent to Governor Rick Snyder, Congressman Dan Benishek, State Sen. Tom Casperson, and State Rep. Ed McBroom.