Texas has removed Historically Underutilized Business certification from the large majority of the women and minority-owned firms that held it. Under emergency rules issued by the acting state comptroller in December, more than 15,000 businesses, close to 97 percent of the program's certified firms, lost their HUB status. The certification is what qualifies a company to compete for a slice of the state's contracting dollars, so losing it is not a paperwork change. It is a lock on the door to public work.
The HUB program was built to widen access to state contracts for businesses that have historically been shut out of them. The December rules recast the program in a way that stripped the certifications from the very owners it was designed to reach, and did it quickly, leaving companies that had planned and bid around HUB status suddenly outside the system.
In March, the response arrived in court. A group of business owners and a trade association, the greater Houston chapter of the National Association of Minority Contractors, sued the state and the acting comptroller over the emergency rules. The filing has been called a landmark challenge: it takes on whether a state agency can dismantle a long-standing certification program by rule, without the legislative process, and reset who gets to compete for public dollars in the country's second-largest economy.
“A certification is a door into billions in state contracts. For more than 15,000 firms, that door was closed by rule, almost overnight.”
In April, an Austin district judge granted early relief, temporarily blocking the removal and ordering the reinstatement of the first businesses that sued. It is a narrow, temporary win rather than a final answer, and it applies to the plaintiffs while the larger fight continues. A trial is set for November 9.
Why we are keeping this on the record: contracting certifications are one of the few concrete tools that move real money toward Black and minority-owned firms, and the outcome here will shape access far beyond Texas. Fifteen thousand businesses did not go quiet when the rule came down. They organized, they filed, and they got the first ruling to go their way. The record continues.
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