State & Local News
Texas Businesses Challenge HUB Program Changes
March 18, 2026
A coalition of minority- and female-owned businesses in Texas has filed a lawsuit against the Texas Comptroller's Office over recent modifications to the state's Historically Underutilized Business (HUB) program. The changes, implemented under interim Comptroller Kelly Hancock, now restrict HUB eligibility exclusively to veteran-owned businesses, excluding minority- and female-owned firms previously supported by the program. Plaintiffs argue that these unilateral changes exceed the Comptroller's authority and violate constitutional protections, potentially impacting state contracting opportunities for diverse businesses.
- Procurement professionals should note the potential legal and policy shifts affecting HUB program eligibility criteria in Texas, which could alter vendor pools and subcontracting plans.
- Contractors and minority-owned businesses may face new barriers to participation in Texas state contracts, requiring adjustments in business development strategies.
- Agencies and procurement officers should monitor the lawsuit's progress as its outcome could influence future HUB program administration and diversity procurement goals.
- This development underscores the importance of understanding state-level procurement program changes and their implications for compliance and competitive positioning.
State contracts should go to the business that delivers the best value for Texas taxpayers, period. Not based on race. Not based on gender. Based on merit.
— Kelly Hancock, Interim Comptroller
The fact that he wasn't even elected by the people of the state of Texas actually makes this even worse.
— Alphonso David, Civil Rights Attorney
To hide behind veterans as justification excluding minority-owned businesses is a simple act of cowardice.
— Boris Miles, State Senator, D 6 Houston
Agencies
Texas Comptroller's Office, Texas Senate, Texas Department of Transportation, Texas Health and Human Services, Texas Facilities Commission
Vendors
Ipsum General Contractors, Williams Professional Water Restoration Service, LLC