Texas Comptroller Kelly Hancock suspended the Historically Underutilized Business (HUB) program on October 28, 2025, to block new certification applications from minority- and women-owned businesses seeking state contracts, affecting thousands of Texas businesses. The immediate implementation of this measure blocks minority and female business owners from obtaining necessary certifications to access government procurement contracts, which represent lucrative business opportunities.
Constitutional Concerns Drive Controversial Decision
The program faces suspension because its administrative procedures must comply with both the U.S. and Texas Constitutions, as well as Governor Greg Abbott’s Executive Order GA-55, which bans race- and sex-based preferences in government benefit distribution, according to Texas agency guidance. Hancock announced the freeze in a statement, saying Texans need equal opportunities to win government contracts based on performance and value, without any additional requirements.
The Acting Comptroller used X to share his stance by announcing Texas would stop issuing new Historically Underutilized Business certifications. Government contracts should be awarded based on performance and value, rather than on race or sex quotas to determine eligibility. Texas needs to eliminate all Diversity, Equity, and Inclusion programs throughout the state.
Lawsuit Forces State’s Hand, Senator Says
State Senator Royce West, D-Dallas, who co-authored the 1991 HUB program legislation, revealed that a state lawsuit forced the Comptroller to remove HUB information from their website. State Senator Royce West, D-Dallas, explained that certain people actively work to stop the HUB program from operating in Texas. The senator explained that the program served an essential purpose because minority business owners faced discrimination until its creation. The program serves a necessary purpose by supporting business growth for all members of society, according to West.
Decades-Old Program Now Under Scrutiny
The Texas state legislature created the HUB program through official legislation in 1991 to enable minority and women-owned businesses to secure government contracting opportunities. A company must prove ownership of at least 51% by an Asian Pacific American, Black American, Hispanic American, Native American, American woman, or Service-Disabled Veteran to receive HUB status.
The Comptroller’s office will continue to collect business participation data while creating procurement standards that prevent racial and sexual discrimination through rulemaking. The suspension of new certifications does not affect existing contracts or non-HUB related reporting requirements, but eligible businesses can still access state contracts through the Centralized Master Bidders List.
Houston Also Hits Pause on Diversity Certifications
The state action occurred because the City of Houston Office of Business Opportunity suspended new application processing for Minority Business Enterprise (MBE), Women Business Enterprise (WBE), Small Business Enterprise (SBE), and Persons with Disabilities Business Enterprise (PDBE) certifications starting from September 26, 2025, until December 1, 2025. Houston officials announced a certification pause to implement system enhancements, update policies, and simplify procedures.