Authority/Reference(s) Texas Government Code §2161; 34 Texas Administrative Code §20.285
Revision Date December 2, 2024

Policy

A Historically Underutilized Business (HUB) Subcontracting Plan (HSP) is written documentation demonstrating good faith efforts in utilizing HUB subcontractors. An HSP is required with bid solicitation responses for contracts with an expected value of $100,000 or more where probable subcontracting opportunities have been determined. The HSP becomes a provision of the awarded contract and is monitored for compliance during the term of the contract to ensure the prime contractor is utilizing only the approved subcontractors on the HSP.

Subcontractor Notification

The prime contractor will provide notice as soon as practical to all subcontractors (HUBs and Non-HUBs) of their selection as a subcontractor for the awarded contract. The notice must specify at a minimum:

  • The contracting agency’s name (i.e. DFPS);
  • Point of contact;
  • Contract manager;
  • Contract number;
  • Subcontracting opportunity the subcontractor will perform;
  • Approximate dollar value of the subcontracting opportunity; and
  • The expected percentage of the total contract that the subcontracting opportunity represents.

A copy of the notice required by this section must also be provided to DFPS contracting point of contact for the contract no later than ten (10) working days after the contract is awarded.

DFPS will document the prime contractor's performance in the contract file to determine if the contractor is complying with the HSP, considering the following:

  • Whether the prime contractor gave timely notice to the subcontractor regarding the time and place of the subcontracted work;
  • Whether the prime contractor facilitated access to the resources needed to complete the work; and
  • Any other information considered relevant to the contract.

Progress Assessment Report (PAR)

Prime contractors must submit monthly compliance reports in the PAR format to DFPS verifying compliance with the HSP, including the use of any expenditures made to their designated subcontractors.

During the term of the contract, the prime contractor is required to submit a PAR to DFPS with each invoice in the format required by the agency, as a condition for payment. DFPS will monitor the prime contractor's PAR (Form 4536) for HSP compliance and modifications.

DFPS will determine if the value of the payments to subcontractors meet the identified percentage(s) and dollar amounts within the bid respondent’s submitted HSP and whether the prime contractor is complying with utilizing only subcontractors identified in the HSP.

PAR Submission

Prime contractors must submit a monthly PAR even if there are no subcontracting payments for the reporting period. Prime contractors must report HUB and non-HUB subcontractor information.

PARs are a condition of payment from DFPS to the prime contractor and from the prime contractor to the subcontractor.

Prior to DFPS issuing payment to the prime contractor, contract staff must:

  • Collect both the fully populated Excel PAR form (Form 4536) for use in HUB Reporting, and the signed and dated PDF version for contracting records;
  • Verify subcontracting payments on the PAR form (Form 4536) Excel by comparing the subcontractor’s invoices with the invoice submitted by the prime contractor;
  • Verify subcontractors listed on the PAR form with subcontractors listed within the HSP;
  • Upload the completed PAR form and supporting documentation into SCOR.

On a monthly basis, contractors need only to submit the final monthly PAR form (Form 4536) Excel to the DFPS HUB administration HUB inbox, ensuring the excel document is completed in all areas.

HSP Change Request

The purpose of the HSP change request is to identify and request changes to the original HSP. The Form 4529 must be reviewed and approved prior to making any modifications to the original HSP.

The respondent must seek approval from DFPS prior to making any modifications to the original HSP, including the hiring of additional or different subcontractors and the termination of a subcontractor identified in its HSP.

If the HSP is modified without the DFPS prior approval, the respondent may be subject to any and all enforcement remedies available under the contract or otherwise available by law, up to and including debarment from all state contracting.

HSP requested changes must comply with the good faith effort requirements related to developing and submitting an HSP and submitted via email to dfpshub@dfps.texas.gov. If the prime contractor decides to subcontract any part of the contract in a manner that is not consistent with the original HSP (ex. new subcontracting opportunity and/or new subcontractors), the prime contractor must demonstrate good faith efforts by:

  • submitting the HSP Change Request form (Form 4529) and an HSP Good Faith Effort - Method A or B (Attachment A or B) to HUB Administration before subcontracting the work under the contract.

Amending the HSP

Before the prime contractor performs or subcontracts any part of the contract in a manner that is not consistent with its original HSP, the prime contractor must submit an HSP Change Request form (Form 4529) to the respective contract manager and the DFPS HUB Administration.

If using Method B (Attachment B), the prime contractor must submit supporting documentation (ex. e-mail notifications) as evidence of a good faith effort in accordance with the HSP Method B (Attachment B).

For the HSP Good Faith Effort - Method A or B (Attachment A or B) forms, please visit the Comptroller of Public Accounts Statewide HUB Program website at https://www.comptroller.texas.gov/purchasing/vendor/hub/forms.php.