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A state office that worked to increase business opportunities for companies owned by members of underrepresented groups was abolished in the North Carolina budget passed in July.
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The shutdown of the Office for Historically Underutilized Businesses, established in 1999 under an executive order by Democratic Gov. Jim Hunt, took effect immediately, leaving many businesses scrambling to understand its impacts.
Now, a coalition of groups is holding a statewide town hall on Sept. 10 at the International Civil Rights Center & Museum in Greensboro to answer questions business owners, community members, policymakers and others in attendance may have about the closure of the office and other provisions related to minority contracting in the budget
“Thousands of North Carolina firms lost the one office, in existence for 27 years, that was established to assist them with state government and public sector contracting opportunities. Most of these businesses found out about the HUB Office’s elimination after the fact. No one is talking about the devastating impact this is having on our HUB and small businesses,” said Gerry McCants, president of the Greensboro Business League, in a news release shared with The News & Observer.
The league, one of the leading organizations for the event, educates, advocates and litigates on behalf of Black-owned businesses, according to its website.
The town hall “is not a meeting about what happened, but more so about what we do next to rebuild the infrastructure, create new pathways, and ensure our HUB and small businesses are positioned to compete for public-sector opportunities,” McCants said.
The budget, drafted by GOP lawmakers who control the legislature, also eliminated the standalone Office of Minority Health and Health Disparities within the state’s health and human services department. The cuts come as the GOP has sought to eliminate programs and initiatives that consider race, sex and other characteristics in government and education, including by passing laws this year that prohibit DEI initiatives in schools.
“Government contracting should always be focused on ensuring the most effective and efficient use of taxpayer dollars rather than advancing divisive DEI initiatives,” Demi Dowdy, a spokesperson for House Speaker Destin Hall, said in an email statement.
“Closing the HUB Office will save taxpayer dollars by putting merit and fair competition back at the center of the state’s contracting process,” Dowdy said.
The News & Observer reached out to both the GOP Senate and House leadership for comment but did not hear back from Senate leader Phil Berger’s office.
The N.C. Small Business Enterprise program, which was previously managed by HUB and aims to help small businesses compete for contracts, remains active. That office is race, ethnicity and gender neutral.
The town hall event location has significance. Organizers said it was picked because it occupies the Woolworth building where four African American N.C. A&T State University students sat down at a segregated lunch counter in 1960. They were told to leave but remained in their seats, drawing national attention and helping spark a youth-led movement to challenge inequality throughout the South.
Organizers said the question “has moved from the right to sit at the counter to the right to a seat at the table where contracting and procurement decisions are made,” according to the news release shared by CJ Broderick, president & CEO of the Greater Durham Black Chamber of Commerce — also a leading organization for the event, and a member of the NC Coalition of Black Chambers.
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The HUB office was part of the Department of Administration. Among other things, the office certified eligible businesses as “HUB” vendors, a designation that helped them win state contracts. It also provided education and help to business owners to navigate the bidding process and track how much the state was spending with these businesses.
Data from fiscal year 2025 shows that across all state agencies, just under $13 billion was spent on goods and services and construction and design services. Of that, just over $928 million — or 7.22% — was spent with HUB-certified businesses.
Businesses were eligible for certification if they were majority-owned by people who are Black, Hispanic, Asian American, American Indian, female, disabled, or socially and economically disadvantaged. Over 6,000 businesses were certified as of February.
There are 1.1 million small businesses in North Carolina, making up 99.6% of the state’s businesses, according to a U.S. Small Business Administration profile citing 2022 Census data.
. Women owned 46% of businesses (counting those owned equally with men), while Black or African American owners held 18.1%, Hispanic owners held 8.9%, and Asian owners held 5.5% of businesses classifiable by owner race or ethnicity.
For most of these minority groups, that means they were underrepresented in overall small business ownership relative to their share of the population — and then further underrepresented in the share of state contracting dollars they received.
The budget also abolished any advisory committees established by the secretary of administration related to minority-business contracting and cuts several provisions in state law related to minority business recruitment. That includes a law that said when the state — or a local government using state money on a project costing $100,000 or more — undertakes a government construction project, it should aim for at least 10% of the project’s dollar value to go to minority-owned businesses. The budget also bans state and local governments from setting their own minority- or women-owned business participation goals for certain types of contracts.
That HUB certification is no longer recognized and HUB programs and services are no longer available, per the administration department. Contracts already in progress continue, except if notified by the awarding agency, according to the department.
Administration Secretary Gabriel Esparza previously told The N&O in a written statement shared by the department: “We are deeply disappointed by the elimination of the HUB Office and the support it has provided to North Carolina businesses.”
The administration department is part of Democratic Gov. Josh Stein’s Cabinet. Stein signed the budget into law while expressing reservations about some of its provisions.
“For more than 25 years, the HUB program has been instrumental in increasing the number and types of businesses competing for government contracts across North Carolina,” said Esparza, who is the first Latino to head a Cabinet department in the state’s history. “This cut means 10 current employees will lose their jobs, and we are working to help them find other opportunities. We hope to continue to work with many HUB businesses through the Small Business Enterprise program, which will be moving to DOA’s Division of Purchase and Contract.”
Organizers want people who attend the event in September to contact Stein’s office and lawmakers. They are pushing for an executive order to move the Small Business Enterprise office from the Department of Administration to the Department of Commerce and enforceable standards for a requirement in state law for contractors to make a “good faith effort” to recruit small businesses. Organizers also seek restoration of the eliminated staff positions, according to their news release.
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This story was originally published August 20, 2026 at 12:30 PM.