The state budget dismantled a decades-old system for minority-business certification, participation goals and contracting accountability. Charlotte now faces a larger question: Who will make sure Black-owned businesses still get a fair shot at public dollars?
By The Metro Record
CHARLOTTE, N.C. — For a small Black-owned company trying to win government work, the hardest part of a contract may come long before anyone breaks ground, delivers a product or sends an invoice.
First comes finding the opportunity. Then understanding the bid. Securing insurance. Meeting bonding requirements. Building relationships with prime contractors. Preparing paperwork. Demonstrating past performance. And, in many cases, finding enough cash to carry payroll and expenses while waiting to be paid.
For more than 25 years, North Carolina maintained a state office designed, in part, to help businesses historically left outside that system get through the door.
That office is now gone.
North Carolina’s 2026 budget abolished the Office for Historically Underutilized Businesses, commonly known as the HUB Office, effective July 7. The same legislation went considerably further: It repealed key statutes governing HUB certification, minority-business participation goals, good-faith recruitment efforts and reporting on participation in public contracts. It also repealed local authority for minority- and women-owned business participation requirements except when federal funding rules require them. (North Carolina General Assembly)
Black-owned businesses can still compete for state contracts. What has changed is the infrastructure around that competition — the certification, outreach, goals and public reporting intended to make sure historically excluded firms were not invisible when public money was being spent.
For Charlotte, where local government has spent years building its own supplier-diversity system, that distinction matters.
More Than an Office Closed
The HUB Office was established in 1999 and helped businesses become certified, learn the state’s procurement system, identify contracting opportunities and build the capacity necessary to compete for government work. The North Carolina Department of Administration said the office assisted thousands of business owners over more than two decades. (NC DOA)
Under the former law, historically underutilized businesses included qualifying companies owned and controlled by people from groups specifically identified in statute, including Black, Hispanic, Asian American and American Indian owners, women, people with disabilities and people considered socially or economically disadvantaged. (North Carolina General Assembly)
But the 2026 budget did not simply remove staff from a state agency.
The law erased statutory provisions that had required public entities and contractors to make documented efforts to recruit minority businesses for certain projects. Those efforts could include contacting eligible businesses before bids were due, making plans and specifications available, breaking large contracts into economically feasible pieces and helping firms navigate bonding, insurance, equipment or credit challenges. (North Carolina General Assembly)
The law also eliminated reporting requirements that tracked minority-business utilization and contract awards.
That creates a fundamental accountability question:
If the government no longer has to measure who receives public contracts, how will taxpayers know whether opportunity is actually being distributed fairly?
What Is a HUB?
A Historically Underutilized Business was a state-recognized business meeting ownership and control requirements established under North Carolina law.
The designation did not guarantee a government contract.
Instead, the state’s HUB system created a framework for certification, outreach, procurement education, participation monitoring and efforts to expand the pool of businesses competing for public work.
That distinction is important. The program was not a promise that a Black-owned firm would win a bid. It was an acknowledgment that simply declaring a competition open does not necessarily mean every business enters that competition with the same information, relationships, capital or institutional access.
Why the Change Could Hit Black Businesses Harder
Government contracts can change the trajectory of a small business.
A multiyear construction subcontract can help a company hire additional workers. A professional-services agreement can establish credibility needed to pursue larger clients. A municipal technology contract can provide predictable revenue. A catering, transportation, maintenance or communications contract can become the foundation that allows an entrepreneur to invest in equipment, insurance and employees.
Those opportunities matter even more when capital is difficult to secure.
National Federal Reserve data continue to show significant financial pressure among Black-owned employer firms. In the 2025 Small Business Credit Survey, only 32% of Black-owned firms that applied for loans, lines of credit or merchant cash advances reported receiving the full amount of financing they sought. The survey is a nationwide convenience sample rather than a random sample, but it provides another indication of the financing obstacles many Black entrepreneurs face. (FRED)
Take away structured procurement outreach and the businesses best positioned to benefit may be those already equipped with dedicated procurement staff, established relationships, previous government contracts, access to bonding and enough working capital to survive a lengthy bidding process.
That does not mean a race-neutral procurement system automatically excludes Black businesses.
It does mean officials should be able to demonstrate that it does not.
Charlotte Has Something to Lose
Charlotte’s experience shows just how much money is at stake.
The city’s Office of Charlotte Business INClusion reported more than $185 million in spending with minority-, women- and small-business enterprises in fiscal year 2024. Spending with minority business enterprises increased 31%, according to the city’s annual report. Charlotte also added 153 newly certified vendors and reported that 60 business owners completed its Contractor Development Program, with 13 of them securing city contracts. (City of Charlotte)
Those numbers represent more than a diversity initiative.
They represent contracts, payroll, equipment purchases, tax revenue, business growth and companies building the experience necessary to compete for larger work.
But Charlotte has already begun changing its system to comply with the new state law.
The city says municipalities must discontinue race- and gender-conscious participation goals. Charlotte has also discontinued its Minority Business Enterprise and Women Business Enterprise certification and is directing eligible firms toward a race- and gender-neutral Small Business Enterprise certification instead. (City of Charlotte)
Julius Edwards, outreach and engagement coordinator for Charlotte Business INClusion, told WBTV that the city can no longer target minority- or women-owned businesses for specific opportunities.
The city, he said, will instead continue its small-business programs and small-business certification. (https://www.wbtv.com)
That leaves Charlotte trying to preserve access while operating within a substantially different legal framework.
The Argument for Race-Neutral Contracting
Supporters of North Carolina’s broader rollback of diversity, equity and inclusion programs have argued that government decisions should not be based on race or gender.
House Speaker Destin Hall, a Republican, described the philosophy plainly this summer, saying taxpayer-funded entities should not be engaged in DEI practices. (WRAL News)
The state is not ending all small-business assistance.
North Carolina’s Small Business Enterprise Program is continuing under the Department of Administration’s Division of Purchase & Contract. Unlike the former HUB structure, NCSBE is explicitly race- and gender-neutral. State officials say eligible small businesses can continue pursuing contracts through North Carolina’s electronic Vendor Portal. (NC DOA)
That is the case supporters of the shift can make: Government should help small companies compete without classifying them by race or gender, and contracts should ultimately be awarded based on qualifications, performance, price and procurement requirements.
But that argument produces another set of questions that cannot be answered by philosophy alone.
Will Black-owned businesses receive the same share of opportunities under the new system?
Will they receive the same information?
Will they make it onto the same subcontracting teams?
Will businesses without longstanding relationships with government agencies and prime contractors successfully enter the pipeline?
And if government agencies stop collecting race- and gender-specific contracting data, will anyone be able to answer those questions with evidence?
The Accountability Gap
This may ultimately be the most consequential part of North Carolina’s decision.
A government can eliminate a participation goal with the stroke of a pen.
Eliminating a disparity is harder.
Before the budget change, state law required the collection of information about minority participation in certain public projects. State agencies, universities, community colleges, school systems and other public entities generated reports that could be reviewed over time. The Department of Administration still maintains archived HUB reports documenting that previous system. (NC DOA)
Those records made it possible — at least in principle — to ask whether public procurement was improving.
Going forward, state reporting will focus on small-business participation rather than the racial and gender categories used by the HUB program. (North Carolina General Assembly)
That means Charlotte’s civic institutions, journalists, researchers, chambers of commerce and business organizations will need to think seriously about what can still legally be measured and published.
Because what is not measured can become easy to ignore.
The public should know how much money government institutions spend with small businesses. It should know how many firms bid, how many win, how many become repeat vendors and how much subcontracting flows to emerging companies.
And wherever legally permissible, Charlotte’s institutions should seek transparent ways to understand whether Black-owned businesses are progressing or disappearing from the contracting pipeline.
What Charlotte Businesses Can Do Now
There are still pathways available.
The City of Charlotte says it will continue its Business INClusion resources, including workshops, vendor support, networking opportunities, contractor development and Small Business Enterprise certification. Its SBE process begins with registering as a city supplier and completing the small-business certification application. (City of Charlotte)
Mecklenburg County also maintains business-development resources, including technical assistance, capacity-building programs and contracting guidance, although its own programs will have to operate within the requirements of the new state law. (Office of Economic Development)
The state says vendors should continue monitoring opportunities through North Carolina’s electronic Vendor Portal. Existing state contracts remain in effect unless an awarding agency says otherwise, but state government will no longer recognize HUB certification for new procurement purposes. (NC DOA)
Charlotte is also bringing businesses and procurement professionals together. A Business Connections Event is scheduled for Sept. 10 at the Charlotte-Mecklenburg Government Center, where business owners can learn about certification, meet city officials, speak with procurement professionals and connect with prime contractors. (https://www.wbtv.com)
Organizations already working with Charlotte businesses — including the Charlotte Mecklenburg Black Chamber of Commerce, Metrolina Minority Contractors Association, Central Piedmont Community College’s Small Business Center and other professional associations — may become even more important as businesses search for information and relationships once provided through the state system. (City of Charlotte)
The Question Is Who Steps In
The end of North Carolina’s HUB Office can be described as an administrative change.
For a Black entrepreneur trying to grow a company, it may feel like something much larger.
A contracting system is built not only from bids and specifications, but from information, relationships, capital, trust and accountability. Businesses that have spent decades trying to gain access to those networks now face a system with fewer formal mechanisms specifically designed to ensure they are seen.
Charlotte still has tools. It still has institutions with deep experience helping small businesses. It still has chambers, contractor organizations, lenders, accelerators and entrepreneurs willing to help one another.
But local leaders should resist treating the state’s decision as the end of the conversation.
They should publish the contracting data they can legally collect. They should expand small-business training and bonding assistance. They should make procurement pipelines easier to see. Prime contractors should disclose how they are building subcontracting teams. Major private institutions should maintain transparent supplier pathways. And business organizations should document what happens to Black-owned firms over the next several years.
Because the real impact of this law will not be measured by the number of offices closed in Raleigh.
It will be measured in Charlotte by the companies that get the call — and those that do not.
By the businesses that win their first major contract — and those that never learn it was available.
By the employees who get hired.
By the companies that grow.
And by whether public dollars continue creating opportunity in communities that spent generations fighting for a place at the table.
I kept the piece as reported analysis rather than inventing the Black business-owner anecdote called for in the outline. Once you have an original Charlotte business-owner interview, that voice can replace the opening and closing and make the story substantially stronger.
