Recently I ran a number of tests to track down the issue, and discovered that it seems to be directly tied to the zone tiles. If more than one town exists inside the same zone, only the first town loaded (based on mod load order and SID value best I can tell) will be able to spawn bar squads.
It mostly only affects modders, though Heng proves a fair bit annoying to players, since it is left absent of recruits and other bar squads. Hopefully the extra information can lead to a fix in a future patch. Happy to provide any files or information needed.
