WASHINGTON — Today, the U.S. Small Business Administration (SBA) sent a letter to 154 Washington, D.C.-based 8(a) firms initiating termination proceedings after an internal review revealed that the firms failed to meet “economic disadvantage” eligibility requirements in the 8(a) Business Development Program. The firms – which will be suspended for at least 30 days before final termination from the 8(a) Program – exceeded statutory net worth limits, adjusted gross income caps, or total asset limits. Collectively, these firms received nearly $1.3 billion in 8(a) set-aside and sole-source contracts during the Biden Administration, from Fiscal Year 2021 to 2024.
“Under President Trump, the SBA is restoring integrity to federal contracting programs that promoted both discriminatory DEI and rampant abuse during the Biden Administration,” said SBA Administrator Kelly Loeffler. “Today, we are taking action to terminate 154 D.C. firms that received $1.3 billion in federal contracts, all of whom were allowed to stay in the 8(a) Program even when they were not economically disadvantaged. This Administration is enforcing the law – which means we’re ending DEI discrimination, rooting out abuse, and removing big companies that unfairly dominated the federal contracting marketplace to the detriment of eligible, honest small business owners.”
The termination proceedings come after a program integrity review by SBA’s Office of Government Contracting and Business Development (GCBD), which routinely verifies that all 8(a) firms meet program eligibility requirements, including those for economic disadvantage.
The SBA’s internal review found that one Washington, D.C. 8(a) firm reported total assets of more than $35 million – over 5 times the statutory eligibility limit – while the firm continued pursuing set-aside contracting opportunities that were reserved for economically disadvantaged businesses. Another firm reported a net worth of at least $24 million and submitted financial statements in September 2021 showing that they exceeded the total asset limit – yet the Biden Administration kept them in the program. Of the $1.3 billion that the 154 8(a) firms received, nearly $1 billion was awarded by the Biden Administration through noncompetitive and nontransparent sole source contracts.
Under Administrator Loeffler’s leadership, the SBA is scrutinizing every 8(a) participant to restore integrity to federal small business contracting. In 2025, the agency initiated the first-ever audit of the program in its nearly 50-year history. Late last year, the SBA ordered all 4,300 8(a) firms to turn over 3 years’ worth of financial documents for review and subsequently suspended1,091 8(a) firms that refused to comply.
