Globe Newswire reports, the U.S. Small Business Administration has initiated termination proceedings against 154 Washington, D.C.-based firms participating in the 8(a) Business Development Program following an internal review that found they failed to meet economic disadvantage eligibility requirements.
According to the SBA, the firms exceeded statutory limits for net worth, adjusted gross income, or total assets, making them ineligible to remain in the program. The companies will be suspended for a minimum of 30 days while termination proceedings move forward.
Collectively, the 154 firms received nearly $1.3 billion in 8(a) set-aside and sole-source federal contracts between fiscal years 2021 and 2024. The SBA stated that nearly $1 billion of that total was awarded through noncompetitive sole-source contracts during the Biden Administration.
The action follows a program integrity review conducted by the SBA’s Office of Government Contracting and Business Development, which routinely verifies that participating firms continue to meet eligibility requirements. The review identified cases in which firms reported assets and net worth far exceeding statutory limits while continuing to pursue contracts reserved for economically disadvantaged businesses.
SBA Administrator Kelly Loeffler said the agency is enforcing the law to restore integrity to federal contracting programs, emphasizing that firms that are not economically disadvantaged should not dominate opportunities intended for eligible small businesses.
The terminations are part of a broader enforcement effort under Loeffler’s leadership. In 2025, the SBA launched the first audit of the 8(a) program in its nearly 50-year history and required all 4,300 participating firms to submit three years of financial records. As a result, 1,091 firms were suspended for failing to comply.
The SBA also clarified that participation in the 8(a) program will no longer be based solely on race, stating that no American may be denied government services on that basis. While more than 2,200 firms were admitted to the program during the Biden Administration, the SBA accepted just 65 new firms last year.
The agency said these actions are intended to ensure that federal contracting opportunities are directed toward small businesses that genuinely meet the program’s economic disadvantage requirements.