8(a) program faces unprecedented pressure from Trump administration attacks

Companies in the 8(a) small business contracting program are facing unprecedented pressure as the Trump administration paints it as rife with corruption and a bastion of illegal diversity, equity, and inclusion.

The Trump administration has attacked the program’s infrastructure by gutting the Small Business Administration, which has lost half of its workforce. At individual agencies, small business advocacy personnel have been reduced to their statutory minimums.

SBA is auditing 8(a) contracts and has suspended 1,000 8(a) companies from the program. Defense Secretary Pete Hegseth said the Pentagon is reviewing billions of dollars in 8(a) contracts for DEI and fraud.

The result is a significant, government-wide slowdown in the use of the program. Company executives have told us that solicitations have been delayed and agencies are avoiding using 8(a) contracts.

"Why pop your head out if you're going to get it crushed," one executive said.

Program defenders we heard from believe the Trump administration fundamentally misunderstands what 8(a) contracting is and what it can do.

The 8(a) program is based on economic and social disadvantages, not race alone. Racial identity was once used as a presumption of disadvantage, but the program has always required companies to demonstrate business capability and performance.

"You've got to have past performance and proven financial capability and proven management to even get into the program so that you have a higher likelihood of success," said Norm Abdallah, executive vice president of Hui Huliau, a Hawaiian native corporation.

A 2023 federal court ruling in the case of “Ultima Services Corp. v. U.S. Department of Agriculture” eliminated racial presumptions for entering the 8(a) program, but now the Trump administration is equating the entire program with DEI.

"When we wrote the rules in 1990, we didn't know the words DEI," said Robb Wong, founder of Fedsolve and a former associate administrator at SBA. "There's always been merit in all of those programs. You have to prove that you're, to some level, a functional business."

Beyond the definitional debate, supporters say 8(a) provides critical procurement flexibility that enables rapid response and can help rebuild the industrial base — priorities the administration claims to support.

Abdallah pointed to the Forge advanced manufacturing facility in Hawaii that his company built as an example. The facility, which produces parts for Navy ships in the Pacific, took four months to establish using 8(a) authorities.

According to Abdallah, leaders of the command told him they would still be in study mode if they used a normal acquisition path.

"Whereas now we're building and putting parts on ships and that increases lethality,” Abdallah said. (Read more about the Forge at our sibling publication, Defense One.)

During the January 2025 wildfires in Greater Los Angeles, Abdallah said his company had people on the ground within 48 hours of getting the call for help.

"This is an approved way to move fast and to be flexible,” he said.

The administration's case against 8(a) contracting rests heavily on fraud concerns, but an analysis of Justice Department data suggests the problem may be overstated compared to fraud in the broader contracting base.

Guy Timberlake, CEO and co-founder of the American Small Business Coalition, analyzed Justice Department prosecutions for 2025. He found that when comparing settlement dollars — not total contract values — small businesses including 8(a) firms paid $60 million in settlements versus $300 million for large companies.

"There were more large companies than small companies or 8(a)s altogether" in prosecutions, Timberlake said. "While there are numbers, more small businesses than large businesses, there are more large businesses there are 8(a)s."

The Trump administration has focused on two major cases out of 4,500 companies in the program. That scrutiny involves an $800 million U.S. Agency for International Development contract and a tribal case.

"That's two companies out of 4,500," Timberlake said. "Then it's like they're blaming the 4,500 for the actions of two."

Some industry observers say companies should refocus their business development strategies anyway, regardless of the program's fate.

"Forget you have 8(a)," Wong said. "Focus on how every other white-owned company would have to focus on government contracts without 8(a)."

Wong added companies that should be worried are "the ones that in their first meeting with a procurement official or a partner, and 8(a) comes up."

Instead, Wong advises companies to focus on solving problems the government needs solved. That means proving readiness and capability, as well as building relationships based on mission alignment rather than certifications.

"Solve a problem that the government knows it needs to solve, provide at a reasonable price, exceed customer service expectation," Wong said. "That's what every decent company does."

Abdallah recommends a similar approach.

“Show the success stories like the Forge, where you can increase lethality because you can move fast and you can be incredibly flexible,” Abdallah said.

Wong said he has already worked with two clients to convince their agencies to use 8(a) contracts in the future.

“After a few months lag, agencies will begin to adopt 8(a) as a legal and legitimate means of procuring goods and services because frankly there will be too many contracts they need to issue,” Wong said. “The 8(a) program is one of the best programs for small businesses but just as important for government efficiency.”