SBA 8(a) Proposed Rule Threatens Individual Indian Contractors

6/23/2026

WASHINGTON, D.C.   –  On June 11, 2026, the Small Business Administration (SBA) announced a proposed rule to “end racial discrimination” and “dismantle the race-based admissions framework” in the 8(a) Business Development framework.  SBA reports that businesses owned by Indian tribes, Alaska Native Corporations (ANCs), and Native Hawaiian Organizations (NHOs) would not be affected by the proposed rule.  However, the proposed rule would impact the ability of businesses owned by individuals who are Alaska Natives, Native Hawaiians, or enrolled members of Federal and State recognized Indian Tribes to participate in 8(a) contracting.  

Section 8(a) of the Small Business Act of 1958 allows “socially disadvantaged” small business owners to receive financial assistance for their businesses.  The current rules at 13 C.F.R. § 124.103 include a list of “designated groups” whose members are presumed to be “socially disadvantaged.”  This list includes individuals who are Alaska Natives, Native Hawaiians, or enrolled members of Federal and State recognized Indian Tribes (Tribal members).  

The proposed rule would remove the list of all “designated groups” presumed to be “socially disadvantaged.”  This includes individual Tribal members, who would then be required to prove that they are socially disadvantaged by submitting verifiable, fact-based evidence.  Indian tribes, ANCs, and NHOs would still be eligible to participate in 8(a) contracting under different sections of the rules.  

Tribes and Tribal members have an opportunity to address this issue by providing written comments on the proposed rule to SBA.  Written comments are due on July 13, 2026.  For example, Tribal members could be included in the provisions that will still provide for Indian tribes and Tribally-owned business to be eligible to participate in 8(a) contracting.

Indian tribes could also require SBA to consult on the proposed rule.  SBA did not schedule Tribal Consultation on the proposed rule as required by SBA’s Tribal Consultation Policy and Executive Order No. 13175 even though the rule will impact Tribal interests.  Tribes and Tribal members may also want to contact their Congressional representatives about the proposed rule before it becomes final.  The proposed rule is available here.  SBA’s Tribal Consultation Policy is available here.

Potential litigation over the proposed rule could impact a landmark U.S. Supreme Court decision that affirmed the political relationship between the United States and Indian tribes and their members.  In Morton v. Mancari, 417 U.S. 535 (1974), the Court upheld an employment preference for Indians within the Bureau of Indian Affairs  in the face of an equal protection challenge and on the basis that the preference was political in nature instead of racial and could be “tied rationally to the fulfillment of Congress’ unique obligation toward the Indians…” Id. at 555.  Recognition of this political relationship set the foundation for the self-determination era with increased federal programs, job opportunities, grants, scholarships, contracts, and many more opportunities for Indian tribes and their members.  

To avoid review of this critical decision by Federal Courts and the Supreme Court, Indian tribes, ANCs, NHOs, and Tribal members may need to inundate SBA with comments and demands for Tribal Consultation affirming the United States political relationship to Indian tribes, ANCs, NHOs, and Tribal members.

Tribes are encouraged to stay in contact with their Congressional Delegations to prevent the President’s FY 2027 cuts and advocate for needed funding increases.

Skenandore Wilson LLP is dedicated to the representation of Tribal Nations, Tribal entities, and individual Tribal members throughout Indian Country.  Our mission is to support and advance the sovereignty, self-sufficiency, and self-governance of our Tribal clients.  To learn more about how we can assist you, contact us at info@skenandorewilson.com or 608-608-1210.