On Monday, July 13, 2026, the Office of Advocacy wrote a supportive comment letter to the U.S. Small Business Administration (SBA) on its proposed rule to remove the rebuttable presumption of social disadvantage for individually owned firms in the 8(a) Business Development Program and replace it with a fact-based, race-neutral standard for proving social disadvantage. The proposal is intended to align the program with the Ultima injunction while preserving the 8(a) pathway for eligible small businesses.
SBA’s proposal would amend 13 C.F.R. § 124.103 to eliminate the prior presumption tied to certain racial and ethnic groups and replace it with a new evidentiary framework for individual applicants. The rule does not affect entity-owned participants, including tribal, Alaska Native, Native Hawaiian, and certain community development entities.
In Ultima Services Corp. v. USDA, a federal court held that SBA’s rebuttable presumption of social disadvantage violated equal protection and enjoined SBA from using it in the 8(a) program. SBA’s proposed rule is meant to conform the regulations to that decision and reduce constitutional litigation risk.
Advocacy recommends that SBA provide clear guidance and examples showing what evidence will satisfy the new standard, implement any processing changes without delays that block eligible firms, and monitor participation and application outcomes after the rule takes effect. These steps are meant to help small businesses understand the new requirements and help policymakers evaluate whether the program continues to serve disadvantaged firms as intended.
Advocacy’s message is simple: SBA should finalize a constitutionally durable rule that preserves the 8(a) program’s mission while replacing the challenged presumption with a clearer, individualized standard.
Access our Regulatory Alerts to view and submit comments on important proposed regulations.