A federal program that’s helped American Indian and Alaska Native tribal firms land lucrative defense contracts has been under increasing scrutiny. That includes firms providing mission-critical services to the Dayton region’s Wright-Patterson Air Force Base.
In January, U.S. Secretary of Defense (now the Department of War) Pete Hegseth posted a video on X announcing a “line-by-line review” of contracts awarded through the 8(a) Business Development Program, referring to it as “the oldest DEI program in the federal government.”
“We have no room in our budget for wasteful DEI contacts that don’t help us win wars, period, full stop,” Hegseth said in the video.
The 8(a) program, provided through the Small Business Administration, is intended to help small businesses owned and controlled by socially and economically disadvantaged individuals compete for and receive government contracts.
Last month, President Donald Trump signed an executive order prompting agencies to cancel and suspend contracts with federal contractors engaging in “racially discriminatory DEI activities.” The order defines those activities as any “disparate treatment based on race or ethnicity” in employment, resource allocations, recruitment and more.
What the 8(a) program means to tribal businesses
Since last year, all 8(a) participating firms have had to respond to several audits and data calls from the SBA and Department of War. The Treasury Department also announced it would be doing an audit of the program. For some businesses, missing these deadlines meant suspension from the program.
“When Congress acts to provide advantages or potential benefits or opportunities to Native-owned entities, it's doing so not on any type of racial classification, rather it's doing so as a political classification based on and exercising Congress's authority under the Indian Commerce Clause."
The Native American Contractors Association, an organization with a mission of preserving Native federal contracting rights, has been helping its members navigate the review. Quinton Carroll, executive director of the Native American Contractors Association and member of the Native Village of Barrow in Alaska said it’s required many resources for firms to meet these requests.
“We don't have any issues with oversight of the program. But at some point, we also want to finalize this audit and move forward with the program and be able to support the mission of the U.S. government,” Carroll said.
What many tribal communities are concerned about is that their participation in this program has less to do with diversity, equity, and inclusion and more to do with U.S. treaty and trust obligations to tribal and Alaska Native communities.
Christopher Slottee is an attorney from Alaska who works closely with American Indian and Alaska Native firms. He said the Department of War’s concern may be based on a misguided view of why the program supports tribally-owned and Alaska Native firms.
“When Congress acts to provide advantages or potential benefits or opportunities to Native-owned entities, it's doing so not on any type of racial classification, rather it's doing so as a political classification based on and exercising Congress's authority under the Indian Commerce Clause,” Slottee said.
Before Congress added statutes broadening the scope of the 8(a) program to include businesses owned by American Indian tribes, Native Hawaiian organizations and Alaska Native corporations, Native participation in federal contracting was minimal, Slottee said.
Businesses owned by these groups don’t have to prove social disadvantage to participate in the program, and are allowed to receive higher directed awards than individually-owned businesses.
Carroll said the Small Business Administration sent out internal guidance last year stating that programs supporting American Indian and Alaska Native tribes won’t be affected by any executive orders targeting DEI programs.
But both Carroll and Slottee said since August, there haven’t been any new tribal firms added to the 8(a) program as of last month.
Contracts drive Miami Valley projects, support Native communities
Since 2017, there have been 860 Department of the Air Force contracts awarded in Ohio to Alaska Native, American Indian or tribally-owned firms, according to federal data.
Much of that work is being done at or for Wright-Patterson Air Force Base, a mission-critical military installation in the Miami Valley.
It houses facilities such as the Air Force Research Laboratory, the headquarters for Air Force Materiel Command and the National Air and Space Intelligence Center, making it a hub for federal contracts.
Wright-Patt's public affairs office declined to comment on this matter.
“Without the 8(a) program to initially help us in the beginning, we would never be able to invest in innovative capabilities that we're able to deliver to our customers. And that took years to get to the point where we're able to do that."
Native federal contracting has become the second largest economic development driver in Indian Country, according to the Native American Contractors Association.
While many awards are won through open competition bids, Carroll said Native federal contractors win a majority of their awards through 8(a).
“The proceeds from those revenues are going back to tribal and Native communities to support infrastructure, public safety, and education. And we're different in the sense that we're not a publicly traded company. We're not (individual entrepreneurs.) The proceeds from our participation in this program, go directly back to support Native communities,” Carroll explained.
8(a) helped Diné Development Corp, now it's 'feeling the pressure'
An enterprise of the Navajo Nation, Diné Development Corporation specializes in IT, cybersecurity and cloud services. The company expanded its Dayton region operations with the opening of its Navajo Code Talkers building in 2024.
Early on, DDC and its subsidiaries supported work at Wright-Patterson Air Force Base allowing it to develop its business footprint in the Dayton region. Now Diné Development has grown to having 10 subsidiaries and it’s been awarded contracts at other U.S. air force bases.
Tribes have the ability to set up multiple businesses in the 8(a) program, so some of Diné Development’s subsidiaries are a part of the nine-year program.
Austin Tsosie, CEO of Diné and a citizen of the Navajo Nation, said they've responded to all of the data calls and haven’t heard any bad news. But it’s taking more work.
“The staff is definitely feeling the pressure and feeling overworked during this time. But I appreciate them for their efforts and all of the goodness that still makes me very confident running DDC,” Tsosie said.
DDC’s been unable to certify one of its subsidiaries, which it submitted an application for in July. In the past, it typically took SBA up to three months to decide upon an application.
But Diné Development's Chief Business Officer Jennifer Creamer said this has been an “atypical environment.”
Creamer said the program has been able to help many tribal firms navigate the federal contracting sphere and find success; that includes Diné Development.
The program helped them to be competitive for contracts outside of 8(a). Creamer said 80% of their recent contracts have been awarded outside the 8(a) program.
“Without the 8(a) program to initially help us in the beginning, we would never be able to invest in innovative capabilities that we're able to deliver to our customers. And that took years to get to the point where we're able to do that,” Creamer said. “We're able to be forward leaning to support our customers in a way that we couldn't have done without such a successful program to help us get really our feet under us and make those investments in ourselves.”
