Congress Is Rethinking Small Business Contracting. Here’s What You Need to Know
A cluster of bills moving through Congress in 2025 could seriously reshape the landscape for small businesses in federal contracting. From more accountability in women-owned awards to restoring set-aside protections and expanding 8(a) construction access, these proposals aren’t just policy tweaks—they could redefine who gets a fair shot at the $700+ billion federal marketplace.
If you’re a small-business owner, a capture strategist, or someone trying to navigate the government contracting certification process, here’s your no-fluff breakdown of what’s happening—and what you should be doing about it.
Let’s break it down. There are eight bills to watch:
H.R. 789 would require agencies to explain why they cancel small business set-asides and refer bidders to OSDBUs. It’s about transparency and making sure small firms don’t waste time chasing ghost bids.
H.R. 818 (SPUR Act) aims to hold agencies accountable for awarding contracts to new small business vendors—especially SDVOSB, HUBZone, and WOSB firms—by tracking first-time awards.
H.R. 1816 would make SBA certification mandatory for a firm to be counted toward the women-owned small business goal. That means no more self-certification shortcuts.
H.R. 2804 seeks to codify the FAR “Rule of Two,” ensuring contracts stay set aside for small businesses when two or more can compete—regardless of contract size. Without it, those protections could disappear during the FAR overhaul.
H.R. 3195 allows a child to temporarily continue SDVOSB status if a veteran passes away, creating smoother succession planning for veteran-owned firms.
H.R. 3736 gives the SBA Administrator a seat on the FAR Council—finally putting a small business voice directly in the rulemaking room.
S. 991 / H.R. 3485 would permanently eliminate the “bona fide place of business” requirement for 8(a) construction contractors, which is set to snap back into effect on 09/30/2025.
Why It Matters: This Is About Access, Not Just Paperwork
The problem isn’t just that too few small businesses get contracts. It’s that the rules are stacked—or about to be. For example:
If H.R. 2804 doesn’t pass, the updated FAR could strip out the Rule of Two above $250K, pushing many contracts into full and open competition. That could gut set-aside opportunities for all but the largest “small” firms.
Without H.R. 1816, WOSB awards will continue to be overinflated by self-certified companies, creating a false sense of progress—and hurting real, certified WOSBs who went through the process.
If the 8(a) bills stall, contractors without a physical office in a project location could suddenly become ineligible, even if they’ve done the work before.
These bills aren’t about theory—they impact whether or not you get to compete, win, and grow.
What You Should Be Doing Right Now
Here’s how you can get ahead of the curve while the legislation winds its way through Congress:
WOSBs: Get Certified—Now.
If you’re not already SBA-certified, start the process ASAP via certify.sba.gov. If H.R. 1816 passes, only certified firms will count toward agency goals.
SDVOSBs: Tighten Your Succession Plans.
Review ownership documents and prep contingency plans that include your children, especially if you’re unmarried. H.R. 3195 could buy your business valuable time after an owner’s passing.
8(a) Construction Firms: Don’t Wait.
The moratorium on the “bona fide place of business” rule ends 09/30/2025. Submit your SBA approvals now—or keep tabs on whether S. 991 or H.R. 3485 pass in time to cancel the requirement altogether.
Track These Bills.
Use Congress.gov to follow each bill (start with H.R. 789 and H.R. 2804). You can set up alerts for updates and committee movement.
Talk to Your Representatives.
Especially with H.R. 2804—small-business advocates say the Rule of Two is at risk. A quick call or email to your Congressional rep can make a difference.
Rethink Your Capture Strategy.
More transparency and support via OSDBUs (H.R. 789) means you should revisit canceled opportunities and stay proactive in outreach.
Zooming Out: Small Business Procurement Is at a Crossroads
This legislative wave comes as the FAR Council begins its long-anticipated overhaul of federal acquisition rules. The risk? Set-asides, sole-source awards, and other small-business-friendly provisions could be removed unless they’re written into law.
These bills represent Congress stepping in to protect access, integrity, and accountability. But protection doesn’t happen by default. Small businesses need to watch closely, engage strategically, and act early.
Want more insight into how these changes tie into your broader contracting strategy? Don’t miss our recent post: “How to Read an RFP Like a Pro: The 10 Most Important Sections to Skim First”—perfect for teams recalibrating their proposal approach in a shifting policy environment.
If you aren't a Squared Compass partner, what are you waiting for? From getting your business set up with specific government set aside programs at both the State and Federal level, to being empowered by a Fractional Capture team to win government contracts, to receiving tailored government contract opportunities Squared Compass delivers immense value which helps propel our partners to success. Schedule a chat with our team today.
