SBA is proposing to amend its 8(a) Program rules to “remove the rebuttable presumption that individuals belonging to certain designated groups are socially disadvantaged and set forth revised standards for individuals establishing social disadvantage.” This proposed rule continues the trend that has been building since the Ultima decision in 2023. In 2023, a federal court said that the rebuttable presumption of social disadvantage under the 8(a) is unconstitutional as it violates the right to equal protection. Based on that decision, SBA stopped relying on the presumption of social disadvantage. Three years later, SBA is proposing to formally eliminate any mention of the presumption from the regulations. SBA would replace the individual social disadvantage narrative with a test that looks to whether a person experienced discrimination on the basis of race through programs like affirmative action.
Here are some key points from the proposed rule.
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