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S 3173

Stop 8(a) Contracting Fraud Act

119th Congress Introduced by Joni Ernst

The Stop 8(a) Contracting Fraud Act halts sole source contracts until the SBA audits its program, boosting oversight and protecting small businesses from fraud.

Introduced in Senate
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Bill Summary · S 3173

Summary of Bill S. 3173: Stop 8(a) Contracting Fraud Act

Bill Number: S. 3173
Introduced: November 10, 2025
Status: Introduced in Senate
Sponsor: Senator Joni Ernst

Purpose and Intent

The Stop 8(a) Contracting Fraud Act aims to enhance oversight and accountability within the Small Business Administration (SBA) by imposing a moratorium on the awarding of sole source contracts. This legislation is designed to ensure that the SBA conducts a thorough audit of its business development program before continuing to award contracts without competitive bidding. The intent is to prevent potential fraud and misuse of funds in the 8(a) contracting program, which is intended to assist small businesses.

Key Provisions

  1. Moratorium on Sole Source Contracts:

    • The SBA is prohibited from awarding sole source contracts under section 8(a)(16) of the Small Business Act until:
      • A full audit of the business development program is completed.
      • A report detailing the findings of the audit is submitted to both the Senate Committee on Small Business and Entrepreneurship and the House Committee on Small Business.

  2. Audit Requirement:

    • The audit must be conducted as ordered by the SBA Administrator on June 27, 2025.

  3. Waiver for National Security:

    • The bill allows for a waiver of the moratorium if a contracting officer determines that a sole source contract is necessary for national security.
    • The process for requesting a waiver includes:
      • Submission of a justification to the head acquisition officer of the agency.
      • Approval from the SBA Administrator or Deputy Administrator.
      • The waiver authority cannot be delegated.

Impact

  • Affected Entities:

    • The primary entities affected by this bill are small businesses that rely on the SBA's 8(a) program for federal contracting opportunities.
    • The moratorium may temporarily limit these businesses' access to contracts until the audit is completed and the findings are reported.

  • Oversight and Accountability:

    • By requiring an audit and report, the bill seeks to increase transparency and accountability within the SBA, potentially leading to improved management of the 8(a) program and reduced instances of fraud.

Procedural Aspects

  • The bill was introduced in the Senate and has been read twice before being referred to the Committee on Small Business and Entrepreneurship for further consideration.
  • The timeline for the moratorium is contingent upon the completion of the audit and the submission of the report, which will determine when sole source contracts can resume.

This legislation represents a significant step towards ensuring that federal contracting processes are fair and transparent, particularly for small businesses that are vital to the economy.

Compiled from official sources — confirm details with the bill’s official record.

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