My government contracting company benefits from funds for disadvantaged small businesses. I'm bracing for change ahead of DOGE.
Taelor Salmon
- 32-year-old Taelor Salmon is the CEO of a government contracting company called TJS Group.
- She said around 50% of her contracts come from funds set aside for socially disadvantaged businesses.
- She doesn't know exactly how DOGE will impact small business set-asides, but she's bracing for change.
This as-told-to essay is based on a conversation with 32-year-old Taelor Salmon, the CEO of TJS Group. Her employment and identity have been verified by Business Insider. This story has been edited for length and clarity.
I'm the CEO of TJS Group, and we've been in business providing services to the government for about nine years now.
We have about 19 employees and provide everything from IT security to facilities maintenance and repair support. But our main focus is administrative and facility support.
Our success isn't tied to the president at this point. It's correlated to the regulations projected by the Small Business Administration, including in programs like the 8(a) Business Development program and Economically Disadvantaged Women-Owned Small Business certifications.
The 8(a) Business Development program was established to give at least 5% of all federal contracting dollars annually to disadvantaged small businesses. The 8(a) program can establish you or your business as socially and economically disadvantaged. We got ours in November 2021, and it's a nine-year program that you apply for with the SBA. There are a lot of requirements in it, and I got denied three times before.
We got our first contract around 2017 when Trump was president. We did well under Trump, but better under Biden simply because TJS Group received its 8(a) certification under him. While this could've happened under Trump, the program has helped us tremendously.
My biggest concern is DOGE, or the SBA, wanting to remove the 8(a) and the funding set aside for minority businesses. My company has significantly benefited from those "set-asides" over the past 3 years. Losing the 8a set-aside would be scary, as much of our contract value has derived from this for our small business.
SBA program funding makes up a large part of our revenue
The SBA's job is to support and assist small businesses. SBA initiatives require Congress to spend a certain amount of taxpayer dollars toward different types of small businesses. Some of the initiatives are for minority-owned, women-owned, or veteran-owned companies. It's the government's way of making sure taxpayer's dollars are funneled back into the economy in a fair way where it's not just going to powerhouses.
About 50% of our revenue is derived from 8(a) program awards.
The 8(a) certification is great because you can get directly awarded contracts without competition. Some people like that, some people hate it, some people think it's unfair. But again, these programs are to help small businesses establish themselves. In the beginning, these programs, or set-asides like 8(a) or EDWOSB, weed out other competition to level the playing field. The goal for these small businesses is to grow into well-established companies in the future so that these very same businesses won't need to rely on set-asides.
I don't know what DOGE will bring, but I'm preparing to be impacted
While TJS Group did well under the prior Trump administration, we're not certain how this administration will treat or change small businesses. I'm not as hopeful as I have been in prior years, given the conversation around the Department of Government Efficiency.
The SBA's 8(a) program has already been in question for the past year or two, so there's strong reason to believe it may not be around in the next 10 years. The program has faced scrutiny, and in 2023, a ruling challenged it. The program now requires applications to be processed with an additional social disadvantage narrative requirement. Prior to the ruling, race served as a qualification for being socially disadvantaged. Now, you have to provide an example of being socially disadvantaged and explain how it impacted your entry into the business world.
As we all know, any major decision, specifically regarding small businesses, requires a lot of change, and that could take months or years. I don't believe DOGE will have a lasting effect, but it has the potential to negatively affect small businesses like ours. The way you reduce that fear and uncertainty is to prepare, be knowledgeable, and fine-tune your strategy.
It's like in basketball — you live by the three-pointer. TJS Group cannot simply rely on our 8(a) status or EDWOSB for awards, we must competitively bid on opportunities to stay competitive. So we try to be proactive about also pursuing opportunities with federal agencies that anybody could pursue.
We're also exploring pursuing partnerships with larger companies, which can have subcontracting goals and requirements that necessitate partnering with small businesses. These partnerships can provide opportunities to expand service offerings and access new customers for small businesses.
We're also looking into opportunities that have the potential to become commercial so that we're not just relying on the government.
Every contract based on government funding is uncertain. Often, contracts remain for all base and options years if there's funding and if you provide good services. So, you could have it for the base, but if they say we don't have funding for the next four years, you can only have it for that year.
My advice to other government contractors would be to pursue opportunities competitively and focus on a niche that aligns within both federal and commercial industries so you're not solely relying on government opportunities.
Government contracting isn't for the weakhearted. You need to plan your business around a worst-case scenario just in case this happens. You're running a business, and you're managing it. And so that's a whole nuance in itself that you have to be prepared for.
There's also never a clear answer with administration change, so it's important to focus on things we, as small businesses, can control.