Why This Matters: The U.S. government allocates over $161 billion annually to construction projects. What’s more, Congress mandates that at least 5% of that total must be awarded to 8(a) firms — a vital program designed to help small businesses thrive in the competitive federal contracting space. If you’re an 8(a) construction firm or considering entering the market, this presents a massive opportunity.
The Power of Sole Source (Non-Compete) Contracts
For many 8(a) construction firms, sole source contracts — also known as direct awards or no-bid contracts — are the lifeblood of their business. These contracts allow 8(a) firms to be directly awarded federal projects without a competitive bidding process. As long as the firm’s proposal is within 10% of the market rate, it can be granted the contract — making it an invaluable tool for winning projects quickly and efficiently.
Sole Source Contract Size Limit: $4.5 Million
One of the key benefits of the 8(a) program is the sole source contract limit of $4.5 million. This means 8(a) firms can secure projects that are critical but don’t require the complexities of large-scale competitive bidding. The best part? These contracts are often the ones that help keep your business running smoothly and profitably.
Top Federal Customers for 8(a) Construction Firms
The pool of potential 8(a) construction firms is 1,320 across the country, the pool of potential government customers is vast. Some of the largest federal entities that award construction contracts to 8(a) firms include:
- Department of Defense (DoD): 420 facilities, with an average of 3.1 8(a) firms per facility
- U.S. Army Corps of Engineers: 42 facilities, with an average of 31.4 8(a) firms per facility
- Veterans Affairs (VA): 1,380 facilities, with an average of 0.96 8(a) firms per facility
- General Services Administration (GSA): 8,397 facilities, with an average of 0.16 8(a) firms per facility
These organizations represent significant opportunities for 8(a) construction firms to get their foot in the door and secure consistent work.
Example 8a Construction Projects
Here are just a few examples of the types of projects that 8(a) construction firms might find themselves bidding on or completing for the DoD and other federal agencies:
- Facility Renovations & Retrofits
- Project: Renovate aging barracks at Fort Hood
- Scope: New flooring, plumbing updates, ADA-compliant bathrooms, HVAC system overhaul
- Why 8(a)?: Under $4.5M, time-sensitive, limited competition
- Security Infrastructure Upgrades
- Project: Install perimeter fencing & surveillance upgrades at Naval Base San Diego
- Scope: Fencing, cameras, access gates, minor electrical work
- Why 8(a)?: Urgent base security upgrades required
- New Training Facility
- Project: Construct a 3-classroom modular training facility at Joint Base Lewis-McChord
- Scope: Ground-up construction of a 4,000 sq ft structure
- Why 8(a)?: Fits within the sole source limit, prior performance excellence
- HVAC System Replacement
- Project: Replace HVAC at a missile maintenance facility at Eglin AFB
- Scope: Removal of old units, installation of high-efficiency units, ductwork, and controls
- Why 8(a)?: Essential to operations, need rapid turnaround
- Roof Replacement
- Project: Replace roofs on 6 administrative buildings at Fort Benning
- Scope: Tear-off, new insulation and membrane, flashing/sealing
- Why 8(a)?: Mission-critical during the rainy season, fits the 8(a) size threshold
- Utility Infrastructure Repair
- Project: Sewer line replacement at Marine Corps Base Quantico
- Scope: Excavation, pipe replacement, site restoration
- Why 8(a)?: Aging infrastructure; desire to support local 8(a) firm
- Emergency Repairs
- Project: Fire damage repairs to barracks at Fort Bliss
- Scope: Structural cleanup, drywall, electrical replacement, painting
- Why 8(a)?: Emergency justification for sole source
- Energy Efficiency Upgrades
- Project: LED lighting and smart control installation at Hanscom AFB
- Scope: Retrofits across 5 buildings, smart metering, new fixtures
- Why 8(a)?: Sustainability focus, small scope, aligns with small business goals
These are just a handful of the thousands of projects awarded annually to 8(a) construction firms — projects that help shape the infrastructure of our military bases, federal offices, and more.
What If the 8(a) Program Goes Away?
While it’s understandable to be concerned about the future of the 8(a) program, it would take an act of Congress to dismantle it — something that is highly unlikely given the political and economic capital invested in supporting small businesses. Federal buyers I’ve spoken with, particularly from the Army Corps of Engineers and the VA, have reiterated that the 8(a) program is a win-win for both the government and small businesses. Sole-source contracts, they argue, save time and money, reducing the administrative burden of smaller contracts while allowing contracting officers to focus on larger, more complex projects.
In short: 8(a) contracts are here to stay, and they remain a vital component of the federal government’s contracting strategy.
Conclusion
The 8(a) program presents a wealth of opportunities for construction firms to tap into lucrative federal contracts. With billions of dollars at stake and a streamlined path to success via sole-source contracts, now is the perfect time to leverage your 8(a) status and build your firm’s future in federal contracting.
Ready to explore 8(a) construction opportunities? Reach out to us for more insights on how your firm can capitalize on this booming market!
