The Return of the 8(a) Bona Fide Place of Business Requirement
On July 24, 2025, Suzanne Sumner of Taft’s Government Contracts team published a timely and insightful article titled “The End of the 8(a) Bona Fide Place of Business Moratorium,” marking a significant development for 8(a) construction contractors operating under the Small Business Administration’s Business Development Program. After nearly four years of flexibility granted in response to the COVID-19 pandemic, the SBA has announced that the moratorium on the “bona fide place of business” requirement will officially end on October 1, 2025. This means that, to receive either sole source or competitive 8(a) construction contracts, firms must once again demonstrate they have an established business location within the “relevant geographical area” where the work is to be performed.
The return of this regulatory hurdle reinstates long-standing rules codified in 13 C.F.R. § 124.501(k), which define both the relevant geographical area and what qualifies as a bona fide place of business. As Sumner explains, the SBA determines the geographical area for a given project, which could include the area served by an SBA district office, a metropolitan statistical area, contiguous counties, or even an adjoining SBA district office. If a company has a bona fide place of business anywhere within a state, it may be eligible to receive 8(a) construction contracts throughout that state—even if multiple SBA districts are present. Additionally, if the firm is already performing a contract in a given state, it can qualify for new contracts in the same location, offering a slight advantage to incumbents.
Sumner further unpacks the nuances when contracts require work across multiple locations. For single award contracts, a company must demonstrate a bona fide place of business in the location where the majority of the work, calculated by dollar value, will occur. For multiple award contracts, however, it is sufficient for the business to have a bona fide location in just one of the work locations. This distinction is critical, particularly for firms operating in dispersed or regionally complex environments.
To qualify as a bona fide place of business, the requirements are surprisingly manageable. According to Sumner’s summary of the regulatory text, a company need only have a single full-time employee working from a home office in the relevant location—even if that employee resides out of state. For instance, a Michigan-based employee working in an Ohio home office still qualifies the company for 8(a) contracts in Ohio. Once the bona fide place of business is established, a firm may move the office to a new address without seeking prior approval from the SBA, provided it promptly notifies the agency afterward.
The application process itself requires submitting a request to the SBA district office where the office is located. The SBA may conduct a site visit, and if it does not issue a decision within five days of the visit (or within 15 days of receiving the request if no site visit occurs), the company may presume approval for the purposes of competition. Still, formal approval from the SBA is required before a contract can be awarded.
With the expiration of the moratorium, Sumner warns that the reinstatement of this requirement will add complexity for 8(a) firms seeking construction contracts. This development underscores the importance of proactive planning and legal compliance for contractors aiming to maintain their eligibility and competitiveness. Contractors are strongly encouraged to reexamine their physical footprints and staffing arrangements, and to initiate the approval process well in advance of October 1. Sumner’s article, co-authored with Taft Summer Associate Richard Roediger, serves as an essential guidepost as the 8(a) community adapts to the return of these regulatory expectations.
Disclaimer: This blog post summarizes a legal bulletin originally authored by Suzanne Sumner and Richard Roediger and is provided for informational purposes only. It does not constitute legal advice or official guidance. Readers should consult qualified counsel or the SBA directly for specific questions or compliance requirements.