Restoring Fair Access™: Navigating the FAR Overhaul and Its Consequences
Introduction
America's small businesses are facing an unprecedented threat. Recent actions by federal agencies have begun dismantling critical protections that ensure small businesses have fair access to federal contracts—contracts that sustain local economies, drive innovation, and underpin our national security. This threat is not abstract: it is immediate, profound, and measurable in billions of dollars potentially lost in congressional districts across America.
At the center of this dismantling is the quiet erosion of the Rule of Two—a foundational legal protection mandating federal agencies to prioritize small businesses when at least two qualified small firms are capable of performing contract work at fair market prices. This erosion is not merely a regulatory shift. It represents a direct and deliberate bypass of the Administrative Procedure Act (APA), the landmark law designed to ensure transparency, public accountability, and statutory compliance in federal regulation.
These actions are illegal, unprecedented, and catastrophic in their consequences. Congress, economic development leaders, the media, and small business stakeholders must act now. Failure to intervene will mean immediate, severe economic harm to thousands of communities, a sharp decline in supplier diversity, innovation, and competition, and a significant redistribution of federal taxpayer dollars to a limited pool of large, incumbent contractors.
I. The Assault: How Regulatory Protections Are Being Quietly Erased
Federal procurement rules designed explicitly by Congress to protect and enhance small business competition have been systematically dismantled by recent regulatory maneuvers. These actions have not occurred through changes in the underlying law but through the covert erosion of enforceable regulations. These regulatory revisions have not only removed essential protections but have also introduced entirely new frameworks—all without Congressional oversight or APA compliance. This illegal and unprecedented approach is what we call the Deviation Doctrine.[1]
The Regulatory Cascade
The erosion is driven by a coordinated series of Executive Orders (EOs 14275, 14276, 14265) and subsequent Federal Acquisition Regulation (FAR) revisions. Executive Order 14275, issued on April 15, 2025, instructed agencies to purge regulations that were not explicitly statutory.[1][2] While marketed as a step towards "modernization," in practice, it has led to systematic removal of the regulatory infrastructure essential for enforcing statutory protections such as the Rule of Two.
This regulatory removal has gone beyond merely "redlining" outdated provisions. Critical safeguards have been deleted entirely, including:
Market Research Requirements: Key sections of FAR Part 10 that explicitly required agencies to identify and prioritize small business contractors have been removed, eliminating the procedural triggers that enforce set-asides.[3]
Contract Clauses Enforcement: FAR Part 52, which embedded enforceable small business requirements directly into contracts, has been gutted, removing the contractual protections that small businesses relied upon for legal recourse and protest.[4]
Transparency and Accountability: FAR 1.404, requiring agencies to publicly document and justify deviations from established rules, has been erased, creating a regulatory black box where changes are invisible, arbitrary, and unchecked.[5] FAR Subpart 1.5 has also been eliminated, removing the mandatory requirement for public notice and comment for any changes to the FAR.[6]
These actions are not just rule deletions—they represent the illegal creation of a fundamentally new regulatory regime, one characterized by informality, discretion, and opacity, directly violating both the letter and spirit of the APA.[1][2]
Real-World Impact at the Congressional District Level
The economic stakes are staggering. In Texas District 25 alone—the district of the Chair of the House Small Business Committee—federal small business contracting generates an average of $209.51 million annually, with over 63% directly secured through set-asides. Yet, small business vendor participation in his district has already plummeted by 57.3% since 2008.[7] In New York’s 1st District, home to the Chair of the Subcommittee on Contracting and Infrastructure, over $216 million is at risk, with vendor participation down nearly 29%.[8] Similar scenarios play out in Georgia's 3rd District and Delaware At-Large, where hundreds of millions in economic activity and local jobs directly depend on robust enforcement of the Rule of Two.[9][10]
In the state of Iowa, represented by the Chair of the Senate Small Business Committee, nearly $250 million in small business contracts—68% secured through set-asides—hangs in the balance. The consequences of losing this economic lifeline would devastate local economies across the state.[11]
Call to Action
This assault on regulatory protections, small business participation, and local economies demands immediate action. Congress must urgently enforce compliance with the APA, explicitly reinstate the procedural infrastructure for the Rule of Two, and halt these illegal regulatory actions before permanent damage occurs. Every day of inaction deepens the economic crisis, reduces competition, and erodes America's small business base—damage from which recovery could take decades, if ever fully possible.