“A failure to support small businesses, including minority-owned small businesses, will be a detriment to the entire American economy.”

WASHINGTON, D.C. – U.S. Senator Maria Cantwell (D-Wash.), Ranking Member of the Senate Committee on Commerce, Science and Transportation, and Sen. Edward J. Markey (D-Mass.), Ranking Member of the Senate Small Business and Entrepreneurship Committee, joined by Senators Tammy Baldwin (D-Wisc.), Jacky Rosen (D-Nev.), Ben Ray Luján (D-N.M.), John Hickenlooper (D-Colo.), Lisa Blunt Rochester (D-Del.), Cory Booker (D-N.J.), Mazie Hirono (D-Hawai’i), Adam Schiff (D-Calif.) and Martin Heinrich (D-N.M.), demanded answers from Administrator of the Small Business Administration Kelly Loeffler and Secretary of Commerce Howard Lutnick on the Trump Administration’s actions eliminating support for small businesses, including small minority-owned businesses.

In March, President Trump issued an executive order directing the Minority Business Development Agency (MBDA) and several other agencies to reduce their functions to the minimum amount required by law. The President’s Fiscal Year 2026 budget proposes to abolish the MBDA and the Trump Administration seeks to eliminate the Small Business Administration’s (SBA) Women’s Business Centers and funding for SCORE, which provides mentorship and resources to small businesses, among other programs.

“We demand answers from the Administration about how it intends to properly serve small business entrepreneurs from minority and underserved communities and follow Federal laws establishing support for such entrepreneurs,” wrote the Senators. “A failure to support small businesses, including minority-owned small businesses, will be a detriment to the entire American economy.”

“The Administration actions to eliminate the MBDA is part of an overall attack on federal support to business owned by socially or economically disadvantaged individuals,” the Senators continued. “Federal agencies have several small business contracting goals, including for small businesses generally, Small Disadvantaged Businesses (SDBs), and women-owned and veteran-owned small businesses.”

These actions are already being felt across the country. For example, the MBDA Business Center in Tacoma, Washington has been forced to close after receiving a notice that its MBDA grant was terminated. From 2016-2021, the Business Center assisted hundreds of businesses to grow, create and retain nearly 3,000 jobs in the region.

Instead of expanding opportunities for more small businesses to grow and thrive, President Trump’s shortsighted actions are throwing cold water on entrepreneurship and job creation. 

“Undermining and dismantling targeted federal programs that recognize the historic challenges faced by minority business owners will ultimately hurt local communities and weaken the U.S. economy,” concluded the Senators.

Sen. Cantwell has been a staunch defender of the MBDA against the Trump Administration’s attempts to illegally dismantle the agency, including demanding answers about compliance with a court order halting the dismantling of the MBDA, demanding Commerce Secretary Lutnick  provide a full accounting of his actions to shutter the MBDA, and calling on the Secretary to honor his previous commitment to protect the MBDA and its mission.

The full text of the letter to Administrator Loeffler and Secretary Lutnick is below and HERE.

Dear Administrator Loeffler and Secretary Lutnick,                                                                                           

The Trump administration is undoing decades of progress supporting minority small business owners, including the attempt to dismantle the Minority Business Development Agency (MBDA), undermine small business contracting programs, and cut targeted resources and services. We demand answers from the Administration about how it intends to properly serve small business entrepreneurs from minority and underserved communities and follow Federal laws establishing support for such entrepreneurs. A failure to support small businesses, including minority-owned small businesses, will be a detriment to the entire American economy.

In 1969, President Nixon created the MBDA to help minority business owners succeed. In 2021, Congress permanently authorized the MBDA, with overwhelming bipartisan support. One of the MBDA’s core functions, as defined in the Minority Business Development Act,[1] is operating a network of Business Centers through public-private partnerships. These Business Centers assist minority-owned businesses with accessing capital, contracts, and counseling, ultimately to facilitate their growth and create jobs. In Fiscal Year (FY) 2024, the MBDA helped minority-owned businesses create or retain more than 23,000 jobs, secure almost $2.7 billion in contracts, and receive in excess of $1.5 billion in capital.[2]

On March 14, 2025, President Trump issued an executive order directing the MBDA and several other agencies to reduce their functions to the minimum amount required by law.[3] On April 10, 2025, nearly every MBDA employee was let go or reassigned. The cancellation of all MBDA grants and Business Center contracts soon followed. Termination letters sent to MBDA grantees and Business Centers—and subsequently rescinded after the Rhode Island Federal District Court issued a preliminary injunction halting the executive order’s implementation—claimed their grants or contracts were no longer consistent with the agency’s priorities. But Congress, not the Trump administration, authorized the MBDA and established its purposes when it passed the Infrastructure Investment and Jobs Act in 2021.[4] Oversight letters from Democratic members of the Senate Commerce Committee regarding the Administration’s actions have gone unanswered.

The Administration actions to eliminate the MBDA is part of an overall attack on federal support to business owned by socially or economically disadvantaged individuals. Federal agencies have several small business contracting goals, including for small businesses generally, Small Disadvantaged Businesses (SDBs), and women-owned and veteran-owned small businesses. Each federal agency with procurement authority has an Office of Small and Disadvantaged Business Utilization (OSDBU) to promote the use of small businesses to fulfill agency contracts. Small business goals and OSDBUs work in tandem to ensure that small businesses, not just large firms, benefit from the largest buyer of goods and services in the world, the U.S. government.

In January 2025, the SBA lowered to 5 percent the goal of increasing the share of federal contracting dollars going to SDBs, a stark contrast to the Biden administration, which raised the SDB goal to 15 percent.[5] The Administration also appears to be undermining OSDBUs; according to reports, the Department of Health and Human Services, the fourth largest grantor of federal contracting dollars,[6] fired all OSDBU staff except one at the agency.[7]

The President’s FY 2026 proposed budget doubles down on these actions by entirely eliminating several statutorily authorized and bipartisan entrepreneurial development programs, in addition to the MBDA. The President’s budget also proposes cutting Women’s Business Centers, the Service Corps of Retired Executives (SCORE), technical assistance for the Microloan program, and more. The Administration justifies these cuts by stating the previous administration awarded “billions in funding to certain businesses solely based on race and gender.”[8] Although some of these programs target specific resources to certain communities, the vast majority of these programs serve all Americans.

The Trump administration’s war on targeted federal programs is already hurting minority and underserved small businesses. The New York Times found that the Administration’s contract cancellations have disproportionately impacted minority- and women-owned small businesses while largely ignoring the largest federal contracts. As of March 2025, 19 percent of cancelled contracts listed on the DOGE website are for minority-owned businesses and 11 percent are women-owned businesses, despite representing just 10 percent and 5 percent of federal contracts, respectively.[9]

Bloomberg reported that SBA employees are uncertain whether they can attend meetings with the Hmong Chamber of Commerce or Latino business associations, and some SBA employees are being directed to withhold annual small business awards that were supposed to go to minority entrepreneurs.[10]

These actions are unacceptable and harm the American economy. Minority-owned businesses employ millions of Americans and generate more than $2 trillion in annual revenue.[11] In the contracting space, the importance of a fully inclusive supplier base has also been well-documented,[12] including in the manufacturing industry.[13] Rather than strengthening support for minority-owned firms, President Trump has instead dismantled the MBDA, lowered contracting goals for SDBs, undermined OSDBUs, and proposed eliminating various entrepreneurial development programs. Undermining and dismantling targeted federal programs that recognize the historic challenges faced by minority business owners will ultimately hurt local communities and weaken the U.S. economy.

We request answers from the Administration in writing on the following questions by July 10, 2025:

1. Please explain how the Department of Commerce plans to utilize congressionally appropriated MBDA funds in accordance with statutory requirements.

2. The MBDA Business Centers program is statutorily authorized under 15 U.S.C. § 9523. Please explain how decisions to fire staff who service the program and cancel Business Center contracts were made.

3. Please detail how the Trump administration plans to meet the existing SDB contracting goal. Will the SBA commit to advocating for the full staffing and resourcing of OSDBUs to ensure all small business contracting goals are met or exceeded? If not, why not?

4. Please detail the specific reasons for the President’s request to eliminate “15 specialized and duplicative programs,”[14] including the Women’s Business Center Program, SCORE, the State Trade Expansion Program, Native American outreach, technical assistance for the Microloan program, Growth Accelerators, and Regional Innovation Clusters.

Sincerely,

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