Native American business groups across the United States are warning that cuts to federal contracting programs could weaken one of the most important economic engines in rural America.
For years, tribal governments expanded beyond casino gaming into industries such as construction, healthcare, manufacturing, banking, and information technology. Much of that growth was supported by federal contracting programs designed to help disadvantaged businesses compete for government work. Now, tribal leaders and consultants say those opportunities are rapidly declining under the Trump administration, creating fresh uncertainty for businesses that support thousands of jobs in underserved regions.
The shift is particularly significant because tribal enterprises often fund essential services including healthcare, education, housing, and infrastructure in areas where alternative sources of investment remain limited.
Oklahoma’s Tribal Economy Extends Far Beyond Gaming
The Chickasaw Nation’s WinStar World Casino in Thackerville, Oklahoma, has become one of the largest gambling destinations in the world, helping anchor the state’s $10bn tribal gaming industry. But gaming now represents only part of the wider tribal business landscape.
Across Oklahoma, tribes own companies operating in sectors ranging from financial services to manufacturing facilities. According to an economic impact study released last year by Oklahoma City University researchers, the state’s 38 federally recognized tribes generated more than $23bn in economic activity in 2023, supporting roughly 140,000 jobs and almost $8bn in wages and benefits.
The effects stretch well beyond tribal citizens. The report found that nearly two-thirds of employees working in Oklahoma’s tribal gaming sector were not Native American citizens. Tribal healthcare providers also treated tens of thousands of non-Native patients, while tribal revenue contributed millions of dollars toward local education systems.
Chris James, president of the National Center for American Indian Enterprise Development, said many tribal businesses operate in remote regions where economic alternatives are scarce.
“Some of these tribes, they’re in very remote areas, and the only economic driver for that community may be a business owned by the actual tribe,” James told Fortune.
Consultants advising tribal governments say federal contracting opportunities have slowed sharply over the past year. Trevor Skelly, chief executive of Gov Contract Pros, said programs supporting underserved small businesses have seen some of the steepest declines.
His analysis of federal procurement data showed tribal businesses received about $1.8bn through the Small Business Administration’s 8(a) contracting program between October and April, down roughly 40% from nearly $3bn during the same period a year earlier.
SBA Audit Creates Uncertainty for Tribal Contractors
The 8(a) program was designed to help disadvantaged businesses compete for federal contracts, particularly in sectors such as construction, engineering, and IT services. Tribal governments have relied heavily on the initiative because it offered a relatively accessible route into stable, multi-year government work.
The Trump administration has tightened oversight of the program as part of a broader review of diversity-focused contracting initiatives. Small Business Administration chief Kelly Loeffler previously described the program as vulnerable to abuse and fraud, prompting a sweeping audit of participating firms.
According to Skelly, the SBA admitted only 65 new firms into the 8(a) program last year, compared with more than 500 in 2024. He added that no new businesses have reportedly been added since August.
An SBA spokesperson told Fortune that tribal entities represented just 16% of all 8(a) participants but received approximately $16bn in federal contracting awards last year, accounting for about 70% of total program funding.
The agency said its audit remains ongoing and is intended to ensure taxpayer value while removing fraudulent operators from the system.
The pressure on tribal contractors arrives as many Native-owned businesses continue expanding into new industries. Research published last month by the Federal Reserve Bank of Minneapolis found tribes active in both gaming and federal contracting controlled more than three-quarters of tribally owned businesses nationwide in 2021.
That concentration highlights how federal contracting has become a gateway for tribes looking to diversify revenue streams beyond gaming operations.
Financing Challenges Leave Tribes More Exposed
The slowdown in contracting also exposes a structural financing challenge facing tribal governments.
Unlike many state or municipal governments, tribal authorities often struggle to access low-cost financing for economic development projects. Cory Blankenship, executive director of the Native American Finance Officers Association, said tribes frequently face elevated borrowing costs because sovereign tribal governments are not required to file the same public financial disclosures as local governments.
That can complicate credit ratings and increase interest rates on large-scale borrowing.
According to the Minneapolis Federal Reserve research, federal contracting revenue for tribes expanded at an average annual rate of 41.6% between 1988 and 2021, far outpacing gaming revenue growth during the same period. That trend helped many tribes build administrative expertise, attract workers, and create capital needed for broader business expansion.
The broader implications extend into regional economies. Data from the U.S. Census Bureau has consistently shown rural counties face slower business formation and weaker investment levels than urban areas, making large tribal employers increasingly important in sustaining local labour markets.
What Rural Communities Will Watch Next
Tribal business leaders are now closely watching whether federal agencies restore contracting opportunities or continue tightening access to programs such as 8(a).
For many tribal governments, the issue extends beyond company revenues. Profits generated through tribal enterprises often fund hospitals, schools, housing projects, and public infrastructure that support both Native and non-Native residents.
If contracting opportunities continue shrinking, the impact could ripple through rural economies already facing limited private investment and slower employment growth.
