Cherokee Federal is the contracting division of Cherokee Nation Businesses and is headquartered in Tulsa. It boasts that it provides defense, technology, health and intelligence services to 60 federal agencies and recently was awarded contracts to support the Golden Dome missile defense project.
That contracting work has received support from the U.S. Small Business Administration's 8(a) program.
Last month, the agency recently suspended 1,000 firms from the program.
This comes after the federal agency required all current 8(a) participants to share records from the last three years by early January. SBA later pushed back the deadline and then announced the suspension of a quarter of participating firms.
In a statement announcing the suspension, SBA Administrator Kelly Loeffler called out the Biden Administration for favoring "minority groups at the expense of every other legitimate small business owner in America, including white Americans." The press release went on to say the suspensions were intended to combat "fraud" and "abuse."
Cherokee Federal is not among the suspended firms. But Cherokee Nation Principal Chief Chuck Hoskin Jr. spoke to a congressional committee about the importance of its work and the risks of conflating support for tribes with race-based diversity, equity and inclusion initiatives.
The U.S. Senate Committee on Indian Affairs held a meeting Tuesday to shut down the misinformation that tribal nations are race-based rather than political entities. Hoskin Jr. was among a group of leaders who testified on behalf of the program, which he said contributed $364 million to the tribe's essential services, such as healthcare, culture revitalization and infrastructure.
"Given our success in the 8(a) program, given what it means to the Cherokee people, and in light of the unfair criticism, I must tell you that I'm worried," Hoskin Jr. said. " I'm worried that this criticism will stall our progress and become yet another unfulfilled promise by the United States."
The SBA's 8(a) program certifies small businesses "considered to be socially and economically disadvantaged" and offers resources and access to government contracting opportunities. Tribally-owned businesses, Native Hawaiian organizations and Alaska Native corporations have a different statutory framework than businesses owned by individuals, which is by design due to the Indigenous communities they serve.
"Congress set up this framework because Native entity-owned firms are accountable to entire Native communities," said Lisa Murkowski, the Chair of the U.S. Senate Committee on Indian Affairs, R-Alaska. "That's a different responsibility. They're accountable to entire Native communities, reinvesting their earnings in broader community priorities and advancing economic self-determination."
Hoskin Jr. said Cherokee Nation companies are required to return at least 37 percent of their net income to the Cherokee Nation's General Fund, which in turn goes back to tribal services. Now, following the news of the suspension, Hoskin Jr. said it is "having a chilling effect" on their operations.
"Right now, we've got our folks at Cherokee Federal talking to contracting officers, having to ask questions about whether we're under investigation, whether there's some fraud afoot," Hoskin Jr. said. "...Credible claims of wrongdoing should be investigated, and lawbreakers should be held accountable. But Native contracting and the 8(a) program are not high-risk endeavors marked by fraud or abuse."
The SBA has not released a list of suspended firms. But leaders from Alaska and Hawaii also testified during the Congressional hearing, showing the new policy has piqued concern in multiple Indigenous communities.
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