Minority Business Development Agency: Information on Performance Assessment and Compliance Monitoring
Fast Facts
The Minority Business Development Agency has programs to grow and develop businesses owned and operated by socially or economically disadvantaged people. The agency helps these businesses access capital, markets, and contracting opportunities through its network of 39 business centers (as of 2024).
This Q&A report reviews MBDA's performance monitoring and program oversight. We found that MBDA annually rates how centers meet performance goals. 5 of the 7 we reviewed received the highest rating in 2023–2024.
MBDA also monitors how centers comply with program requirements. 5 centers initiated improvement plans in 2021–2024.
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Highlights
What GAO Found
The Minority Business Development Agency’s (MBDA) mission is to promote the growth and competitiveness of minority business enterprises. These enterprises are statutorily defined as being at least 51 percent owned, operated, and controlled by one or more socially or economically disadvantaged individuals. MBDA supports these enterprises through a network of business centers designed to expand their access to capital, contract opportunities, and markets. In 2024, there were 39 active business centers.
MBDA’s responsibilities include assessing business centers’ performance against annual program goals and monitoring their compliance with statutory and program requirements. GAO’s review of performance information for a sample of seven centers found that most reported exceeding annual goals in 2024. MBDA monitoring includes reviews of centers’ performance and financial reports and site visits by MBDA staff. In 2023, MBDA initiated performance improvement plans for five of the 39 centers for issues such as submitting incomplete reports.
MBDA’s Key Activities for Monitoring and Enforcing Compliance at Business Centers
Following executive orders issued in February and March 2025, MBDA and business centers lost access to the agency’s performance data platform, nearly all MBDA staff were placed on administrative leave, and cooperative agreements with business centers were terminated. In May 2025, staff reductions and some agreement terminations were rescinded by a preliminary injunction order issued by a federal district court. According to MBDA officials, the agency retained its performance data. In November 2025, the same court issued an order vacating agency actions under the March executive order and a permanent injunction prohibiting the federal government from implementing the executive order. However, in January 2026 the defendants, including MBDA, appealed the November 2025 decision. The appeal was pending as of February 27, 2026.
Why GAO Did This Study
The Minority Business Development Act of 2021 includes a provision for GAO to review MBDA’s programs, including business center compliance with program requirements. This report describes MBDA programs, its assessment and oversight of business centers, and the effects of executive orders issued in early 2025. GAO analyzed agency documents, notices of funding opportunity, and performance reports; reviewed laws, executive orders, and research literature; and interviewed MBDA officials, business center operators, and advocacy organizations. GAO also reviewed 2024 performance data for a nongeneralizable sample of seven business centers (selected in part for geographic diversity) and analyzed compliance and enforcement activity in 2021–2024.
For more information, contact Courtney LaFountain at LaFountainC@gao.gov.