SBA Relocation Mandate: 30% of D.C. Staff Must Move to Lower-Cost Areas, Lose Full-Time Remote Work

The “Returning SBA to Main Street Act of 2025” is a major overhaul of how the Small Business Administration (SBA) operates, focusing heavily on getting federal employees out of the Washington D.C. area and into the regions they serve. The bill mandates that if the SBA Administrator determines it will save the government money, they must relocate at least 30 percent of all headquarters staff to field offices outside the Washington metropolitan area within one year of the law being enacted (Sec. 3). This isn't just a suggestion; it’s a hard target that also requires the SBA to cut its physical headquarters office space by at least 30 percent within two years (Sec. 4).

The Cost of Decentralization: Pay Cuts and Lost Flexibility

For the employees involved, this is a massive change. If you’re one of the headquarters staff selected for relocation, two big things happen. First, your pay rate must be adjusted to the cost-of-living scale of your new location (Sec. 3). Given that the D.C. area has one of the highest federal pay localities, this likely means a significant pay cut for many. Second, you automatically lose the authorization to telework full-time (Sec. 3). This means no more 100% remote work for relocated staff. The bill also specifies that even headquarters employees who aren't being moved but currently work 100% remotely will lose that full-time telework status 180 days after the SBA submits its required report to Congress, unless they qualify for an ADA accommodation (Sec. 3).

Picking New Homes: Geographic Diversity and Rural Focus

The Administrator has to be strategic when choosing these new locations, prioritizing geographic diversity and paying special attention to rural markets (Sec. 3). The goal is to spread SBA jobs around and improve in-person customer service in the regions. This could be a win for smaller towns and rural areas that suddenly become home to a handful of high-level federal jobs. For example, a small town in the Midwest might see an influx of new residents and federal salaries, which could be a boost to the local economy.

The Accountability Loophole

There’s a section in this bill that cuts off a key avenue for accountability. Section 8, titled “No private cause of action,” explicitly states that if the government makes a decision about who to move, where to move them, or how to implement these changes, you cannot file a lawsuit to challenge that decision. This means if an employee feels they were unfairly selected for a costly move and pay cut, or if they feel the cost-saving determination was flawed, they have no recourse through the courts. Furthermore, the Act explicitly overrides any conflicting laws or existing agreements, including labor contracts (Sec. 7), suggesting that established employment terms could be swept aside to meet the relocation deadlines.

What Congress Will See

Beyond the physical moves, the bill tightens up reporting to Congress. Starting immediately, the SBA must include detailed breakdowns in its budget justifications showing exactly how many employees are at headquarters, how many are in the field, and specifically how many are full-time teleworkers—including those who only work remotely due to an ADA accommodation (Sec. 5). This ensures Congress has a clear picture of the SBA’s geographic footprint and remote work practices moving forward, making it easier to track compliance with the new decentralization mandate.