This government program from 1938 sought out to provide employment for the disabled. Why are most defense contractors increasingly skeptical of it?
For starters, no one is against giving opportunities for quality, long-term employment to the blind and disabled. However, these opportunities for the blind and disabled are only becoming worse as the AbilityOne program is increasing its list of items government procurement officers often must purchase from their partners, moving in on privately held companies. Some say this encroachment is not fair and costs the government more money than it should. Others say the government is paying AbilityOne-linked companies more for items that are often imported, rather than made by the legally blind and disabled as originally intended. Ability One and its nonprofits’ labor laws would be considered offensive to most people with a conscience, with some blind and disabled workers involved in the program as recent as 2020 deemed “trainees” and thus not eligible for Social Security, Medicare, and pandemic-era unemployment benefits, the bipartisan National Council on Disability (NCD) said in a report published last year. Only 3% of them got a wage hike over a year of employment, the report said.
“Policies from the Past in a Modern Era: The Unintended Consequences of the AbilityOne
Program”, by the National Council on Disability.
AbilityOne’s required purchase items have gone from around 259 products in 1971 for procurement officers to 18,533 items today, based on AbilityOne’s May 2025 Procurement List. Federal contracts that have incorporated FAR Clause 52.208-9 “Contractor Use of Mandatory Sources of Supply or Services” are the contracts that will require use of AbilityOne products in performance of the contract. Under the FAR alone, AbilityOne has a lock on a lot of basic products used at military bases – everything from bedding and mattresses to gaskets and O-rings used in military vehicles.
Many items are imported, often via sub-contractors, with the AbilityOne partnered entity mostly serving as packaging and logistics labor. This puts long-time contractors at the risk of losing legit government contracts to an ever-expanding, and often more expensive, AbilityOne program. This is a no-no for AbilityOne.
There are lots of non-handicapped sales people pushing AbilityOne-entity products to defense procurement officials. Once a small entity created by the Franklin Delano Roosevelt administration, AbilityOne has expanded into a huge, monopolistic business. A growing chorus of manufacturers, and advocates for the disabled, question its expansion, and wonder if it is serving who it set out to serve 80-years ago. It is wiser to integrate the blind and disabled into the commercial workforce and let those companies bid.
Assuming the bulk of the program does what it has set out to do – provide meaningful work for the disabled – there is evidence suggesting that some of the program is a waste, and that the AbilityOne Commission is being duped by the non-profit companies who work as prime vendors for the Commission’s two Central Nonprofit Agencies (CNA) – National Industries for the Blind (NIB), and Source America. AbilityOne does not work with vendors directly. They are the government’s one-stop shop for hiring the blind via NIB and the disabled via SourceAmerica. NIB works with non-profit groups like Lighthouse of Louisiana and SourceAmerica works with hundreds of companies.
At a time when we are trying to decouple from China and increase our country’s Operational Readiness, in defense lingo, this program allows Chinese imports to be purchased and used by service members domestically and internationally at the expense of AbilityOne program labor, but also at the expense of non-AbilityOne private sector contractors who manufacture the same items.
What Democrats and Republicans Said About AbilityOne
What is a disability? For AbilityOne, an employee whose work will qualify as part of the disabled workforce hired for government procurement, a disability is defined as a significant physical or mental disability that is not expected to substantially improve during an individual’s lifetime. Within that framing, the disability then becomes whatever the vendor contracted by SourceAmerica says it is. For some companies, a disability is a previous drug addiction. For others, it could be a long-term mental health disorder that requires medication. (NIB only works with the legally blind.)
In that October 2020 90-page, bipartisan, NCD critique of AbilityOne, report authors wrote that the AbilityOne Commission has a list of disabilities that it considers qualifying. The manual lists common functional limitations related to a given disability as a way of analyzing whether an individual’s disability is significant. It includes people with learning disabilities (think dyslexia), mental illnesses (such as a bipolar disorder designation), but also odd disabilities that would confuse most people – hypertension and even obesity were mentioned in the report. This would qualify a company as having qualifying disabled workers.
NCD staffers at the time spoke with a number of people working with SourceAmerica contractors on job sites. They said these people “did not present as having a significant disability.”
“If the goal of the AbilityOne Program is to employ people with severe disabilities who have difficulty finding public or private employment, it was difficult to see how the people NCD spoke with had any severe disabilities,” the report said.
There are a small handful of legal cases against them.
A 2015 False Claims Act case brought by a whistleblower against one of NIB’s affiliated contractors called Industries for the Blind and Visually Impaired alleged they were importing from China for AbilityOne but claiming it was American made. The company later settled for $1.94 million in 2020.
As an example of companies losing government contracts (or facing risk of losing them) to AbilityOne, in 2024 a Kentucky-based company called Professional Diversity Solutions (PDS), a veteran owned business that makes or services eye glasses for the military, challenged the Veteran Administration’s AbilityOne contracts. They said the program harmed them under the so-called “rule of two” policy, which gives Veteran owned business a lead when there are two or more bidders.
Another Veteran-owned business – Superior Optical in Mississippi – successfully protested the Veterans Administration’s decision to move purchase requirements that were set-aside for veteran-owned small businesses but got moved to AbilityOne program.
Government programs are breeding grounds for fraud, waste and abuse. But if AbilityOne is expanding its list of must-buy items for the Department of War under Federal Acquisition Regulation requirements, then non-AbilityOne companies with substantially more competitively priced goods and services will not be allowed to bid for those same contracts.
AbilityOne: Original Intent
The AbilityOne Program traces its roots to the Wagner-O’Day Act of 1938, a New Deal-era law championed by Senator Robert Wagner and Representative Caroline O’Day. That law was updated in 1971 under the Javits-Wagner-O’Day Act (JWOD) and requires federal departments to purchase certain products made by vendors who employ the disabled and legally blind for the majority of their workforce. AbilityOne built a permanent government market for goods “produced by the disabled.” The word “produced” is key here, and tends to be overlooked by AbilityOne and the two CNA’s. The DoW sees AbilityOne as the stamp of approval that they are abiding by domestic sourcing and hiring the disabled.
The AbilityOne Commission is the 50+ year old government body that oversees procurement policy and creates the Procurement List of approved products and services. The Commission outsources all of its work to the CNA’s – National Industries for the Blind and SourceAmerica. The CNA’s coordinate contracts between the federal government and local vendors who are to fulfill AbilityOne purchase orders. They are privately run.
Some of their items are locally made, as was the intent.
The SKILCRAFT brand is a product line owned by NIB and is supposed to be made by the legally blind at roughly 80 affiliated “Lighthouse”-branded agencies. They make everything from pens to cleaning supplies.
SourceAmerica was established in 1974 to implement the JWOD expansion. It works with over 400 vendors today.
Between 2011 and 2018, the Federal Government purchased on average $3.1 billion worth of goods and services annually through the AbilityOne Program. It is now closer to $6 billion.
SourceAmerica became infamous in 2016 when a whistleblower complained to CNN, with one of their own attorneys saying it was “run like a mafia.” This led to the first reform at AbilityOne in a generation. It is now supposed to audit the companies that SourceAmerica and NIB hire, meaning they should know whether or not a product is really produced domestically.
What can Congress do?
Direct the Inspector General of the Department of War, in coordination with the Government Accountability Office, to audit all existing SourceAmerica and NIB contracts to identify any use of imported goods that are repackaged and labeled as American made. Determine the actual percentage of work performed by disabled individuals in production of items on the AbilityOne mandatory sourcing lists under FAR rules. No federal funds should be used to support foreign supply chains, especially when the idea of AbilityOne is to serve local workers, not outsource labor to other countries via imports. Congress should disallow contracts where NIB and SourceAmerica are sub-contracting out, and selling foreign made goods under the AbilityOne umbrella.
Government contracting officers should provide priority procurement status for products made by companies invested in domestic supply chains. Language such as this should be put into the Federal Acquisition Regulation and National Defense Authorization Act, ensuring the enforcement of Buy America laws by the Department of War and Homeland Security, for example, reduce federal spending on overpriced and non-compliant products, and open federal procurement to competitive, American-made alternatives. Another option is to get rid of the mandatory procurement list and instead require commercial companies that want to participate in the bidding hire blind and disabled persons to integrate them into the workforce.
The Office of the Inspector General – the government watchdog for fraud and abuse – still describes AbilityOne as “high-risk for program integrity,” even though it now has the auditing staff to detect and correct abuse more effectively. Still, this IG is under the AbilityOne wing. We are supposed to assume they will call out their own employer.
Other than hiring people who are really disabled, the second most important thing to audit is whether or not defense contracts are going to importers under the guise of an AbilityOne mandate. We believe this is happening.
Imported Goods: Required and Repackaged.
We have assumed that the bulk of AbilityOne’s funding is going to NIB and SourceAmerica contractors that are severely disabled, above and beyond the disabled that work in private sector business. We are also assuming that a large-enough portion of their contracting is going to importers – perhaps via subcontractors – and awarded to companies that, by any one’s measure, are not employing the severely disabled.
AbilityOne, in their encroachment into more items required under FAR 52.208-9, is becoming a negative to private sector business, including many who already hire those who would be considered disabled by SourceAmerica.
The medical gloves example
AbilityOne now includes those blue, nitrile exam gloves used by dentists and some doctors on their procurement list. There are a few companies in the U.S. that make these, but the main competitors are in China and Malaysia. One local producer said they are not getting government contracts now that AbilityOne is in the space, but they also blamed the cost cutting initiatives spurred on by the Elon Musk-created Department of Government Efficiency. The Transportation Security Administration, part of the Department of Homeland Security, are big buyers of those gloves and most come from China. This does not mean that TSA bought them via AbilityOne, however. TSA does buy these gloves by the AbilityOne qualifying company called Bosma. Another is a non profit called the Central Association for the Blind and Visually Impaired. They might be importing from China, repackaging, and selling to TSA. The volume required for these products cannot be met by AbilityOne contractors alone and so there are only market rumors that these companies subcontract out. Some of them are looking for domestic producers who do not qualify for AbilityOne in order to not be caught importing.
Military procurement example
One military buyer said the Buy American Act was “exempt when it comes to Ability One because (the military) looks at them as the sole-source. Any organization supporting the Department of War should be required to follow the law.”
The Buy American Act restricts the purchase of non-domestic supplies by the Federal Government, but AbilityOne and NIB are exempt from that act in the FAR regulations at this time.
Pricing and imports
“I have seen first hand in the past couple years, boxes labeled Made in the USA, and inside they have products labeled Made in China. The box may have been made in the USA, but not the product,” one procurement officer said.
On September 10, 2025, the AbilityOne Commission issued a directive titled “Compliance with Domestic Sourcing Laws.” It states that products and services on their procurement list must “fully comply with all applicable domestic sourcing laws, particularly the Buy America Act; the Make PPE in America Act, and the Trade Agreements Act.” The policy’s scope covers NIB, SourceAmerica and their participating suppliers. They likely did this because they know AbilityOne is being abused and littering the defense contractor system with imports, cutting out domestic American businesses, and charging between 40% and 200% more in some cases, even without hiring more disabled workers to fill all of these orders.
“Our vendors found products cheaper than Ability One; thus saving the government money,” another procurement officer said.
Strange labor laws
Although this has supposedly been remedied, mainly at NIB, it is unclear if the same holds for hundreds of vendors working for SourceAmerica and, ultimately, AbilityOne. Under Department of Labor law Section 14(c) of the Fair Labor Standards Act of 1938, people with disabilities can be hired for below minimum wage.
One person with inside knowledge said some of the AbilityOne-qualifying companies are not paying employee taxes because employers list the workers as “trainees”, disqualifying them from things like unemployment insurance. This practice needs to be investigated. This labeling does not mean they are paid below min wage under 14(c) laws; they are being paid as full time employees but are not receiving any benefits. Private sector companies competing for government contracts are also competing against these weak labor practices.
In a recent op-ed published in September by Helen Journal – a magazine focused on issues relating to intellectual and developmental disabilities – former NCD Chairman Neil Romano wrote:
“For over 30 years, the Government Accountability Office (GAO) has warned the public, the disability community, and Congress that our federal disability programs are uncoordinated, outdated, and ineffective….The result? Billions spent with little to show for it in long-term outcomes related to the healthcare, employment, and independence of people with disabilities.
Romano’s position is that people with disabilities, especially the legally blind, or those who are wheelchair bound, need reforms across a host of government regulations, and not merely AbilityOne. Romano advocates for more inclusion of the disability in the work place, opposed to corralling them fully into government-dependent workshop employment.”
AbilityOne has passed its prime.
DoW Secretary Pete Hegseth wants a deep dive into one specialty program for the blind, the Randolph-Sheppard Act. The National Federation for the Blind said removing them from managing dining vending operations would usher in AbilityOne, at higher costs. While Secretary Hegseth is re-thinking these mandated government contracts under the Randolph-Sheppard Act, he might find it useful to also look at the Mandatory Procurement List of AbilityOne; an ever-expanding list that is oddly made by a declining number of workers.
Many disability advocates believe there are better ways to hire the disabled in the private sector. Moreover, government contractors are being cut out, not priced out, from bidding as the program keeps growing. The government would save money if many of these contacts were open to private bids. Moreover, it is common for AbilityOne contractors to subcontract their work to a private subcontractor.
“The federal Ability One Commission has outlived its usefulness to people with disabilities and the American people,” said Romano. “In 2021, the National Council on Disabilities issued a report that clearly showed that the AbilityOne program has not kept up with the changing needs in disability employment in America and, in many ways, stands as a barrier to the desire for competitive integrated employment for people with disabilities.”
