DOGE slashed dozens of federal contracts in Pennsylvania — and businesses are feeling the pain

In 2014, Daniel Watson-Bey enrolled in a federal program to help minority-owned small businesses like his video production firm so he could compete for government contracts.

Through the program, the Lansdale-based company East Hill Media won federal bids to install video conference systems at the U.S. Military Academy at West Point, host webinars about low-income housing programs, and do community engagement ahead of a dam demolition on the Monongahela River in Pittsburgh.

Not only did his revenue double over the last decade — but working for Washington felt meaningful.

“It was this combination of knowing we were making a difference and knowing we would get paid on time,” Watson-Bey said, noting that small municipalities and private clients often lag on their invoices.

But that revenue stream evaporated last month when the Trump administration canceled East Hill’s last contract with the U.S. Department of Housing and Urban Development (HUD) as part of a sweeping austerity campaign to reduce the size of the federal government.

As of Friday, East Hill’s contract was one of at least 45 contracts held by Pennsylvania companies that were allegedly canceled by the Department of Government Efficiency — the retrenchment task force better known as DOGE, which is led by Elon Musk, the world’s richest man.

The Pennsylvania list offers a window into the unsung work that Washington outsources to small and large businesses across the commonwealth — providing mental health treatment for workers in war zones, researching the safety and risks of implantable medical devices, integrating Biden-era climate change initiatives into public housing programs.

While President Donald Trump has championed DOGE as a reformist cost-cutting measure, some companies feel the economic damage will outweigh any visible gains for states like Pennsylvania. Some companies downplayed the economic hit to their business. Others said the lost contracts will force them to scale back operations and lay off workers.

And the taxpayer savings touted by DOGE remain suspect. In one case in Pennsylvania, DOGE appeared to take credit for canceling a $34 million contract that was nullified by the Biden administration in November — adding to a pattern of errors that appear to have inflated the department’s success.

Nearly 40% of the publicly visible contracts may yield no savings, as many contracts were already paid out, according to an Associated Press analysis. The Inquirer found some of DOGE’s calculations were also based on high contract ceilings for need-based services, but companies said they would never have been paid that full amount.

DOGE’s limited data make it difficult to verify its claims.

The department’s online “Wall of Receipts” touts more than $15 billion in savings — but only about a third of the contracts are visible. Troves of contracts have also disappeared from the online database without explanation in recent weeks, including at least 19 in Pennsylvania as of Friday.

Still, an Inquirer analysis of 37 contracts DOGE’s data sample in Pennsylvania found more than half of the posted contracts tied to two agencies the White House has targeted for cuts: HUD and the Consumer Financial Protection Bureau. About 57% of the companies on the Pennsylvania list also are owned by veterans, women, or people from underrepresented groups.

DOGE did not respond to a request for comment. And questions about the department’s methodology have also gone unanswered in Congress — leaving both Democrats and Republicans without answers for their constituents hurt by the cuts.

“There’s a complete lack of transparency, which is ordinarily where Congress should be stepping up and asking for oversight,” U.S. Rep. Mary Gay Scanlon, a Democrat who represents Delaware County and parts of Philadelphia, said Tuesday.

The slashed contracts have elevated some concern about the economic fallout from Trump’s slash-and-burn approach to downsizing the federal government, and come as Pennsylvania workers have also been hit by mass layoffs targeting probationary employees as well as sweeping cuts to government grants.

Monica Gould’s Mechanicsburg, Pa.-based consulting firm, JAMA Enterprises & Strategic Consulting Partners, had four contracts terminated on the DOGE list.

One was with the U.S. Department of Agriculture’s dairy program to develop a succession plan for the people who regulate and grade America’s milk. Gould said JAMA established an emerging leadership program to help fill jobs in an industry that trends older, as professionals there age out.

Another contract was for training supervisors in the Commerce Department. The program, three years into a five-year contract, provided leadership and organizational skills to mid-level managers at the department.

“It appears that leadership development and culture development are not valued,” Gould said. “We know great leaders inspire and engage employees, making them more productive, creative, and innovative. These cuts … are going to have a devastating impact on employee morale.”

Gould, who emigrated from India with her parents when she was a toddler, runs a certified woman- and minority-owned business — one of several on the Pennsylvania DOGE list.

On a personal level, the canceled contracts come on the heels of a massive hit to Gould’s business, which she started 30 years ago after having children and seeking out a life with more balance following years in corporate America.

Her largest government contract, a $34 million commitment with USAID to provide mental health and other support to employees often working in war zones, was also canceled.

Taken together, it’s about a 60% reduction in Gould’s company’s business and has required her to lay off staff, many of whom live in Pennsylvania.

The USAID contract termination came just days after Trump was elected, though it now appears on DOGE’s list of claimed reductions.

Such inflations have become a trademark for Musk’s frugality task force in recent weeks. In one case reported by the New York Times, the task force took credit for ventilating a $53 million federal contract that had ended in 2005. The contract was later scrubbed from the site. The USAID contract remained on the DOGE list as of Friday.

Some of the largest reported contract cancellations in Pennsylvania also suggest that DOGE might be inflating its math.

Jurisolutions, a Philadelphia-based firm that outsources attorneys and paralegals for project-based work, held five contracts on the Pennsylvania list. Two of them were with the CFPB and combined for $30 million, a sizable sum that fuels DOGE’s claim of billions in savings.

But Cindy Towers, the company’s president and CEO, called the figure “a bit misleading.” Both were “indefinite quantity” contracts — the kind used for an unspecified amount of work in an unlimited quantity.

Towers said she was providing attorneys to Washington for various legal projects.

But even if the contract had not been canceled, the firm would never bill anywhere close to that ceiling, she said. The reason for the large sum is to avoid the need to draft a new contract in the event of a massive increase in demand for services.

“It’s a contract that means that they don’t know how much they’re going to need,” Towers said. “If the total value is $10 million, it doesn’t mean they’re going to use $10 million. They’re only going to use my lawyers when they need my lawyers.”

Federal contracts represent a fraction of Jurisolutions’ business. Towers said she would help attorneys detailed to those federal projects in Washington find work with her other clients. She said the impact for her company is far less severe than it is for others amid the federal downsizing.

While DOGE claims all contracts posted on its website as cancellations, some are not designated as terminated in federal contract documents linked by DOGE.

In one case, a large health-care company, United Concordia, said it had received no notice of a contract that appeared on the DOGE list being canceled. The contract with the Consumer Financial Protection Bureau for dental insurance was valued at a maximum of $8 million.

“United Concordia Dental has not received notice of cancellation of the contract and continues to perform work under the agreement,” Suzanne Cibotti, communications consultant for the Camp Hill, Pa.-based company, told The Inquirer on Friday.

For Watson-Bey, news of the cancellation came last month alongside a “clerical error.” The government accidentally wired his business over $150,000. Officials asked him to wire it back.

He suspected his decade of federal contracting would come to an end when Trump took office, and since the November election, he has moved his business out of his office and into his home as a precaution.

Still, his five-year contract with HUD to provide webinar services for housing programs was to run through next fall. Now, he is downsizing further, worried he may not be able to pay his three employees.

It’s one way that the DOGE cuts, he said, will leave a lasting ripple.

“You can’t just arbitrarily cut everything like Reagan and make government so small you could drown it in a bathtub,” he said. “It’s not sustainable. Every action has another reaction.”

Staff data reporter Chris Williams contributed to this article.