SBA policy changes would restrict access to capital for certain small businesses and shutter SBA field offices in “sanctuary cities”
(Washington, July 15) - Ranking Member Edward J. Markey (D-Mass.) and House Small Business Committee Ranking Member Nydia M. Velázquez (NY-07) today wrote to U.S. Small Business Administration (SBA) Administrator Kelly Loeffler requesting answers about the Trump administration’s efforts to limit economic opportunity for American entrepreneurs, including immigrants. The SBA previously announced it will shutter seven field offices in municipalities considered by the Administration to be “sanctuary cities” and restrict SBA loan access for small businesses with certain noncitizen owners and employees, including those with legal immigration status—signaling to immigrants that they are no longer welcome to pursue the American dream. These extreme policies break with a quarter century of SBA guidance and threaten to undermine both local economies and national growth.
In their letter, the lawmakers highlight a recent SBA policy change that prevents critical loans—7(a) and 504 loans, as well as Microloans—from going to any small business that is owned or operated, even in very small part, by certain noncitizens. This policy will harm small businesses whose owners, investors, or key employees are foreign nationals or immigrants with certain legal statuses, including asylees, refugees, visa holders, and recipients of Deferred Action for Childhood Arrivals (DACA) status.
In the letter, Ranking Members Markey and Velázquez write, “SBA’s policy changes are a solution in search of a problem and appear to stem from the notion that certain groups are receiving loans when they otherwise shouldn’t be. Our committees have never seen any evidence, credible or otherwise, that meaningful numbers of individuals in the United States without legal authorization are receiving access to SBA financing.”
The lawmakers also highlight how the SBA is eroding the trust of small business owners by politically targeting the relocation of regional offices in major metropolitan areas and doubling down by endorsing legislation that would remove all field resources, not just regional offices, from “sanctuary jurisdictions.”
In the letter, Ranking Members Markey and Velázquez continue, “We firmly believe that our cities should be safe, all acts of violence should be taken seriously, and violent crimes should not be tolerated. However, the Trump administration has made clear that its policies are not aimed at improving public safety or targeting individuals with criminal backgrounds. Instead, this Administration is playing political games with people’s livelihoods and, once again, recklessly failing to consider the interests of small businesses. SBA’s loan-policy and office-closure decisions will unduly harm millions of small businesses across the country that have been suffering through the chaotic, confusing, and unpredictable economic policies of the Trump administration.”
The lawmakers request responses by July 29, 2025, to questions, including:
- Why has the agency deviated from a quarter century of precedent, including from policies that the first Trump administration followed, in imposing a strict requirement that a small business with certain noncitizens who own or operate—even in part—the firm are ineligible for SBA loans?
- Does SBA have concerns that barring delegated lenders from having SBA expressly approve certain loans will cause lenders to make ineligible loans or forgo making certain loans altogether? How will SBA provide delegated lenders with assurance on the eligibility of their loans, beyond an email inbox?
- Does the SBA anticipate that its policy change will compel small business owners to unduly discriminate against individuals in hiring, firing, promotion, or recruitment decisions based on their national origin or citizenship status?
- How will the SBA’s relocation of regional offices impact service to immigrant entrepreneurs? What steps is the SBA taking to mitigate negative impacts to immigrant entrepreneurs?
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