The U.S. House of Representatives passed a legislation on Friday (June 6) that will prevent non-citizens from obtaining loans from the Small Business Administration (SBA), bringing the agency’s previously proposed new policy closer to being enshrined in law.
The bill passed with a vote of 217 to 190, with 8 Democratic lawmakers and all Republican lawmakers voting in favor. If the bill is passed in the Senate and signed into law by President Donald Trump, applicants for SBA loans will be required to submit documentation proving their citizenship.
The sponsor of the bill, Republican Representative Beth Van Duyne from Texas, stated during the House session, “Loans are guaranteed by taxpayers through the SBA, and we cannot allow those who are in the country illegally to take loans away from hard-working Americans.”
However, some Democratic lawmakers deny evidence showing that SBA loans have been allocated to non-citizen business owners. Democratic Representative LaMonica McIver from New Jersey stated that the true purpose of the bill is to use small business policy as a political tool against immigrants, making it “not only wrong, but harmful.”
Previously, the Trump administration implemented a regulation prohibiting non-citizen business owners from receiving SBA loans, citing an audit that found the agency approved a $783,000 SBA loan in June 2024 to a small business partially owned by non-citizens.
On Thursday, the House also passed another bill to relocate SBA offices from so-called “sanctuary cities” to areas that comply with federal immigration enforcement regulations.
The Department of Homeland Security (DHS) recently released a list of “sanctuary jurisdictions across the U.S. that violate federal immigration laws,” covering over 500 states, counties, and cities from coast to coast. The federal government warned that these sanctuary jurisdictions “intentionally obstruct enforcement of federal immigration laws and endanger the safety of American citizens,” urging them to immediately revise their policies.
President Trump nominated former Senator Kelly Loeffler as the SBA Administrator on December 4 last year, emphasizing that “small businesses are the backbone of our great economy.” Loeffler, upon confirmation by the Senate on February 24 this year, issued 15 memoranda stating her commitment to implement the administration’s “America First” policy rigorously, cracking down on pandemic-related loan fraud and explicitly prohibiting illegal immigrants from receiving SBA assistance.