A new bill led by Senate Small Business and Entrepreneurship Committee Ranking Member Edward Markey (D-Mass) aims to override the Small Business Administration’s (SBA) policies that prevent small businesses, including food and beverage startups, with legal permanent residents from obtaining SBA-guaranteed loans.
The legislation, titled Investing in the American Dream Act, would restore previous SBA lending standards by establishing a 51% US citizen ownership threshold. This framework governed the program for decades until last year. The bill would ensure loan programs remain accessible to small businesses with legally present immigrant owners.
Markey, alongside Rep. Nydia Velázquez (D‑NY), who sponsored the House version of the legislation, said in a press hearing yesterday that the bill seeks to undo a series of citizenship‑only ownership rules imposed by the SBA over the past year. SBA’s policy changes require SBA‑loan applicants to be 100 percent owned by US citizens or US nationals, disqualifying businesses with even partial ownership by green card holders.
Markey and Velázquez previously warned the agency against adopting those rules. The pair sent formal letters to the SBA last year cautioning that citizenship‑only ownership requirements would break with roughly 25 years of SBA precedent and disrupt access to capital for otherwise eligible small businesses.
The economic impact of SBA loans
SBA loans, Markey said, are often used to expand workforces and job creation in local communities. Small businesses with legal immigrant owners, he said, are “being marginalized” by SBA’s policy.
Markey emphasized the economic role of immigrant‑owned businesses in his home state, noting that Massachusetts is home to more than 91,000 immigrant entrepreneurs – roughly 2 percent of the national total – generating approximately $3.1 billion in business income annually.
“Nationally, one in five Fortune 500 companies was founded by immigrants, and nearly half were founded by immigrants and their children,” Markey said. “Immigrant entrepreneurs are the American story.”
Citing SBA data, Markey added that loans previously extended to green card holders totaled approximately $5.7 billion nationwide and supported an estimated 80,000 jobs.
Velázquez: SBA policy shifts are confusing borrowers and lenders
Velázquez said the SBA’s repeated policy shifts have created confusion across the small‑business lending ecosystem.
“SBA has changed its citizenship rules four times since the start of the second [Trump] administration,” Velázquez said. “Lenders don’t know what to do. Borrowers don’t know if they qualify.”
Under the SBA’s current rules, only US citizens or US nationals whose primary residence is in the United States are eligible for SBA‑guaranteed loans. In a March 9 announcement, the agency said it was banning “foreign nationals and non‑citizens from accessing SBA‑guaranteed small business loans.”
The policy applies across flagship SBA programs, where loans typically range from $500 to $5.5 million and may be used for operating capital, workforce expansion or long‑term fixed assets. Any ownership stake by a non‑citizen – including lawful permanent residents – leaves a business ineligible.
The US Small Business Administration was contacted for comment on the Investing in the American Dream Act but did not respond in time for publication.
Bill supporters emphasize economic impact is at stake
Supporters of the Investing in the American Dream Act argue the economic consequences extend beyond individual borrowers. Rep. Lateefah Simon (D‑Calif.), whose 12th Congressional District is home to communities speaking more than 150 languages, said immigrant small businesses are deeply embedded in local economies.
Others framed the issue as economic rather than political. Gregory Dyson, chief operating officer of the National Community Reinvestment Coalition, said access to small‑business capital “shouldn’t be a partisan issue – it’s an economic issue.”
The bill also drew support from the Small Business Majority, a coalition of nearly 100 advocacy organizations representing small businesses across the country.
