Scheduling note: WhatMatters is honoring Farmworkers Day and will be back in your inboxes Thursday.
Of all the states, California is home to the most small businesses, and has the largest immigrant population. But a recent rule change from the Small Business Administration could mean that the number of would-be owners of California restaurants, child care businesses, law practices, nail salons and other enterprises would significantly diminish.
As CalMatters’ Levi Sumagaysay explains, in March the SBA began limiting access to its loans to only U.S. citizens and nationals. Green-card holders no longer qualify for loans, and neither do businesses that are just partly owned by a permanent legal resident with a green card. SBA-backed loans by private funders, which provide loans for people whom banks may deem riskier, are also off the table starting April.
Maggie Clemmons, an SBA spokesperson, said in an email that the agency has limited lending capacity and that the new policy “will help ensure more American citizens have access to funding previously granted to noncitizens.”
But SBA loans have been crucial for immigrant entrepreneurs because of their typically low interest rates and they’re available to those without an established credit history. Forty percent of California’s business community is made up of immigrant entrepreneurs and in 2023, they generated $28.4 billion in income. The rule change could affect about 220,000 California small business owners who hold green cards.
Two decades ago, Cristina Foanene arrived in the U.S. from Romania on a green card and received an SBA loan in 2018. The loan enabled her and her husband to establish a glass company in Fresno, which now employs 30 workers.
- Foanene: “The loan gave us an opportunity to create more jobs, to have an even greater impact in our community. … It literally breaks my heart. There are so many good people with good intentions. I feel it’s unfair.”
Join us in Fresno Wednesday at 5:30pm to hear candidates for governor address the issues that are most important to the Central Valley. Register now for the Central Valley Gubernatorial Forum, moderated by CalMatters.
Join CalMatters on April 22 in Pasadena for a conversation on rebuilding after the devastating January 2025 Los Angeles wildfires. Experts will examine how workforce shortages are shaping rebuilding efforts and what it will take to strengthen the skilled trades pipeline. Register today.
Be part of the conversations driving California forward at the CalMatters Ideas Festival on May 21 in Sacramento. Get your tickets now.
Other Stories You Should Know
Friend no friend of the court
After a CalMatters investigation revealed that a Ventura County fiduciary has been directing her clients’ money to her husband’s law firm and health care company, a county judge has begun the process to unwind the woman’s business conflicts, writes CalMatters’ Byrhonda Lyons.
For years Angelique Friend hired her husband, David Esquibias, as her attorney and his in-home health care company to provide her elderly clients’ care. Friend’s clients often paid the bill for these services, and while the court knew about the couple’s connections, the California Professional Fiduciary Bureau generally prohibits such conflicts of interest.
The county judge ordered Friend to stop hiring both Esquibias as her attorney and his health care company. The judge also blocked Esquibias from collecting attorney’s fees in three cases and suspended Friend as the trustee in a fourth case.
At a hearing, Esquibias expressed shock that his work relationship with Friend had now become a problem given the court’s approval of it for years.
A new role for the state in construction?
Among a spate of recently introduced bills to boost factory housing construction in California, one stands out for its unprecedented proposal to have the state dive into a new role, reports CalMatters’ Ben Christopher.
The bill would have the state become a re-insurer for developers and lenders interested in building houses in factories. Because these houses take less time to build and are constructed in safer working conditions, they’re cheaper to make and ultimately more affordable to buy. But construction in general is a risky endeavor, and factory-based building more so.
By enabling the state to insure the insurers — stepping in to cover a portion of the payout if a project fails — the bill aims to make insurance companies more willing to offer insurance. Developers would theoretically be more encouraged to sign on with factories, giving factories more steady business.
But questions remain, including how much this could cost taxpayers, and whether other lawmakers have enough faith in a nascent industry to support the bill. The measure is expected to be heard in committee in late April.
And lastly: The tax returns of aspiring governors
Top candidates for California governor have released their tax returns, giving voters a peek inside their earnings and income. Among the key highlights: Democrat Tom Steyer, a billionaire and former hedge fund manager, and his wife reported a total income of $39 million in 2024 — more than all nine of his major opponents and their partners made that year combined. Read more from CalMatters’ Yue Stella Yu.
California Voices
CalMatters columnist Dan Walters: Santa Monica’s new factory-built housing complex highlights the housing opportunities, and hurdles, put forward by the recent bill package related to modular housing.
CalMatters contributor George B. Sánchez-Tello: The abrupt halt of a mental health center in Monterey County, in part due to local pushback, underscores California’s scarcity of residential programs.
With sky-high gas prices, refineries shutting down and California’s dependence on imports, state regulators must revise their proposal to update the state’s cap-and-invest program, writes state Sen. Tony Strickland, a Huntington Beach Republican.
Other things worth your time:
CA Rep. Swalwell accuses Trump of trying to influence CA governor’s race with old FBI files // Los Angeles Times
CA’s governor’s race has no frontrunner — but plenty of cash // San Francisco Chronicle
Riverside County sheriff’s investigation that seized 650,000-plus ballots is ‘on hold’ // The San Bernardino Sun
CA legislators consider requiring breathalyzers on all DUI offenders’ vehicles // The Orange County Register
After ever-costlier CA fires, new study could shape state’s response // The Press Democrat
Federal stipulation protects Cal State from losing funds over Title IX dispute // EdSource
Inside the CA mountain compound led by Cesar Chavez // The New York Times
Next to Joshua Tree National Park, an Australian mining company is staking its claim for rare earth minerals // Los Angeles Times
Providers brace for thousands of San Diegans to lose SNAP benefits // The San Diego Union-Tribune
via CalMatters https://ift.tt/TVK0fn8
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