American Entrepreneurs First Act of 2025

Enumerated powers · passes

Congress has the power to regulate interstate commerce under Article I, Section 8, Clause 3, and to spend for the general welfare under Article I, Section 8, Clause 1. The Small Business Administration's loan programs are a federal spending program that affects interstate commerce, and Congress has the authority to set conditions on the receipt of federal funds. The bill's requirements and eligibility criteria are within Congress's spending power, as they are conditions on the receipt of federal loans.

Bill of Rights · raises concerns · severity: significant

The bill does not directly infringe on the First, Second, Third, Fourth, Sixth, Seventh, Eighth, or Ninth Amendments. However, the exclusion of certain classes of individuals from a federal benefit program may implicate the Fifth Amendment's Due Process Clause, which includes an equal protection component. The Supreme Court has held that the Fifth Amendment's Due Process Clause prohibits the federal government from denying equal protection of the laws. The bill's categorical exclusion of asylees, refugees, and DACA recipients may be an arbitrary classification that lacks a rational basis, thus violating the Fifth Amendment's equal protection guarantee.

Individual liberty · raises concerns · severity: significant

The bill restricts the ability of certain individuals to participate in a federal loan program, which is a government benefit, not a fundamental right. However, the restriction is based on immigration status, and the government must have a compelling justification for such a classification. The bill's exclusion of asylees and refugees, who are lawfully present and authorized to work, may not be rationally related to a legitimate government interest, as these individuals contribute to the economy and are eligible for other federal benefits. The burden is on the government to justify the restriction, and the bill does not provide a compelling justification for excluding these individuals.

Decentralization · raises concerns · severity: minor

The bill fails the decentralization test because it consolidates decision-making at the federal level, which is inherent in a federal loan program. However, the question is whether the eligibility criteria could be handled at a lower level. The federal government has a legitimate interest in ensuring that federal funds are used for their intended purpose, and the eligibility criteria are a condition of the loan. The bill does not directly violate the Tenth Amendment, but it does consolidate decision-making at the federal level, which is necessary for a federal program. The bill fails the test because it does not allow for local or state flexibility in determining eligibility, but this is not a significant issue given the federal nature of the program.

Due process and takings · raises concerns · severity: significant

The bill does not take property without just compensation, but it may violate procedural due process by denying certain individuals a fair opportunity to participate in a federal benefit program. The bill's eligibility criteria are clear, but the exclusion of certain classes of individuals may be arbitrary and capricious, lacking a rational basis. The bill does not provide a hearing or an opportunity to challenge the exclusion, which may violate the Due Process Clause of the Fifth Amendment. The government must provide fair notice and a fair hearing before denying a benefit, and the bill does not provide such procedures.