CEASE Act of 2025

Enumerated powers · passes

Congress has authority 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 7(a) loan program is a federal spending and lending program that facilitates small business access to credit, which substantially affects interstate commerce. Limiting the number of for-profit SBLCs is a direct exercise of Congress's power to structure and administer federal programs. The bill does not exceed enumerated powers.

Bill of Rights · passes

The bill does not implicate any of the first ten amendments. It does not restrict speech, religion, assembly, press, petition, arms, quartering, search and seizure, self-incrimination, due process, takings, trial rights, or cruel and unusual punishment. The cap on SBLCs is a commercial regulatory measure that does not touch upon protected rights.

Individual liberty · raises concerns · severity: minor

The bill restricts the ability of for-profit entities to participate in the 7(a) lending program by capping the number of SBLCs at 16. This limits the economic liberty of potential new entrants to engage in a specific line of business. However, the restriction is not a direct prohibition on private lending—it only limits participation in a federal program. The government has a legitimate interest in managing the program's integrity and ensuring adequate oversight. Under rational basis review, the cap is likely permissible, but it does impose a restriction on private economic activity that requires justification.

Decentralization · raises concerns · severity: minor

The bill fails the decentralization test because it consolidates decision-making at the federal level regarding the number of SBLCs, which could be handled by the states or by market forces. However, the 7(a) program is inherently federal, as it uses federal funds and guarantees. The cap is a federal administrative decision, but it does not prevent states from regulating their own lending markets. The bill does not directly violate the Tenth Amendment because it does not commandeer state governments, but it does centralize authority over a program that could be administered more locally.

Due process and takings · passes

The bill does not deprive any person of life, liberty, or property without due process. It does not take private property for public use without just compensation. The cap on SBLCs is a prospective regulatory change that does not retroactively affect existing licenses or contracts. There is no procedural due process issue because the bill is a legislative act, not an adjudicative decision. Substantive due process is satisfied because the cap is rationally related to the legitimate government interest of overseeing the 7(a) loan program.