Federal disaster loans are now available to Boyle Heights businesses hammered by the Lineage warehouse fire, but a rule change bars any business with even partial immigrant ownership from applying. In a city where immigrants own more than half of all businesses, the restriction leaves the majority of LA's entrepreneurs without access to the program.

The U.S. Small Business Administration opened its Economic Injury Disaster Loan program after Gov. Gavin Newsom's office requested a disaster declaration Aug. 10. Eligible businesses and nonprofits in Los Angeles, Kern, Orange, San Bernardino and Ventura counties can borrow up to $2 million at 4% interest, with no payments due for 12 months. The application deadline is May 14, 2027.

The catch is citizenship.

Since March 1, the SBA has required 100% U.S. citizen ownership for its loans, including disaster loans. Even a business partly owned by a green card holder is ineligible. The change reversed the agency's previous standard, which required only 51% citizen or legal-permanent-resident ownership.

SBA loans "are for American citizens, and we're unapologetic about it," Administrator Kelly Loeffler told Newsmax.

That hits LA hard. Immigrants represented 51.4% of business owners in the city in 2019, generating $4.3 billion in business income, according to the American Immigration Council. The figures are from 2019, the most recent available.

The Lineage Logistics cold-storage warehouse at 1400 S. Los Palos St. caught fire June 17 and burned for about a week. More than two months later, cleanup remains delayed and residents and businesses are still reporting odor and pest problems, according to ongoing local coverage. Business owners in the area have also reported lost income tied to reduced foot traffic from immigration enforcement activity over the past year.

Local organizations have tried to fill the gap. Inclusive Action for the City, the Boyle Heights Chamber of Commerce and the Hustle & Heart Collective created the Boyle Heights Fire Relief Fund, which offered grants of $3,000 to eligible brick-and-mortar small businesses and $1,000 to eligible street vendors. Applications for that fund closed July 13.

Inclusive Action, led by President and CEO Rudy Espinoza, also offers its own low-interest loans to entrepreneurs: $500 to $250,000 at 5% to 8% fixed interest for up to seven years, available to LA County businesses earning under $3 million annually.

LA County Supervisor Hilda Solis has directed her office to establish a Business Interruption Fund, using First District Catalytic Development Funds, for businesses affected by the Lineage fire and other local emergencies. Details on the funding amount and how to apply had not yet been finalized as of early August. Businesses can call the LA County Office of Small Business at (844) 432-4900 for help with documentation in the meantime.

For those who do qualify for the SBA loan, in-person help is available at the East LA Business Source Center, run by New Economics for Women, at 1780 E. First St. (323-568-1520), and the East LA Entrepreneur Center at 4716 E. Cesar Chavez Ave. (Monday through Friday, 8 a.m. to 4:30 p.m.). Applications can also be filed at sba.gov/disaster or by calling the SBA's disaster assistance line at (800) 659-2955.