A coalition of U.S. Senators sent a letter to leadership March 26, asking that the Small Business Administration (SBA) extend economic assistance to the cannabis industry.
Last month, President Trump instructed the SBA to allocate $50 billion to low-interest loans to help small businesses during the COVID-19 pandemic, but cannabis businesses were excluded from these relief efforts.
“Because federal law prohibits the sale and distribution of cannabis, the SBA does not provide financial assistance to businesses that are illegal under federal law,” Carol Chastang, SBA public affairs specialist, told Cannabis Business Times at that time. “Businesses that aren’t eligible include marijuana growers and dispensers, businesses that sell cannabis products, etc., even if the business is legal under local or state law.”
In their letter, Michael Bennett (D-CO), Cory Booker (D-NJ), Tammy Duckworth (D-IL), Kirsten Gillibrand (D-NY), Kamala Harris (D-CA), Edward Markey (D-MA), Robert Menendez (D-NJ), Jeffrey Merkley (D-OR), Jacky Rosen (D-NV), Bernie Sanders (I/D-VT) and Ron Wyden (D-OR) urged their fellow lawmakers to allow state-legal cannabis businesses to access loans and other forms of economic assistance from the SBA.
Specifically, the senators requested that lawmakers include language in the forthcoming appropriations bill that prohibits the SBA from denying loan applications from licensed cannabis businesses for the 7(a) Loan Guarantee Program, Disaster Assistance Program, Microloan Program and 504/Certified Development Company program.
“Over the last decade, there has been a clear shift in public opinion toward supporting the legalization of cannabis in the United States,” the senators wrote in the letter. “However, SBA’s current policy excludes small businesses with ‘direct’ or ‘indirect’ products or services that aid the use, growth, enhancement, or other development of cannabis from SBA-backed financing. Consequently, small businesses in states with some form of legal cannabis must choose between remaining eligible for SBA loan programs, or doing business with a rapidly-growing and legal industry.”
Industry advocates such as the Marijuana Policy Project (MPP) are also pushing for relief efforts to extend to cannabis businesses.
“So far, none of the relief packages have included cannabis, so we're hoping and encouraging the next relief package to include cannabis businesses as well as other businesses,” Karen O’Keefe, MPP’s director of state policies, told Cannabis Business Times. “So far, they haven't been eligible for the relief that other small businesses have been able to get because of the pandemic."
Senior Editor Patrick Williams contributed to this report.
