Senators Urge Financial Committee To Give Cannabis Industry Access To Fed Small Business Loans

Senators are urging the Senate Appropriations Subcommittee on Financial Services and General Government (FSGG) to level the playing field for the state-legal marijuana industry by extending Small Business Administration (SBA) programs and services.

Cannabis companies currently are barred from obtaining SBA loans due to federal law, which classifies marijuana as a Schedule 1 substance.

Equal Opportunities To State-Legal Cannabis Entrepreneurs

Led by Sen. Jacky Rosen (D-NV), lawmakers sent a letter calling on committee leadership to provide the same opportunities for growth and success as other small businesses, reported Marijuana Moment.

“Currently, most banks are reluctant to serve even state-legal cannabis businesses due to conflicts with federal law, meaning that these legally operating small businesses often are forced to operate using only cash, potentially jeopardizing public safety in order to do business,” reads the letter.

The senators asked to include language in future spending legislation that prohibits SBA from denying applications for a pair of loan programs for marijuana small businesses that are operating legally in states where marijuana is legal.

Lawmakers want to ensure that SBA's entrepreneurial development programs are open to state-legal cannabis businesses and that such businesses can benefit from them.

Additionally, SBA loan programs and entrepreneurial development programs can provide valuable resources to cannabis small businesses, particularly for minority, women, and veteran business owners. 

“Access to SBA loan and entrepreneurship programs would support a rapidly growing industry that creates jobs, supports small businesses, and raise revenues in states that have chosen to legalize cannabis.” 

The letter was also signed by Sens. Ron Wyden (D-OR), Tammy Duckworth (D-IL), Ed Markey (D-MA), John Hickenlooper (D-CO), Alex Padilla (D-CA), Cory Booker (D-NJ) and Jeff Merkley (D-OR). Last year, Rosen's request was unsuccessful. This year, the Senators hope for a better outcome.

Additionally, she emphasized that small businesses are vital components of Nevada's local economy and play a significant role in powering communities.

Rosen's Previous Cannabis Reform Efforts: Rosen has been advocating for cannabis reforms, including the SAFE Plus Act, which she discussed with other Democratic senators in February.

However, steps are being taken to address the issue. The Senate Banking Committee has officially scheduled a hearing to take up the Secure and Fair Enforcement (SAFE) Banking Act on Thursday, May 11 to address challenges faced by small businesses and workers in the cannabis industry.

Photo: Courtesy Of Mike Petrucci On Unsplash