Senator introduces bill to make cannabis businesses eligible for SBA loans

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US Democratic Senator Jacky Rosen of Nevada introduced legislation last week that would make regulated cannabis businesses eligible for loans and other programs from the federal Small Business Administration (SBA). If passed, the Fair Access for Small Cannabis Businesses Act would help ensure that licensed cannabis businesses have access to the same benefits available to other legal businesses, including the popular SBA 7(a) loans, disaster loans, microloans and the Small Business Investment Company. (SBIC) program. The legislation also ensures that businesses in the regulated marijuana industry have access to SBA resource partners such as the SCORE business mentoring program, Veterans Business Outreach Centers and Women’s Business Centers.

Rosen has been an outspoken advocate of allowing businesses in the legal cannabis industry access to banking services and resources offered by the SBA. Under current SBA regulations, businesses that provide “direct or indirect products or services that assist the use, growth, or enhancement of cannabis are eligible for SBA loans and programs,” according to a statement from the senator’s office.

“Unfair barriers to basic federal support and resources have hurt small cannabis businesses that operate legally in our state,” Rosen said Nov. 18. “This legislation will level the playing field so that small cannabis businesses—including those owned by people of color, women, and veterans—have access to the same federal resources and loans that other legal businesses are entitled to.”

Expansion of opportunities for cannabis businesses

In 2021, Rosen highlighted the need to expand access to SBA resources for small cannabis businesses operating legally under state law while questioning then-nominee for SBA administrator Isabel Guzmán, who was later approved by the Senate. And earlier this year, she sent a letter urging the Senate Appropriations Committee to include language preventing the SBA from excluding small, legally-operated cannabis businesses from its lending and entrepreneurship programs. Rosen also previously addressed a bipartisan letter to the leaders of the House and Senate Armed Services Committee in December 2021, urging his fellow legislators to uphold the Safe and Fair Banking Act (SAFE) provisions in the Banking Act. Fiscal Year 2022 National Defense Appropriations.

“Lack of access to capital and banking services remain the biggest barriers to entering the cannabis industry,” said Layke Martin, executive director of the Nevada Cannabis Association. “We are grateful for Senator Rosen’s efforts to support small cannabis businesses by increasing access to SBA loans and programs.”

Khadijah Tribble, executive director of the US Cannabis Council (USCC) trade group, hailed the introduction of the Cannabis Small Business Fair Access Act, saying that legalizing marijuana alone is not enough to address the harms caused by nearly a century of marijuana prohibition. .

“For Black and Latino communities that have been devastated by the war on drugs for decades, there is a light at the end of the tunnel as the end of cannabis prohibition nears. But without access to capital through financial tools like SBA loans, most black and brown cannabis entrepreneurs won’t have the opportunity to profit from an industry that was once used to stigmatize them, even in states where the plant has been legalized,” Tribble said. in a USCC statement. “Senator Rosen’s landmark legislation would help promote fairness and innovation in the cannabis industry by leveling the playing field for independent cannabis operators. If combined with the SAFE Banking Act, the Cannabis Small Business Fair Access Act would create a regulatory framework that would ensure a vibrant startup scene and player diversity.”