A US Senator has introduced a new bill that would allow in-state legal marijuana businesses access to certain federal Small Business Administration (SBA) loans and services that are available to businesses in any other industry.
Senator Jacky Rosen (D-NV) introduced the legislation Thursday, during a week of significant congressional activity on cannabis reform issues.
The senator’s proposal would prevent the SBA from denying a variety of loans and other services, including disaster relief, microloans and technical assistance, to businesses just because they are involved in legal cannabis markets.
“Unfair barriers to basic federal support and resources have hurt small cannabis businesses that operate legally in our state,” Rosen told Marijuana Moment. “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.”
The “Fair Access for Cannabis Small Businesses Act” contains similar provisions to a House bill introduced last year by Rep. Nydia Velázquez (D-NY), although that legislation also contained broader language to remove marijuana from the Controlled Substances Act (CSA).
The new bill lacks those federal legalization provisions, but it would amend the Small Business Act to add terms to various sections that state that loans and services cannot be denied “just because the borrower is a legitimate business or service related to the cannabis supplier.”
Rosen’s legislation also includes a couple of additional amendments to the Small Business Act that weren’t included in Velázquez’s bill, such as ensuring cannabis businesses have access to “resource partner assistance” and service providers like small business development centers, women’s malls, and veteran companies outreach centers.
A section on SBA technical assistance would also be uniquely changed under Rosen’s bill to support the cannabis industry.
“For black and brown communities that have been ravaged by the war on drugs for decades, there is light at the end of the tunnel as the end of cannabis prohibition nears,” said Khadijah Tribble, CEO of the US Cannabis Council. United States (USCC). press release on Friday. “But without access to capital through financing tools like SBA loans, most black and brown cannabis entrepreneurs won’t have the ability to profit from an industry that was once used to stigmatize them, even in growing states. which the plant was legalized”.
Rosen, who sits on the Senate Small Business Committee, has been a longtime advocate pushing for SBA reform to treat the cannabis industry no different than other traditional markets.
Over the summer, Rosen asked colleagues on the powerful Appropriations Committee to include provisions in a spending bill to give small marijuana businesses fair access to SBA loan programs and business development resources, for example .
The senator also addressed the issue at a Senate Small Business Committee hearing last year, receiving a pledge from then-nominee and current SBA Administrator Isabel Guzman that she would look into expanding access to businesses in the state marijuana market.
Criticisms of the lack of SBA access for cannabis businesses have surfaced during the coronavirus pandemic. Rosen conducted a separate letter addressing the issue alongside nine other senators last year.
The SBA confirmed in 2020 that cannabis companies do not qualify for disaster loans during the coronavirus pandemic.
There has been talk of easing the marijuana industry’s access to the SBA through an incremental cannabis reform package that is being actively finalized by Senate Majority Leader Chuck Schumer (D-NY), but others have signaled that the final bill will be more focused, centered on bipartisan expungement and banking proposals.
“Senator Rosen’s landmark legislation would help foster equity and innovation in the cannabis industry by leveling the playing field for independent cannabis operators,” said the USCC’s Tribble. “When paired with the SAFE Banking Act, the Fair Access for Cannabis Small Businesses Act would create a regulatory framework that would ensure a vibrant startup scene and diversity of players.”
A comprehensive legalization bill that Schumer, Senator Cory Booker (D-NJ) and Senate Finance Committee Chairman Ron Wyden (D-OR) introduced in July also contains a provision to create a pilot program of 10 years through the SBA “for the intermediary loan” to support small marijuana businesses owned by people who have been disproportionately affected by the war on drugs.
Rosen’s bill was filed the same week that the entire Senate approved the bipartisan House-approved cannabis research bill, marking the first time a standalone piece of marijuana reform legislation has ever been sent to the president’s desk.
Also on Tuesday, congressional lawmakers held a hearing to discuss federal marijuana legalization and state cannabis developments, hearing testimony from a group of broadly pro-reform advocates.
The chairman of the subcommittee that held that hearing also said Tuesday that he will soon introduce a bill aimed at protecting federal workers from being denied security clearance on marijuana.
Read the text of Rosen’s bill on marijuana industry access to SBA services below:
Congressman anticipates bill to protect federal workers from losing safety clearances due to marijuana