(Katelynn Richardson) – U.S. Sen. Jacky Rosen, D-Nev, introduced the Fair Access for Cannabis Small Business Act Thursday, which would ensure cannabis small businesses operating legally within their states can access Small Business Administration (SBA) services.
The SBA currently bars cannabis companies from its programs and loans, regardless of state law, because cannabis remains federally illegal. Marijuana is classified by the Drug Enforcement Administration as a Schedule I controlled substance.
“The unfair barriers to basic federal support and resources have hurt our state’s legally-operating cannabis small businesses,” said Sen. Rosen in a statement. “This legislation will level the playing field so that cannabis small 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.”
There are currently over 700 active recreational and medical cannabis license holders in the state, according to the State of Nevada Cannabis Compliance Board.
According to the news release, the Fair Access for Cannabis Small Business Act would open up access to SBA 7(a) loans, disaster loans, microloans, the Small Business Investment Company (SBIC) program, and the SBA’s resource partners, such as SCORE, Veterans Business Outreach Centers, and Women’s Business Centers.
“Lack of access to capital and banking services remain the greatest barriers to entry into the cannabis industry,” said Layke Martin, Executive Director of Nevada Cannabis Association, in a statement. “We are grateful for Senator Rosen’s efforts to support small cannabis businesses by increasing access to SBA loans and programs.”
Khadijah Tribble, CEO of the U.S. Cannabis Council, said the bill would benefit “Black and brown cannabis entrepreneurs.”
“For Black and brown communities that have been ravaged by the war on drugs for decades, there is a light at the end of the tunnel as the end of cannabis prohibition comes near,” Tribble said. “But without access to capital through financing tools like SBA loans, most Black and brown cannabis entrepreneurs won’t get the chance to profit from an industry that was once used to stigmatize them – even in states where the plant has been legalized.”
Banking reform concerns featured prominently in discussions at this year’s MJBizCon, a cannabis trade show hosted in Las Vegas November 15-18.
Another piece of legislation on the table is the Secure and Fair Enforcement (SAFE) Banking Act, which would protect financial institutions that do business with cannabis companies from facing penalties. The bill currently has 42 co-sponsors, including 9 Republicans.
“Senator Rosen’s landmark legislation would help advance equity and innovation in the cannabis industry by leveling the playing field for independent cannabis operators,” Tribble continued. “If 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 a diversity of players.”
In June, Rosen sent a letter to the Senate appropriators urging them to “include language preventing the SBA from excluding from its loan and entrepreneurship programs legally operated cannabis small businesses in Nevada and across the country.”
Katelynn Richardson | The Center Square