Cannabis Businesses Eligible for Federal Aid

Cannabis Businesses Eligible for Federal Aid

Recently, there’s been a major shift in how marijuana is perceived in the U.S. Early this year, multiple states legalized the use of recreational marijuana. Most of these states will open retail until 2024. It seems that we’re steadily moving into a time that’s more accepting of cannabis. So much so that U.S. representatives are beginning to see the cannabis industry as a serious contender. Earlier this year, lawmakers in the House of Representatives introduced 3 new bills. These bills aimed to make state-legal cannabis businesses eligible for federal aid. Specifically, aid given to small businesses, such as loans, disaster relief, and grant programs.  

These new bills are meant to provide an equal playing field for cannabis businesses. Cannabis businesses are currently prohibited from receiving federal aid due to marijuana being classified as a Schedule I controlled substance. Regardless, the legal cannabis industry provides a lot for the nation. It provides nearly 320,000 full-time jobs in the U.S., according to industry estimates. The cannabis industry also helps cities with tax revenue. For example, California passed $1 billion in cannabis tax revenue two years after launching. 

These new house bills will provide aid for cannabis businesses that faced hardships during the COVID-19 pandemic.

1st Bill To Make Cannabis Businesses Eligible for Federal Aid 

H.R. 2712 is the first of the three house bills to help cannabis businesses. The bill’s actual name is Ensuring Safe Capital Access for All Small Businesses Act of 2021. It’s sponsored by House Small Business Committee Chairwoman Nydia Velázquez (D-NY). This bill would allow marijuana businesses to access resources from the federal Small Business Administration (SBA). Additionally, it would expand access to services such as microloans, disaster assistance and the agency’s loan guaranty program. 

Velazquez makes the argument that with more states pushing for legalization, there’s more and more legitimate small businesses being formed. These small, cannabis businesses are being excluded from SBA programs and from the help they may desperately need. 

2nd Bill To Make Cannabis Businesses Eligible for Federal Aid 

The second bill aimed to help cannabis businesses is H.R. 2649. It’s titled the Homegrown Act of 2021. Additionally, the bill is sponsored by Rep. Dwight Evans (D-PA). It would establish a U.S. Small Business Administration grant program to provide funding to state and local governments. Furthermore, this funding will be used to help them navigate the licensing process for cannabis businesses. Additionally, the bill specifies that the grant money should be used to benefit communities disproportionately impacted by the drug war. It also aims to remove marijuana from the Controlled Substances Act. 

Evans believes that this bill will aid small businesses and help them emerge from local people rather than large companies. “My bill would act as a poverty-buster and help homegrown small businesses, which are the backbone of our economy and our neighborhoods,” Evans explained.

3rd Bill To Make Cannabis Businesses Eligible for Federal Aid 

Lastly, the third bill is H.R. 2652. It’s titled Ensuring Access to Counseling and Training for All Small Business Act of 2021. The bill is sponsored by Rep. Jared Golden (D-ME). In addition, this bill would prohibit SBA partners that provide guidance and training services from denying help to businesses solely because of involvement in cannabis. This would make cannabis businesses eligible for federal aid in the form of services and guidance. The changes in this bill would affect providers. These include SBA’s Small Business Development Centers, Women’s Business Centers and the Veterans Business Outreach Centers. 

Rep. Golden believes this bill will aid the nation’s economic recovery. “Our continued economic recovery depends on the health of American small businesses of all kinds.” He explains that denying help to small businesses, even cannabis ones, prevents the creation of jobs and lifting the economy. 

“My bill would help address this problem by providing small business owners directly or indirectly associated with the cannabis industry with access to the services and resources they need to get their small businesses off the ground and grow.” 

More Cannabis Legislation

Federal lawmakers have also been working on other cannabis-related proposals. In April, the U.S. House of Representatives approved a bill related to cannabis and bank relations. The bill protected banks that service state-legal marijuana businesses from being penalized by federal regulators. 

Marijuana businesses are mostly denied accessing traditional financial institutions, and thus have to operate on a mostly cash-only basis. This makes them targets of crime—a point that many advocates, regulators, and bank representatives have emphasized. 

With bills like these being introduced, it seems that cannabis legalization at a federal level may be introduced soon. 

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