House lawmakers on Wednesday explored effort to ease rules and boost small business owners in the legal cannabis industry.
The hearing before the House Committee on Small Business, “Unlocked Potential? Small Businesses in the Cannabis Industry,” brought witnesses from the cannabis industry to discuss the obstacles they face in accessing programs from the Small Business Administration.
Small Business Committee Chairwoman Nydia Velázquez (D-N.Y.) in her opening remarks said she called the hearing to draw “needed attention to an industry that is rapidly evolving” with “small businesses at the forefront.”
“As the only House Committee dedicated solely to the needs of small firms, it is important for us to be shedding light on the challenges these small entities face as well as the economic potential they offer,” she said. “Despite growing economic opportunities around legal cannabis, factors like federal law enforcement, conflicting rules among the states, and our current banking regulations are hindering the ability for entrepreneurs and small businesses to fully engage in this new industry.”
Velázquez is drafting legislation that would make it easier for cannabis businesses legal under state laws to get help from Small Business Administration programs, which are now often closed to them.
Recreational marijuana is legal in 10 states and the District of Columbia, with medical marijuana legal in 33. But marijuana businesses have long complained that because cannabis is illegal under federal laws they face obstacles to obtaining banking services or participating in government programs.
Wednesday’s hearing comes as lawmakers broadly push to lift those restrictions. The House Financial Services Committee advanced legislation with bipartisan support earlier this year, the SAFE Banking Act, that would allow marijuana businesses into the banking system. It is unclear when the bill will get a vote on the full floor and it faces tougher prospects in the GOP-controlled Senate.
One of the witnesses before the panel, Dana Chaves, senior vice president and director of specialty banking at First Federal Bank in Lake City, Fla., testified that even though she could legally do business with cannabis companies under state law, federal law prevented her from getting access to small business loans and other programs.
“I hope this Committee will develop and pass legislation that expands access to business loans and lending programs under the jurisdiction of SBA for cannabis-related business, many of which are led by aspiring entrepreneurs or are minority or women-owned,” Chaves testified.
Another witness, Shanita Penny, president of the Minority Cannabis Business Association, also urged lawmakers to ease access to SBA programs for cannabis businesses.
But many GOP lawmakers are still skeptical of efforts to ease restrictions on marijuana businesses.
Small Business Committee Ranking Member Steve ChabotSteven (Steve) Joseph ChabotBipartisan House bill seeks to punish Burma for genocide Bipartisan House bill seeks to punish Burma for genocide 58 GOP lawmakers vote against disaster aid bill MORE (R-Ohio) questioned those efforts, warning of the harmful effects of pot use.
“Research suggests that it will inhibit long-term thinking, developing, and learning,” Chabot noted.
The lawmakers also heard from Eric Goepel, founder and CEO of the Veterans Cannabis Coalition, who spoke about making medicinal marijuana more accessible to veterans and service members.
“Untreated chronic pain is an underlying contributor to suicide rates amongst veterans. The relief that cannabis brings to veterans is exponential,” he testified.