Connecticut officials are rolling out a new loan program aimed at supporting social equity marijuana businesses, providing financial assistance to help people who’ve been disproportionately impacted by prohibition expand operations in the legal industry.
As the state continues to see record high cannabis sales since the adult-use market launched in January, the Social Equity Council (SEC) and Department of Economic and Community Development (DECD) said that applications are now open for its Canna-Business Revolving Loan Fund (CBRLF).
Loan recipients can use the money to buy equipment, improve and expand their businesses, access working capital and lines of credit, enhance technology infrastructure, cover loan closing costs and carry out environmental studies related to construction and renovation.
“Access to fair, safe and equitable funding for cannabis businesses is critical to standing up and building strong companies,” SEC Executive Director Ginne-Rae Clay said in a press release on Tuesday. “Connecticut is among the first states to offer direct state financial assistance to ‘budding’ cannabis entrepreneurs.”
“Access to capital means one less thing our cannabis supply chain must think about,” she said. “We are excited to announce this loan fund as we continue to provide support and technical assistance that will ensure the success and stability of the social equity cannabis supply chain.”
The offices are authorized to grant low-interest loans amounting to $50 million under the legalization law that Gov. Ned Lamont (D) signed in 2021.
The fund, made possible under the state’s legalization law, will provide social equity licensees with loans set at the prime interest rate plus three percent, and they can’t be set at less than six percent or more than nine percent. Licensees who complete SEC’s accelerator program would receive a 1.5 percent interest rate discount, meaning the lowest rate would be 4.5 percent.
“This new loan program is vital to helping applicants quickly access the funding they need to get their cannabis operations up and running,” SEC Chair and DECD Deputy Commissioner Paul Robertson said. “It is an important step forward in building Connecticut’s cannabis marketplace and capitalizing on the jobs, investment and many other benefits it will generate in the years ahead.”
“The Canna-Business Revolving Loan Fund is a great example of how the Social Equity Council is working to create new paths to economic empowerment for those living in communities adversely affected by the war on drugs,” he said.
Marijuana Moment is tracking more than 1,000 cannabis, psychedelics and drug policy bills in state legislatures and Congress this year. Patreon supporters pledging at least $25/month get access to our interactive maps, charts and hearing calendar so they don’t miss any developments.
Learn more about our marijuana bill tracker and become a supporter on Patreon to get access.
Connecticut’s cannabis market has shown consistent growth since its January launch, with the state seeing record sales seventh months in a row. In July, it hit $13 million in recreational marijuana purchases.
Meanwhile, as of July 1, Connecticut adults 21 and older are able to grow their own marijuana plants for personal use.
The governor also recently signed a budget bill that includes provisions to provide state-level tax relief to licensed marijuana businesses that are currently prohibited for making federal deductions under an Internal Revenue Service (IRS) code known as 280E.
A separate cannabis omnibus bill was also signed by Lamont in June that contains a number of reforms, including the establishment of off-site event permits for marijuana retailers, restricting intoxicating hemp-derived products and creating a new Office of the Cannabis Ombudsman.
Connecticut’s House of Representatives approved a bill in May to build on the state’s marijuana legalization and expungements law by requiring courts to reduce sentences or dismiss charges for a wider range of cannabis-related convictions and, accordingly, to release people who are currently incarcerated on those charges.
The House also passed a measure in May to bill to decriminalize possession of psilocybin mushrooms.
Neither of those bills were taken up by the Senate prior to the end of the legislative session, however.
Separately, Lamont announced in January that the state had cleared nearly 43,000 records for marijuana-related convictions. The legalization legislation that he signed into law in 2021 empowered the state government to facilitate mass cannabis conviction relief.
This story was updated to add more context about the loan rates.
Photo courtesy of Chris Wallis // Side Pocket Images.