President Joe Biden’s nominee to run the Small Business Administration (SBA) recently committed to “explore” ways the agency could change its policy on prohibiting people with certain criminal convictions—including over marijuana—from accessing federal business loans and other services.
Isabel Guzman, who currently heads California’s Office of the Small Business Advocate, was pressed on the federal agency’s policies for people with prior convictions, particularly when it comes to cannabis crimes, by Sen. Cory Booker (D-NJ) during a confirmation hearing this month.
The senator noted the high number of marijuana arrests in the U.S. and said that “those people with criminal convictions for doing things that two of the last four presidents admitted to doing will be excluded from a lot of the loan programs that we’ve seen” under SBA. That includes the Payment Protection Program (PPP) and other financing services.
“I just want to put a finer point on what I’m looking for, which is just—you can do it with a stroke of a pen. You can empower folks. And you know marijuana laws are disproportionately enforced against who?” Booker said.
“People of color,” Guzman answered.
“People of color. We literally have college kids, with impunity, smoking pot—but people who are black and brown are four times more likely even though their usage rates are no different. That ultimately affects…40,000 collateral consequences. That is one of the reasons why there’s such a wealth disparity between communities of color because they’re over-policed and over-convicted for things that are just unjust.”
Watch Booker and Guzman talk about SBA marijuana policy below:
The senator said that he’s “really hoping, with a sweep of the pen, that you would change this,” adding that, based on his work with Vice President Kamala Harris during her time in the Senate and conversations with Biden, he knows “where their heart is on these issues.”
“I hate to put you on the spot, but would you commit to reversing this guidance and creating justice for black and brown folks who have been over-incarcerated for these non-violent drug crimes to allow them to have access to these loan programs?” he asked.
Guzman replied that “I believe I shared with you as well that, during my time at the administration, we did focus on this reentry population, as well as making some administrative changes to simplify access. I would immediately be willing to dive in and explore what administrative changes” are possible.
Booker said that, if she followed through, she would see the “most ridiculous happy dance you’ve ever witnessed” because “this is something that is just so painfully wrong.”
“The universe is not that big, but you could really become a model for the whole executive branch, where just somebody got in there and quickly did right,” he said. “I know communities would celebrate as much as I will should and when that happens.”
Booker has also been part of a trio of senators—alongside Majority Leader Chuck Schumer (D-NY) and Finance Committee Chairman Ron Wyden (D-OR)—who have been etching a path to federally legalize marijuana this session. The senator was also recently appointed to lead a key Judiciary subcommittee with jurisdiction over drug policy issues—and he immediately signaled that cannabis reform would be part of his agenda.
Separately at the same SBA hearing at which Booker discussed marijuana convictions, Sen. Jacky Rosen (D-NV) brought up the inability of cannabis businesses to receive SBA aid.
“We do have legal state cannabis businesses,” Rosen said. “Will you work with our office to commit to consider providing legally operating cannabis small businesses equal access to SBA resources—loans, counseling, mentoring and training?”
“I commit to further understanding those rules and regulations,” Guzman replied, “and seeing how we can partner with your office to serve all the small businesses who are in need.”
SBA officials confirmed in March of last year, amid the coronavirus pandemic, that state-legal cannabis businesses are ineligible for federal disaster relief loans offered to other small businesses. The agency further asserted that the loans are also off-limits to businesses that indirectly serve the marijuana industry.
Rosen, along with Wyden and other lawmakers, penned a letter to Senate leadership last April arguing that the cannabis industry deserved equal access to federal relief.
This barrier to aid access for what’s becoming a massive industry in states across the U.S. has elicited strong pushback from reform advocates and stakeholders.
A coalition of marijuana industry trade groups—including the National Cannabis Industry Association, National Cannabis Roundtable, Minority Cannabis Business Association and Cannabis Trade Federation—signed a joint letter last year, urging congressional leaders to lift restrictions and allow cannabis businesses to obtain the same relief as any other legitimate market.