A congressman says he’s working to include provisions to allow marijuana businesses to access banking services in an upcoming COVID-19 stimulus package.
The proposal from Rep. Ed Perlmutter (D-CO) also has the support of top congressional leadership, including House Speaker Nancy Pelosi (D-CA), he said.
The congressman brought up the measure—a revised version of the Secure and Fair Enforcement (SAFE) Banking Act—during a Democratic caucus meeting last week. That bill, which cleared the House along largely bipartisan lines last year, has been the subject of ongoing negotiations since it advanced to the Senate Banking Committee.
On a town hall call with small businesses in his Colorado district on Thursday night, Perlmutter was asked by the executive director of a top marijuana company whether the cannabis market has any hope of becoming eligible for federal loan and lending programs, as businesses that work with marijuana directly or indirectly are currently excluded from Small Business Administration (SBA) benefits.
Perlmutter first discussed the SAFE Banking Act and said that there “had been work on it and then the pandemic hit.” But now he’s working to insert its provisions into the next coronavirus package, albeit in a revised form.
“We have prepared legislation that we hope will be in the next package. Probably not the one that’s being discussed right now, but we’ve asked for legislation to allow for banking, for SBA lending, for testing to be part of the next package,” the congressman told the LivWell Enlightened Health executive. “Whether we’re going to get it, whether we can get the Senate to finally get off of their fannies and pass it, I don’t know. But you can rest assured that the issue you raised is front and center.”
A spokesperson later said the congressman misspoke when he referenced including SBA program access in the legislation, though there is a strong push by industry stakeholders and advocates to extend those benefits to cannabis businesses through upcoming coronavirus legislation.
“I raised this very question to our caucus, to Speaker Nancy Pelosi directly last week, saying, look this is a major employer in Colorado and elsewhere around the country. They have been deemed essential services in many, many states,” Perlmutter said during the town hall call. “They cannot access any of the relief that we are providing for in any of these three packages that we have passed. She said, as did the other leadership members on the call, said she wanted to see it get passed.”
Perlmutter reiterated that the speaker supports his proposal and said the Democratic caucus will “continue to work on it over the next couple weeks as we put these additional packages together.”
Marijuana Moment reached out to Pelosi’s office for comment, but a representative did not immediately respond.
“I continue to push for the passage and enactment of the SAFE Banking Act to ensure cannabis and cannabis-related businesses can access the banking system, including access to much-needed financial assistance during times of need such as this COVID-19 pandemic,” Perlmutter told Marijuana Moment. “I’m also focused on ensuring any federal funding for state and local governments remains flexible enough so as not to exclude cannabis businesses in states where they are legal, legitimate businesses.”
“The cannabis industry represents major employers and hundreds of thousands of employees across the country and we must keep them in mind as we continue to develop federal relief packages in response to the COVID-19 public health crisis,” he said.
It’s not clear what kind of revisions are being considered with respect to the SAFE Banking Act, which would shield banks from being penalized by federal regulators for servicing state-legal marijuana businesses. Senate Banking Committee Chairman Mike Crapo (R-ID) has floated certain changes that industry stakeholders generally view as untenable—including limits on the potency of products that businesses could sell in order to qualify for banking access—but Sen. Cory Gardner (R-CO) recently said that progress is being made in negotiations.
While SBA access might not be a key part of Perlmutter’s current COVID-related legislative efforts, advocates are strongly pushing for its inclusion in the aid packages.
“COVID19 has made this a difficult time for all Americans, and the cannabis industry is not immune,” Michael Correia, director of government relations for the National Cannabis Industry Association, told Marijuana Moment. “The inability for both direct and indirect cannabis businesses to access any relief funds from the Small Business Administration is unacceptable, especially when the majority of states have deemed them essential.”
“Discussions regarding the next coronavirus relief package are well underway, and we are working day and night to remedy this and provide any sort of relief possible for our industry,” he said.
SBA has made clear that federal policies prohibit the agency from providing its services to businesses that market marijuana, or even those that indirectly work with the industry such as accounting or law firms. While many cannabis businesses are continuing to operate as state-approved essential services, industry stakeholders say they need the federal safeguards just like any other legitimate company.
In a letter to state treasurers that was delivered this week, a coalition of marijuana industry associations urged the officials to pressure their congressional delegations to include SBA access for cannabis firms in future coronavirus legislation. They also want the states to explore providing separate loan and lending programs for the market.
“Given the unprecedented government intervention in the economy to mitigate the spread of COVID-19 and the harm on businesses, it is crucial that workers and small businesses in the cannabis industry receive the same protections and resources,” Justin Strekal, political director of NORML, told Marijuana Moment. “It’s downright cruel that a majority of states have designated the marijuana industry as ‘essential’ yet deny them access to desperately needed support.”
Rep. Earl Blumenauer (D-OR), a longtime champion of cannabis reform, also said in a blog post this week that the current COVID-19 response legislation “does not go as far as I’d like to give enough Oregonians the relief and security they deserve” and he’s fighting for “SBA grant eligibility for state-legal cannabis companies” as part of the next package.
Eleven senators wrote in a letter to Appropriations Committee leadership last week that they want the SBA issue for cannabis businesses addressed in separate annual spending legislation.
This story has been updated to include clarification from Perlmutter’s office about the scope of cannabis reform legislation he’s pushing to include in coronavirus aid packages.