WASHINGTON – U.S. Senator John Hickenlooper, alongside nine of his Senate colleagues, recently sent a letter urging the U.S. Senate Committee on Appropriations to allow legal cannabis small businesses to access programs and resources from the Small Business Administration (SBA).
“SBA loan programs would be especially helpful to cannabis small businesses because they would fill gaps left by the private sector and could expand the availability of capital for many entrepreneurs– including for our minority, women, and veteran business owners,” wrote Hickenlooper and the senators.
“Access to SBA loan and entrepreneurship programs would support a rapidly growing industry that creates jobs, supports small businesses, and raises revenues in states that have chosen to legalize cannabis,” they continued.
Last year, Colorado collected over $274 million in tax revenue from legal cannabis businesses. However, current federal policy prevents these businesses from accessing small business loans and entrepreneurial development programs available to all other legal businesses.
Hickenlooper sits on the Senate Small Business and Entrepreneurship Committee. Hickenlooper is a cosponsor of the Secure and Fair Enforcement Regulation (SAFER) Banking Act, which would give legal cannabis businesses access to critical banking services
Full text of the letter is available HERE and below.
Dear Chairman Van Hollen and Ranking Member Haggerty:
As you begin drafting the Fiscal Year 2025 (FY25) Financial Services and General Government Related Agencies Appropriations Bill, we respectfully request that you include bill language prohibiting the U.S. Small Business Administration (SBA) from denying loan applications for the 7(a) Loan Guarantee Program, Disaster Assistance Program, Microloan Program, and 504/Certified Development Company Loan Program to legally operating cannabis small businesses in states that have legalized cannabis sale and use. We also request that you include bill language prohibiting SBA from excluding such state-legal cannabis businesses from participating in or benefiting from SBA’s entrepreneurial development programs.
Over the years, there has been a clear shift in public opinion supporting legalization of cannabis in the United States. Most recently, Delaware, Ohio, and Minnesota joined a long list of states and the District of Columbia that have legalized both the medicinal and recreational sale and use of cannabis. In 2022, states collected nearly $3 billion in tax revenue from legal cannabis sales, and that number is expected to grow as more states are poised to legalize cannabis this year. However, SBA’s current policy excludes from its loan and entrepreneurial development programs all small businesses with “direct” or “indirect” products or services that aid the use, growth, enhancement, or other development of cannabis. Consequently, small businesses in states with some form of legal cannabis must choose between remaining eligible for SBA financing and support and participating in or doing business with a rapidly-growing and legal industry.
The SBA’s loan programs provide financial assistance in the form of loans and loan guarantees to small businesses that cannot easily access capital. These include the 7(a) Loan Guarantee Program, Disaster Assistance Program, Microloan Program, and 504/Certified Development Company Loan Program. Currently, most banks are reluctant to serve even state-legal cannabis businesses due to conflicts with federal law, meaning that these legally operating small businesses often are forced to operate using only cash, potentially jeopardizing public safety in order to do business. SBA loan programs would be especially helpful to cannabis small businesses because they would fill gaps left by the private sector and could expand the availability of capital for many entrepreneurs– including for our minority, women, and veteran business owners. Likewise, SBA’s entrepreneurial development programs provide critical training, counseling, and technical assistance to small businesses across the country – resources desperately needed by entrepreneurs in the new and burgeoning state-legal cannabis industry. Access to SBA loan and entrepreneurship programs would support a rapidly growing industry that creates jobs, supports small businesses, and raises revenues in states that have chosen to legalize cannabis.
We strongly support SBA making all of its programs open and available to all state-legal cannabis small businesses. We, therefore, ask the Subcommittee on Financial Services and General Government to include bill language in your forthcoming legislation to help extend SBA loan and entrepreneurship programs to cannabis small businesses legally operating in states that allow the sale and use of cannabis for medicinal or recreational purposes.
Thank you for your leadership in crafting this important appropriations bill, and for your consideration of this request.
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