Categories: CannabisGeneral News

Congress Considering COVID-19 Relief Funds for Cannabis Businesses

The COVID-19 pandemic has caused havoc globally, followed by a global shutdown. Programs of COVID-19 relief funds were introduced to help keep the businesses afloat, that are still operating during this crisis. Early rounds of federal COVID-19 relief funding, shut out state-legal cannabis companies. However, the same state-legal cannabis companies saw hope today after the Emergency Cannabis Small Business Health and Safety Act was introduced.

Rep. Earl Blumenauer (D-OR) and Rep. Ed Perlmutter (D-CO), have introduced the bill. This bill would end the exclusion of cannabis businesses (and those related such as the businesses that provide services for them) from further federal relief funding, by the Small Business Administration (SBA). The bill would ultimately allow cannabis companies to access the COVID-19 relief funds that are already available to other small businesses.

Businesses that deal directly with the production of cannabis as well as the sales of cannabis, along with the businesses that provide services to them, are not eligible for any SBA programs, according to the current policy by the Small Business Administration (SBA). Furthermore, the declaration of essential businesses has been given to many indirect businesses, along with being forced to close.

Cannabis businesses that have remained open during this lockdown, have been shown struggle to surmount with the declination of sales, disruptions of supply chains, onerous tax rates, lack of access to banking services, along with the incurrence of costs due to the implementation of the additional health and safety measures that have been taken for the protection of employees and customers.

Although cannabis businesses are considered essential during the COVID-19 pandemic, they are not considered eligible for the COVID-19 relief funds. According to the founder and co-chair of the Congressional Cannabis Caucus, Rep. Blumenauer, the Congress seeks to provide relief to small businesses across America, however, leaving the state-legal cannabis stores, even though they are essential to communities, and have also met the demands of this crisis.

Rep, Blumenauer further added that the inclusion of state-legal cannabis stores must be considered in federal COVID-19 response efforts. Rep. Blumenauer continued that if they do not provide the cannabis businesses with the relief needed to carry out the recommended measures for public health and worker-focused measures, it would put the hard-working people and cannabis customers at significant risk

According to Rep. Perlmutter, significant employers and contributors to local economies in Colorado and across the country are cannabis businesses. Rep. Perlmutter further added that cannabis businesses should be the recipient of the same level of support as other legal and legitimate businesses have. Rep. Perlmutter continued that cannabis companies should also further be eligible for the SBA relief funds during this COVID-19 crisis.

Rep. Blumenauer led a bipartisan coalition that consisted of nearly three dozen members of Congress, last week. They called on House and Senate leaders, for the inclusion of cannabis companies in any future COVID-19 relief programs that may be expected.

According to the coalition members, a major contributor to the US economy and workforce is the state-legal cannabis industry. The coalition members further added that the state-legal cannabis industry has employed over 240,000 workers across 33 states and four territories, which consequently generated $1.9 billion in state and local taxes in 2019.

Despite the declaration of cannabis stores and dispensaries as essential businesses by most US states, many of those workers have been laid off or furloughed. According to the coalition members, cannabis businesses, unlike other small businesses, are not eligible for the CARES Act programs.

Furthermore, due to the federal banking rules, cannabis companies do not hold eligibility for small business loans or lines of credits that may help with keeping other businesses afloat amid a global pandemic.

Saher Asad Mir

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