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Rosen Introduces Legislation to Ensure Cannabis Small Businesses Can Access SBA Loans and Programs Available to Other Small Business

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WASHINGTON, DC — Yesterday, U.S. Senator Jacky Rosen (D-NV), a member of the Senate Committee on Small Business and Entrepreneurship, introduced the Fair Access for Cannabis Small Business Act to ensure that legally operating cannabis small businesses have access to loans and programs provided by the Small Business Administration (SBA). Currently, the SBA excludes all small businesses with direct or indirect products or services that aid the use, growth, or enhancement of cannabis from accessing SBA loans and programs.

“The unfair barriers to basic federal support and resources have hurt our state’s legally-operating cannabis small businesses,” said Senator Rosen. “This legislation will level the playing field so that cannabis small businesses – including those owned by people of color, women, and veterans– have access to the same federal resources and loans that other legal businesses are entitled to.”

“Lack of access to capital and banking services remain the greatest barriers to entry into the cannabis industry,” said Layke Martin, Executive Director of Nevada Cannabis Association. “We are grateful for Senator Rosen’s efforts to support small cannabis businesses by increasing access to SBA loans and programs.”

“Senator Rosen’s landmark legislation would help advance equity and innovation in the cannabis industry by leveling the playing field for independent cannabis operators,” said Khadijah Tribble, CEO of the U.S. Cannabis Council. If paired with the SAFE Banking Act, The Fair Access for Cannabis Small Businesses Act would create a regulatory framework that would ensure a vibrant startup scene and a diversity of players.”

“Thank you to Senator Rosen for putting forth this thoughtful piece of legislation that underlines the need for us to help promote small businesses in the cannabis industry,” said Kaliko Castille, President of the Minority Cannabis Business Association (MCBA). “At MCBA, we believe that when we center small businesses in our policy making, it is Black and brown entrepreneurs that will benefit — as most of the largest cannabis companies are not minority owned. It is critical that small businesses in the cannabis industry have an opportunity to access the same resources as any other non-cannabis business.”

This legislation would ensure cannabis small businesses have access to SBA programs and loans like 7(a) loans, disaster loans, microloans, the Small Business Investment Company (SBIC) program, and  SBA’s resource partners including SCORE, Veterans Business Outreach Centers, and Women’s Business centers.

Senator Rosen has long been a leader in the fight to ensure cannabis small businesses have access to banking services and SBA resources. Last year while questioning then-nominee for SBA Administrator Isabel Guzman, Senator Rosen highlighted the need for opening up SBA resources to legally-operating cannabis small businesses. She also sent a letter earlier this year urging Senate Appropriations to include language preventing the SBA from excluding from its loan and entrepreneurship programs legally operated cannabis small businesses in Nevada and across the country. Senator Rosen had also previously led a bipartisan letter to House and Senate Armed Services Committee leadership in December 2021 urging them to keep the SAFE Banking Act in the FY 2022 NDAA.

OPINION: The Medical Community Must Embrace Standard Cannabis Education

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By Timothy Byars, Director of Cannabis Programs, Pacific College of Health and Science

On July 21, 2022, Senate Majority Leader Chuck Schumer (D-NY), and Senator Cory Booker (D-NJ) filed the Cannabis Administration and Opportunity Act (CAOA), a bill that ends federal cannabis prohibition, establishes federal cannabis tax rates, expunges some cannabis convictions, and enables the FDA to regulate cannabis products. Whether CAOA has enough support to navigate the legislative cycle before the 117th Congress concludes on January 3, 2023 is anyone’s guess. COAO has some similarities to the MORE Act, which already passed in the House in April of this year.  Conservative Democrats, Republicans, and Libertarians, however, might not support such broad and comprehensive reform, and might lobby instead for a bill that is more limited in scope, such as the Safe Banking Act or the States Reform Act.

It’s also possible that no federal reform passes in 2022, that Republicans regain control of the Senate in 118th Congress, and that federal cannabis reform stalls. It’s not controversial, however, to suggest that federal legalization of cannabis will happen eventually. Cannabis legalization is one of the increasingly few issues that Americans agree on—a Pew Research survey suggested that 91% of U.S. adults stated that cannabis should be legal for medical or adult use.[1]

How will healthcare organizations respond to federal legalization and an increasing number of patients who want to consider incorporating cannabis into the medical regime? The quotidian model in which healthcare organizations send their patients to cannabis dispensaries for medical advice is no longer tenable. When healthcare professionals refuse to discuss a patient’s cannabis use, and when they remain obstinately uninformed about cannabis administration, drug to drug interactions, potential benefits, and adverse effects, it amounts to a professional and ethical failing.

Currently, cannabis patients lack confidence in their primary care provider’s ability to help these patients navigate the path of medical cannabis use.[2] When patients lack confidence in their medical provider’s ability to direct them about cannabis use, they get advice from cannabis dispensaries, friends, and from the internet,[3] none of which are optimal resources for medical advice.

Researching cannabis use on the internet can be a daunting task, even for savvy consumers. In the U.S., the public was subject to decades of misinformation and research bias that shaped the public’s perception of cannabis use and of cannabis consumers (public opinion about cannabis was low throughout the twentieth century. In fact, in 1990, only about 17% of respondents of the Gallup Poll favored cannabis legalization—the same number as 1969, the first year they asked about cannabis). It wasn’t too long ago when people were terrified of cannabis. As president, Reagan called cannabis “the most dangerous drug in the U.S.”[4] It was billed as highly addictive and destructive. It was a gateway drug.[5] Conversely, if you spend 10 minutes on the internet today, you might think that cannabis cures everything.[6] [7] Informed healthcare professionals can help their patients reconcile these vastly opposing perspectives by providing some insight about cannabis history and policy, and more importantly, by explaining some of the science of cannabis use, especially around its safety and efficacy.

Of course, no patient should be getting their healthcare advice from the internet or from a retail employee. Cannabis health care is a responsibility that must be embraced by healthcare professionals and organizations, and that acceptance begins with a commitment to standardized clinical cannabis education.

Standard cannabis education ensures that healthcare professionals are equipped with foundational knowledge about dosing, routes of administration, side effects, drug interactions, titration, and other facets of cannabinoid medicines. Currently, most medical schools fail to teach their students about the endocannabinoid system or about cannabinoid pharmacokinetics and pharmacodynamics[8] (the number frequently cited is 13% of medical schools mention the ECS in their curricula, which is the outcome of independent research from Dr. David B. Allen who, in 2016, surveyed over 100 accredited U.S. medical schools).

Medical schools will eventually begin to incorporate information about the ECS into their curricula—it’s too vast a physiological system and too important to continue to ignore. In the meanwhile, healthcare professionals will need to continue getting this information through the emerging programs and through self-study (higher education is the perfect place for this type of learning, incidentally, as comprehensive programs can implement specific strategies to ensure a deep learning of program and course objectives). Of course, foundational education alone does not necessarily equate with clinical competency, but education is a critical first step that can help clinicians be confident and competent when they address cannabis patients.

Beyond this foundational knowledge, clinicians must also obtain an understanding about the types of products that available in their state or community. The patchwork of state cannabis laws combined with decades of federal prohibition has resulted in very few national cannabis brands. Every state will have varied cannabis products, and cannabis product selection is bewildering for most patients. There are hundreds of products with varying potencies, multiple cannabinoids to select from, varying terpene profiles, and multiple routes of administrations. Imagine walking into a fully stocked pharmacy, hoping to treat an illness, condition, or disease, and being told to pick out your own products, with no guidance or support from a qualified clinician. That’s the model that currently exists for most cannabis patients.

In 2021, the adult-use markets and medical-only states in the U.S. combined to sell nearly $25 billion worth of cannabis products, which means that US consumers spend more on cannabis products than on energy drinks, milk, and orange juice (for comparison, the US spends nearly 100 billion on beer annually). [9] Furthermore, Whitney Economics calculates that the 2021 total cannabis sales figure—again, just under $25 billion—represents about only 25% of the total potential US cannabis market.[10] In other words, 75% of the nation’s cannabis demand is still being met by illicit growers and sellers. As more states legalize medical and adult use cannabis programs, an increasing number of patients will have access to legal cannabis products.

Patients are using cannabis. Healthcare professionals will treat these patients. It’s now imperative that clinicians begin to understand cannabis pharmacology, especially in the context of impending federal cannabis reform. Cannabis is a tool. It should be in every clinician’s toolbox, and clinicians must know how to properly wield that tool.

FOOTNOTES:

[1] Green TV. Americans overwhelmingly say marijuana should be legal for recreational or medical use. Pew Research Center. https://www.pewresearch.org/fact-tank/2021/04/16/americans-overwhelmingly-say-marijuana-should-be-legal-for-recreational-or-medical-use/. Published April 16, 2021. Accessed August 15, 2022.

[2] Boehnke KF, Litinas E, Worthing B, Conine L, Kruger DJ. Communication between healthcare providers and medical cannabis patients regarding referral and medication substitution – journal of cannabis research. BioMed Central. https://jcannabisresearch.biomedcentral.com/articles/10.1186/s42238-021-00058-0. Published January 24, 2021. Accessed August 15, 2022.

[3] Salter A, Cutter G, Marrie RA, et al. Sources of cannabis information and medical guidance for neurologic use. Neurology Clinical Practice. https://cp.neurology.org/content/12/2/102. Published April 1, 2022. Accessed August 15, 2022.

[4] Moya-Smith S. Marijuana legalization must make war on Drugs’ victims whole before companies profit. NBCNews.com. https://www.nbcnews.com/think/opinion/marijuana-legalization-must-make-war-drugs-victims-whole-companies-profit-ncna981391. Published March 11, 2019. Accessed August 15, 2022.

[5] This is your brain on drugs. Wikipedia. https://en.wikipedia.org/wiki/This_Is_Your_Brain_on_Drugs. Published July 31, 2022. Accessed August 15, 2022.

[6] Freedman D. Pop culture says CBD cures everything-here’s what scientists say. Newsweek. https://www.newsweek.com/2019/09/06/cbd-oil-miracle-drug-science-1456629.html. Published August 29, 2019. Accessed August 15, 2022.

[7] Velasquez-manoff M. Can CBD really do all that? The New York Times. https://www.nytimes.com/interactive/2019/05/14/magazine/cbd-cannabis-cure.html. Published May 15, 2019. Accessed August 15, 2022.

[8] Hartley M. Why isn’t the endocannabinoid system taught in medical schools? Leafly. https://www.leafly.com/news/science-tech/cannabis-endocannabinoid-system-in-medical-school. Published July 28, 2020. Accessed August 15, 2022.

[9] Barcott B, Whitney B. The US cannabis industry now supports 428,059 jobs. Leafly. https://www.leafly.com/news/industry/cannabis-jobs-report. Published February 23, 2022. Accessed August 15, 2022.

[10] Barcott B, Whitney B. The US cannabis industry now supports 428,059 jobs. Leafly. https://www.leafly.com/news/industry/cannabis-jobs-report. Published February 23, 2022. Accessed August 15, 2022.

 

Senators Merkley, Rosen Lead Bipartisan Effort to Improve Safety for Legal Cannabis Businesses

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Bipartisan Group of Senators Calls to Include the SAFE Banking Act in Compromise House-Senate Competitiveness Bill

DISTRICT OF COLUMBIA: Oregon’s U.S. Senator Jeff Merkley and Senator Jacky Rosen (D-NV) led 22 of their colleagues in a bipartisan effort requesting that congressional leadership include the Secure and Fair Enforcement (SAFE) Banking Act of 2021, which would allow state-legal cannabis business to access banking services, in the final version of competitiveness legislation currently being negotiated between the House and Senate. Passage of the SAFE Banking Act, which Merkley has introduced since 2015, would help ensure that legal cannabis businesses do not have to operate in all-cash—the current reality for thousands of small businesses across the country, which has led to ongoing threats of robbery and assault for business owners and employees. 

The letter sent to Senate Leaders Chuck Schumer and Mitch McConnell, and Speaker Nancy Pelosi and Leader Kevin McCarthy in the House, notes the SAFE Banking Act has passed the House six times—most recently as an amendment to its version of the bipartisan competition bill, and urges leadership to ensure the text of that amendment remains in the final conferenced version of the bill to be considered by both the House and the Senate.

“The SAFE Banking Act, as included in the House-passed America COMPETES Act, would allow banks, credit unions, and other financial institutions to offer banking services to legally-operating cannabis businesses without fear of punishment by federal regulators,” wrote the lawmakers. “Currently, thirty-seven states and the District of Columbia have legalized marijuana for medical use, and eighteen states and the District of Columbia allow adult recreational use. As a result, the cannabis industry has become a powerful job creator and a significant generator of tax revenue. However, financial institutions are often reluctant to transact with cannabis-related businesses, even in states that have some form of legalized cannabis, due to legal and regulatory risks arising from inconsistent federal and state laws.

“Allowing cannabis businesses operating legally and in compliance with state law to access financial services without federal reprisal would address public safety and compliance challenges, helping communities reduce cash-motivated crimes,” they continued. “Law enforcement organizations have publicly testified before Congress about these cash-related safety risks, including theft, robbery, and serious violence perpetrated against employees responsible for conducting what should be routine business operations.1 The same law enforcement organizations also have testified about the importance of moving these large amounts of cash in the cannabis industry into the banking system, where accounts are monitored in accordance with existing federal anti-money laundering laws and the Bank Secrecy Act. Enacting the SAFE Banking Act via the jobs and competitiveness legislation before us would support a rapidly growing industry that creates jobs, fosters innovation, supports small businesses, and raises revenue in states that have chosen to legalize cannabis, while reducing safety risks to industry employees and the public alike.”

Senators Merkley and Rosen have repeatedly advocated for the bipartisan SAFE Banking Act and have been a vocal advocates and leaders for federal action that treats Oregon’s and Nevada’s legally-operating cannabis businesses fairly.

In addition to Senators Merkley and Rosen, the letter is signed by Senators Steven Daines (R-MT), Cynthia Lummis (R-WY), Gary Peters (D-MI), Tammy Duckworth (D-IL), Angus King (I-ME), Michael Bennet (D-CO), Mark Kelly (D-AZ), Dan Sullivan (R-AK), Kevin Cramer (R-ND), Martin Heinrich (D-NM), Ben Ray Lujan (D-NM), Patty Murray (D-WA), Catherine Cortez Masto (D-NV), Tim Kaine (D-VA), Robert Menendez (D-NJ), Lisa Murkowski (R-AK), Mazie Hirono (D-HI), Kyrsten Sinema (D-AZ), Alex Padilla (D-CA), Patrick Leahy (D-VT), John Hickenlooper (D-CO), and Chris Coons (D-DE).

Full text of the letter can be found here and follows below:

May 12, 2022

Dear Leader Schumer, Leader McConnell, Speaker Pelosi, and Leader McCarthy,

We write to request that the final conferenced American competitiveness, jobs, and innovation package retain the text of the Secure and Fair Enforcement Banking Act (SAFE Banking Act) of 2021 included in the House of Representatives’ American COMPETES Act of 2022. The House has now passed the SAFE Banking Act six times, including most recently as an amendment to its version of the bipartisan competition bill, and we ask you to ensure that the text of that amendment remains in the final conferenced version of the bill to be considered by both the House and the Senate.

The SAFE Banking Act, as included in the House-passed America COMPETES Act, would allow banks, credit unions, and other financial institutions to offer banking services to legally-operating cannabis businesses without fear of punishment by federal regulators. Currently, thirty-seven states and the District of Columbia have legalized marijuana for medical use, and eighteen states and the District of Columbia allow adult recreational use. As a result, the cannabis industry has become a powerful job creator and a significant generator of tax revenue. However, financial institutions are often reluctant to transact with cannabis-related businesses, even in states that have some form of legalized cannabis, due to legal and regulatory risks arising from inconsistent federal and state laws. Allowing cannabis businesses operating legally and in compliance with state law to access financial services without federal reprisal would address public safety and compliance challenges, helping communities reduce cash-motivated crimes. Law enforcement organizations have publicly testified before Congress about these cash-related safety risks, including theft, robbery, and serious violence perpetrated against employees responsible for conducting what should be routine business operations.2 The same law enforcement organizations also have testified about the importance of moving these large amounts of cash in the cannabis industry into the banking system, where accounts are monitored in accordance with existing federal anti-money laundering laws and the Bank Secrecy Act. Enacting the SAFE Banking Act via the jobs and competitiveness legislation before us would support a rapidly growing industry that creates jobs, fosters innovation, supports small businesses, and raises revenue in states that have chosen to legalize cannabis, while reducing safety risks to industry employees and the public alike.

The House of Representatives already added the SAFE Banking Act as an amendment to the America COMPETES Act by a bipartisan a vote of 262-168, and on February 4, 2022, passed the amended America COMPETES Act by a bipartisan vote of 222 to 210. The standalone legislation on which the amendment is based previously passed the House of Representatives 321-101, garnering the support of more than three-quarters of the chamber and a majority of the members of each party. The bill’s list of co-sponsors is also bipartisan in both the House and the Senate. Given the demonstrated broad support for this measure, we ask you to ensure that the text of the SAFE Banking Act remain in the forthcoming final conferenced version of the jobs and competitiveness bill when it comes to the House and Senate for final votes. This will help cannabis-related businesses, support innovation, create jobs, and strengthen public safety in our communities. We look forward to working with you on this important issue.

Sincerely,

Retail Safety Update from WSLCB Chair David Postman

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WASHINGTON: As many of you know, the Liquor and Cannabis (LCB) has been focused on helping licensed cannabis retailers deal with the recent surge in violent armed robberies of cannabis stores.

Our largest gathering so far was a roundtable discussion held by the board on March 29. You can read the transcript of that discussion here. We had more than 200 people on line who heard from four retailers, State Treasurer Mike Pellicciotti, Senators Keiser and Nobles, Rep. Chambers, and a representative from the National Cannabis Industry Association.

A key message from retailers at the March 29 Roundtable was for the state to “not wait to act until our plans are perfect.” We have taken that to heart and have been working hard to take action on solutions available to us. Here are some of what has happened since that event:

  • Retailers’ Session with Law Enforcement. On April 12, LCB Enforcement and Education director, Chandra Brady, convened a licensee’s-only on-line session with law enforcement to discuss best practices for safe operations in light of the crime surge. We had presenters from Olympia, Seattle, Bellevue and Tacoma police departments and the Pierce and King county sheriffs’ offices.
  • Seeking Crime Prevention Training Contract. The LCB is working to see if we can issue a contract for in-person crime prevention training.
  • Governor-Convened Meeting on Cashless Options. The governor’s office convened a meeting with financial industry representatives and retailers with state officials to discuss cash-less options for store operations. The Department of Financial Institutions (DFI) described the various businesses operating in the state today and LCB CFO James Morgan explained that all of those options are allowed under our rules.

DFI is creating a website that lists third-party business that provide cashless options to retailers. The LCB and DFI will issue a joint message to retailers later today directing retailers to DFI’s website. The next step being considered is a larger meeting with retailers statewide to more fully explain available options and what else could be done under current federal restrictions.

  • SAFE Banking Act. There is a lot of work going on to let Congress know how important it is to pass the SAFE Act to lift restrictions on banks doing business with cannabis licensees. Myself and and others met with staff to Sen. Murray the week of April 11. Sen. Murray’s staff assured us that the senator remains a staunch advocate of the bill.

As you may know, the concern is that Senate sponsors of a national legalization bill are reluctant to pass SAFE without the bigger bill. They say they don’t want to continue to advance the current cannabis industries around the country before national legislation is in place with criminal justice reform and a mandate for a more equitable system.

The issue is part of the America COMPETES Act, an unrelated economic development and trade bill. That House passed COMPETES with SAFE in it but the Senate stripped everything from the Act, forcing it to a conference committee.

Senators Murray and Cantwell and Rep. Del Bene are conferees and the governor and others will be reaching out to them to discuss the need to act now.

Gov. Inslee, Treasurer Mike Pellicciotti and others will be issuing a letter to Congress. To coincide with the letter, Gov. Inslee and Attorney General Bob Ferguson jointly penned an op-ed published today that calls on Congress to act.

  • Potential Legislation. A small group of agency and governor’s office staff will be convening to discuss possible legislation to help licensees. Those conversations will include discussion of the idea of a tax credit for licensees who make safety improvements to operations.
  • Labor & Industries Workplace Safety. LCB staff met with Labor & Industries to discuss worker safety regulations and the role of L&I as it pertains to workplace safety. There are things happening in that realm and we expect L&I to be communicating with the industry as a whole about expectations.

We look forward to continued engagement with industry members. Thank you for your review.

David Postman

Chair, Liquor and Cannabis Board

NY State Senator Cooney Introduces Tax Bill to Allow Licensed Cannabis Business Owners to Deduct Business Expenses

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NEW YORK:  Senator Jeremy Cooney (D-Rochester) introduced legislation that will allow future NYS licensed adult-use cannabis businesses to deduct business expenses when filing state taxes. These deductions are standard for existing non-cannabis businesses across the state. 

The recently enacted Marijuana Regulation and Taxation Act (MRTA) legalized recreational adult-use cannabis, and provides a structure to allow New York State (through the Office of Cannabis Management) to license proprietors to legally conduct business in this new industry. However, section 280E of the U.S. Internal Revenue Code prohibits these licensed businesses from making deductions or account for expenses that come with running a business, while filing state taxes. These restrictions result in taxing cannabis enterprises at a higher rate than businesses in other industries in New York. The higher than average taxes will create an unnecessary barrier to entry and discourage or disqualify equity candidates and legacy market participants from joining the new legal market.

Senate Bill S.7518 will amend the state tax law to allow cannabis enterprises licensed by New York State to deduct ordinary and necessary business expenses. The legislation will provide tax equity to licensed businesses in the emerging industry and aims to prevent the new economy from being dominated by large corporations who can afford to pay the higher tax rates. This Bill was modeled after similar legislation in the State of California (AB-37), which passed in October of 2019.

 Senator Jeremy Cooney: 

The MRTA was crafted with a focus on equity at all stages of implementation in the new recreational adult-use cannabis market. We must ensure that this focus includes licensing and taxation of these new businesses is top of mind while we create the foundations of this new sector of the economy. I am proud to sponsor legislation that will create a more equitable taxation system to allow more small business owners and entrepreneurs to participate in the new cannabis market.”

 Allan Gandelman, Executive Founder, NYCGPA:

“The New York Cannabis Growers & Processors Association fully supports Senator Cooney’s efforts to correct this prohibitionist tax law. Amending section 280E of the Internal Revenue Code is a crucial step in achieving New York’s goal of creating a truly equitable, accessible and opportunistic cannabis industry for upstate farmers and locally-owned and family-owned businesses. Without this amendment, New York’s adult-use market could become dominated by large multi-state operators who can afford to pay the higher tax rates and business costs. In order for the state’s adult-use market to reach its full and true potential, New Yorkers need to be positioned to succeed in the legal market and the effective tax rates that cannabis businesses would currently face is a significant hindrance. There is much to be optimistic about for New York’s legal market, but we must continue to be accountable and do the necessary work to establish an industry that is reflective of our state and the goals set out in the MRTA.”

Bob Duffy, President & CEO, Greater Rochester Chamber of Commerce: 

“If New York State hopes to be a leader in this emerging industry, we must acknowledge the reality: outrageous taxes will discourage entry and participation in the market, cause dollars to exit our State for more competitive opportunities, and lead to an exacerbated black market that poses real dangers for our communities. I applaud Senator Cooney for leading the effort to ensure New York encourages entrepreneurship, equity, and economic vitality by sponsoring this measure.”

 Anthony M. Gaddy, Co-Founder & President/CEO, Upstate NY Black Chamber of Commerce (A U.S. Black Chamber):

“Financing and expenses should not create additional barriers for equity applicants, especially seeking to enter the cannabis industry, especially when considering how the failed ‘War on Drugs’ has already impacted the communities from which these new businesses will likely open. This new legislation will help these small businesses, especially Black-owned businesses, launch while also playing a pivotal role in helping equity applicants access this emerging economy.”

 Ken Pokalsky, Vice President, The Business Council of New York State:

“The Business Council supports this legislation as cannabis businesses operating under New York State law should not be barred by the Internal Revenue Code from taking advantage of state-level business expense deductions that are available to all other businesses. These companies should have equal access to state tax credits that promote in-state investments and job creation.”

 Steven Phan, Co-founder of Come Back Daily and Chair, Retail Committee, NYCGPA:

“For retail owners looking to break into the adult-use market, the potential effective tax rates we could deal with as a result of the 280E tax law, on top of the already-inflated rent and cost of doing business that exist in New York, could be a crippling hurdle for establishing a successful legal cannabis business. If the state truly wants to provide legacy market members, social equity applicants and diverse business owners with accessible opportunity in a legal market, Senator Cooney’s lead must be followed in amending this discriminatory law. If the cannabis industry is to be considered fully legitimate and legal in this state, it is absolutely imperative that this step be taken to lift yet another unfair barrier that will disproportionately phase out small business owners and individuals meant to be prioritized by the MRTA.”

 Glenna Colaprete, Owner, Glenna’s CBD & Spa:

“We have seen the inability to write off plant touching activities as a significant part of the barrier to entry in other states. If we truly want social and economic equity then this important legislation is paramount in order to help ensure this, especially for social equity applicants.”

 Kristin Jordan, CEO of Park Jordan, & the Founder and President of the Board of Directors of Asian Cannabis Roundtable:

“We have seen how taxation, as it stands in the cannabis market, ultimately creates inequity, stifles small business and props up the illicit market. This legislation allowing businesses to deduct expenses with the state is key to not only ensuring economic equity but that New York becomes synonymous with thriving entrepreneurship”

 Lauren Rudick, Partner/Co-Founder, Cannabis Law Practice at Hiller PC:

“Senator Cooney’s proposed amendment of this tax law is imperative to pushing forward New Yok’s key goals for its legal cannabis industry, particularly with regard to its goal of awarding 50% of cannabis business licenses to businesses which qualify as social and economic equity applicants.  Priority in licensing, however, means nothing if the business cannot be profitable, and 280E is a direct hindrance in profitability.  Section 280E of the Internal Revenue Code directly contradicts the MRTA’s vision of establishing an equitable and accessible adult-use market in New York. The existing tax laws stigmatize a completely legal industry and ostracize those the MRTA was designed to benefit, all while opening the door for large multi-state operators to swoop in and take on the costs small New York-owned businesses otherwise could not afford.”

Opinion: How Cannabis Can Save The Mid Terms For Democrats in 2022

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By Stu Zakim

As we look at the narration for President Biden’s accomplishments during the first two years of his administration which don’t get the attention it deserves, the mid-terms become a real measurement of how the voters view them and the way the Senate and House guide that success.

Regardless, the GOP is widely expected to win the majority in the House and Senate in this November’s mid-term elections.  History teaches us that the party in power loses in the mid-terms as it serves as a referendum to the voters as to whether the governing party should stay in power for the next two years until the 2024 Presidential elections. In other words, as we’ve seen, the Dems seeking re-election in the House and Senate are screwed.  Many voices of reason on both sides are not running again; the cost of constant examination and negative campaigning has taken its toll for a lot of politicians who opted to serve the public to keep the US in the right in a world of wrongs.

Enter Cannabis to save the union.  First myth to destroy is that consumption and desire to see it legalized nationally is a partisan issue. This storyline show the fallacy of that assumption as Democrats and Republicans consume Cannabis and support legalization equally.

That said, the GOP has taken a back seat to reaching out to the multi generational consumers of Cannabis; they as a party still think of Cannabis as “evil weed” and “Reefer Madness.”  A majority of GOP’s on a national level still see it that way.  The perfect example is the disconnect between the House and the Senate on the big issue of banks accepting the ability of those in the Cannabis industry to get access to legal banking with the SAFE Banking Act as well as the MORE Act.  Last week, for the second time, the House approved the law; it is fully expected to be rejected by the Senate again and forcing Cannabis companies to rely on private equity to fund their growth.

This presents Democrats with an excellent opportunity to take advantage of the GOP’s outright rejection of any bi-partisan legislation toward the above issues, as well as addressing other concerns about social equity, erasing the barriers to access for those marginalized communities who bore the brunt of the failed war on drugs, expunging records for minor offenses and other matters of importance as part of their platforms and active policies.  These issues are important to many and never really addressed by politicians in the past due to the stigma around Cannabis and its community.  Having a record prevents people from getting jobs, access to federal housing, being eligible for federal and state loans, and basically creating a vicious cycle of failure rather than success for a large part of their constituency.  And, until recently in an ironic way, they were prevented from getting legitimate employment opportunities in the Cannabis industry.

Credit to NY Governor Hochul for recognizing this disenfranchised group of voters and coming up with a solution that addresses several wrongs as indicated above.  Recently, she made national news with her announcement that NY State will be issuing their first few hundred licenses for those who were incarcerated for minor Cannabis offenses.  She is in a very tight race for re-election this November.  Her GOP opponent, Lee Zeldin’s polling shows them in a dead heat.   Additionally, she has created a $200 million grant program that will help licensed equity applicants find, lease and renovate storefronts into Cannabis dispensaries, thus removing some of the many barriers to access that community faces. As of November, 2021, NY state had either expunged or in the process of expunging the records of close to 400,000 people, many of whom were disproportionately black, brown and Latino.  That’s a large group of untapped voters who can turn this close election into a smash for Hochul.  I’m not saying her actions aren’t coming from her heart; rather, I’m saying it’s also a very smart political move and one that the Democrats who find themselves in tight races, which is just about anyone running for re-election this year, should think about.

We currently have 18 states where adult-use Cannabis is legal.  When you add the states with only medical, we’re looking at 37 states.  That’s a lot of people of all ages who used the power of their vote to affect these changes and want representatives that share their opinion.  To all the Democrats running for state, local or federal office this year, embrace and mobilize this very strong and powerful voting block.  Create and promote policies that address these concerns and you’ll find a new source of fundraising as well as voters.

One of my worst nightmares during the 2020 election campaign was that with his approval ratings tanking, being impeached and in a close race for re-election, the Donald would all of a sudden come out in favor of federal legalization as his “October surprise” and be elected as a result.  Thank God that didn’t happen, but, now, with the predictions of a massacre for Democrats in November, I think the Democratic candidates have nothing to lose and everything to win so they can maintain control of the House and Senate rather than face a GOP majority that will spend its time seeking revenge rather than making policies and laws that help people’s lives.  And, certainly not help the Cannabis cause.

Let’s hope they listen.

Stu Zakim is a Strategic Communications professional with senior level experience in the entertainment, media and cannabis sectors

stu@bridgestrategic.com @stuzakim 732-754-9051

Congressional Cannabis Caucus Co-Chairs Blumenauer, Lee Release Year-End Progress Memorandum, Outline Goals for 2022

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DISTRICT OF COLUMBIA:  Congressional Cannabis Caucus Co-Chairs Earl Blumenauer (D-OR) and Barbara Lee (D-CA) today released a year-end progress memorandum that includes steps taken by Congress throughout 2021 in the cannabis space. Co-Chairs Blumenauer and Lee also detail their top priorities for 2022, including federal descheduling, sentencing reform, industry equity, and research. 

“The table is set and the time is right for comprehensive cannabis reform, which will make a huge difference for people around the country,” said Co-Chair Blumenauer. “This year, we’ve advanced the MORE Act closer to the finish line, passed the SAFE Banking Act, and made progress in terms of research. Most importantly, we’ve watched this issue gain more momentum than ever with the American people—almost 70 percent of whom, including a majority of Republicans, want to see federal reform. Let’s get it done.”

“It’s time for the federal government to catch up to the rest of the country and start leading on cannabis reform,” said Co-Chair Lee. “The solutions for comprehensive reform are there, and this year we made progress. We’ve passed the MORE Act in the House, the SAFE Banking Act, and several Appropriations provisions. It’s far past time Congress move to finally get this across the finish line. Ending the war on drugs is an issue of racial equity and a moral imperative. I look forward to continuing my work with Cannabis Caucus Co-Chair Rep. Blumenauer to make strides toward comprehensive reform in the new year.

The memorandum is available here.

Congressman Blumenauer Lauds House Passage of Federal Legislation to Give Cannabis Businesses Access to Banking Services

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Under SAFE Banking Act, cannabis businesses would not have to operate in cash, which has made Portland-area stores and workers a target for violent robberies.

DISTRICT OF COLUMBIA: On April 19th, 2021 the U.S. House of Representatives passed federal legislation to provide legitimate cannabis businesses access to banking services, an issue that has long been championed by U.S. Rep. Earl Blumenauer (D-OR), founder and co-chair of the Congressional Cannabis Caucus. The bipartisan passage of the Secure And Fair Enforcement (SAFE) Banking Act in the 117th Congress comes as Portland-area cannabis businesses and their workers continue to be targeted with violent robberies that have been linked to a system that forces cannabis businesses to deal almost exclusively in cash.

“Cannabis will soon be a $20 billion industry and is overwhelmingly supported by the American public. The insane prohibition on banking services serves no one’s interest, except for money launderers, tax evaders, or those who are going to rob these cash-rich businesses,” Blumenauer said. “As we continue to push forward with full legalization, addressing this irrational, unfair, and unsafe denial of banking services to state-legal cannabis businesses is a top priority. This is a critical element of reform that can’t wait, and I urge our cannabis champions in the Senate to take up this legislation as soon as possible.”

Under the federal prohibition on cannabis, banks and credit unions are currently prohibited from serving cannabis businesses, even with financial products as simple as savings accounts or payroll checks. Notwithstanding the financial and practical hardships facing legal cannabis businesses, forcing these businesses to operate on a cash-only basis creates a public safety risk and makes tracking revenue more difficult for tax purposes.

The cash-only nature of cannabis businesses also makes them easy and frequent targets for robberies, which puts workers at risk. According to a March 2021 report by Willamette Week, in the preceding 10 months, Portland cannabis shops were robbed, burglarized, or looted 95 times – often at gunpoint – resulting in one tragic fatality.

The legislation passed in the House would prohibit federal regulators from taking punitive measures against depository institutions that provide banking services to legitimate cannabis-related businesses and ancillary businesses like the electricians, plumbers, and the landlords that serve them. The SAFE Banking Act also requires a GAO study and annual regulator reports to Congress to ensure equal access to credit and to reduce barriers to marketplace entry for potential and existing minority- and women-owned cannabis-related businesses.

Full text of the SAFE Banking Act can be found here.

SAFE Banking Act Reintroduced as Momentum for Cannabis Reform Continues to Grow

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Landmark, bipartisan legislation passed U.S. House multiple times in last two years

DISTRICT OF COLUMBIA: U.S. Rep. Ed Perlmutter (CO-07) reintroduced his landmark legislation to reform federal cannabis laws and reduce the public safety risk in communities across the country. The bipartisan Secure and Fair Enforcement (SAFE) Banking Act of 2021 – authored by Perlmutter and sponsored by Reps. Nydia M. Velázquez (D-NY-07), Steve Stivers (R-OH-15), and Warren Davidson (R-OH-08) and cosponsored by more than 100 members – would allow marijuana-related businesses in states with some form of legalized marijuana and strict regulatory structures to access the banking system. The SAFE Banking Act is seen as the first of many cannabis reforms Congress needs to address.

Forty-seven states, four U.S. territories, and the District of Columbia – representing 97.7 % of the U.S. population – have legalized some form of recreational or medical marijuana, including CBD. Yet current law restricts legitimate licensed marijuana businesses from accessing banking services and products, such as depository and checking accounts, resulting in businesses operating in all cash. This is a serious public safety risk for our communities, inviting theft, robberies, burglaries, or worse, as Colorado saw with the murder of Travis Mason in June 2016 and Michael Arthur in Portland, Oregon in December 2020.

“The genie is out of the bottle and has been for many years. Thousands of employees and businesses across this country have been forced to deal in piles of cash for far too long, and it is the responsibility of Congress to step up and take action to align federal and state laws for the safety of our constituents and communities. The public safety need is urgent, and a public health and economic need has also emerged with the pandemic further exacerbating the cash-only problem for the industry,” said Congressman Perlmutter. “In many states, the industry was deemed essential yet forced to continue to operate in all cash, adding a significant public health risk for businesses and their workers. As we begin our economic recovery, allowing cannabis businesses to access the banking system would also mean an influx of cash into the economy and the opportunity to create good-paying jobs. Thank you to Reps. Velázquez, Stivers and Davidson for their continued support and input on the bill, and I look forward to working with Senators Merkley and Daines to get the SAFE Banking Act passed in the Senate and signed into law.”

“The cannabis industry has been operating with great success, with many of these businesses deemed essential as the coronavirus pandemic took hold,” said Congresswoman Velázquez. “However, without the ability to safely utilize the banking system, cannabis-related businesses are left behind and stuck resorting to tactics that can threaten public safety and economic success. That’s why I am proud to join to Reps. Perlmutter, Stivers, and Davidson in introducing the SAFE Banking Act, to allow these business in states that have legalized cannabis to access to the banking system, just as any other business currently enjoys. Doing so will help create jobs in communities throughout America, while stimulating the economy as we recover from the fallout of the pandemic.”

“We have a responsibility to legislate for the reality we live in, and the reality is that legal businesses in thirty-three states, including Ohio, are being denied access to the banking system and forced to assume huge risks as a result of operating solely in cash,” Congressman Stivers said. “The SAFE Banking Act is about keeping people safe, something that 321 of my colleagues recognized last year. I look forward to seeing this bill make it all the way to the President’s desk this Congress.”

“I’m excited we’re reintroducing SAFE Banking, again with bipartisan support. This bill is an important hedge against financial cancellation, and it will protect businesses and industries that find themselves out of favor with the latest trends of the day,” said Congressman Davidson. “Today we’re talking about banking cannabis, hemp, and firearms, but tomorrow there could be another industry that has its access to the banking system threatened by statute or by public opinion. With SAFE Banking, as long as its legal in the jurisdiction, no bank should be compelled to cancel their customers by a mob saying, ‘You aren’t going to bank THOSE people are you?’ Sadly, that has already happened too often in American history and it must end.”

“No one working in a store or behind a register should have to worry about experiencing a traumatic robbery at any moment. That means we can’t keep forcing legal cannabis businesses to operate entirely in cash—a nonsensical rule that is an open invitation to robbery and money laundering,” said Senator Merkley (D-OR). “Let’s make 2021 the year that we get this bill signed into law so we can ensure that all legal cannabis businesses have access to the financial services they need to help keep their employees safe.”

“The ‘SAFE Banking Act’ will help Montana small businesses, create jobs, boost local economies, and improve public safety,” stated Senator Daines (R-MT). “I’m glad to be working on this bipartisan legislation to provide certainty for small businesses in Montana. Montana business owners should have the ability to freely use banks, credit unions and other financial institutions without the fear of punishment.”

In the 116th Congress, 206 members cosponsored the SAFE Banking Act and it passed the U.S. House in a broad bipartisan vote of 321 to 103, with 91 Republicans and one Independent voting in support. The bill also passed as part of the Heroes Act, an earlier COVID relief package which was approved by the House on two separate occasions. In February 2019, the SAFE Banking Act prompted the first-ever congressional hearing on the issue of cannabis banking.

The SAFE Banking Act provides protections from money laundering laws for any proceeds derived from these state-legal marijuana businesses. This will get cash off the streets and into the financial system which is built to root out fraud and illicit activity. This bill also includes protections for hemp and hemp-derived CBD related businesses, which still struggle in accessing financial services despite the legalization of hemp in the 2018 Farm Bill. The current version of the bill has been updated slightly to include minor technical changes to the safe harbor, strengthened hemp provisions, and other technical updates.

The U.S. cannabis industry continues to grow at a rapid rate, with the current value estimated at $17.7 billion, a substantial amount of which remains unbanked. As of January 2021, the legal cannabis industry supports 321,000 jobs across the country. Over the 2018-2028 period, job growth in this market is projected to climb 250%, the fastest rate for any sector in the U.S. Bringing in this cash will make the industry safer and give banks and credit unions more capital to lend during the economic recovery as a result of the COVID-19 pandemic.

U.S. House Of Representatives Approves Cannabis Banking Reform In Larger COVID-19 Relief Package

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Lawmakers voted 208-199 (23 not voting) in favor of coronavirus “HEROES” relief package

DISTRICT OF COLUMBIA: On Friday evening (5/15/20) lawmakers in the United States House of Representatives passed additional coronavirus relief legislation to provide continued economic and government support to the country. The Health and Economic Recovery Omnibus Emergency Solutions (HEROES) Act includes the language of the SAFE Banking Act, which would prevent federal financial regulators from punishing financial institutions that provide services to state-legal cannabis businesses.

Since the onset of the COVID-19 pandemic, cannabis businesses across the country have been deemed essential and continue to operate. However, many of these businesses still lack access to the same financial services that are granted to every other industry in the United States. Because it is possible that coronavirus can be transmitted on currency — placing private industry and government workers at risk when handling large amounts of cash — allowing the cannabis industry to access banking services is now more crucial than ever. This policy change would also ensure that small and minority-owned businesses can access the financial assistance designed for them in many state programs.

The HEROES Act, which includes provisions to allow banks and financial institutions to provide services to the cannabis industry without fear of criminal prosecution, will now head to the Senate for consideration. In September 2019, the House of Representatives voted in favor of the SAFE Banking Act, but the legislation has since stalled in the Senate.

Statement from Steve Hawkins, executive director at the Marijuana Policy Project:
“I’m encouraged that the House recognizes the urgency of this issue and has taken this strong and necessary position. We thank Chairwoman Maxine Waters and Rep. Ed Perlmutter for their leadership on the issue.

“Continuing to exclude the cannabis industry from accessing basic and essential financial services during this time will result in more harm than good. Not only will it make the country’s economic recovery that much harder, but the provisions intended to help minority-owned businesses would continue to be absent within the industry.”

Statement from Don Murphy, director of federal policies at the Marijuana Policy Project:
“In light of the public health and public safety benefits of this specific change in policy, the Senate has good reason to pass this language into law. This is a change in policy that the banks are asking for even more than the cannabis companies. We urge the Senate Banking Committee to adopt the SAFE Banking provisions to ensure financial institutions can provide basic banking services to businesses that are compliant with state law.”

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