Committee Holds Hearing on Role of Small Businesses in Cannabis Sector
Washington, June 19, 2019
Washington, D.C.— Today, the House Committee on Small Business under Chairwoman Nydia M. Velázquez (D-NY) held its first ever hearing into the role of small businesses in the legal cannabis sector. Despite being federally prohibited, medical cannabis use is legal in a majority of states, while nearly a dozen states have legalized recreational use for adults.
“As more and more states take steps to bring cannabis to commerce, we are seeing small businesses at the forefront of this expanding industry,” said Chairwoman Velázquez. “As the only House Committee dedicated solely to the needs of small firms, it is important for us to be shedding light on the challenges these small entities face as well as the economic potential they offer.”
“Legal cannabis presents significant business opportunities as the underground market transitions into a regulated business sector, but onerous capital requirements, restrictions on licensing for those with even minor previous drug related convictions and other factors have limited opportunities and success for minorities and other disadvantaged groups in the legal cannabis industry,” said Shanita Penny, President of the Board of Directors, Minority Cannabis Business Association, Portland, OR. “The undeniable effects of the drug war are hampering equity in the industry, but together, we can address and repair the harms caused by discriminatory enforcement of marijuana laws and ensure access to and diversity in the emerging legal cannabis industry.”
“Within the cannabis sector, as they do in every other field, veterans bring to the table both hard and soft skills necessary for successful business operations,” said Eric Goepel, Founder & CEO, Veterans Cannabis Coalition, Walnut, CA. “From technical know-how in disciplines like supply chain logistics and information technology to intangible qualities like leadership and perseverance, veterans offer advantages to any potential employer.”
“Given the current lack of clarity for cannabis banking as well as the inability for SBA to partner with community banks to assist MRBs, I have seen (and continue to see) those involved in the state-regulated cannabis industry struggle,” said Dana Chaves, Senior Vice President and Director of Specialty Banking, First Federal Bank, Lake City, FL. “I know of a business with clients in eleven states who needs capital to expand so they can service their new clients. The company is unable to secure the lending required to purchase the equipment needed in order to fulfill those contracts.”
“We know the cannabis industry is quickly evolving but is mired with inconsistent federal and state laws that are creating barriers for small businesses,” said Chairwoman Velázquez. “Today’s hearing was an important step in acknowledging these challenges from the federal level.”