WASHINGTON OFFICE 

EARL BLUMENAUER

1111 Loncwonm 
THIFID DISTRICT, OREGON

WASHINGTON. DC 20515
2 .
COMMITTEE ON WAYS AND MEANS 02) 925 4811

DISTRICT OFFICE:
911 NE 11TH AVE
SUITE 200
OR 97232
(503) 231-2300

(anagram of the mnitrh ?tatea

3901152 at iRrpres?entatihts
Washingtun, Eat 20515

 

May 4, 2018

The Honorable Linda McMahon
Administrator

United States Small Business Administration
409 3rd Street, SW

Washington, DC 20416

Administrator McMahon:

I am writing to express my concerns with the Small Business Administration (SBA) ?Revised
Guidance on Credit Elsewhere and Other Provisions in SOP 50 10 (Control No. 5000-
17057). This guidance prevents the SBA from supporting loans to many small business in
Oregon, 45 other states, Guam, and Washington, D.C.?all of which have legalized some form
of cannabis (adult-use, medical, and/or CBD).

As a longtime supporter of program to back loans for small businesses, I understand the
importance of this program for my community and across the country. The policy established by
this guidance to prevent businesses that derived any of their revenue from sales to ?Direct
Marijuana Businesses? and hemp~related businesses means that countless small businesses are
no longer eligible for SBA loans.

The cannabis industry is one of the fastest growing job sectors in the an
estimated $7.2 billion and growing. Reports suggest that the legal marijuana industry will create
nearly a quarter million jobs by 2020 and nearly 300,000 jobs by 2025. In Oregon, the cannabis
market is worth nearly $800 million. These companies and their employees pay taxes that
support schools and local law enforcement, and contribute to their state and local economies.

new guidance will mean that countless small businesses including architecture firms,
accountants, garden supply businesses, and construction companies across the country will be
put at a competitive disadvantage if just one of their clients or customers are part of the
burgeoning cannabis industry?an industry that was in many states created by voter ballot
initiatives. While I believe that cannabis industry businesses should be treated the same as all
other businesses, at the very least, ancillary businesses should not be penalized for supporting a
business that is legal in their state.

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The cannabis industry is already a core part of the economy in Oregon and dozens of other states
that this rule would be impossible to implement and wreak havoc across multiple sectors of the
economy. For example, would just one order from a cannabis business for soil preclude a locally
owned garden center from receiving federal government loan support in the future?

I call upon you to repeal this guidance immediately to prevent further economic harm and to
provide certainty for the thousands of state-legal cannabis businesses and the companies they do

business with.

Sincerely,

MW

Earl Blumenauer
Member of Congress