Can a Marijuana Business get one of the Coronavirus loans?
The federal government has created $360 billion in U.S. Small Business Administration loans to provide relief to small businesses during the pandemic. Despite being deemed essential services in most states, the SBA has been quick to point out that businesses operating illegal under federal law are not eligible for the loans, even if they are operating legally under state and local law.
This nothing new. The SBA has steadfastly refused to provide any sort of assistance to marijuana businesses because of federal law.
At the same time, all businesses, including marijuana businesses, must comply with the federal Medical Family Leave Act. All businesses with fewer than 500 employees must provide up to 80 hours of paid sick leave at full wages if an employee cannot work due to coronavirus. This includes not being able to work if the employee contracts the virus as well as not being able to work because of caring for someone with the virus and caring for children because school or day-care is closed, among other things. This is on top of any paid sick leave that the employer already provides. The pay is capped at $511 per day if the employee is sick and must self-quarantine and $200 per day if the employer cannot work because of caring for others.
In addition, all employers must provide up to 12 weeks of paid FMLA leave to employees who must stay home to care for children whose schools or daycares are closed. If the employee can work from home, the paid leave does not apply. There are rules on how much the employer must pay and when.
Finally, the CARES Act provides loans to small businesses to cover payroll, health care benefits, employee salaries, rent, utilities, and mortgage interest. Once again, marijuana businesses are left out. The program, called the Paycheck Protection Program, is administered through banks and credit unions. The same banks and credit unions that will not make loans to marijuana businesses because of federal law. So, while marijuana businesses may technically be eligible for these loans, banks are highly unlikely to administer them.