A proposal to offer up to $5 million in loans to help cannabis microbusiness operators failed to gain traction in a legislative committee hearing Thursday after some lawmakers said there weren’t enough details to warrant support.

Lawmakers on the New Mexico Finance Authority Oversight Committee voted 6-5 to derail a finance authority oversight proposal to utilize unused millions from a longstanding Economic Development Revolving Fund program to make the loans.

The plan, proponents said, was to offer loans of up to $250,000 to eligible applicants over the next five years. Microbusinesses are those that plant or sell no more than 200 plants at one time.

“If we don’t find a way to help these microbusinesses to enter into the market, then ultimately they will be shut out,” Linda Trujillo, superintendent of the state Regulation and Licensing Department, told lawmakers during Thursday’s hearing. Her department earlier created a Cannabis Control Division to oversee the state’s fledgling recreational cannabis industry.

She said the “biggest barrier” to getting into the state’s Cannabis Regulation Act — which became law this year — is “access to capital.”

The loans were aimed at recipients who have a track record in agriculture and have been approved for a license to operate a cannabis business.

While the loans would have been steered toward economically disadvantaged rural and agricultural communities and those harmed by drug use, some lawmakers said there were not enough details about how the financial oversight authority would vet and choose applicants and whether the money would get to those who need it most.

“We may have to slow things down so we do things right,” Sen. Stuart Ingle, R-Portales, said. “There’s lots of things here we need to look at.”

Sen. Joe Cervantes, D-Las Cruces, said he did not like that the cover sheet for the proposed loan rules included a sentence proclaiming the legislative committee had approved the rules on Thursday — making it sound like it was a done deal even before the vote.

“This feels like this is a take-it-or-leave-it situation,” Cervantes said. “It sounds like we have to approve this now.”

He said the way the proposal was being moved forward was “bypassing the legislative process.”

Earlier this year, Gov. Michelle Lujan Grisham, a Democrat who has long favored legalizing cannabis use and possession in New Mexico, signed the Cannabis Regulation Act, allowing for the production, manufacture, sale and use of cannabis among people 21 and older.

As Trujillo’s agency began developing rules for cannabis producers, manufacturers, retailers and other entities, many New Mexicans expressed concerns that startup money could be hard to come by for smaller operators.

That’s partly because, under federal law, cannabis production and use remains illegal, which means cannabis businesses cannot access federal loans.

“There’s not a place for a small business to go to get a loan of this sort,” Marquita Russel, CEO of the New Mexico Finance Authority, told committee members.

Rep. Liz Thomson, D-Albuquerque and chair of the committee, first urged Russel and Trujillo to address some of the concerns raised by lawmakers and bring the proposal back in November’s meeting for reconsideration.

Thomson, who supported the proposal, then suggested Russel and Trujillo return Friday to try again, but several lawmakers, including Cervantes, said that would be “improper.”

Thomson said she would check with the state’s Legislative Council Service to see if it was possible to act on it Friday.

“If it’s doable, we’ll do it, and if not, we won’t,” she said.

Legislative Council Service Director Raúl Burciaga was not in the office Thursday and could not be reached for comment.

General Assignment Reporter

Robert Nott has covered education and youth issues for the Santa Fe New Mexican. He is assigned to The New Mexican's city desk where he covers a general assignment beat.

(2) comments

Chris Mechels

There should be no consideration of this proposal, or similar ones, until the NMFA is investigated. Marquita Russel, CEO of the New Mexico Finance Authority is, today, making awards, under the LEDA Recovery Grants Program, that she KNOWS are based on invalid 2.92.1 Rules, which have violated the NM Rules Act, and are thus "invalid". Russel seems to think this is just fine, which makes me wonder about her honesty, ethics, and concern for the public's money. The state JTIP, the Job Training program is more of the same, based on invalid rules.

All such programs should be halted, until EDD and NMFA explain why they are breaking our laws, and throwing some $200 million out the window. Seems like larceny to me. Contact me for more info; cmechels@q.com

Mike Johnson

Ahhh, you mean my neighbor's idea to open up a neighborhood smoking dope shop for his friends won't get a loan?

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