WASHINGTON, D.C. – The spreading of COVID-19 has forced many businesses to suddenly close, resulting in massive job losses. How will Americans pay their mortgages, rent, or buy food if we soon see unemployment numbers that could exceed levels seen during the Great Depression?
With so many out of work and many more likely joining them in the coming weeks, Americans are looking to Washington D.C. to provide a lifeline. One bill, the Families First Coronavirus Response Act (FFCRA), has already been signed into law by President Trump. This provides $1 billion in additional funds for states to direct toward bolstering their unemployment insurance programs.
Lawmakers on Capitol Hill have been working to pass additional relief legislation—but when it comes to the federal government and the cannabis industry, the relationship is not usually cozy. Will those relief funds find their way to cannabis workers who are out of work due to the coronavirus pandemic?
“Given that marijuana remains an unlawful substance under Schedule I of the Controlled Substances Act, there has been concern that the relief under the FFCRA would not be available to cannabis businesses and, therefore, would not be available to support cannabis workers,” Linda Hollinshead, an attorney and Partner at Duane Morris LLP told mg.
This presents a simple yet critical question. We’ve seen federal agencies, for years, interfere with state-run cannabis industries. Although states are now afforded more protections from federal interference, can the federal government tell states how to spend the relief money?
“The law provides that any administrative grants transferred to the account of a state may be used ‘by such State only for the administration of its unemployment compensation law,’ suggesting that the money is being provided to support a state’s program, and that the federal government will not dictate how it is spent or what industries will be recipients of those grants,” Hollinshead said. “As a result, it does not appear that the additional availability of these federal funds under the FFCRA jeopardizes an individual’s ability to have access to state unemployment benefits.”
In fact, Hollinshead does not see a long list of new criteria states and residents will have to meet in order to qualify for the additional funding.
“The balance of the funds are going to be available to assist a state(s) with the costs associated with the increase in claims, so long as the states has demonstrated steps it has taken or will take to ease eligibility requirements and access to unemployment compensation for claimants directly impacted by COVID-19.”