In 2017, Allan Gandelman, an owner of Main Street Farms in Cortlandville, started a new business growing hemp. Six months later the bank he was using backed out.
“We went to five different banks that all said no,” he said. “Luckily a local credit union decided to kind of take a risk and bank with us and they’ve become amazing.”
In front of Gandelman’s hemp fields, Sen. Chuck Schumer (D-N.Y.) announced Tuesday he would ask the Federal Reserve, Federal Deposit Insurance Corp. and the federal Office of the Comptroller of the Currency to issue guidance to financial institutions, so they can work more with hemp-oriented businesses.
Uses of hemp
• Electrical components
• Paper and packaging
• Building materials
• Hemp infused beer
• Hemp milk
Source: Sen. Charles Schumer
“When you’re a farmer, you need a loan,” he said. “When you’re starting up a new business, you need a loan, and while hemp has been legalized a good number of financial institutions are reluctant to make loans and extend services to hemp-oriented businesses.”
Schumer said it’s not necessarily because the bank doesn’t want to do business with a hemp-oriented company, but because the bank is cautious to provide services without regulations from the federal government.
But it isn’t just issues with banks, Gandelman said, it’s credit card companies too.
Gandelman said about two or three months ago credit card processors stopped working with him, meaning they couldn’t do online business or handle credit card transactions at farmers’ markets. It costs Gandelman thousands in revenue.
“We’ve been facing a lot of issues that when you’re a small business, especially with banking, there’s already a lot of issues,” he said.
He said clearing up those issues with regulations will allow his business to continue growing.
And Schumer wants to see more fields grow.
“New York State has a great climate for growing hemp and that’s one of the reasons I’m working hard to make us the center of growing and processing in the whole country and as you know we are well on our way to that,” he said, noting Cortland County will play a huge role in the industry.
In the past three years, hemp went from being almost nothing in Cortland to a planned 80 acres, or more, expected this year.
Trevor Sherman of Dryden began growing a small amount of hemp for a friend at the Ithaca Farmer’s Market to use for juicing in October 2017. Over a year ago, he increased his crop to one acre after attending a seminar at Cornell University and he has plans to add even more.
Schumer said more hemp-oriented businesses will lead to thousands of jobs.
“Jobs come from the farming, the processing, but there are going to be companies that want to locate here to make the products that we’re talking about so there are lots of good paying jobs that can come out of this,” he said.
Gandelman bought JTS Lumber Inc., at 185 Main St. Cortland to process his hemp plants to make cannabidiol or CBD oil — adding up to 45 jobs by the end of the year.
“We can see the great potential this has for our region and for our state,” said Assemblywoman Barbara Lifton (D-Ithaca).