Just a few short hours before House representatives were set to vote on the cannabis banking bill. 20 state governors and one U.S. territory; as well as bankers’ associations representing all 50 states sent a letter to the House leadership expressing support for the bill to protect banks.
The Governor of Colorado led the governors’ letter. It states that the officials “strongly support the passage of the Secure and Fair Enforcement (SAFE) Banking Act” in order to “remove the legal uncertainty and allow banks and credit unions to provide services to state-licensed cannabis-related businesses.”
The letter also addresses the burden cash-only businesses pose to the public, customers, and employees. It also is a burden for state and local government agencies when collecting tax and fee payments. They must do so in person and in cash. This creates additional public expenses and employee safety risks.
Cannabis Banking Bill
On Monday, the House of Representatives approved the SAFE Banking Act. This will protect banks that service state-legal marijuana businesses from being penalized by federal regulations.
Members in the House passed the legislation by a vote of 321-101. It was reintroduced by Rep. Ed Perlmutter (D-CO) and a long list of cosponsors last month. The House took it up under a process known as suspension of the rules. This does not allow for amendments and requires a two-thirds supermajority to pass.
Typically, marijuana businesses are precluded from accessing traditional financial institutions. They have to operate on a cash-only basis. This makes them targets of crime and other complications that average businesses do not have to worry about for the most part.
Input from Lawmakers
“The fact is that people in states and localities across the country are voting to approve some level of cannabis use, and we need these cannabis businesses and employees to have access to check accounts, payroll accounts, lines of credit, credit cards, and more,” Perlmutter said on the House floor. “This will improve transparency and accountability and help law enforcement root out illegal transactions to prevent tax evasion, money laundering, and other white-collar crime. But most importantly, this will reduce the risk of violent crime in our communities.”
The co-chair of the Congressional Cannabis Caucus, Rep. Earl Blumenauer (D-OR), said “it’s time for us to address this inconsistency, it’s time for us to pass, again, the SAFE Banking Act and it’s time for us to move forward with legalization on the federal level.”
Rep. Patrick McHenry (R-NC) was the only lawmaker to openly oppose the bill on the floor. But in a sign of the bipartisan nature of this reform, Rep. David Joyce (R-OH) defended the legislation on the floor. He said, “I’m proud to help lead this common sense and overdue effort.”
This vote marks the fourth time the House has approved the SAFE Banking Act. In 2019 lawmakers passed it as a standalone bill and then twice more as part of the coronavirus relief legislation. However, the measure never moved forward in the Senate under Republican control last session.
From the House to the Senate, What to Expect
Currently, advocates and industry stakeholders are feeling positive that the bill will not end in the House. With Democrats now in control of both chambers and the White House, there are expectations that the proposal will travel through the Senate and onto the president’s desk.
Since Joe Biden became president, this is the first time a supermajority of the House has voted positively to recognize that the legalization and regulation of marijuana is a vital public policy to probation and criminalization.
“The SAFE Banking Act is only a first step at making sure that these state-legal markets operate safely and efficiently. The sad reality is that those who own or patronize the unbanked businesses are themselves criminals in the eyes of the federal government, which can only be addressed by removing marijuana from the list of controlled substances,” NORML Political Director Justin Strekal said.
This bill is crucial to improve public safety and transparency. It will also help level the playing field for small businesses with limited access to capital.
Cannabis Banking Bill and the Senate
The legislation was also refiled in the Senate just days after the House introduced it last month. Sen. Jeff Merkley (D-OR) and Steve Daines (R-MT) are the chief sponsors for the legislation. The Senate version currently has 32 cosponsors. We are still waiting for word on when the bill will be scheduled for action in the chamber. Make sure to check back for more cannabis and hemp related news.