The governors of 20 states and one U.S. territory—in addition to bankers associations representing each state within the nation and a coalition of state treasurers—lately despatched letters to House management, expressing help for a invoice to guard banks that service state-legal marijuana companies that the chamber is set to vote on within hours.
Colorado Gov. Jared Polis (D) led the governors’ letter on Monday, which states that the officers “strongly support the passage of the Secure and Fair Enforcement (SAFE) Banking Act” with the intention to “remove the legal uncertainty and allow banks and credit unions to provide services to state-licensed cannabis-related businesses.”
“Because few banks and credit unions provide these services, state-licensed cannabis businesses predominantly operate on a cash basis,” the governors wrote. “Without banking services, state-licensed cannabis businesses are unable to write checks, make and receive electronic payments, utilize a payroll provider, or accept credit and debit cards.”
“Cash only businesses pose a significant public safety risk to customers and employees. The cash-only environment also burdens state and local government agencies that must collect tax and fee payments in person and in cash, which creates additional public expenses and employee safety risks.”
“State and federal governments have a shared interest in upholding the rule of law, protecting public safety, and transitioning markets out of the shadows and into our transparent and regulated banking system. Many of our states have implemented laws and regulations to reduce these risks while ensuring financial accountability of the cannabis industry. These public safety risks can be further mitigated on the federal level by passing the SAFE Banking Act to provide state-licensed cannabis businesses with access to banking service providers.”
Alongside Polis, the governors of California, Connecticut, Illinois, Louisiana, Maine, Massachusetts, Michigan, Nevada, New Jersey, New Mexico, New York, North Dakota, Oregon, Pennsylvania, Utah, U.S. Virgin Islands, Virginia, Washington, West Virginia and Wisconsin signed the letter.
“I’m proud that my fellow Governors and I are urging Congress to make the common sense decision to allow state-licensed cannabis-related businesses to access our financial institutions,” Polis mentioned in a press launch. “For more than a decade, Colorado has been a model of the success of these businesses and it’s well past time that we allow them to join our transparent and regulated banking system.”
Separately, bankers associations from all 50 states plus Puerto Rico despatched a letter to House management on Monday that equally voices help for passing the SAFE Banking Act, which they characterised as “an important step to address the conflict between federal and state laws and how banks safely work with legal cannabis and cannabis related businesses.”
51 state bankers associations additionally wrote @HouseDemocrats @HouseGOP immediately urging lawmakers to help the “strongly bipartisan” #SAFEBanking Act of 2021, which might assist “banks safely work with legal cannabis and cannabis related businesses.” https://t.co/tZWqC5bsJN pic.twitter.com/Pf0iclRrzI
— American Bankers Association (@ABABankers) April 19, 2021
“Although we do not take a position on the legalization of marijuana, our members are committed to serving the financial needs of their communities—including those that have voted to legalize cannabis,” the letter states. “Despite this ever-growing voter preference, current federal law continues to prevent banks from safely banking these businesses without fear of federal sanctions. As a result, this segment of our local economies is forced to operate on an all-cash basis, which creates serious public safety, revenue administration, and legal compliance concerns in the communities we serve.”
“The SAFE Banking Act is a banking-specific bipartisan solution that would address the reality of the current marketplace and allow banks to serve cannabis-related businesses in states where the activity is legal,” the associations said.
Last week, the National Association of State Treasurers additionally wrote to congressional leaders, saying that whereas its members don’t take a place on legalization typically, the group “remains concerned by the ancillary effects posed by legitimate participants in the industry lacking reliable access to the federally regulated banking system.”
“The National Association of State Treasurers continues to support commonsense federal laws and regulations to provide essential banking services to legitimate cannabis businesses, promote public safety and financial transparency, and facilitate tax and fee collection without compromising federal enforcement of anti- money laundering laws against criminal enterprises. To that extent, we fully support the key elements of the SAFE Banking Act that comport with our association’s policy as outlined in this letter and that is contained in our policy resolution.”
Three state attorneys basic and the highest prosecutor for Washington, D.C. sent a letter to congressional leaders earlier this month, they usually additionally requested Congress to approve the reform.
The SAFE Banking Act, reintroduced by Rep. Ed Perlmutter (D-CO) and a protracted listing of cosponsors final month, is anticipated to simply go within the House after Monday’s debate wraps up.
It handed as a standalone invoice within the chamber in 2019 with robust bipartisan help, and its language was additionally hooked up to 2 items of coronavirus reduction laws that the House accepted. It didn’t advance within the Senate in any kind beneath Republican management, nevertheless.
Among advocates and stakeholders, there’s an expectation that this 12 months can be totally different now that Democrats management each chambers and the White House.
The laws would be sure that monetary establishments may tackle cannabis enterprise purchasers with out going through federal penalties. Fear of sanctions has saved many banks and credit score unions from working with the trade, forcing marijuana corporations to function on a money foundation that makes them targets of crime and creates issues for monetary regulators.
Days after the legislation was launched within the House final month, it was also refiled in the Senate, the place Sens. Jeff Merkley (D-OR) and Steve Daines (R-MT) are the chief sponsors. That version presently has 32 cosponsors. It stays to be seen when the invoice can be scheduled for motion within the chamber.
After it handed the House final Congress, advocates and stakeholders carefully watched for any motion to return out of the Senate Banking Committee, the place it was referred after being transmitted to the chamber. But then-Chairman Mike Crapo (R-ID) didn’t maintain a listening to on the proposal, regardless of speak of negotiations taking place regarding certain provisions.
Crapo mentioned he opposed the reform proposal, however he signaled that he may be extra amenable if it included sure provisions seen as untenable to the trade, together with a two p.c THC efficiency restrict on merchandise to ensure that cannabis companies to qualify to entry monetary companies in addition to blocking banking companies for operators that promote high-potency vaping units or edibles that might attraction to youngsters.
Sen. Sherrod Brown (D-OH), who took the highest seat in that panel after Democrats secured a majority within the Senate, advised reporters in February that he’s “willing” to move the cannabis banking bill, “but with it needs to come sentencing reform.”
When legislative leaders introduced that the SAFE Banking Act was getting a House vote in 2019, there was pushback from some advocates who felt that Congress should have prioritized comprehensive reform to legalize marijuana and promote social fairness, quite than begin with a measure seen as primarily pleasant to trade pursuits.
Rep. Earl Blumenauer (D-OR), co-chair of the Congressional Cannabis Caucus and an authentic cosponsor of the invoice, mentioned final month that the plan is to pass the banking reform first this session as a result of it “is a public safety crisis now,” and it’s “distinct—as we’ve heard from some of my colleagues—distinct from how they feel about comprehensive reform.”
Meanwhile, congressional lawmakers are concurrently getting ready to introduce laws to finish federal cannabis prohibition.
Senate Majority Leader Chuck Schumer (D-NY), Senate Finance Chairman Ron Wyden (D-OR) and Sen. Cory Booker (D-NJ) are in the process of crafting a legalization bill, they usually’ve already met with advocates to get feedback on how best to approach the policy change.
Schumer mentioned final week that the laws can be launched and placed on the floor “soon.”
On the House aspect, Judiciary Chairman Jerrold Nadler (D-NY) mentioned lately that he plans to reintroduced his legalization bill, the Marijuana Opportunity, Reinvestment and Expungement (MORE) Act, which cleared the chamber final 12 months however didn’t advance within the Senate beneath GOP management.
Read the letter from the governors on the marijuana banking laws beneath:
Read the letter from the National Association of State Treasurers on the cannabis reform invoice beneath:
Photo courtesy of Mike Latimer.