A nationwide community bank association has added its voice to the chorus of calls imploring Senate leadership to act on marijuana banking reform.
The Independent Community Bankers of America (ICBA) that represents around 50,000 community banks across the US sent a letter urging the Senate to include provisions in a manufacturing bill that would safeguard financial institutions that service state-legal marijuana businesses.
Those provisions stem from the Secure and Fair Enforcement (SAFE) Banking Act, which has been approved by the House of Representatives in one form or another six times. Most recently, the House included cannabis banking in its version of the manufacturing bill – the AMERICA Competes Act – but Senate leadership opted to remove these provisions.
Marijuana reform advocates, industry stakeholders, and lawmakers across the political divide have all called on the Senate to reinsert marijuana banking reform back into the final bill before sending it to President Joe Biden.
As the ICBA notes in its letter, the SAFE Banking Act “would create a safe harbor from federal sanctions for financial institutions that serve cannabis-related businesses (CRBs), as well as the numerous ancillary businesses that serve them, in states and other jurisdictions where cannabis is legal.”
“We are pleased to reiterate ICBA’s strong support for this legislation, which is essential for the ongoing ability of community banks to effectively serve their communities,” the letter continues. “ICBA urges the support of all members of the House and Senate for inclusion of the SAFE Banking Act in the conference report to the America COMPETES Act.”
The ICBA’s letter follows similar calls from banking associations representing all 50 states, while the third-ranking Democrat in the Senate recently threw her weight behind including cannabis banking reform in the AMERICA Competes Act.
Washington State officials also implored Senate leadership to get behind the proposal in the wake of a recent spate of deadly robberies at cannabis dispensaries.
The SAFE Banking Act was first introduced by Rep. Ed Perlmutter in 2019, but since then neither Republican or Democratic leadership in the Senate has held a floor vote on the measure despite its success in the House.
Senate Majority Leader Chuck Schumer has said he wants to prioritize comprehensive federal cannabis reform with social equity provisions before approving piecemeal reforms, such as the SAFE Banking Act.
As a compromise, lawmakers have proposed revisions concerning criminal justice reform, scientific research and taxation but, as Perlmutter notes, the more “we expand this thing, then we start losing votes, particularly Republican votes and we got [already] enough votes in the Senate to do it.”
In the absence of Senate action on cannabis banking, marijuana businesses are increasingly turning to alternative, secure methods of handling digital payments, while more and more banks are opting to take the risk and offer their services regardless of the impasse.