For advocates and cannabis business owners alike, the Secure and Fair Enforcement (SAFE) Banking Act needs to happen sooner rather than later. And in a glimmer of hope, the new chairman of the Senate Banking Committee told reporters he’s open to advancing a bill that would protect banks serving state-legal cannabis businesses. The caveat? The bill must be passed along with legislation that offers sentencing reform for drug offenses.
Senator Sherrod Brown (D-OH) is the new chair of the Senate Banking Committee. On Friday, February 5, Cleveland.com reported Brown’s commentary on the issue. Brown noted that he will coordinate it with the Senate Judiciary Committee if he proceeds with the SAFE Banking Act. That group has authority over sentencing reform provisions.
Brown was also quoted after meeting with Colorado lawmakers on cannabis issues. “I don’t think we move on legalization the way that Colorado and some other states want us to unless we really look more seriously at who’s in prison for how long for those kinds of offenses, and we don’t do one without the other,” he said.
Marijuana industry banking access was not a priority of Brown’s as recently as 2018. In fact, he was still holding to old-school rhetoric, questioning if cannabis is a gateway drug. “States that have legalized marijuana, we’ll see what happens in those states,” Brown said.
The SAFE Banking Act has been a hot topic for a while now. The general provision would prevent banks from being penalized by the feds for working with state-legal marijuana businesses. The cannabis industry, along with advocates, says that banking access is critical, from both a legitimacy standpoint and a safety one. Right now, most business is done with cash, including making tax payments. Cannabis businesses have to secure that cash somewhere, and that makes them a potential target for theft. Advocates say that banking access is critical to legitimize the industry, noting that the cash-only process is too reminiscent of the black market.
House leadership debated the topic last year — and advocates and legislators recommended postponing taking any action on the SAFE Banking Act until more robust legislation on broad legalization was moving through the process.
Banking reform has been down this road before. The House approved the bill in 2019 but didn’t go anywhere, thanks to former Banking Committee Chairman Mike Crapo (R-ID). Likewise, the SAFE Banking Act was lumped into two rounds of COVID-19 relief bills by House Democrats. The Senate squashed that.
But there’s still hope. The SAFE Banking Act’s sponsor, Rep. Ed Perlmutter (D-CO), noted in early February that he will work to get provisions into the next COVID relief package. Regardless, the Senate still has to approve it, and the Senate is where it’s stalled out previously.
There’s still significant momentum behind cannabis reform, but the banking portion may be secondary to broad reform. Case in point: a trio of senators are pushing for substantial reform while collaborating with activists and industry stakeholders on the issue. Senate Majority Leader Chuck Schumer (D-NY), Senate Finance Committee Chairman Ron Wyden (D-OR), who just happens to hail from my home state, and Sen. Cory Booker (D-NJ) are already making progress. The senators have already met with various industry groups, including the Drug Policy Alliance, NORML, the National Cannabis Industry Association, and Students for Sensible Drug Policy.
For those states that have legalized cannabis, the unprecedented (and welcomed) tax revenue has been a critical component for legislator support. In Oregon, for example. Wyden has been vocal in his goal to “end the prohibition and come up with sensible tax and regulatory oversight at the federal level.”
If marijuana was legal on the federal level, then, according to Wyden, a whole slew of problems would be cleared up. “This is a framework that I’ve championed, and I’ll be championing it as chairman,” he said. “You do that, and you take care of the banking question, you take care of the tax question, you take care of the research issue and this whole array of issues that have been gridlocked because the federal government on cannabis has been tethered to yesteryear. That has been the central problem.”
Well, we can all agree on the fact that 2020 was a doozy of a year, and we’re just starting to emerge from the shadow of the pandemic. That said, while cannabis banking reform may be lower on the list of priorities for 2021, it’s still a thing. And we might just get to skip over all the hassle and fuss and move straight into federal legalization. Can you imagine the aftershocks? If weed was legal across all 50 states, the whole banking access debate would be null and void.