Since the advent of America’s fledgling cannabis industry, licensed marijuana businesses have been unable to access banking services. Since federal law classifies cannabis as a Schedule I controlled substance, banking institutions avoid partnering with state-legal cannabis businesses. This has made such businesses prime targets for robberies and burglaries because they are forced to operate on a cash-only basis and tend to have thousands of dollars on site.
House representatives have tried to pass cannabis banking regulations that would finally allow businesses in the state-legal cannabis industry to access much-needed banking services. However, these protections have failed to advance past the Senate more than five times even though Senate Majority Leader Chuck Schumer is an ardent believer in cannabis reform. Now that the midterms are fast approaching, a bipartisan group of representatives is urging the Senate to pass the SAFE Banking Act.
Introduced by Rep. Ed Perlmutter, the SAFE Banking Act would allow financial institutions to serve the state-legal cannabis industry without fear of federal reprisal. Even though the legislation has been advanced by the House seven times as either a standalone bill or as an amendment to larger legislation, it has repeatedly failed to get past the Senate.
Lead sponsor of the act, Perlmutter says lawmakers have been frustrated for quite a while over the Senate’s refusal to pass cannabis banking. He says that Senate lawmakers have to figure out what they want from a cannabis banking bill and what they can actually pass, which will ultimately require bipartisan discussions between Senate Democrats and Republicans.
Perlmutter is now trying to advance cannabis banking on two fronts: he is working to include cannabis banking language in the National Defense Authorization Act (ACT), and he is waiting for Schumer to finally unveil his long-anticipated cannabis reform bill. Schumer’s Cannabis Administration & Opportunity Act (CAOA) would decriminalize cannabis at the federal level and also contains criminal justice elements, but it has been delayed several times.
Schumer, who stated in the past that he would advance comprehensive cannabis reform with or without President Joseph Biden’s support, has stated repeatedly that cannabis reform with social equity components should advance before cannabis banking. Last September, he even revealed that several key senators had agreed not to advance marijuana banking reform before comprehensive legalization.
Even so, lawmakers from the House of Representatives are now increasing the pressure on their Senate counterparts to pass cannabis banking. Perlmutter emphasizes that Senators must act on a standalone cannabis banking bill that is currently on the floor of the Senate Banking Committee. Senators also have the option of adding cannabis banking language to the NDAA, he says. In this way, the industry and its leading actors such as American Cannabis Partners would have access to banking services, as do other state-legal industries.
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