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Banking
Aug, 2022 by Cannabiz Wholesaler
Ultimately it all comes down to money – and hence, banking.
“There’s no getting around it,” the National Cannabis Industry Association (NCIA) recently reported in a media blast. Late June proved to be “a mixed bag for cannabis policy in Washington, D.C. While there was excitement around the introduction of two bills in the House of Representatives, it was tempered by the fact that congressional leaders removed the SAFE Banking Act language from the America COMPETES/USICA trade bill.”
“The cannabis industry, and many others, were disheartened to learn that the SAFE Banking Act language that had been attached to the House’s America COMPETES Act was stripped out during negotiations last week,” reported Michelle Rutter Friberg, NCIA’s Deputy Director of Government Relations. Over the last couple of months, both parties have been “scrambling to negotiate the legislation into something that could pass both chambers and get across the President’s desk.”
Unfortunately, Majority Leader Charles Schumer (D-NY), Minority Leader Mitch McConnell (R-KY), Speaker Nancy Pelosi (D-CA), and Minority Leader Kevin McCarthy (R-CA) decided to put the SAFE Banking Act on the chopping block again despite pleas from businesses, financial institutions, and numerous state officials, the statement continued.
While SAFE will not be included in this legislative package, lead sponsor Rep. Ed Perlmutter went to Twitter to talk about what’s next: “By excluding the #SAFEBankingAct from the #USICA/#COMPETES bill, the Senate continues to ignore the public safety risk of forcing cannabis businesses to deal in all cash. In the wake of the Senate’s inaction, people continue to be killed and businesses continue to be robbed. I will continue to push for #SAFEBanking to be included in COMPETES, other legislative vehicles, or for the Senate to finally take up the stand-alone version of the bill which has been sitting in the Senate for three and a half years.”
Public Demands
“But don’t give up just yet,” Friberg exhorted members of her association. “There’s been much talk on Capitol Hill about a ‘SAFE+’ package of some type.”
Sadaf Naushad, an NCIA Intern, laid it out: “As the cannabis industry progresses nationwide, the public demands Congress pass major cannabis reforms. After months of opposition met among Congress members, a breath of fresh air awaits cannabis advocates, lobbyists, and consumers.”
In mid-June, “two crucial congressmen revealed objectives to establish an extensive package of incremental cannabis proposals.” While Senate Majority Leader Chuck Schumer expects to file the final version of the Cannabis Administration and Opportunity Act (CAOA) sometime this summer, lawmakers are using the draft language as a guide to propose an alternative backup bill in creating a cannabis “omnibus” package.
“With the wide-ranging package garnering support across Democratic and Republican lawmakers, industry insiders have high hopes that both chambers could come together to endorse an effective, bipartisan bill by the end of this year,” Naushad reported.
Recently, a number of Congress members have discussed the possibility of creating a new cannabis bill that would comprise several incremental measures, including provisions focusing on banking, access to medical cannabis for veterans, research expansion, access to SBA programs, drug sentencing reformations, and more.
Lead sponsor of the Secure and Fair Enforcement (SAFE) Banking Act Perlmutter “is hoping to incorporate protection for financial institutions operating with state-legal cannabis businesses in a potential package,” Naushad noted. “According to Rep. Perlmutter, members also have interest in including Rep. Dave Joyce’s (R-OH) Harnessing Opportunities by Pursuing Expungement (HOPE) Act, a bill designed to expunge prior marijuana convictions.”
Additionally, lawmakers are deliberating over granting cannabis businesses access to SBA loans and services that are obtainable to every other industry, a reform initially advocated by Sen. Jacky Rosen (D-NV). “These four concerns –- veterans, research, expungements, and banking – constitute a small portion of the package’s considerations.”
Bills, Bills
Late June also saw the introduction of two cannabis bills in the House, the association pointed out: one was a new bill that had never been introduced, while the other has been introduced in many past Congresses. The former: the Capital Lending and Investment for Marijuana Businesses (CLIMB) Act; the latter: the Veterans Equal Access Act.
Led by Reps. Troy A Carter, Sr. (D-LA) and Guy Reschenthaler (R-PA), the CLIMB Act looks to:
* Provide safe harbor for private financial institutions to offer lending services to state-legal American businesses. Due to federal prohibition, a majority of American banks will not offer loans or lending options to small, minority- and veteran-owned cannabis businesses.
* Protect government agencies such as Community Development Financial Institutions (CDFI), the Small Business Administration (SBA) and Minority Business Development Association (MBDA) from issuing grants and other sources of government funding. The CLIMB Act will allow entrepreneurs and small businesses to apply for funding to start and grow their business in the cannabis industry, particularly in areas most adversely impacted by the War on Drugs, Friberg noted. “The Veterans Equal Access Act has been introduced in the past; this session, the bill is again led by champion Rep. Earl Blumenauer (D-OR) and newcomer to the legislation and Cannabis Caucus co-chair Brian Mast (R-FL).”
The bill states that the secretary of the VA must “authorize physicians and other healthcare providers employed” by the department to (1) “provide recommendations and opinions to veterans who are residents of states with state marijuana programs regarding the participation of veterans in such state marijuana programs” and (2) “complete forms reflecting such recommendations and opinions.”