Congressional lawmakers are strongly encouraged to enact banking legislation to aid marijuana businesses nationwide.
According to a recent report, this past Monday, the Independent Community Bankers of America (ICBA), along with 44 state partners, sent a letter to Senate Majority Leader Chuck Schumer (D-NY) and Minority Leader Mitch McConnell (R-KY) imploring the Senate leaders to pass the Secure and Fair Enforcement (SAFE) Banking Act prior to the end of the year.
The letter states in part, “The SAFE Banking Act is essential for the ongoing ability of community banks to effectively serve their communities. The Act would also alleviate the significant threat to public safety posed by cash-intensive CRBs (Cannabis Related Businesses) effectively being shut out of the banking industry.”
"The SAFE Banking Act is essential for the ongoing ability of community banks to effectively serve their communities. The Act would also alleviate the significant threat to public safety posed by cash-intensive CRBs (Cannabis Related Businesses) effectively being shut out of the banking industry.”
- Letter to Senate Leadership by ICBA and its Partners
Schumer has been working on a comprehensive cannabis reform omnibus bill containing much of the same language in the SAFE Act for some time. Talks between the majority leader and key bipartisan senators concerning the legislation have been increasing recently as the lame-duck session of Congress rapidly comes to a close.
The main issue for the ICBA and its partners concerns public safety. Many marijuana businesses are forced to conduct business mainly on a strict cash basis because of the federal limits placed on financial institutions attempting to do business with an industry still plagued by moral and legal misconceptions. As a result, many of these companies have become targets of crime. The SAFE Banking Act or some similar version would go a very long way in curbing this catastrophic activity and allow legitimate businesses the right to enjoy the financial services and security afforded all other types of companies.
As the ICBA further states in its letter to Schumer and McConnell, “This legislation enjoys strong, bipartisan support, would resolve a conflict between state and federal law, and addresses a critical public safety concern. We urge its enactment without further delay.”
Feeling the pressure from groups like the ICBA, Schumer stated last month that Congress is getting “very close” to passing his cannabis banking and expungements bill, indicating that he had made substantial inroads with several Republican senators concerning the legislation.
However, for many reform advocates, their support for Schumer’s “SAFE Plus” package will significantly depend on certain critical adjustments to the banking language in the bill, particularly regarding minority-owned businesses.
They want to amend the bill to include funding for Minority Deposit Institutions (MDIs) and Community Development Financial Institutions (CDFIs) that provide commercial loans to minority-owned businesses. Additionally, they want changes to the legislation mandating banks that work within the marijuana sector to demonstrate non-discriminatory lending practices.
Specific details and modifications notwithstanding, the ICBA and its partners feel that time is of the essence, particularly now that the Republicans have regained control of the House. However, for many on Capitol Hill, marijuana reform is a uniquely bipartisan and somewhat unifying issue.
For example, Rep. Nancy Mace (R-SC), who sponsored a cannabis legalization bill earlier this year, does not necessarily believe a GOP-controlled House is a death knell for legislation like the SAFE Banking Act or Sen. Schumer’s omnibus bill.
As she stated in a recent interview, “I don’t want us to sit on the sidelines and do nothing next session like we always have. We’ve got to modernize our laws, modernize our regulations. We need to (ensure) that we’re not funding the cartels by not moving the ball forward—that we are being smart about it and saving lives. This is where we can make that work happen.”
"I don’t want us to sit on the sidelines and do nothing next session like we always have. We’ve got to modernize our laws, modernize our regulations. We need to (ensure) that we’re not funding the cartels by not moving the ball forward—that we are being smart about it and saving lives. This is where we can make that work happen.”
- Rep. Nancy Mace (R-SC)
While groups like the ICBA and lawmakers like Schumer would prefer to enact impactful legislation as soon as possible, it is encouraging to see the seismic shift in Congress regarding marijuana reform on both sides of the political spectrum. More and more decision-makers on Capitol Hill are finally coming to the economic and, more importantly, political realization that Americans want an end to prohibition and safe, financially sound and reliable markets within this budding new and exciting industry.