A key Senate committee is planning to vote on a bipartisan bill to expand banking services for legal marijuana businesses by the end of September, sources familiar with the plans, confirmed to the Washington Examiner on Friday.
The Senate Banking, Housing, and Urban Affairs Committee intends to hold a markup session for the bill during the last week of September, which was first reported by NBC News. The legislation is intended to give federally regulated banks and credit unions legal cover to take cannabis dispensaries and growers as customers.
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Currently, banks and credit unions still face federal prosecution and penalties if they provide services to legal cannabis businesses because it is still considered a Schedule I substance, which is defined as drugs with no currently accepted medical use and has a high potential for abuse, according to the Drug Enforcement Administration. As a result of not having access to financial services, many state-legal cannabis businesses are forced to operate their businesses only using cash.
The bill stalled in the last Congress but was tweaked and reintroduced by Sens. Jeff Merkley (D-OR) and Steve Daines (R-MT) earlier this year. At this point, the SAFE Banking Act has 42 co-sponsors, nearly half of the Senate, and that includes eight Republicans and three independents. Senators attempted to pass the bill as part of a larger government funding bill approved last year, but ultimately, it was unsuccessful after facing fierce opposition from Republican leadership.
Congressional Republicans have begun to get on board with the measure even though many of them still oppose efforts to legalize cannabis, with some highlighting a rise in robberies at dispensaries in recent years because they often only use cash.
“The emphasis needs to be on safety,” Sen. Dan Sullivan (R-AK) told NBC News. “So what I really worry about is someone’s going to get murdered or robbed and severely beaten, and then we’re going to be spurred to action. And that’s the wrong way to do it, you know?”
A key point of contention that remains is Section 10 of the bill, which imposes requirements if a regulator discourages a bank from entering into or maintaining a banking relationship with a customer or group of customers. These requirements have been described as burdensome and a potential roadblock for bank regulators who are attempting to stop payment fraud. The provision has been something some Democrats like Sen. Jack Reed (D-RI) have pushed to change, but Republicans like Daines want to keep in the legislation.
However, lobbyists opposed to the effort are out in full force. Smart Approaches to Marijuana Action, an organization against legalizing marijuana, is attempting to urge lawmakers who haven’t taken a position on the bill to oppose it. The group sent a letter to Sen. Tommy Tuberville (R-AL), who has yet to formally endorse the legislation.
“Marijuana is particularly dangerous for young people, a group you have demonstrated great care for in your career as a college coach,” the group said in the letter. “Your support for the SAFE Banking Act is equivalent to supporting the federal legalization of marijuana and would send a dangerous message to young people who look up to you as a role model.”
Senators on both sides of the aisle are projecting optimism the bill will get approved out of committee.
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“I want to see a strong vote come out,” said Sen. Sherrod Brown (D-OH), the chairman of the committee, speaking to reporters this week. “It helps us with momentum on the floor and the House.”
While the bill appears to have wide support in the Senate, it’s unclear what its fate looks like in the Republican-controlled House. Speaker Kevin McCarthy (R-CA) voted for the bill in the past, but it’s unclear if he could pass a similar bill now due to an influential bloc of House conservatives who have significant sway over McCarthy’s narrow majority.
