A bipartisan coalition of 34 state and territory attorneys general are urging Congress to pass coronavirus relief legislation that includes language protecting banks that service marijuana businesses from being penalized by federal regulators.
The case they lay out runs directly counter to seemingly coordinated statements by GOP lawmakers in opposition to the banking provision’s inclusion in legislation the Democratic-led House passed on Friday.
In a letter to House and Senate leadership on Tuesday, the top state law enforcement officials said there are three main reasons that providing the cannabis industry with banking access is especially necessary during the pandemic.
First, the public safety threat of operating on a largely cash-only basis has been exacerbated amid the crisis. Second, large cash transactions “places law enforcement, tax regulators, consumers, and patients at heightened risk of exposure to the virus.” Third, access to financial institutions would make it easier to collect tax revenue from marijuana sales, which is particularly needed to offset economic shortfalls due to the health crisis.
Congress needs to pass #SAFEBankingAct, led by @RepPerlmutter. Particularly during #COVID19, it is irresponsible to force #cannabis businesses to operate in cash. We @COAttnyGeneral led a bipartisan AG coalition to demand action. https://t.co/o5JR3UXO92
— Phil Weiser (@pweiser) May 19, 2020
“The current predicament of a rapidly expanding national marketplace without access to the national banking systems has resulted in an untenable situation,” the officials wrote. “We stress that current legislative models are available to fix this situation.”
The argument from the attorneys general, which includes seven Republicans, flies in the face of criticism from GOP lawmakers, who have stated that the banking language included in House leadership’s latest COVID-19 package is not germane and is simply part of a liberal wish list.
The letter goes on to say that passing the Secure and Fair Enforcement (SAFE) Banking Act as part of coronavirus relief legislation would not represent an endorsement of cannabis legalization by Congress. “Rather, it reflects a recognition of the realities on the ground and an embrace of our federalist system of government that is flexible enough to accommodate divergent state approaches,” they said.
AG @pweiser today led a bipartisan coalition of 34 attorneys general urging Congress to pass as part of upcoming #COVID19 relief legislation that would give legal marijuana-related businesses access to the federal banking system.#coleg #marijuana https://t.co/MId1AqUtfv pic.twitter.com/ddf31UF9oQ
— CO Attorney General (@COAttnyGeneral) May 19, 2020
Colorado Attorney General Phil Weiser and North Dakota Attorney General Wayne Stenehjem led the letter.
Top prosecutors from Alaska, Arkansas, Connecticut, Delaware, the District of Columbia, Guam, Hawaii, Illinois, Iowa, Maine, Maryland, Massachusetts, Michigan, Minnesota, Nevada, New Jersey, New Mexico, New York, North Carolina, Northern Mariana Islands, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, Utah, Vermont, Virginia, Washington, West Virginia and Wisconsin also signed the letter.
Our office joined a bipartisan coalition of 34 attorneys general urging Congress to pass legislation giving legal marijuana businesses access to the federal banking system, reducing health & safety risks during the COVID-19 pandemic.
— Washington State Attorney General (@AGOWA) May 19, 2020
“Many legitimate businesses have been pushed into cash-dependent models because they don’t have access to the federal banking system. At a time when COVID-19 has exacerbated health and safety concerns related to cash exchanges, now more than ever it is vital Congress act on this point,” Weiser said in a press release. “We in Colorado will continue to be at the forefront of defending our businesses and their employees.”
California Attorney General Xavier Becerra said that the “continued exclusion of the licensed cannabis industry from the federal banking system is untenable—and unwise.”
Congress should move swiftly to pass this commonsense legislation and provide relief to the many local cannabis businesses who are playing by the rules. https://t.co/IK1eJYL1kB
— Xavier Becerra (@AGBecerra) May 19, 2020
“The coronavirus crisis has only exacerbated the economic and investigatory challenges that arise from keeping a $15 billion industry in the shadows,” he said. “Congress should move swiftly to pass this commonsense legislation and provide relief to the many local cannabis businesses that are playing by the rules.”
Last year, I led a group of 38 AGs in support of the #SAFEBankingAct, which ultimately passed the House.
This bill will deter criminal activity, protect the health of our residents, and make our communities safer: https://t.co/iv0ZyYDiGp
— AG Karl A. Racine (@AGKarlRacine) May 19, 2020
The House approved the coronavirus relief package last week, with no members filing amendments to strike the banking language despite pushback from Republican lawmakers, including Senate Majority Leader Mitch McConnell (R-KY).
Advocates, stakeholders and lawmakers have been pushing for some form of cannabis reform to be inserted into COVID-19 legislation. The inclusion of the SAFE Banking Act, which was previously passed by the House as a standalone bill on a bipartisan basis last year, represents a significant victory to that end.
That said, it is unclear how the issue will fare in the Senate, whether as part of the COVID-19 response or otherwise.
Rep. Ed Perlmutter (D-CO), the lead sponsor of the bill in the House, made an argument in favor of the provision’s inclusion that’s similar to one point that attorneys general made.
Thank you to @COAttnyGeneral and others for your leadership on this issue. The #SAFEBankingAct is important for the cannabis industry and its workers who were also deemed essential during the #COVID19 crisis even as they face an increased public safety and public health risk. https://t.co/cqXcR1ezge
— Rep. Ed Perlmutter (@RepPerlmutter) May 19, 2020
He said that while some Republican legislators might argue that the cannabis language doesn’t belong in a coronavirus bill, the measure would actually protect public health by reducing the threat of spreading the virus through cash transactions.
After the House passed the SAFE Banking Act last year, it’s since sat in limbo in the Senate Banking Committee. Negotiations over the bill have been ongoing, with the Chairman Mike Crapo (R-ID) recommending a series of changes, but Sen. Cory Gardner (R-CO) saying a deal was “close.”
Advocates have also been asking lawmakers to add language extending access to federal Small Business Administration (SBA) relief programs to cannabis businesses in coronavirus legislation. That didn’t materialize in this package, however.
Currently, SBA specifically prevents marijuana businesses from receiving COVID-related relief due to federal prohibition. That also includes companies that work indirectly with the industry, such as accounting and legal firms.
Rep. Earl Blumenauer (D-OR) introduced a bill last month that would fix that, calling for SBA access for cannabis businesses and ancillary companies. That came after he led a letter with 34 bipartisan members of the House urging leadership to include the policy change in future coronavirus-related bills.
Sens. Jacky Rosen (D-NV) and Ron Wyden (D-OR) made a similar request to Senate leaders in a separate letter.
Read the cannabis bankin letter from the attorneys general below:
Most Kansas City Government Workers Will No Longer Face Pre-Employment Marijuana Tests Following City Council Vote
Most government workers in Kansas City, Missouri will no longer face pre-employment drug tests for marijuana under an ordinance that the City Council approved on Thursday.
The measure, which was introduced by Mayor Quinton Lucas (D) in July, was passed by local lawmakers in an 11-2 vote.
“It shall be unlawful for the City of Kansas City to require a prospective employee to submit to testing for the presence of marijuana in the prospective employee’s system as a condition of employment,” the text of the ordinance states.
Lucas, who last year filed a since-enacted measure to remove all local criminal penalties for cannabis possession, celebrated the latest development.
Opportunities should not be foreclosed unnecessarily.
Glad to see passage of our law eliminating pre-employment screening for marijuana at Kansas City government for most positions.
One step of many in becoming a fairer city.
— Mayor Q (@QuintonLucasKC) September 23, 2021
“Opportunities should not be foreclosed unnecessarily. Glad to see passage of our law eliminating pre-employment screening for marijuana at Kansas City government for most positions,” he said. “One step of many in becoming a fairer city.”
There are some exceptions to the policy change. Law enforcement, workers who require a commercial driver’s license and those who are involved in the supervision of “children, medical patients, disabled or other vulnerable individuals” can still be screened for cannabis.
Last year, the mayor announced a pardon program for those with previous convictions for possession of marijuana or paraphernalia.
Drug testing for cannabis has become a hot topic of late since the Olympics suspension of U.S. runner Sha’Carri Richardson, with more people arguing that use of the plant shouldn’t lead to punishments, especially given the ongoing rise of the legalization movement. The World Anti-Doping Agency recent announced that it would review its marijuana policy for athletes next year.
The Biden administration has come under fire this year for terminating or otherwise punishing staffers who were honest about their past cannabis use as part of the background check process.
White House Press Secretary Jen Psaki has said that nobody in the White House was fired for “marijuana usage from years ago,” nor has anyone been terminated “due to casual or infrequent use during the prior 12 months.” However, she’s consistently declined to speak to the extent to which staff have been suspended or placed in a remote work program because they were honest about their history with marijuana on a federal form that’s part of the background check process.
In June, a powerful congressional committee released a report that urges federal agencies to reconsider policies that result in the firing of employees who use marijuana legally in accordance with state law.
Separate standalone legislation has been previously introduced by Rep. Charlie Crist (D-FL) to provide protections for federal workers who consume cannabis in compliance with state law, but it never received a hearing or a vote and has not been refiled so far this Congress.
As of last year, New York City employers are no longer able to require pre-employment drug testing for marijuana as a part of the hiring process—though there are a series of exemptions to the policy. The City Council approved the ban in 2019, and it was enacted without Mayor Bill de Blasio’s (D) signature.
Statewide in Missouri, voters may see multiple marijuana initiatives on the state’s 2022 ballot, with a group filing an adult-use legalization proposal last month that could compete with separate reform measures that are already in the works.
Photo courtesy of Brian Shamblen.
Full-Page Washington Post Ad Calls For Marijuana Prisoner’s Freedom While Celebs Make Money In Industry
Supporters of a 26-year-old man who is currently incarcerated while awaiting sentencing for a federal marijuana charge took out a full-page ad in The Washington Post on Thursday, blasting the hypocrisy of his imprisonment while celebrities like Beyonce, Jay Z, Seth Rogen and Willie Nelson stand to profit off the legal cannabis industry.
Jonathan Wall faces up to 15 years in prison on charges that he and other conspired to traffic marijuana from California to Maryland over two years. His family says this is a flagrant miscarriage of justice that highlights the need for relief for Wall and for broader federal marijuana reform.
The ad has the headline, “Who will be the last person incarcerated for marijuana in the United States?”
“Cannabis corporations are in Maryland and 26 other states making billions in revenue growing, manufacturing and distributing pot,” it says. “Cannabis conglomerates wonderfully engaged in branding, licensing , product innovation, research and development.”
It notes that, just miles away from where Wall is being held, consumers can buy marijuana from major marijuana businesses like Curaleaf or Acreage Holdings, which counts former GOP House Speaker John Boehner (R-OH) among its board members.
“But then you—along with the likes of Jay Z, Seth Rogen, and Willie Nelson—would be in violation of U.S. federal law and subject to incarceration,” the ad says. “26-year-old Jonathan Wall faces life in prison while Beyonce says that she’s starting a cannabis farm. This is not the way the law is supposed to work.”
“President Biden recently gave a speech about how 20 years in Afghanistan was too long and that our continued involvement there was a mistake. Well, what about more than 50 years of proven failure, 50 years of gross economic waste, 50 years of caging our own citizens, 50 years of asset forfeiture abuse, 50 years of enforcement disparity and evisceration of the constitutional rights of people of color. In a country where you can guy an assault rifle and fifth of whiskey, federal prohibition of cannabis has never been about more than fear, bias, race, stigmatization and control.”
This isn’t the first time that the Biden administration has faced demands to provide relief for people criminalized over marijuana.
Congressional lawmakers have also recently pushed President Joe Biden to grant clemency to nearly 20,000 people in the federal prison system—including those with drug convictions.
A group of more than 150 celebrities, athletes, politicians, law enforcement professionals and academics separately signed a letter that was delivered to Biden, asking him to issue a “full, complete and unconditional pardon” to all people with non-violent federal marijuana convictions.
While advocates are looking for more, the Biden administration is asking a fraction of people with drug convictions who were placed on home confinement amid the coronavirus pandemic to apply for the relief.
“It is time for our government to admit that it has made a mistake,” the new ad says.
House Officially Passes Defense Bill With Marijuana Banking Protections, But Key Senators May Block Path Ahead
The U.S. House of Representatives on Thursday approved a large-scale defense spending bill that includes an amendment to shield banks that works with state-legal marijuana businesses from being penalized by federal regulators. Now advocates and industry stakeholders are left wondering: what’s the fate of the reform in the Senate? And can it make it to the president’s desk?
New comments from Sen. Cory Booker (D-NJ)—who’s helping lead the charge to advance comprehensive marijuana legalization and who has been severely critical of efforts to enact banking reform first—signal that the path to pass the incremental policy change through the National Defense Authorization Act (NDAA) could be in jeopardy in the Senate. Other key senators have also expressed skepticism about the reform’s prospects through this process.
For supporters, things may have been more simple if the Senate had moved to include cannabis banking reform in its own version, but the text of NDAA released by Senate Armed Services Committee on Wednesday does not contain that language. That means the matter will need to be settled in a bicameral conference committee after the full Senate formally passes its bill. At that point, negotiators from both chambers will work to resolve differences between their separate proposals.
Already, there’s pushback from key senators to including the Secure and Fair Enforcement (SAFE) Banking Act in the NDAA that’s ultimately sent to President Joe Biden. That’s not especially surprising considering that leadership, including Senate Majority Leader Chuck Schumer (D-NY), has insisted on passing comprehensive justice-focused marijuana legalization first rather than advance an incremental reform on banking. But recent statements do raise questions about the prospects of enacting the reform through the defense bill.
It’s not that the SAFE Banking Act is partisan or especially controversial on its face; it’s a matter of legislative priorities for certain senators and a question of germaneness in NDAA. As of Tuesday, when the reform amendment was officially attached to the House version of the bill, it has now passed five times in the chamber, usually along largely bipartisan lines.
Rep. Ed Perlmutter (D-CO), chief sponsor of the SAFE Banking Act, spoke with Marijuana Moment about the process moving forward in a phone interview on Wednesday. He was optimistic about the measure’s prospects with NDAA as the vehicle, though he conceded that he hadn’t spoken with Schumer or other key senators who are actively finalizing legalization legislation that they hope to see move first.
“I think the fifth time is the charm,” he said. “I mean, obviously, we still have to do some work to make sure that it remains part of the NDAA as the House and the Senate go to conference. So we still have work to do with the Senate to make sure that it remains part of it. But I think that it will.”
“I mean, the fact that it deals with cartels and national security, on top of the need for the public safety piece of this thing, I think that we’ll be able to convince the conference committee and the conferees generally to keep it in,” he said. “But we still have work to do.”
Marijuana Moment is already tracking more than 1,200 cannabis, psychedelics and drug policy bills in state legislatures and Congress this year. Patreon supporters pledging at least $25/month get access to our interactive maps, charts and hearing calendar so they don’t miss any developments.
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Some advocates have expressed support for enacting the achievable banking policy change while working to build support for more comprehensive reform.
“Enactment of the SAFE Banking Act would improve public safety and business efficiency in the 36 states that currently permit some form of retail marijuana sales,” NORML Political Director Justin Strekal said. “The Senate should ensure this provision remains in the final version of this funding package and enact it swiftly.”
“The SAFE Banking Act is only the first step toward making sure that state-legal marijuana markets operate safely and efficiently,” he said. “The sad reality is that those who own or patronize these currently unbanked businesses would still be recognized as criminals in the eyes of the federal government and by federal law. This situation can only be rectified by removing marijuana from the list of controlled substances.”
Schumer and certain other senators, meanwhile, have insisted the banking issue should be tackled by holistically ending marijuana prohibition. They argue that it is inappropriate to pass what is seen as an industry-focused reform that helps businesses and investors while leaving unaddressed the harms of decades of racially disparate prohibition enforcement that should be addressed with equity-focused legalization.
Booker, who is helping Schumer alongside Senate Finance Committee Chairman Ron Wyden (D-OR) to produce a final legalization bill has said he would proactively work to block any senators who attempt to get marijuana banking reform passed before enacting social justice-focused legalization legislation.
And Booker told Politico on Wednesday that cannabis banking is “something that should not be included” in NDAA.
Senate likes to send NDAA amendments to a vote by unanimous consent. If one senator raises an objection to an NDAA Amendment, it can kill or stall it. Booker wouldn’t discuss his plans but said has “a lot of options as an individual senator” should the amendment be proposed.
— Natalie Fertig (@natsfert) September 22, 2021
“It undermines the ability to get comprehensive marijuana reform and the kind of things that are harder to get done like expungement of people’s records,” he said, echoing a point that Schumer made in an interview with Marijuana Moment in April. And a spokesperson for the majority leader affirmed that his position has not changed in light of the House development.
Should a senator propose a floor amendment to the chamber’s version of the defense bill to incorporate SAFE Banking, Booker left open the possibility of standing in its way.
Sen. Jeff Merkley (D-OR), sponsor of the standalone Senate version of the SAFE Banking Act, also declined to say whether he would push to attach the reform to NDAA and told Politico he’d “love to see if we can even do the more comprehensive [reform]—that’d be even better.”
Senate Armed Services Committee Chairman Jack Reed (D-RI), meanwhile, told Roll Call that the issue hasn’t been discussed by members of his panel. And bipartisan supporters of the reform—including Sens. Brian Schatz (D-HI) and Rand Paul (R-KY)—told the outlet they weren’t certain that the Senate would pursue marijuana banking through NDAA.
Schatz also said that Senate Minority Leader Mitch McConnell (R-KY) “doesn’t like” the marijuana banking proposal, and so “he’s going to have to consult with the Republicans in his conference who are in favor of this reform, but so far he’s been blocking it.”
Based on these comments, it seems increasingly clear that the effort to enact SAFE Banking through the must-pass defense bill faces a tough road ahead. And despite bipartisan support for the proposal on its own, it’s an open question as to whether the negotiators in committees of jurisdiction will be able to reach a consensus.
At an initial meeting of the House Rules Committee about NDAA on Monday, House Armed Services Committee Chairman Adam Smith (D-WA), who is managing the bill for the chamber, acknowledged that while some members might consider certain amendments “superfluous” to defense spending matters, the annual legislation has been used as a vehicle to advance non-germane legislation in the past. He added, though, that doing so has historically required the issues at hand to have broad bipartisan support in order to survive the House-Senate conference committee process.
He didn’t specifically cite the cannabis banking proposal, but Perlmutter himself said earlier in the hearing that “whether something is superfluous is always in the eyes of the beholder,” signaling that he feels his measure’s germaneness in this context is up for interpretation.
Smith said that “whatever superfluous items the Rules Committee decides to put in order and get attached to this bill, we go to conference, and in conference, we work in a bipartisan fashion.”
But beyond Smith and Reed, it will also be up to leading members of key committees that handle banking issues to decide whether the measure gets a ride to the president’s desk in NDAA.
“We’re not going to pull one over on anybody here. We’re going to have to work with committees of jurisdiction—not just the chairs, but the ranking members as well—to come to some agreement on those before we go forward,” he said. “So if you see an item that you consider to be superfluous being added to the bill, don’t freak out.”
The chair’s comments about needing support from leaders of committees of jurisdiction raise questions about whether the amendment stands a chance in conference with the Senate following House approval. Not only did House Financial Services Committee Ranking Member Patrick McHenry (R-NC) vote against the standalone SAFE Banking Act this year and in 2019, but on the Senate side, even Banking Committee Chairman Sherrod Brown (D-OH) has been generally unenthusiastic about advancing the reform.
On the flip side, House Finance Services Committee Chairwoman Maxine Waters (D-CA) is a supporter of the banking reform and brought it through her panel last Congress. Senate Banking Committee Ranking Member Pat Toomey (R-PA), for his part, has previously voiced support for advancing the SAFE Banking Act.
Perlmutter has said that he appreciates that Senate leadership is pushing for a more comprehensive end to federal marijuana prohibition—and he agrees with Booker that promoting social equity is an important objective—but he feels the SAFE Banking Act is urgently needed to address public safety issues resulting from the industry’s lack of access to traditional financial institutions.
Some of the strongest proponents for broad reform like Rep. Earl Blumenauer (D-OR) voted in favor of the SAFE Banking Act in April despite the body yet having taken up a legalization measure this session.