Another Financial Association Pushes Senate To Pass Marijuana Banking Reform
Another financial association is imploring Senate leadership to pass a bipartisan bill to safeguard banks that work with state-legal marijuana businesses.
The Independent Community Bankers of America (ICBA), which represents about 50,000 community banks throughout the country, sent a letter to key senators on Thursday, urging the adopting of cannabis banking reform language in a large-scale manufacturing bill that’s headed to a bicameral conference committee.
The House did include the Secure and Fair Enforcement (SAFE) Banking Act in its version of the AMERICA Competes Act, but it was stripped in the Senate. Advocates and stakeholders have been putting pressure on the Senate to accede to the House and reinsert the language in the final package that’s sent to the president’s desk.
The SAFE Banking Act “would create a safe harbor from federal sanctions for financial institutions that serve cannabis-related businesses (CRBs), as well as the numerous ancillary businesses that serve them, in states and other jurisdictions where cannabis is legal,” ICBA said in the new letter.
ICBA called on Senate leaders to include ICBA-advocated legislation to establish a cannabis banking safe harbor in the America COMPETES Act conference report. https://t.co/Yexw0tzVpG
— Independent Community Bankers of America (@ICBA) May 6, 2022
“We are pleased to reiterate ICBA’s strong support for this legislation, which is essential for the ongoing ability of community banks to effectively serve their communities,” the association said. “ICBA urges the support of all members of the House and Senate for inclusion of the SAFE Banking Act in the conference report to the America COMPETES Act.”
Banking associations representing all 50 states and one U.S. territory also sent a letter to Senate leaders late last month, imploring them to include marijuana banking reform in the manufacturing bill that’s set to be negotiated.
Rep. Ed Perlmutter (D-CO) is the chief sponsor of the SAFE Banking Act, which has passed the House in some form six times at this point. He’s been strongly pushing for the measure’s passage as an urgent public safety issue that would give state-legal businesses access to traditional financial services that are afforded to other legal industries.
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But so far, the Senate has been reluctant to advance the measure under Democratic and Republican control. Senate leadership has insisted on passing comprehensive legalization legislation first before the cannabis banking bill.
A top aide for Senate Majority Leader Chuck Schumer (D-NY), who is working to finalize his own legalization bill, recently tempered expectations about the prospects of moving marijuana banking through the America COMPETES Act.
That reluctance on the Senate side was also the subject of a letter from Perlmutter that was sent to leadership last month.
The congressman has even made a point to talk about enacting the reform legislation during committee hearings on ostensibly unrelated or wider-ranging legislation, like at a recent House Rules Committee hearing.
Despite recently saying that he’s “confident” that the Senate will take up his bill this session, Perlmutter recognized that while he’s supportive of revisions related to criminal justice reform, taxation, research and other issues, he knows that “as we expand this thing, then we start losing votes, particularly Republican votes and we got enough votes in the Senate to do it” as is.
Meanwhile, the governor, attorney general and other top officials in Washington State sent a letter to congressional leaders last week, again emphasizing the urgent need to pass marijuana banking reform as a public safety imperative.
With respect to the AMERICA Competes Act, the third-highest-ranking Democratic member in the Senate, Sen. Patty Murray (D-WA), has taken special interest in the issue, describing marijuana banking reform as a priority as an appointed member on the bicameral conference committee.
Separately, Washington State officials also recently held a virtual roundtable to address the spate of deadly robberies targeting marijuana retailers, with regulators reiterating their call for a federal policy change and discussing steps the state can take on its own while Congress fails to act.
Washington State’s treasurer has been especially vocal about the need for congressional reform, and he wrote in a recent letter to his colleagues in other states that it’s “just not safe to have this financial volume in cash.”
He made similar remarks at a recent conference of the National Association of State Treasurers (NAST). And Colorado Treasurer Dave Young echoed that sentiment in a recent interview with Marijuana Moment.
In the absence of congressional action, more states are moving to enact marijuana banking reform policies on their own. For example, Pennsylvania House lawmakers filed a companion bill to a Senate-passed measure late last month that would provide banking protections and tax relief for marijuana businesses.
Meanwhile, the number of banks that report working with marijuana businesses ticked up again near the end of 2021, according to recently released federal data.
It’s not clear if the increase is related to congressional moves to pass a bipartisan cannabis banking reform bill, but the figures from the Financial Crimes Enforcement Network (FinCEN) signal that financial institutions continue to feel more comfortable servicing businesses in state-legal markets.
Some Republicans are scratching their heads about how Democrats have so far failed to pass the modest banking reform with majorities in both chambers and control of the White House, too. For example, Rep. Rand Paul (R-KY) criticized his Democratic colleagues over the issue in December.
Read ICBA’s letter to Senate leadership on passing marijuana banking reform below:
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