Three state attorneys general and the top prosecutor for Washington, D.C. sent a letter to congressional leaders on Thursday, reiterating their support for legislation that would protect banks that service state-legal marijuana markets from being penalized by federal regulators.
Rep. Ed Perlmutter (D-CO) is the chief sponsor of the Secure and Fair Enforcement (SAFE) Banking Act in the House, while Sens. Jeff Merkley (D-OR) and Steve Daines (R-MT) are carrying their chamber’s version. Both were reintroduced with substantial bipartisan cosponsor lists last month.
Colorado Attorney General Phil Weiser (D) led the new letter, which says that the signatories support the proposal and “encourage Congress to take action expeditiously.”
AG Weiser previously expressed support for the bill, which passed the House but failed to pass the U.S. Senate: https://t.co/MId1AqUtfv@RepPerlmutter recently reintroduced the bill, and the attorneys general urge the House of Representatives and Senate to promptly take action.
— CO Attorney General (@COAttnyGeneral) April 1, 2021
“Without access to traditional financial services, [state-legal marijuana businesses] operate exclusively or primarily in cash, making those businesses targets for criminal activity and hindering efforts to ensure regulatory and tax compliance and track financial flows,” they wrote. “This status quo—a rapidly expanding, multibillion-dollar national marketplace without access to the national banking systems—is untenable.”
The Republican attorneys general of North Dakota and Ohio, as well as the Democratic attorney general of Washington, D.C., joined Weiser in signing the letter. It’s similar to a message that 34 top state prosecutors sent to congressional leadership in 2020.
“To address an untenable status quo and recognize on the ground realities, we strongly urge the House of Representatives and Senate to promptly take up and act upon the SAFE Banking Act,” the new letter says. “Our states’ ability to protect public safety and properly regulate this new and growing industry depends on Congress enacting this vital legislation.”
— Phil Weiser (@pweiser) April 1, 2021
The House did pass the marijuana banking bill last Congress, but it did not advance in the Senate under Republican control. Democratic leaders also included the proposal as part of two COVID-19 relief bills.
The SAFE Banking Act would ensure that financial institutions could take on cannabis business clients without facing federal penalties. Fear of sanctions has kept many banks and credit unions from working with the industry, forcing marijuana firms to operate on a cash basis that makes them targets of crime and creates complications for financial regulators.
After it passed the House last session, advocates and stakeholders closely watched for any action to come out of the Senate Banking Committee, where it was referred after being transmitted to the chamber. But then-Chairman Mike Crapo (R-ID) did not hold a hearing on the proposal, despite talk of negotiations taking place regarding certain provisions.
Crapo said he opposed the reform proposal, but he signaled that he might be more amenable if it included certain provisions viewed as untenable to the industry, including a 2 percent THC potency limit on products in order for cannabis businesses to qualify to access financial services as well as blocking banking services for operators that sell high-potency vaping devices or edibles that could appeal to children.
Sen. Sherrod Brown (D-OH), who took the top seat in that panel after Democrats secured a majority in the Senate, told reporters in February that he’s “willing” to move the cannabis banking bill, “but with it needs to come sentencing reform.”
“I don’t think we move on legalization the way that Colorado and some other states want us to, unless we really look more seriously at who’s in prison for how long for those kinds of offenses and we don’t do one without the other,” he said.
The committee’s ranking member, Sen. Pat Toomey (R-PA), said in November that he is “open to working with my colleagues on how we could enable businesses that are operating legally in their respective states to be able to have ordinary banking services” and that it’s “something we should work on.”
At the end of the last Congress, the prior Senate version of the SAFE Banking Act had garnered a total of 35 senators signed on, including now-Vice President Kamala Harris.
When legislative leaders announced that the SAFE Banking Act was getting a House vote in 2019, there was pushback from some advocates who felt that Congress should have prioritized comprehensive reform to legalize marijuana and promote social equity, rather than start with a measure viewed as primarily friendly to industry interests.
Rep. Earl Blumenauer (D-OR), co-chair of the Congressional Cannabis Caucus and an original cosponsor of the bill, said last month that the plan is to pass the banking reform first this session because it “is a public safety crisis now,” and it’s “distinct—as we’ve heard from some of my colleagues—distinct from how they feel about comprehensive reform.”
Meanwhile, congressional lawmakers are simultaneously preparing to introduce legislation to end federal cannabis prohibition.
Senate Majority Leader Chuck Schumer (D-NY), Senate Finance Chairman Ron Wyden (D-OR) and Sen. Cory Booker (D-NJ) are in the process of crafting a legalization bill, and they’ve already met with advocates to get feedback on how best to approach the policy change. Wyden is the only member of the trio to be listed as an original cosponsor of the new SAFE Banking Act.
Schumer said this week that they will be introducing the legalization bill “shortly.”
House Judiciary Chairman Jerrold Nadler (D-NY) also recently said that he would be reintroducing the Marijuana Opportunity, Reinvestment and Expungement (MORE) Act, which would federally deschedule cannabis and contains a number of social equity provisions. That proposal passed in the House last year.
As more states have legalized marijuana for recreational or medical use, financial institutions have relied on 2014 guidance from the Financial Crimes Enforcement Network (FinCEN) that requires them to submit suspicious activity reports if they elect to provide financial services to cannabis businesses. In the years since, the number of depositories taking on marijuana clients has gradually increased—until a more recent downward trend that now seems to be stabilizing.
The head of the Internal Revenue Service (IRS) told Congress in February that the federal agency would “prefer” for state-legal cannabis firms to be able to pay taxes electronically, as the current cash-based system under prohibition is onerous and presents risks to workers.
Former Treasury Secretary Steven Mnuchin similarly said in 2019 that he’d like to see Congress approve legislation resolving the cannabis banking issue, and he pointed to the fact that IRS has had to build “cash rooms” to deposit taxes from those businesses as an example of the problem.
Read the attorneys general letter on marijuana banking reform below:
Pennsylvania Senators Will Consider DUI Protections For Medical Marijuana Patients At Hearing
A Pennsylvania Senate committee is set to take up a bill next week that would protect medical marijuana patients from being prosecuted under the state’s “zero tolerance” DUI laws.
The legislation, sponsored by Sen. Camera Bartolotta (R), would amend state statute to require proof of active impairment before a registered patient can be prosecuted for driving under the influence. The current lack of specific protections for the state’s roughly 368,000 patients puts them in legal jeopardy when on the road, supporters say.
The #PASenate Transportation Committee will hold a hearing on 9/21 with a focus on my #SB167, which would remove DUI penalties for legal medicinal cannabis use. @SenLangerholc @PASenateGOP Details ⤵️https://t.co/cSd2Cpdky9 pic.twitter.com/av3mxvAuCk
— Senator Bartolotta (@senbartolotta) September 16, 2021
Bartolotta first introduced an earlier version of the bill in June 2020. She said at the time that the state needs to “ensure that the legal use of this medicine does not give rise to a criminal conviction.”
Months after the standalone reform legislation was introduced, the Pennsylvania House approved a separate amendment that would enact the policy change.
Pennsylvania legalized medical marijuana in 2016, with the first dispensaries in the state opening in 2018. But the state’s zero-tolerance DUI law still doesn’t reflect those changes. Because it criminalizes the presence of any THC or its metabolites in a driver’s blood—which can be detected for weeks after a person’s last use—the law puts virtually all medical marijuana patients at risk, even if it’s been days since their last use and they show no signs of impairment.
Bartolotta’s bill would require officers to prove a registered patient was actually impaired on the road.
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“Unimpaired patients currently face the risk of being arrested, prosecuted and convicted for using medicinal marijuana that has no bearing on their ability to drive a vehicle,” the senator wrote in a cosponsorship memo late last year. “Given the very serious consequences of a DUI conviction, my legislation will provide critical protections for medicinal cannabis patients by ensuring responsible use of their legal medicine does not give rise to a criminal conviction.”
Several legal cannabis states have enacted per se THC limits in blood, similar to blood alcohol requirements. However, evidence isn’t clear on the relationship between THC concentrations in blood and impairment.
A study published in 2019, for example, concluded that those who drive at the legal THC limit—which is typically between two to five nanograms of THC per milliliter of blood—were not statistically more likely to be involved in an accident compared to people who haven’t used marijuana.
Separately, the Congressional Research Service in 2019 determined that while “marijuana consumption can affect a person’s response times and motor performance… studies of the impact of marijuana consumption on a driver’s risk of being involved in a crash have produced conflicting results, with some studies finding little or no increased risk of a crash from marijuana usage.”
Outside of this bill, Pennsylvania lawmakers have continued to pursue adult-use legalization in the state. Earlier this year, two legislators circulated a memo to build support for a comprehensive reform bill they plan to introduce, for example.
A bipartisan Senate duo is also in the process of crafting legislation to legalize cannabis across the commonwealth. They announced some details of the proposal earlier this year, but the bill has yet to be formally introduced.
Outside the legislature, Gov. Tom Wolf (D) said earlier this year that marijuana legalization was a priority as he negotiated the annual budget with lawmakers. However, his formal spending request didn’t contain legislative language to actually accomplish the cannabis policy change.
Wolf, who signed a medical cannabis expansion bill in June, has repeatedly called for legalization and pressured the Republican-controlled legislature to pursue the reform since coming out in favor of the policy in 2019. Shortly after he did that, a lawmaker filed a separate bill to legalize marijuana through a state-run model.
Lt. Gov. John Fetterman (D), who is running for U.S. Senate, previously led a listening tour across the state to solicit public input on legalization. He’s credited that effort with helping to move the governor toward embracing comprehensive reform. The lieutenant governor even festooned his Capitol office with marijuana-themed decor in contravention of a state law passed by the GOP-led legislature.
Fetterman has also been actively involved in encouraging the governor to exercise his clemency power for cannabis cases while the legislature moves to advance reform.
In May, Wolf pardoned a doctor who was arrested, prosecuted and jailed for growing marijuana that he used to provide relief for his dying wife. That marks his 96th pardon for people with cannabis convictions through the Expedited Review Program for Non-Violent Marijuana-Related Offenses that’s being run by the Board of Pardons.
Overall, legalization is popular among Pennsylvania voters, with 58 percent of residents saying they favor ending cannabis prohibition in a survey released in April.
Another poll released in May found that a majority of voters in the state also support decriminalizing all currently illicit drugs.
Photo courtesy of Mike Latimer.
80 Top Law Enforcement Officials, Including A Biden Nominee, Urge SCOTUS To Hear Safe Injection Drug Case
A coalition of 80 current and former prosecutors and law enforcement officials—including one who is President Joe Biden’s pick for U.S. attorney of Massachusetts—have filed a brief urging the Supreme Court to take up a case on the legality of establishing a safe injection facility where people can use illicit drugs in a medically supervised environment.
The nonprofit organization Safehouse was set to launch a safe consumption site in Philadelphia before being blocked by a legal challenge from the Trump administration, and it filed a petition with the nation’s highest court last month to hear the case. Now the group of law enforcement officials associated with Fair and Just Prosecution are calling on the Supreme Court to act in an amicus brief.
“Amici have an interest in this litigation because overdose prevention sites (OPSs) are among the harm reduction and public health interventions that have proven effective in preventing fatal overdoses and diverting people from unnecessary and counterproductive interactions with the justice system,” they wrote. “Amici, many of whom are currently or were previously responsible for enforcing the nation’s drug laws, also believe that the Controlled Substances Act cannot be construed to prohibit operation of a facility designed to address the most acute aspects of this public health emergency.”
“As law enforcement and criminal justice leaders, amici’s objective is to maintain public safety; saving lives and promoting health is as central to that mission as preventing and prosecuting crime.”
Read the full brief: https://t.co/e4Sv6oba4b
— Fair and Just Prosecution (@fjp_org) September 17, 2021
If the court agrees to hear the dispute, advocates will be looking toward the Biden Justice Department and whether it will continue the federal government’s opposition to allowing supervised injection facilities. It would be a precedent-setting case that could steer policy for years to come, meaning Safehouse is taking a significant risk by pursuing the appeal of its loss in a lower court before the majority of conservative justices.
“Failing to address the loss of life resulting from drug overdoses—and criminalizing a community-based public health organization working to save lives—will further erode trust in the justice system,” the new brief states. “If there were ever a time to demonstrate that our government values the dignity of human life, that time is now.”
While President Joe Biden hasn’t weighed in directly on safe consumption sites, there’s been a theme within his administration of embracing the general concept of harm reduction for drugs. The White House Office of National Drug Control Policy (ONDCP), for example, said that “promoting harm-reduction efforts” is a first-year priority. In an overview of its objectives, the office said it intends to expand “access to evidence-based treatment,” enhance “evidence-based harm reduction efforts” and promote “access to recovery support services.”
These goals theoretically align with those of Safehouse, which wants to give people with substance use disorders a facility where medical professionals can intervene in the event of an overdose and provide people with the resources to seek recovery.
Among the signatories on the amicus brief are a former deputy assistant attorney general under Obama, district attorneys of Baltimore, Cook County, Dallas County, Los Angeles County, Manhattan, Philadelphia, San Francisco County and Seattle and the former attorneys general of Ohio, Vermont and Virginia.
But one signatory who especially stands out is Rachael Rollins, the district attorney of Suffolk County, Massachusetts who is Biden’s nominee for U.S. attorney of Massachusetts.
“As an elected prosecutor, I have a responsibility to protect every member of my community, which requires moving away from criminal justice responses to substance use disorder,” Rollins said in a press release. “Instead, we must embrace proven public health strategies as potential solutions. Lives depend on it.”
Philadelphia District Attorney Larry Krasner said the drug war “has taken too many lives already, and criminalization has only exacerbated this devastating toll.” He added: “We need a new way forward that allows communities to address the overdose crisis with harm reduction approaches proven to save lives and improve community safety.”
“Our nation’s failed war on drugs has taken too many lives…and criminalization has only exacerbated this devastating toll. We need a new way forward that allows communities to address the overdose crisis with harm reduction approaches proven to save lives." –@DA_LarryKrasner
— Fair and Just Prosecution (@fjp_org) September 17, 2021
Fair and Justice Prosecution, the group that coordinated the amicus brief, also organized a tour of Portugal for 20 top prosecutors in 2019 so they could learn about the successful implementation of the country’s drug decriminalization law.
Safehouse won a battle in a federal district court in 2019 to proceed with the facilities. But in January, the U.S. Court of Appeals for the Third Circuit overturned the decision, ruling that permitting such facilities would violate a 1980s-era federal statute that bars organizations from running operations “for the purpose of unlawfully… using controlled substances.” That law was passed while Biden served in the Senate and helped push punitive drug policies that have had lasting consequences.
“As current and former criminal justice leaders, amici have seen first-hand how the classic ‘war on drugs’ approach to drug control—with its almost exclusive focus on aggressive criminal law enforcement—has exacerbated the overdose epidemic,” the pro-reform prosecutors and cops wrote in the new brief. “This experience confirms that no jurisdiction can arrest its way out of this public health problem. Fatal overdoses are a symptom of substance use disorder, a medical condition requiring a medical response.”
“Distorting federal drug laws to prohibit an [overdose prevention site] or to prosecute its sponsors would further undermine trust in the justice system and faith in the fair and sensible application of our drug laws. Interpreting federal criminal law to bar empirically validated harm reduction measures would make no one safer; it would only impede cooperation between law enforcement and the communities they serve.”
In its original petition to the Supreme Court in the current safe injection site case, Safehouse argued that the justices should “grant review to determine whether” federal statute really does prohibit “non-commercial, non-profit social service agencies…from establishing an overdose-prevention site that includes medically supervised consumption.”
“This question is a matter of life or death for thousands of Philadelphians and many thousands more throughout the country,” it said. “Tragically, while respondents have been pursuing this declaratory judgment against Safehouse, more than 3,200 people died in Philadelphia of drug overdoses—many of which could have been prevented if medical care had been immediately available through supervised consumption services.”
Safehouse also pointed out that Xavier Bacerra, the Biden administration’s secretary of health and human services, was among eight top state law enforcement officials who filed an earlier amicus brief in support of the organization’s safe injection site plan when he served as California’s attorney general.
The organization put the gravity of the case in no uncertain terms, painting a picture of how its proposed facility can save lives.
“When breathing stops, even a brief delay while waiting for medical help to arrive may result in an otherwise preventable overdose death or irreversible injury,” the petition says. “As a result, every second counts when responding to an opioid overdose; as more time elapses, the greater the risk of serious injury and death. Ensuring proximity to medical care and opioid reversal agents like the drug Naloxone at the time of consumption is therefore a critical component of efforts to prevent fatal opioid overdose.”
“Intervention by this Court is warranted to make clear that the federal law does not criminalize this essential public health and medical intervention designed to save lives from preventable overdose death,” it continues.
Safehouse argued that the appeals court’s interpretation of the law “eviscerates the intended boundaries of the statute and would criminalize the operation of legitimate businesses, charities, families, and good Samaritans that serve and reside with those suffering from addiction.”
If the Supreme Court were to take up the case and rule in favor of Safehouse, it could embolden advocates and lawmakers across the country to pursue the harm reduction policy.
The governor of Rhode Island signed a bill in July to establish a safe consumption site pilot program where people could test and use currently illicit drugs in a medically supervised environment. It became the first state in the country to legalize the harm reduction centers. It’s not clear whether the Department of Justice will seek to intervene to prevent the opening of such facilities in that state.
Massachusetts lawmakers advanced similar legislation last year, but it was not ultimately enacted.
A similar harm reduction bill in California, sponsored by Sen. Scott Wiener (D), was approved in the state Senate in April, but further action has been delayed until 2022.
At the same time that Safehouse is turning to the Supreme Court, it also announced recently that it will be returning the the federal district court that gave it an initial 2019 victory in support of establishing a safe injection facility before it was overturned in the appeals court.
The organization is making the unique argument that the federal government’s decision to block it from providing the service violates religious freedom by subjecting participants “to criminal penalties for exercising their sincerely held religious beliefs that they have an obligation to do everything possible to preserve life and to provide shelter and care to the vulnerable, including those suffering from addiction.”
In 2018, a congressional subcommittee approved legislation to specifically prohibit Washington D.C. from using local tax dollars to help open safe consumption facilities. But that provision was not enacted and has not been reintroduced since.
A 2020 study found that people “who reported using supervised injection facilities on an at least weekly basis had a reduced risk of dying compared to those who reported less than weekly or no use of this health service.”
Read the amicus brief from the prosecutors on the Safehouse safe injection site case below:
Photo courtesy of Jernej Furman.
Former GOP Congressman Who Actually Supported Marijuana Reform Enters The Cannabis Industry
Lately it’s come to seem as if most of the former politicians who’ve entered the marijuana industry were unhelpful or downright hostile to legalization when they were in office. But on Friday, a cannabis company announced an addition to its board who disrupts that narrative: a former Republican congressman who has a consistent legislative record of cosponsoring and voting for marijuana reform measures.
The multi-state cannabis businesses Red White & Bloom Brands Inc. (RWB) is bringing on former Rep. Ryan Costello (R-PA) to help it navigate the complicated regulatory space, drawing on his experience in Congress as the company works to expand.
Costello certainly isn’t the only Republican lawmaker who’s made the transition from Capitol Hill to the cannabis market. But he is a rare example of a politician who actually embraced enacting marijuana policy changes while he was in power before standing to profit from the industry. The congressman cosponsored a variety of bills—including ones to shield states that legalize cannabis from federal interference—and supported several reform amendments.
“I’m looking forward to utilizing my 15+ years of service in government, the legal profession, and my familiarity with cannabis policy to be a strategic resource for RWB as it positions itself as a true market leading house of brands in the permitted U.S. marketplace,” Costello said in a press release.
This breaks with a trend that has increasingly frustrated advocates, where it seems the people most inclined to benefit from legalization are those who stood in the way in Congress. The best-known example of that is former GOP House Speaker John Boehner (R-OH), who’s faced criticism from activists over his anti-legalization record while in office before joining the board of marijuana company Acreage Holdings.
While Costello left Congress in 2019 prior to the historic House vote on a standalone bill to federally deschedule cannabis, there are plenty of examples of him supporting more modest reform proposals during his congressional tenure.
He was a cosponsor of legislation to protect state marijuana markets from federal intervention, promote cannabis research, support military veterans’ access to medical marijuana, protect banks that service state-legal cannabis businesses and legalize industrial hemp.
The congressman also voted in favor of floor amendments to shield all state marijuana programs from Justice Department intervention, allow Department of Veterans Affairs doctors to recommend medical cannabis and end hemp prohibition.
In that respect, he was a rare GOP lawmaker. While the issue is increasingly bipartisan among the public, that hasn’t been reflected in Congress. And now Costello is in a position to leverage his legislative experience to advance a marijuana business’s interests.
It’s an exception to the trend.
For example, Tom Price, the former U.S. Department of Health and Human Services (HHS) head under President Donald Trump, is serving as a member of the board of directors for a medical marijuana business in Georgia after he refused to take action to reclassify cannabis under federal law when he had the power to do so. Price consistently voted against marijuana reform measures while serving in Congress.
Former Rep. Steve Buyer (R-IN), who also has a long track record of opposing marijuana legalization efforts, joined a Canadian cannabis company’s board in 2019.
Earlier this month, a New York-based lobbying firm that’s headed by a former Republican U.S. senator announced that it is launching a practice focused on serving cannabis businesses. That former senator, Alfonse D’Amato, racked up a record of supporting the war on drugs while in office.
There is at least one other former GOP congressman who entered the cannabis space with a legislative record supporting marijuana reform. Former Rep. Dana Rohrabacher (R-CA), who championed cannabis reform while in Congress, became an advisory board member for a marijuana company after being voted out of office in 2018.
Separately, President Joe Biden’s pick to head up federal drug policy worked for a major marijuana business last year, according to his financial disclosure reports.
Photo courtesy of WeedPornDaily.