A key congressional committee is scheduled to vote on far-reaching legislation that would expand marijuana businesses’ ability to store their profits in banks on Tuesday.
But key Republican lawmakers on the panel are now asking Chairwoman Maxine Waters (D-CA) to delay the vote.
“As you know, marijuana is a schedule I controlled substance… The impact that many state laws, which have legalized marijuana, have on the federal laws governing the manufacturing, use, and sale of marijuana, including proceeds, raise many questions and concerns,” Reps. Patrick McHenry (R-NC) and Blaine Luetkemeyer (R-MO) wrote in a letter to Waters on Thursday. “Any change to these statutes, or those that impact them, has the potential to divide the Congress and the country. We must ensure that Congress has done its due diligence, including conducting thorough oversight and review, before moving such legislation.”
The two GOP lawmakers are the ranking minority members on the full House Financial Services Committee and its Consumer Protection and Financial Institutions Subcommittee, respectively.
The legislation in question—the Secure And Fair Enforcement (SAFE) Banking Act—was the subject of a lengthy hearing last month touching on the public safety and other implications of preventing cannabis businesses from being able to access banks, which forces many to operate on a cash-only basis and can make them targets for robberies.
The bill currently has 143 cosponsors—almost a third of the entire House—including 12 Republicans. If enacted, it would protect banks that serve the cannabis industry from being penalized by federal regulators under money laundering and drug laws.
It would also clarify that “proceeds from a transaction conducted by a cannabis-related legitimate business shall not be considered as proceeds from an unlawful activity solely because the transaction was conducted by a cannabis-related legitimate business.”
It seems unlikely the new Democratic majority will acquiesce to the GOP request on an issue many members of their party have identified as among the priorities to address in the 116th Congress.
“The hearing is not being delayed,” a spokesperson for Rep. Ed Perlmutter (D-CO), the legislation’s chief sponsor, wrote in an email.
The Republican letter, which was first reported by Politico, requests a delay “until the Committee has a better understanding of the full range of consequences that enacting such legislation may trigger” and lists out 15 “unanswered questions” they have about the proposal.
Among other things, McHenry and Luetkemeyer want clarity on how the bill would affect federal agencies’ enforcement of other laws, like the Bank Secrecy Act as well as Know Your Customer rules, anti-money laundering regulations and Currency Transaction Report and Suspicious Activity Report filing requirements.
They want assurances that “there are no unintended consequences, such as cartels and other bad actors gaining access to our financial system” and they want to better understand the legislation’s implications for payment processors, insurers, investment companies and law enforcement agencies.
They also have questions on how changing banking rules for marijuana businesses might impact “other products and services offered by financial institutions, including but not limited to mortgage products, deposit advance products or general commercial lending.”
“How are proceeds from state licensed growers and distributers taxed under federal law?” they ask. “Relatedly, what conforming changes to our tax code are necessary?”
McHenry and Luetkemeyer said that the February hearing on cannabis banking issues “made clear that we need to better comprehend and address the supervisory and regulatory issues that would result from enactment” of the bill before a vote is held.
In 2014, the full House adopted an amendment to prevent the Department of Treasury from punishing banks that work with cannabis businesses. Although the measure was approved by a floor vote of 231 to 192—at a time when far fewer states had laws allowing legal marijuana than is currently the case—it received no action in the Senate and was not enacted into law.
Companion marijuana banking legislation has not yet been filed in the Senate for the current Congress, though it is expected soon. A bill in that chamber garnered 20 cosponsors during the 115th Congress.
Read the full letter seeking a delay in the marijuana banking vote below:
GOP seeks delay on marijuan… by on Scribd
New York And Connecticut Governors Talk Marijuana Legalization On Fishing Trip
The governors of New York and Connecticut went fishing and talked about marijuana legalization on Tuesday.
The conversation comes after lawmakers in both states were unable to pass legalization legislation before their respective sessions’ ends this year, despite having the support of New York Gov. Andrew Cuomo (D) and Connecticut Gov. Ned Lamont (D).
“We talked about policy issues like the marijuana issue, which is obviously also relevant to contiguous states,” Cuomo said at a press conference following the fishing trip. “What Connecticut does on marijuana is relevant to New York, what New York does is relevant to Connecticut so we talked about that and a lot of issues. So we had fun.”
Watch Cuomo’s marijuana comments at about 5:00 into the video below:
Cuomo had described legalization as a top legislative priority for 2019 and included it in his state budget proposal. But after months of negotiations with lawmakers, the plan fell through, due in part to disagreements about how to allocate tax revenue and whether to allow individual jurisdictions to opt out of allowing cannabis businesses.
The governor did sign legislation in July that expands the state’s marijuana decriminalization policy and provides a pathway for expungements of past marijuana convictions.
Over in Connecticut, Lamont campaigned on legalization during his election bid last year and described it as one of his administration’s “priorities” after he took office. But as with neighboring New York, the legislature failed to advance a legalization bill beside multiple successful committee votes and hearings throughout the year.
The specifics of what the governors talked about during their fishing expedition on Lake Ontario aren’t clear, but both are presumably gearing up for another round of legislative efforts marijuana over the coming year and could take lessons from each other as reform talks continue.
Another East Coast state, New Jersey, has also struggled to move legalization legislation forward, with lawmakers saying that the issue should be taken up by voters in 2020 rather than pushed through the legislature, though there has been discussion lately about another try at moving a bill before year’s end. Gov. Phil Murphy (D) did sign a decriminalization and expungements bill in May, however.
Photo courtesy of CBS 6.
GOP Congressman Will Meet Attorney General To Discuss Expanding Marijuana Research
Rep. Matt Gaetz (R-FL) said on Monday that he will soon be speaking with the U.S. attorney general about expanding marijuana research.
The congressman, a close ally of President Trump, is a vocal proponent of medical cannabis and has argued that the federal drug scheduling system is hampering research into the plant’s therapeutic potential.
“I will be meeting with Attorney General Bill Barr in the coming weeks to discuss the Department of Justice’s approach to unlocking more research grants so that we can have American innovation applied to our health care in a way that can get people off of some of these devastating opioids and painkillers, and on to a more natural product,” he said following a radio town hall event.
Even under the framework of prohibition, the Justice Department is able to promote research by, for example, approving additional marijuana manufacturers—something the Drug Enforcement Administration (DEA) said it would do three years ago.
Barr has voiced support for expanding the number of federally authorized cannabis manufacturers.
“I think we’re going to move forward on it,” the attorney general said in April. “I think it’s very important to get those additional suppliers.”
Earlier this year, Gaetz joined congressional colleagues in leading a letter addressed to Barr and the head of DEA expressing frustration that the Justice Department has declined to take action despite its pledges. The lawmakers implored DEA to “do whatever you can to speed up and improve the research application process.”
Gaetz also introduced legislation that would force DEA to approve additional facilities to produce research-grade cannabis. A version filed last year cleared the Judiciary Committee in a voice vote, and he reintroduced the bill in January but it has not yet been acted upon.
Listen to Gaetz’s new cannabis comments, about 1:20 into the audio below:
DEA is facing two lawsuits regarding its approach to marijuana, including one that concerns the lack of diversity of research-grade cannabis since only one manufacture is currently authorized. The agency was ordered to respond to the suit by August 28.
Separately, a group of patients and advocates sued DEA over marijuana’s Schedule I status under the Controlled Substances Act, with a federal court directing the agency to “promptly” consider reclassifying cannabis.
Gaetz also spoke about the need to more broadly reform cannabis laws during the Monday remarks.
“The federal government listing marijuana as a Schedule I drug impairs financial transactions, it impairs research and it stops us from being able to unlock cures for some of America’s most vulnerable people,” the congressman said, adding that he’s a cosponsor of legislation that would deschedule marijuana that was introduced by Judiciary Chairman Jerry Nadler (D-NY).
Gaetz, who is also a member of the Judiciary Committee, said he is requesting that the panel hold a hearing on cannabis legislation. That’d mark the second such meeting after a Judiciary subcommittee convened last month to discuss paths to ending federal prohibition.
The congressman’s staff wasn’t able to provide Marijuana Moment with additional details regarding the meeting with Barr.
Photo courtesy of Meredith Geddings.
Elizabeth Warren’s Criminal Justice Plan Involves Legalizing Marijuana And Safe Injection Sites
Legalizing marijuana, granting clemency to people convicted of drug offenses and investing in harm reduction programs such as safe injection sites are part of a criminal justice reform plan that Sen. Elizabeth Warren (D-MA) released on Tuesday.
The 2020 Democratic presidential candidate stressed that the war on drugs has been carried out in a racially discriminatory manner, writing that it’s unfair that “a kid with an ounce of pot can get thrown in jail, while a bank executive who launders money for a drug cartel can get a bonus. It’s long past time for us to reform our system.”
“This failure [of the drug war] has been particularly harmful for communities of color, and we need a new approach,” she said. “It starts with legalizing marijuana and erasing past convictions, and then eliminating the remaining disparity between crack and powder cocaine sentencing.”
What’s more, the drug war “has criminalized addiction, ripped apart families—and largely failed to curb drug use” when a more effective system would treat addiction as a public health issue.
Next, we have to rethink what we choose to criminalize. That starts with repealing the 1994 crime bill—the bulk of which needs to go—and legalizing marijuana. Overcriminalization has filled prisons and devastated communities—and it's time for it to end.
— Elizabeth Warren (@ewarren) August 20, 2019
That includes diverting people who’ve been convicted of non-violent drug offenses to treatment programs and providing evidence-based resources for people suffering from addiction. For example, Warren’s plan calls for safe injection sites where people can use illicit drugs under the supervision of medical professionals who can help prevent fatal overdoses and get people into treatment. She also said needle exchange programs and expanding access to buprenorphine would reduce the opioid crisis.
“Instead of locking up people for nonviolent marijuana crimes, I’ve proposed putting pharmaceutical executives on the hook to report suspicious orders for controlled substances that damage the lives of millions.”
She also called for the abolition of certain mandatory minimum sentences and said that “people who struggle with addiction should not be incarcerated because of their disease.”
“Mass incarceration has not reduced addiction rates or overdose deaths, because substance abuse disorder is a public health problem — and it’s long past time to treat it that way,” the plan says. “We know that diversion programs are both more humane and a better investment than incarceration — for every dollar we invest in treatment programs, we can save $12 in future crime and health care costs.”
“And rather than incarcerating individuals with substance abuse disorders, we should expand options that divert them into programs that provide real treatment.”
Like Sens. Bernie Sanders (I-VT), Cory Booker (D-NJ) and South Bend, Indiana Mayor Pete Buttigieg, Warren’s criminal justice reform proposal also mentions executive actions she could unilaterally take.
Specifically, she wrote that the Justice Department should not hold authority to make clemency recommendations and it should instead be left up to an independent clemency board so that those eligible for a pardons and commutations are more quickly identified.
The president can grant clemency and pardons herself. I'll empower a clemency board to make recommendations directly to the White House, identifying broad classes of potentially-deserving individuals for review, such as those serving mandatory minimums that should be abolished.
— Elizabeth Warren (@ewarren) August 20, 2019
“I’ll direct the board to identify broad classes of potentially-deserving individuals for review, including those who would have benefited from retroactivity under the First Step Act, individuals who are jailed under outdated or discriminatory drug laws, or those serving mandatory minimums that should be abolished,” she said.
The plan’s unveiling comes two days after Sanders released his criminal justice reform proposal, which also called for marijuana legalization and the implementation of harm reduction policies such as safe consumption facilities.
Buttigieg’s plan stands out from his fellow Democratic candidates in at least one regard: the mayor said drug possession should broadly be decriminalized.
Warren also released a separate plan for Indian tribes last week that involves protecting tribal cannabis programs from federal intervention.
Photo courtesy of Edward Kimmel.