In the latest sign of shifting attitudes on marijuana policy in Congress, a Senate bill to protect banks that service state-legal marijuana businesses gained a notable new cosponsor on Wednesday.
Susan Collins, the Republican senator from Maine who is well known as a centrist, signed onto the Secure and Fair Enforcement (SAFE) Banking Act. The move is particularly notable given that just a few years ago she spoke out forcefully against a similar proposal because she didn’t want banks to “essentially finance dealers of recreational marijuana.”
To that end, the latest cosponsorship may be a bellwether for the legislation, signaling that like its House companion, it stands to earn bipartisan support if advanced to the Senate floor.
Back in 2015, Sen. Jeff Merkley (D-OR) introduced an amendment to a funding bill that would bar federal regulators from using their resources to penalize banks just because they provide financial services to cannabis businesses operating in compliance with state law.
Collins spoke out at the Appropriations Committee hearing, saying, “I just want to make sure that members of this committee understand that this amendment is different from the one that many of us supported” in the past to shield state medical cannabis from federal interference, because it also applied to recreational firms.
“It is allowing banks to essentially finance dealers of recreational marijuana,” Collins said. “I think that’s very different from medical marijuana, so I will be opposing this amendment.”
Listen to the senator discuss the marijuana banking amendment, starting around 2:45:00 into the audio below:
Before the panel voted in favor of the proposal, the senator offered that “this amendment could be narrowed to apply just to medical marijuana—in which case I would support it—but it applies to recreational marijuana as well, so I oppose it.”
What happened in the years since to lead Collins to back essentially the same proposal as a standalone bill? Most notable, of course, is the fact Maine voters legalized cannabis for adult use, and so more businesses and constituents in her state now stand to directly benefit from its enactment than was the case in 2015 when Maine only had medical cannabis on the books.
But it remains to be seen if her embrace of the modest reform signals that the moderate Republican would back more comprehensive legislation such as a bill to end federal prohibition. Marijuana Moment reached out to Collins’s office for comment, but a representative was not immediately available.
“It literally took marijuana becoming Maine’s largest agricultural commodity for Senator Collins to support the SAFE Banking Act,” NORML Political Director Justin Strekal told Marijuana Moment, referencing recent sales data. “Unfortunately, she has yet to oppose the policy that labels Maine’s famers, shopkeepers and consumers to be labeled as criminals under federal law.”
All told, the SAFE Banking Act now has 37 Senate cosponsors, plus Merkley as the chief sponsor. That’s more than a third of the chamber’s membership. The House already passed its version of the bill along largely bipartisan lines last month.
When the Senate might take up the measure is another question.
Senate Majority Leader Chuck Schumer (D-NY), who is working on a bill to federally legalize cannabis, has made clear that he wants to tackle the issue holistically and end prohibition first, rather than take the incremental step to protect banks that work with marijuana businesses.
He told Marijuana Moment last month that he and his colleagues “hope to include things that deal with banking and finance” in their reform legislation, but social equity is the priority.
Senate Banking Committee Chairman Sherrod Brown (D-OH) was recently pressed on next steps for the bill, and he tempered expectations about the timing for advancing the reform.
Brown has made clear that he’s not eager to move on the SAFE Banking Act, citing reservations about certain provisions. “I think we need to look at a number of things,” he said in an interview, adding that “I will look at this seriously. We’re not ready to move on it.”
That said, Brown has been talking with other Senate leaders about a way forward for cannabis banking legislation.
One thing the chairman previously said he wanted to do was tie the cannabis banking legislation to sentencing reform. That’s fine by Rep. Ed Perlmutter (D-CO), sponsor of the House version of the SAFE Banking Act who said he’s fine with making it a “bigger bill,” but now it seems Brown is being open to dropping that condition.
The vote in the House last month marked the fourth time the chamber has approved the SAFE Banking Act. Lawmakers passed it as a standalone bill in 2019 and then twice more as part of coronavirus relief legislation. At no point did the measure move forward in the Senate under Republican control last session, however.
The legislation 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 Congress, 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 two 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.
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.”