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House Approves Marijuana Banking Bill In Historic Vote

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The House of Representatives passed a standalone marijuana reform bill for the first time in history on Wednesday.

The chamber advanced the legislation—which would protect banks that service the cannabis industry from being penalized by federal regulators—in a vote of 321-103.

All but one Democrat voted in favor of the bill. Republicans were virtually split, with 91 voting for the legislation and 102 opposing it.

For six years, lawmakers have been pushing for the modest reform, which is seen as necessary to increase financial transparency and mitigate risks associated with operating on a largely cash-only basis—something many marijuana businesses must do because banks currently fear federal reprisal for taking them on as clients.

Watch the House debate and vote on marijuana banking below:

The Secure and Fair Enforcement (SAFE) Banking Act is sponsored by Rep. Ed Perlmutter (D-CO). It cleared the House Financial Services Committee in March and was officially scheduled for a floor vote last week. The vote was held through a process known as suspension of the rules, meaning it required two-thirds of the chamber (290 members if all were present) to approve it for passage.

While the House has approved historic cannabis amendments in the past, including one this summer that would protect all state marijuana programs from federal intervention, those have had to be renewed annually. This is the first time a standalone reform bill was approved in the chamber, and the policy will be permanently codified into law if the Senate follows suit and the president signs it.

“If someone wants to oppose the legalization of marijuana, that’s their prerogative, but American voters have spoken and continue to speak and the fact is you can’t put the genie back in the bottle. Prohibition is over,” Perlmutter said on the floor. “Our bill is focused solely on taking cash off the streets and making our communities safe and only congress can take these steps to provide this certainty for businesses, employees and financial institutions across the country.”

 

Rep. Denny Heck (D-WA) made an impassioned case for the bill, sharing an anecdote about a security guard who worked for a cannabis shop who was killed on the job and emphasizing that the legislation would mitigate the risks of violent crime at these businesses.

“You can be agnostic on the underlying policy of whether or not cannabis should be legal for either adult recreational use or to treat seizures, but you cannot be agnostic on the need to improve safety in this area,” he said.

“This bill is not only timely, but extremely necessary,” Rep. Barbara Lee (D-CA) said. “Right now the cannabis industry needs access to safe and effective banking immediately.”

Rep. Patrick McHenry (R-NC), ranking member of the House Financial Services Committee, raised concerns about the legislation and suggested that the bill would provide drug cartels with access to financial services. He was one of just three lawmakers who rose in opposition to the bill, with the remaining time on the opposition end having been yielded to supporters.

The legislation hasn’t been without controversy, even among pro-reform advocates. After Majority Leader Steny Hoyer (D-MD) announced his intent to put the bill on the floor by the end of the month, several leading advocacy groups including the ACLU, Drug Policy Alliance (DPA) and Center for American Progress wrote a letter asking leadership to delay the vote until comprehensive legalization legislation passed.

The groups has expressed concerns to Financial Services Chairwoman Maxine Waters (D-CA) that approving the banking bill first could jeopardize the chances of achieving more wide-ranging reform that addressed social equity issues such as legislation introduced by Judiciary Chairman Jerrold Nadler (D-NY). They said they were caught off guard when Hoyer announced the vote.

But as the vote approached, advocates and lawmakers wasted no time emphasizing the need to go further than the banking bill.

“I have long fought for criminal justice reform and deeply understand the need to fully address the historical racial and social inequities related to the criminalization of marijuana,” Waters said in a press release on Tuesday. “I support legislation that deschedules marijuana federally, requires courts to expunge convictions for marijuana-related offenses, and provides assistance such as job training and reentry services for those who have been disproportionately affected by the war on drugs.”

She reiterated that point during debate on the floor, stating that the banking legislation “is but one important piece of what should be a comprehensive series of cannabis reform bills.”

Nadler also released a statement stating that while he would vote yes on the SAFE Banking Act, he is “committed to marking up [his legalization bill] and look[s] forward to working with reform advocates and my colleagues in this important effort going forward.”

Hoyer also weighed in on the need for broader reform in a statement on Wednesday.

“I am proud to bring this legislation to the Floor, but I believe it does not go far enough,” he said. “This must be a first step toward the decriminalization and de-scheduling of marijuana, which has led to the prosecution and incarceration of far too many of our fellow Americans for possession.”

Rep. Steve Cohen (D-TN) applauded the Judiciary Committee chairman for announcing he will hold a markup of comprehensive cannabis legalization following this vote.

“Today’s vote is a significant first step, but it must not be the last. Much more action will still need to be taken by lawmakers,” NORML Political Director Justin Strekal told Marijuana Moment. “In the Senate, we demand that lawmakers in the Senate Banking Committee hold true to their commitment to move expeditiously in support of similar federal reforms. And in the House, we anticipate additional efforts to move forward and pass comprehensive reform legislation like The MORE Act—which is sponsored by the Chairman of the House Judiciary Committee—in order to ultimately comport federal law with the new political and cultural realities surrounding marijuana.”

Steve Hawkins, executive director of the Marijuana Policy Project, said the “cannabis industry can no longer proceed without the same access to financial services that other legal companies are granted.”

“This decision is an indication that Congress is more willing than ever to support and take action on sensible cannabis policies. The passage of the SAFE Banking Act improves the likelihood that other cannabis legislation will advance at the federal level. It is important to recognize that the SAFE Banking Act, if passed by the Senate and signed into law by the president, would strengthen efforts to increase the diversity of the cannabis industry.”

“We applaud the House for approving this bipartisan solution to the cannabis banking problem, and we hope the Senate will move quickly to do the same,” Neal Levine, CEO of the Cannabis Trade Federation, said. “This vital legislation will have an immediate and positive impact, not only on the state-legal cannabis industry, but also on the many communities across the nation that have opted to embrace the regulation of cannabis.”

“Allowing lawful cannabis companies to access commercial banking services and end their reliance on cash will greatly improve public safety, increase transparency, and promote regulatory compliance,” he said.

DPA noted that it had “no objections to the substance of the SAFE Banking bill,” but that the organization and its allies However, DPA and allies “sent a letter of concern because we believe it is a mistake for the House to pass an incremental industry bill before passing a comprehensive bill that prioritizes equity and justice for the communities who have suffered the most under prohibition.”

“We are encouraged by the announcement from House Judiciary Chairman Jerry Nadler that he intends to hold a vote on MORE and will push him in the coming weeks to commit to a date,” DPA Policy Coordinator Queen Adesuyi said. “We also thank Majority Leader Hoyer for his commitment to work with Mr. Nadler and others to advance broader marijuana reform in this Congress.”

“The marijuana banking bill cannot be the end of the road for marijuana reform this Congress,” she said.

Ahead of the vote, Rep. Joe Neguse (D-CO) said “Only Congress can provide the certainty financial institutions need to start banking cannabis-related legitimate businesses” and that he’s “proud to support the SAFE Banking Act today to support hard-working Coloradans and their families.”

Rep. Kendra Horn (D-OK), said in a floor speech earlier on Wednesday morning that current law is “endangering communities as well as inhibiting small businesses from growing.”

“This industry is bringing revenue to our state, creating small businesses and helping those suffer with physical illness to relieve their ailments,” she said. “The SAFE Banking Act supports this growing Oklahoma industry, our banks and works to keep Oklahomans that work in and around this industry safe.”

“Access to safe banking is a big deal for the businesses and employees in New Mexico who work in the cannabis industry. It’s why I’m a cosponsor of the SAFE Banking Act & will be voting for it today,” Rep. Deb Haaland (D-NM) said.

 

Many have viewed the banking proposal as the first step on the pathway to ending federal cannabis prohibition, and it’s consistent with an agenda outlined by Rep. Earl Blumenauer (D-OR) last year through which he suggested that committees advance incremental marijuana reforms under their respective jurisdictions, leading up to the eventual passage of a full legalization bill.

“We’re in this fix today because Congress has refused to provide the partnership and the leadership that the states demand,” Blumenauer said on the floor. ”The states aren’t waiting for us.”

“This is an important foundation, but it’s not the last step,” he said. We have important legislation that’s keyed up and ready to go. This approval today will provide momentum that we need for further reform that we all want and will make America safer and stronger.”

That said, while the vote signals that the House has a clear appetite for reform, it remains to be seen if the Republican-controlled Senate will approve the banking bill. Apparently anticipating that conservative lawmakers might not support the legislation as it passed out of committee, Perlmutter moved to add amendments last week that were designed to broaden its GOP appeal.

Those provisions include clarifying that hemp and CBD businesses would also be protected and stipulating that federal regulators couldn’t target certain industries such as firearms dealers as higher risk of fraud without valid reasoning.

That’s likely to endear Senate Banking Committee Chairman Mike Crapo (R-ID) to the SAFE Banking Act. His panel held a hearing on the issue in July, and the senator said he wants to have a vote on cannabis financial services legislation by the end of the year but also suggested at the time that it might not be a copy of Perlmutter’s bill.

The hemp-focused provisions are also intended to appeal to Senate Majority Leader Mitch McConnell (R-KY), who championed the crop’s federal legalization through last year’s Farm Bill but has said he doesn’t support its “illicit cousin” marijuana.

Kevin Sabet, president of the prohibitionist group Smart Approaches to Marijuana, recognized the inevitability of the House passing the legislation hours before the vote and said Perlmutter’s amendments were key to its advancement.

“This is a gift to Big Tobacco, which has already invested billions into pot,” Sabet said in a statement following the vote. “Granting this industry access to banks will bring billions of dollars of institutional investment from the titans of addiction and vastly expand the harms we are already witnessing.”

The legislation might also face pushback from some Senate Democrats who share concerns expressed by advocacy groups that it’s important to move on comprehensive reform before tackling banking. Senate Minority Leader Chuck Schumer (D-NY) and Sens. Cory Booker (D-NJ), Kamala Harris (D-CA) and Bernie Sanders (I-VT) each recently indicated that their votes could possibly be contingent on advancing a justice-focused legalization bill.

Rep. Alexandria Ocasio-Cortez (D-NY) suggested last week that she also might withhold her vote for the same reasons, but she ultimately approved it.

Tough work still lies ahead for lawmakers and advocates if they hope to enact the banking bill into law this Congress but, for the moment, there’s an air of celebration as the House made history by voting to pass a standalone cannabis reform bill for the first time.

“Having worked alongside congressional leaders to resolve the cannabis industry’s banking access issues for over six years, it’s incredibly gratifying to see this strong bipartisan showing of support in today’s House vote,” Aaron Smith, executive director of the National Cannabis Industry Association, said. “Now, it’s time for the Senate to take swift action to approve the SAFE Banking Act so that this commonsense legislation can make its way to the President’s desk.”

“This bipartisan legislation is vital to protecting public safety, fostering transparency, and leveling the playing field for small businesses in the growing number of states with successful cannabis programs,” he said.

Update: This story has been updated to include additional commentary. 

Key Committee Chair Broke Promise On Marijuana Justice Before Banking Vote, Advocates Say

Image element courtesy of Tim Evanson.

Marijuana Moment is made possible with support from readers. If you rely on our cannabis advocacy journalism to stay informed, please consider a monthly Patreon pledge.

Kyle Jaeger is Marijuana Moment's Los Angeles-based associate editor. His work has also appeared in High Times, VICE and attn.

Politics

Congresswoman Wants Ban On DC Marijuana Sales Lifted Through Coronavirus Legislation

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A congresswoman is calling on the government to end a policy prohibiting Washington, D.C. from legal marijuana sales, arguing that the jurisdiction is in particular need of tax revenue from cannabis commerce due to the coronavirus outbreak.

Rep. Eleanor Holmes Norton (D-DC) has repeatedly condemned the congressional rider barring the District of Columbia from allowing retail sales that has been extended each year since 2014, shortly after local voters approved a ballot measure to legalize low-level possession and home cultivation. But given the need for resources to combat the pandemic, she said a reversal of the provision should be included in the next COVID-related relief bill.

“At this moment of unparalleled need, D.C. should be able to collect tax revenue from all available sources, like every other jurisdiction, including from recreational marijuana, which is believed to be widely used in the District,” the congresswoman said in a press release on Friday, adding that D.C. was shorted in the last stimulus because Congress treated it as a territory rather than a state.

“While I am working for a retroactive fix in the next coronavirus bill, it is imperative that Congress also repeal the D.C. recreational marijuana commercialization rider in the next bill to help D.C. shore up its finances,” she said. “It is beyond unreasonable that congressional interference keeps only the District from commercializing recreational marijuana, while all other jurisdictions are free to do so.”

“Bringing the District in line with other jurisdictions would create a critical source of tax revenue in our time of need.”

Last year, the House approved an appropriations bill that excluded the D.C. rider, but it was included in the Senate version and ultimately made its way into the final package that the president signed. The cannabis commerce ban was also included in President Trump’s budget proposal earlier this year.

“True to form, Representative Eleanor Holmes Norton continues to be one of the best allies to the cannabis reform movement,” Justin Strekal, political director for NORML, told Marijuana Moment. “During this unprecedented COVID-19 outbreak, it is critical that lawmakers analyze and reform any and every aspect of public policy to mitigate the health crisis and build a foundation for a strong recovery.”

“As the majority of states that regulate cannabis have deemed the industry essential to the continued functioning of their jurisdictions, the continued congressional prohibition of the District of Columbia enacting it’s own adult-use program becomes even more ridiculous,” he added.

Norton, in an interview about her push, said that the congressionally mandated prohibition on sales doesn’t prevent people from accessing cannabis but does block the city from collecting tax revenue.

“You can buy two ounces but, by the way you’ve got to do that on the black market,” she told WUSA-TV. “But there’s nobody to tax it. And I’m simply trying to get the taxes the District is due for merchandise, in this case marijuana that’s being consumed readily in the District of Columbia.”

Legislative priorities for Congress have shifted significantly as lawmakers attempt to address the outbreak, and that’s meant putting some reform efforts on hold. However, the issue isn’t being ignored entirely, and it’s possible that other members may look to attach modest marijuana proposals to additional coronavirus legislation.

For example, Rep. Katherine Clark (D-MA) said this week that U.S. Department of Veterans Affairs policy preventing its doctors from recommending medical cannabis in legal states puts service members at risk in Massachusetts because the state is shuttering recreational shops (but not medical dispensaries) and some veterans fear registering as patients out of concern that they could lose federal benefits.

Eleven senators wrote a letter to Appropriations Committee leadership asking that they allow small cannabis businesses to access federal loans and disaster relief programs. While the lawmakers said it should be enacted through an annual spending bill, advocates have argued that the policy change should be pursued through coronavirus legislation since these businesses are facing challenges just like those experienced by many other companies during the pandemic.

Eleven Senators Push To Let Marijuana Businesses Access Federal Loan Programs

Photo courtesy of WeedPornDaily.

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North Dakota Activists Say Marijuana Legalization Initiative Unlikely In 2020 Due To Coronavirus

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North Dakota activists announced on Thursday that they are suspending their campaign put marijuana legalization on the November ballot due to the coronavirus outbreak.

In a Facebook post, Legalize ND said “we are going to have to face a few hard realities going forward” as businesses are shuttering, public events are being cancelled and individuals are encouraged to shelter in place. The pandemic means in-person signature gathering can’t take place, and the state does not allow for alternative signing options such as by mail or online.

“Due to the virus all of our major avenues for signature collection have been cancelled or indefinitely postponed, and going door to door is not safe for both those knocking and those getting knocked,” the group said. “Businesses will continue to collect, but we don’t want to create another vector for the coronavirus. As a result, at this time if something major doesn’t change we will not be able to make the 2020 ballot.”

Legalize ND said there’s no way for state policies related to signature gathering to be changed ahead of the November election. They needed to collect 13,452 valid signatures from voters before July 6 in order to qualify. In all likelihood, the campaign said it would have to shift its focus to the July 2022 primary election.

“This isn’t the solution we want, but given the situation it is what will have to happen,” the post states. “Stay safe, and hopefully we can make a major push when the quarantine ends.”

The proposed initiative would allow individuals to purchase and possess up to two ounces of cannabis. Unlike a much more far-reaching measure the same group pushed in 2018 that included no possession or cultivation limits, which voters rejected, this version would prohibit home growing, impose a 10 percent excise tax and establish a regulatory body to approve licenses for marijuana businesses.

North Dakota voters approved a medical cannabis initiative in 2016.

The coronavirus outbreak has dealt several blows to drug policy reform efforts in recent weeks.

California activists for campaigns to amend the state’s legal cannabis program and legalize psilocybin mushrooms are asking for a digital signature option.

Likewise in Washington, D.C., advocates for a measure to decriminalize psychedelics asked the mayor and local lawmakers to accept online signatures for their ballot petition.

An effort to legalize medical cannabis in Nebraska is facing similar signature gathering challenges. A campaign to legalize cannabis in Missouri is also in jeopardy.

In Oregon, advocates for a measure to decriminalize drug possession and a separate initiative to legalize psilocybin for therapeutic purposes have suspended in-person campaign events amid the pandemic.

In New York, Gov. Andrew Cuomo (D) recently conceded that legalization was “not likely” going to happen through the budget, as he hoped. Coronavirus shifted legislative priorities, and comprehensive cannabis reform seems to have proved too complicated an issue in the short-term.

Idaho activists announced on Thursday that they are suspending their campaign, though they are still “focusing on distributing petitions through online download at IdahoCann.co and encouraging every volunteer who has downloaded a petition to get them turned in to their county clerk’s office by mail, regardless of how many signatures they have collected.”

Finally, in Arizona, a legalization campaign is petitioning the state Supreme Court to instruct the secretary of state to allow individuals to sign ballot petitions digitally using an existing electronic system that is reserved for individual individual candidates seeking public office.

Virginia Groups Push Governor To Amend Marijuana Decriminalization Bill On His Desk

Photo courtesy of Philip Steffan.

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Arizona Legal Marijuana Campaign Asks Supreme Court To Allow Electronic Signatures Amid Coronavirus

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Several campaigns to put initiatives on Arizona’s November ballot—including one to legalize marijuana—are asking the state Supreme Court to allow electronic signature gathering amid the coronavirus pandemic, which has made in-person ballot petitioning all but impossible.

Smart and Safe Arizona, the group behind the cannabis measure, along with three other campaigns, filed a petition with the court on Thursday, requesting that it direct the secretary of state to let them digitally collect signatures. They stressed that the infrastructure already exists, as residents are able to use a system called E-Qual to sign ballot petitions for individual candidates running for office.

While the marijuana campaign has already gathered more than 320,000 signatures, which is well over the required 237,645 signatures for statutory proposals, they have yet to be verified and activists would like to continue collection efforts to ensure that they qualify for the ballot.

In the filing, the groups argued that limiting the E-Qual system to office seekers is unconstitutional. However, state law stipulates that it can only be used for that purpose, so it remains to be seen whether court action will produce the intended result. There was a bill filed last year to expand its utility to allow digital signature gathering for initiatives, but it has not advanced in the legislature.

“Legal access to E-Qual for these citizen initiatives is the right thing for public health and democracy,” attorneys representing the groups said in a statement. “Following Governor Doug Ducey’s stay-at-home order issued Monday and current CDC recommendations, gathering hundreds of thousands of signatures on paper, at people’s homes, or in public spaces, is impossible to do safely and responsibly during this pandemic. E-Qual is a very reasonable remedy.”

The legalization petition would allow individuals 21 and older to possess and purchase cannabis from licensed retailers. People could possess up to an ounce of marijuana at a time and cultivate up to six plants for personal use.

The measure also contains several restorative justice provisions such as allowing individuals with prior marijuana convictions to petition the courts for expungements and establishing a social equity ownership program

Cannabis sales would be taxed at 16 percent. Tax revenue would cover implementation costs and then would be divided among funds for community colleges, infrastructure, a justice reinvestment and public services such as police and firefighters.

The Department of Health Services would be responsible for regulating the program and issuing cannabis business licenses. It would also be tasked with deciding on whether to expand the program to allow for delivery services.

“The Committees have explored potential alternatives, such as mailing petitions to interested persons to circulate within their families,” Smart and Safe Arizona Campaign Manager Stacy Pearson said in a declaration filed with the court. “This, however, is expensive, inefficient, and has no realistic likelihood of permitting the Committees’ to gather large numbers of valid petition signatures.”

The legalization group was joined by campaigns to limit school vouchers, provide sentencing reform and increase taxes on the wealthy to fund public education in the petition. Separately, two other campaigns—to enact voting reform and end surprise hospital billings—filed a similar lawsuit in a federal court on Thursday.

Smart and Safe Arizona is not the only drug policy reform campaign to request electronic signature gathering since the COVID-19 outbreak.

Activists in California released a video last month asking officials to allow digital signatures for a petition to revise the state’s adult-use marijuana program. In Washington, D.C., advocates for a measure to decriminalize psychedelics similarly wrote to the mayor and local lawmakers, imploring them to accept online signatures for their ballot petition.

Another California campaign to legalize psilocybin mushrooms is struggling and asking for electronic signature gathering to qualify for the ballot.

Others have generally shut down campaign activities in light of the pandemic, which has resulted in shutter businesses and shelter-in-place orders across the country.

An effort to legalize medical cannabis in Nebraska is facing similar signature gathering challenges. A campaign to legalize cannabis in Missouri is also in jeopardy.

In Oregon, advocates for a measure to decriminalize drug possession and a separate initiative to legalize psilocybin for therapeutic purposes have suspended in-person campaign events amid the pandemic.

In New York, Gov. Andrew Cuomo (D) recently conceded that legalization was “not likely” going to happen through the budget, as he hoped. Coronavirus shifted legislative priorities, and comprehensive cannabis reform seems to have proved too complicated an issue in the short-term.

Idaho activists announced on Thursday that they are suspending their campaign, though they are still “focusing on distributing petitions through online download at IdahoCann.co and encouraging every volunteer who has downloaded a petition to get them turned in to their county clerk’s office by mail, regardless of how many signatures they have collected.”

Idaho Activists Suspend Campaign To Legalize Medical Marijuana Due To Coronavirus

Photo courtesy of Mike Latimer.

Marijuana Moment is made possible with support from readers. If you rely on our cannabis advocacy journalism to stay informed, please consider a monthly Patreon pledge.
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