The top law enforcement officials from 38 U.S. states and territories are calling on Congress to pass legislation to increase marijuana businesses’ access to banks. The move comes just days after the treasurers of 17 states issued a separate call in support of the pending cannabis financial services bill.
Even as a growing number of states adopt laws to legalize marijuana for medical or recreational use, federal prohibition remains intact—for now—and that makes many banks wary of maintaining accounts for cannabis growing, processing or retail operations. They could, they fear, be prosecuted under federal money laundering laws.
Legislation to shield financial services providers from being punished by regulators for working with the cannabis industry has been gaining momentum in Congress, and now the effort is getting a boost from the National Association of Attorneys General, which is officially endorsing the bill.
“Businesses are forced to operate on a cash basis. The resulting grey market makes it more difficult to track revenues for taxation and regulatory compliance purposes, contributes to a public safety threat as cash-intensive businesses are often targets for criminal activity, and prevents proper tracking of billions in finances across the nation,” the attorneys general wrote in a letter to congressional leaders on Wednesday.
@COAttnyGeneral leads coalition of 38 state/territory AGs calling on #Congress to pass @RepPerlmutter's bill allowing #cannabis companies to access banks w/o fear of federal repercussions. @NatlAssnAttysGn has adopted this position as official policy.https://t.co/6kr60PamhQ
— CO Attorney General (@COAttnyGeneral) May 8, 2019
“[R]regardless of how individual policymakers feel about states permitting the use of medical or recreational marijuana, the reality of the situation requires federal rules that permit a sensible banking regime for legal businesses,” the officials wrote.
In March, the House Financial Services Committee approved the marijuana banking bill in a bipartisan vote of 45 to 15. The legislation, sponsored by Rep. Ed Perlmutter (D-CO), now has 173 cosponsors—substantially more than a third of the entire chamber’s membership. It is expected to be considered on the House floor within the next several weeks.
“The SAFE Banking Act is about public safety, accountability and respecting states’ rights. I appreciate the overwhelming support of the attorneys general and treasurers,” Perlmutter said in a statement. “Their endorsement of the SAFE Banking Act underscores the need to respect states’ rights on this issue and make our communities safer by allowing the marijuana industry and related businesses access to the banking system.”
The support of our nation's attorneys general and state treasurers underscores the need to respect states’ rights on this issue and make our communities safer by allowing the marijuana industry and related businesses access to the banking system. #SAFEBanking https://t.co/B1GpOUIoNK
— Rep. Ed Perlmutter (@RepPerlmutter) May 8, 2019
An identical companion bill on financial services for cannabis businesses in the Senate has 25 lawmakers signed on—fully a quarter of the body.
The new letter, led by Colorado Attorney General Phil Weiser, was joined by attorneys general from Alaska, Arizona, Arkansas, California, Connecticut, Delaware, the District of Columbia, Guam, Hawaii, Illinois, Iowa, Kentucky, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Nevada, New Jersey, New Mexico, New York, North Dakota, the Northern Mariana Islands, Ohio, Oklahoma, Oregon, Pennsylvania, Puerto Rico, Rhode Island, Utah, the U.S. Virgin Islands, Vermont, Virginia, Washington, West Virginia and Wisconsin.
— Rob McKenna (@robmckenna) May 8, 2019
Late last month, Oregon Treasurer Tobias Read led a group of fellow state fiscal officials in sending a separate letter to congressional leaders in support of the marijuana banking legislation.
“Businesses operating in cash pose a significant public safety risk. Absent access to banking services, cannabis-related businesses are unable to write checks, make and receive electronic payments, utilize a payroll provider, or accept credit and debit cards,” they wrote. “Processing, storing, and moving large amounts of cash puts business owners, their employees, and their customers at risk of violent crime. The cash-only environment means state and local government agencies must collect tax and fee payments in person and in cash, incurring added expenses and employee safety risks.”
Despite the advancement of the cannabis banking bill in the House, Senate Banking Committee Chairman Mike Crapo (R-ID)refused to commit to hold a hearing or vote on the bill in his panel when asked last month.
The proposals have already been endorsed by the American Bankers Association and a number of other organizations representing financial services industry interests, as well as by drug policy reform groups.
The backing by the state attorneys general, which was first reported by the Denver Post, could go a long way toward earning support from law-and-order conservatives who might otherwise scoff at the notion of supporting legislation to assist marijuana businesses.
Today I’m leading 38 AGs in urging Congress to pass the #SAFEBankingAct, to allow legal marijuana businesses to access the US banking system.
— AG Karl A. Racine (@AGKarlRacine) May 8, 2019
“Compliance with tax laws and requirements would be simpler and easier to enforce with the regulated tracking of funds in the banking system, resulting in higher tax revenues,” the attorneys general wrote. “Our banking system must be flexible enough to address the needs of businesses in the various states and territories, with state and territorial input, while protecting the interests of the federal government. This includes a banking system for marijuana-related businesses that is both responsive and effective in meeting the demands of our economy.”
— Xavier Becerra (@AGBecerra) May 8, 2019
— Ohio Attorney General Dave Yost (@OhioAG) May 8, 2019
The treasurers, in their letter, offered further encouragement to skittish lawmakers by saying that allowing the banking fix would not be “a tacit endorsement of descheduling or rescheduling cannabis from the Controlled Substances Act.”
“Without banking services, cannabis businesses are less able to obey the law, pay taxes, and follow state regulations of the industry,” they wrote. “The public safety risks posed by these businesses are easily mitigated through access to banking service providers and keeping the cash off the streets. Nearly every U.S. state has a stake in this issue.”
Bernie Sanders Talks Marijuana With Killer Mike, Danny Glover And Ben & Jerry’s Founder
Sen. Bernie Sanders (I-VT) led a panel during a presidential campaign stop in North Carolina on Friday where he and surrogates—rapper Killer Mike, actor Danny Glover and Ben & Jerry’s founder Ben Cohen—discussed marijuana reform.
At one point, Cohen said that he was arrested after being caught smoking cannabis while he was in school but the police only charged him for littering—a discretionary decision that he said he likely wouldn’t have been afforded if he was black. He speculated that without that privilege, the incident could have cost him loans that allowed him to build his ice cream empire.
Sanders, a 2020 Democratic presidential candidate, opened the conversation by asking Killer Mike to weigh in on the impact of the drug war, particularly on communities of color.
The artist said the “war on drugs, we now know from history, has been a tremendous failure” and that it “was never a war on drugs, it was a war on progressive white kids and black people.”
He discussed the racist origins of prohibition, the role cannabis criminalization has played in mass incarceration and emphasized the need to include restorative justice in a legal marijuana system.
“But we have a greater opportunity, and the greater opportunity is this: marijuana is going to be legal in our lifetime,” he said. “Beyond getting a little stoned in the morning, which I didn’t do this morning because I knew I had to come see you guys, marijuana provides through hemp paper, alternative to plastics, it provides jobs, resources, dispensaries.”
Watch the conversation about cannabis, starting at about 11:20 into the video below:
“We have an opportunity this time to take the people that are exiting jail, have expunged records and creating a pathway as wide as this aisle directly to legal marijuana and creating economic sustainability in the same communities that were robbed of that opportunity,” he said.
“As for me and my stoner friends, we’ll be buying Ben & Jerry’s and voting for Bernard Sanders.”
Glover joked that Mike’s plan is the “real green new deal that we need right here,” riffing off the name of climate change agenda backed by Rep. Alexandria Ocasio-Cortez (D-NY).
“What we’re talking about now is repairing the wrongs that were done on our communities, and we have a senator who’s going to be the president, who’s saying that we’re not only going to repair the wrongs of the war on drugs but we are going to bring back an era that we are organizing in our communities,” the actor said.
Cohen highlighted racial inequities in marijuana enforcement and broader societal structures, starting by noting that his parents were only able to enter the middle class with the help of a government program providing low-interest mortgages that black people were not entitled to. That program allowed him to go to a good school, he said, where he got busted for cannabis at one point.
“In the midst of getting my higher education, one summer I was smoking some pot with some friends on a beach and the cops caught us,” he said. “We were handcuffed and they took us to the station and they ended up giving us a ticket for littering a lighted cigarette butt on the ground.”
“But I am well aware that if I was black, I would’ve ended up with a criminal record that would have prevented me from getting the loans that we needed to start Ben & Jerry’s,” he said. “It’s really clear to me that if I was black, there wouldn’t have been a Ben & Jerry’s. I’m conscious of that, I think about that, and that’s one of the big reasons I’m supporting Bernie because he’s going to put an end to that system.”
The criminalization of marijuana has been a disaster for communities of color.
We will legalize marijuana, expunge past convictions and invest revenue from legal marijuana back into those communities. pic.twitter.com/x7xrzw1Eu4
— Bernie Sanders (@BernieSanders) September 21, 2019
Sanders closed the panel discussion by asking audience members to raise their hands if they knew someone arrested for marijuana, or were themselves arrested. He did a similar exercise at a campaign rally in South Carolina earlier this week.
After hands shot up, the senator said “this is what the war on drugs has done in this country.”
“It has criminalized so many people in this room. This is amazing,” he said. “The war on drugs has been incredibly destructive for millions and millions of people in this country and we’re going to end that war on drugs and we’re going to make marijuana legal.”
Photo courtesy of Facebook/Bernie Sanders.
Former Federal Prosecutor’s Marijuana Legalization Measure Advances In South Dakota
A measure to legalize marijuana in South Dakota—introduced by a former federal prosecutor and backed by a leading national cannabis advocacy group—was recently cleared for signature gathering.
Brendan Johnson, who served as the U.S. Attorney for the District of South Dakota and whose father represented the state in the U.S. Senate until 2015, filed the initiative in June. It received an official explanatory statement from the attorney general last month and its backers were given the green light to start collecting signatures last week.
“We are excited to move forward with these ballot initiative campaigns,” Johnson told Marijuana Moment. “South Dakota voters are ready to approve both medical marijuana and legalization at the ballot box next year.”
The Marijuana Policy Project (MPP) is supporting the proposed constitutional amendment, as well as a separate statutory initiative to legalize medical cannabis in the state that was approved for signature collection last month.
The former federal prosecutor’s measure, which is being steered by the committee South Dakotans for Better Marijuana Laws, would allow adults 21 and older to possess and distribute up to one ounce of marijuana. Individuals would also be allowed to cultivate up to three cannabis plants. The South Dakota Department of Revenue would be tasked with issuing licenses for manufacturers, testing facilities and retailers.
Sales would be taxed at 15 percent under the initiative, and revenue would be used to fund the program’s implementation, with additional monies going toward public education and the state general fund.
Beside legalizing marijuana, the amendment would also instruct the legislature to enact legislation to legalize hemp and medical cannabis. If the separate statutory medical marijuana legalization initiative, being coordinated by the group New Approach South Dakota, qualifies and passes as well, that latter requirement wouldn’t be necessary.
“The Marijuana Policy Project strongly supports the South Dakota campaign,” MPP Deputy Director Matthew Schweich, who led the organization’s efforts in support of previous legalization campaigns in Maine, Massachusetts and Michigan, told Marijuana Moment. “Across the country, and even in conservative states, voters are demanding marijuana policy reform. Our goal is simple: to effectuate the will of the people when elected officials choose to ignore it.”
Petitioners for the proposed constitutional amendment must collect 33,921 valid signatures from voters to qualify for the 2020 ballot. For statutory initiatives, 16,961 signatures are required. MPP’s involvement will likely bolster the campaign’s prospects of meeting that goal.
It’s already clear that marijuana reform measures are going to face resistance from certain quarters, with Gov. Kristi Noem (R) vetoing a hemp legalization bill in March and the state’s Republican party urging residents not to sign ballot petitions.
“Our campaign, South Dakotans for Better Marijuana Laws, will be working from now until Election Day 2020 to earn the support of South Dakotans from every corner of the state,” Johnson said.
Photo courtesy of WeedPornDaily.
Cory Booker Pledges To Back Only Marijuana Bills With Justice Focus As Banking Vote Approaches
With a vote on marijuana banking issues imminent in the House, Sen. Cory Booker (D-NJ) emphasized on Friday that he will not support cannabis legislation that doesn’t include restorative justice components.
In a tweet that linked to an earlier Marijuana Moment article on his cannabis stance, the 2020 Democratic presidential candidate wrote that “any marijuana legislation moving through Congress must include restorative justice for those most harmed by the War on Drugs in order to get my vote.”
As I said earlier this year, any marijuana legislation moving through Congress must include restorative justice for those most harmed by the War on Drugs in order to get my vote.https://t.co/Y1dOwgHbm2
— Sen. Cory Booker (@SenBooker) September 20, 2019
The statement comes at a critical moment in the marijuana reform movement. House leadership announced on Friday that the first full floor vote on a standalone piece of cannabis reform legislation—a bill to protect banks that service cannabis businesses from being penalized by federal regulators—will be held next week. But that development has also created controversy, with several advocacy groups arguing that a vote should be postponed until more wide-ranging reform legislation is passed.
Although Booker didn’t directly reference the banking bill his his tweet, its timing seemed to suggest that he sides with those groups—which include the ACLU, Human Rights Watch and Drug Policy Alliance—and that he wouldn’t support the Secure and Fair Enforcement (SAFE) Banking Act as written.
Booker’s Senate press secretary confirmed to Marijuana Moment in an email that his boss’s Twitter post was sent directly in reaction to the House banking news.
While some have made the case that the bill would help promote social equity by improving access to banking services for minority business owners, for example, others view the legislation as primarily benefiting large cannabis firms.
Throughout his campaign, the senator has emphasized the need for inclusive and comprehensive marijuana reform. He determined that a bill to protect state cannabis programs from federal intervention that he formerly cosponsored didn’t meet that standard and did not attach his name to the latest version.
“At this point it’s too obvious and urgent and unfair that we’re moving something on marijuana on the federal level and it doesn’t do something on restorative justice,” he told VICE in April. “I want that bill to have some acknowledgement of the savage injustices that the marijuana prohibition has done to communities.”
“I get very angry when people talk about legalizing marijuana and then give no light to how marijuana law enforcement was done in ways that fed upon poor communities—black and brown communities. This is a war on drugs that has not been a war on drugs—it’s been a war on people, and disproportionately poor people and disproportionately black and brown people.”
Booker also said that he wants to couple conversations about legalization with talk of expunging prior cannabis convictions “in the same breath.”
The senator’s potential future opposition to a House-passed cannabis banking bill could prove problematic as its supporters work to shepherd the legislation through a chamber where it already faces an uphill path under anti-marijuana Majority Leader Mitch McConnell (R-KY) and skepticism from other GOP lawmakers.
Photo courtesy of Senate Democrats.