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Sen. Jeff Merkley “Disappointed” That Democrats Blocked His Marijuana Banking Amendment

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One of the U.S. Senate’s foremost champions for marijuana law reform says he is “disappointed” that fellow Democrats recently joined with Republicans in blocking his amendment to increase cannabis businesses’ access to banks.

Last month, Sen. Jeff Merkley (D-OR) offered a measure that would have shielded banks that open accounts for state-legal marijuana businesses from being punished by federal regulators for that activity even though cannabis remains illegal under federal law.

While the Senate Appropriations Committee had approved two similar amendments in previous years, the panel this time voted to table the measure with a bipartisan vote of 21 – 10, with ranking member Sen. Patrick Leahy (D-VT) and other Democrats who normally support marijuana reform objecting on procedural grounds.

“I was disappointed,” Merkley said in an interview with BuzzFeed editor Ben Smith on Monday. “We had passed this twice before.”

“We need to establish banking for cannabis because a cash economy is an invitation to money laundering and theft and cheating your employees and cheating on your taxes [and] organized crime. All bad.”

“I accompanied the owner of a company who had $70,000 in his backpack to pay quarterly taxes,” Merkley recounted in response to the cannabis banking question on Monday, which was suggested to BuzzFeed by Marijuana Moment’s editor. “It’s so bizarre going down the freeway and talking about how they have to pay their employees in cash, have to pay their suppliers in cash. It’s a bad system.”

“Everyone should agree: States’ rights on this. Let the states have an electronic system to track what these businesses are doing, not billions of dollars floating around like this.”

Despite his disappointment with the measure being blocked, the Oregon Democrat, who is believed to be considering a 2020 presidential run, said that his colleagues “had a fair point to make on the policy front” in tabling the measure.

At the time, Leahy argued that spending bills such as the one before the committee should be kept “free of new controversial policy riders” and that a more appropriate forum would be an authorizing committee that sets banking laws.

“It wasn’t existing policy and therefore it was new policy,” Merkley acknowledged in the new interview.

But he pointed out that there are few other avenues available for senators to pursue the issue.

“Here’s the thing. Normally we could take these policy bills like I was putting forward [and] you could put it on the floor of the Senate as an amendment to something,” he said. “In 2017, outside of the budget process, not a single amendment was considered on the floor of the Senate… This is the end of the Senate really as a deliberative body on policy. So if you’re blocked in the Appropriations Committee, and you’re blocked on the floor, then it’s very hard to put ideas out there and say, ‘Hey vote on this. This matters.'”

The House Appropriations Committee also defeated a cannabis banking amendment last month.

See the video of Merkley’s remarks at about 19:15 into the clip below:

Photo courtesy of Senate Democrats.

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.

Tom Angell is the editor of Marijuana Moment. A 15-year veteran in the cannabis law reform movement, he covers the policy and politics of marijuana. Separately, he founded the nonprofit Marijuana Majority. Previously he reported for Marijuana.com and MassRoots, and handled media relations and campaigns for Law Enforcement Against Prohibition and Students for Sensible Drug Policy. (Organization citations are for identification only and do not constitute an endorsement or partnership.)

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Trump Treasury Official Wants Congress To Fix Marijuana Businesses’ Banking Issues

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Congress needs to come up with a solution for banking access by the marijuana industry, a top federal Treasury Department official said on Wednesday. And he hopes that will happen by 2020, if not sooner.

Joseph Otting, the comptroller of the currency, told reporters that lawmakers “have to act at the national level to legalize marijuana if they want those entities involved in that business to utilize the U.S. banking system,” according to PoliticoPro.

Cannabis businesses acting in compliance with state law face uncertainty when dealing with federally regulated financial institutions. And banks potentially risk being penalized for servicing those businesses, leading many to avoid the industry altogether.

That said, a steadily growing number of banks are operating accounts for cannabis companies anyway, federal data shows.

“If I’m a betting person, I’m like 25-30 percent maybe next year, but I would hope by 2020 we can get this issue resolved,” said Otting, who was also recently assigned to double duty as acting director of the Federal Housing Finance Agency.

He previously called the existing situation “generally not healthy,” echoing comments made by Federal Reserve Chairman Jerome Powell, who said “it would be great if [the banking issue] could be clarified.”

Similarly, Treasury Secretary Steven Mnuchin has described the banking conflict as untenable. He said last year that his department was “reviewing the existing guidance,” referring to a 2014 Obama-era policy memo meant to provide direction for banks on how to service marijuana businesses.

“We do want to find a solution to make sure that businesses that have large access to cash have a way to get them into a depository institution for it to be safe,” he said.

More Banks Welcome Marijuana Business Accounts, New Federal Report Shows

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Sen. Chuck Schumer Welcomes Major Cannabis Company To New York’s Hemp Industry

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Canadian marijuana giant Canopy Growth Corporation will enter the nascent U.S. hemp industry by building a massive farming and production center in southern New York, U.S. Senate Minority Leader Chuck Schumer (D-NY) announced on Monday.

Canopy has yet to finalize its plans for an exact location—a contract could be signed as soon as Monday, Schumer said—but the company could eventually support “up to 400 jobs” in hemp cultivation, processing and product manufacturing at what would be a “first of its kind” center for the just-legalized U.S. hemp industry, the senator said.

Once a key American crop—George Washington famously grew hemp at Mount Vernon, and there was a stand of hemp plants in northern Virginia where the Pentagon now stands—the U.S. now lags far behind other countries in hemp production, a result of the country’s broad outlawing of cannabis decades ago.

Eventually, Canopy plans to invest “between $100-$150 million” into a New York State-based industrial hemp farm, Schumer said, with other companies potentially drawn to the sector by such a prominent anchor business.

“Hemp is a very valuable product and a burgeoning crop here” in southern New York, said Schumer, offering a very brief remedial education in the plant for those present at a press conference he convened. “I’m not kidding when I say this, but hemp is everywhere.”

“This is going to be a major shot in the arm” for the area, he added.

“Hemp” is more of a legal than a botanical distinction. Under U.S. law, cannabis sativa with 0.3 percent or more THC is considered “marijuana” and falls under federal drug-control laws. Cannabis with less than 0.3 percent THC is considered industrial hemp.

Hemp has been legal to import and process, but until very recently, hemp cultivation was mostly illegal in the U.S.

That prohibition that ended when President Donald Trump signed the 2018 Farm Bill into law last month. The previous 2014 version of the Farm Bill created a pilot program for states that wished to legalize small-scale hemp cultivation as part of research programs.

Based on that success and on growing support for an end to cannabis prohibition nationwide, the 2018 Farm Bill legalized cultivation of hemp outright. Almost immediately, politicians began touting the crop’s potential as a miracle product and an economic boon with enthusiasm once reserved only for acolytes of hemp evangelist Jack Herer.

Senate Majority Leader Mitch McConnell, who championed the hemp legalization provisions, signed off on the final version of the Farm Bill with a hemp pen—but for now, Schumer, his Democratic counterpart, may have stolen the top Republican’s fire.

“I’ve always believed that states should be the laboratories of democracy,” he said. “I’ve been very eager to have the hemp industry grow in New York and the Southern Tier.”

Hemp Legalization Is Officially In The Final Farm Bill

Photo courtesy of Senate Democrats.

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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Alcohol Sales Aren’t Impacted By Marijuana Legalization, Trade Association Finds

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Marijuana legalization hasn’t hurt alcohol sales in the years since legal markets were established in Colorado, Washington State and Oregon, according to a new study from an alcohol trade association.

The Distilled Spirits Council looked at alcohol tax and shipment data before and after legalization to determine whether cannabis reform impacted sales of spirits, beer or wine in legal states.

“Simply put, the data show there has been no impact on spirits sales from recreational marijuana legalization,” the council’s chief economist, David Ozgo, said in a press release on Thursday.

“We now have four years of retail recreational marijuana sales history in Colorado and Washington state, and three years in Oregon, and each of these markets remain robust for spirits sales,” he said. “We did this study because there is a lot of misinformation circulating about the impact of recreational marijuana legalization on distilled spirits and the wider alcohol market.”

Per capita spirits sales actually increased slightly in post-legalization years, which was consistent with national trends. Sales were up 7.6 percent in Colorado, 5.4 percent in Washington and 3.6 percent in Oregon.

Via the Distilled Spirits Council.

The trade association also analyzed beer and wine sales during the same period. For beer, sales were down marginally, with drops of 3.6 percent in Colorado, 2.3 percent in Washington and 3.6 in Oregon. But again, that’s consistent with national trends, according to the study.

Via the Distilled Spirits Council.

Wine sales were mixed across the three states: Up 3.2 percent in Colorado, down 3.1 percent in Washington and up .7 percent in Oregon.

Via the Distilled Spirits Council.

The Distilled Spirits Council also used their analysis as an opportunity to plug their policy recommendations to lawmakers in states considering marijuana legalization. While the association has declined to take a position on whether to legalize, it shared a list of recommendations ranging from equitable taxes on cannabis and alcohol to THC content disclosure requirements.

There is at least one major alcohol group that is willing to support states’ right to legalize, though. The Wine & Spirits Wholesalers of America (WSWA) called for the end of federal marijuana prohibition last year and, in December, went so far as to host a briefing on cannabis policy for lawmakers and congressional staffers.

Reform advocates have questioned whether legal access to marijuana would adversely impact alcohol sales, with more people opting to consume cannabis over booze. There is some research that indicates the alcohol industry is being interrupted in medical marijuana states, but more data is needed.

Marijuana Is Safer Than Alcohol, Tobacco Or Sugar, Americans Say In New Poll

Photo courtesy of Pixabay.

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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