Congress is set to take up a large-scale spending bill to provide funding for the government in the 2023 Fiscal Year—and it will be the second major test within the span of a week to see if marijuana banking and other cannabis reforms are pursued through a must-pass vehicle during the lame duck session.
Advocates are eagerly awaiting action on a so-called SAFE Plus package that Senate Majority Leader Chuck Schumer (D-NY) has been finalizing and that’s expected to focus on marijuana banking and expungements. After cannabis reform was excluded from the National Defense Authorization Act (NDAA) that was released this week, the House sponsor of the Secure and Fair Enforcement (SAFE) Banking Act said he was eyeing appropriations as a possible alternative vehicle.
So far, there are no public commitments that it will happen, but it will be known relatively soon. Democratic leaders said they had expected to file the text of the omnibus on Monday, but that has now been pushed back in light of ongoing talks with Republicans. Beyond SAFE or SAFE Plus, there are a multitude of cannabis provisions that were previously included in House and Senate appropriations bills this cycle, so advocates will also be waiting to see if any of those are adopted as part of the final deal.
Senate Appropriations Committee Chairman Patrick Leahy (D-VT) said on the floor on Thursday that Democrats “eliminated the so-called poison pill riders that Republicans have objected to” in the omnibus spending package.
That’s not necessarily a sign that there’s been agreement to omit SAFE Plus from the funding package, but the statement also came after Senate Minority Leader Mitch McConnell (R-KY) talked about tanking the reform as part of NDAA and said lawmakers should also apply that “lesson” to the appropriations process.
On Friday, SAFE Banking sponsor Sen. Jeff Merkley (D-OR) said that he will “keep fighting” to get the reform “passed this year,” adding that “this is not the end of the road.”
I will keep fighting to get the SAFE Banking Act passed this year—this is not the end of the road. We need to make sure that legal cannabis businesses have access to the financial services they need—operating in cash is an open door to robbery and money laundering.
— Senator Jeff Merkley (@SenJeffMerkley) December 9, 2022
“We need to make sure that legal cannabis businesses have access to the financial services they need—operating in cash is an open door to robbery and money laundering,” he said. That’s also a point highlighted in a recent analysis that looked at the trends and motivations for crimes targeting cannabis businesses in Washington State.
One senator who could make or break the final SAFE deal in appropriations is Sen. Pat Toomey (R-PA), who was among a small group of senators who met with the Justice Department this week to seek assurances that issues it raised over SAFE Banking in a memo earlier this year have been effectively resolved.
Eight Republican Pennsylvania state senators applied pressure on Toomey to advance the banking reform, sending a letter on Friday saying that “stalled passage of SAFE has led to unacceptable real-world consequences.” That includes “employees of businesses unable to access banking services, state licensed cannabis retailers having to do business in all cash, and cannabis businesses being targeted for violent robbery.”
“On behalf of all Pennsylvanians impacted by the Commonwealth’s medical cannabis program, we ask that you please support the SAFE Banking Act,” the senators wrote to Toomey, who is the ranking member on the Senate Banking Committee.
Meanwhile, Sen. Patty Murray (D-WA), who will serve as Senate president pro tempore for the 118th Congress, is also pushing for passage of the cannabis banking reform during the lame duck, which she discussed at a leadership briefing with Schumer this week.
Murray said that Democrats have made significant progress on a number of issues, even with the slimmest possible majority in the Senate. She said that “we are not done yet,” and there are areas of bipartisan consensus that can still advance before the end of the session, which includes “making sure our legal cannabis businesses can access credit.”
Whether SAFE or SAFE Plus makes it into the forthcoming appropriations deal is yet to be seen. But it’s far from the only cannabis reform that advocates are hoping to see included in the final package delivered to the president’s desk.
The various appropriations bills that the House and Senate considered or advanced this year contain provisions ranging from protecting state marijuana programs from federal interference to removing the congressional blockade that’s prevented Washington, D.C. to implement a system of regulated cannabis sales for adults.
Here’s an overview of the drug policy provisions that may or may not make it into the final spending package that’s due out on Monday:
Medical marijuana programs in states and U.S. territories would continue to be protected from Justice Department interference under both a Senate and House rider that’s been annually renewed each year since 2014.
“SEC. 531. None of the funds made available under this Act to the Department of Justice may be used, with respect to any of the States of Alabama, Alaska, Arizona, Arkansas, California, Colorado, Connecticut, Delaware, Florida, Georgia, Hawaii, Illinois, Indiana, Iowa, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Montana, Nevada, New Hampshire, New Jersey, New Mexico, New York, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, South Dakota, Tennessee, Texas, Utah, Vermont, Virginia, Washington, West Virginia, Wisconsin, and Wyoming, or with respect to the District of Columbia, the Commonwealth of the Northern Mariana Islands, the United States Virgin Islands, Guam, or Puerto Rico, to prevent any of them from implementing their own laws that authorize the use, distribution, possession, or cultivation of medical marijuana.”
The House took it a step further by including language that would prevent federal intervention in all state, territory and tribal cannabis programs.
“SEC.__. None of the funds made available by this Act to the Department of Justice may be used to prevent a State, the District of Columbia, or a Territory of the United States from implementing a law authorizing the use, distribution, possession, or cultivation of marijuana.
SEC.__. None of the funds made available by this Act to the Department of Justice may be used to prevent an Indian Tribe (as such term is defined in section 4 of the Indian Self-Determination and Education Assistance Act (25 U.S.C. 5304)) from enacting or implementing a tribal law that authorizes the use, distribution, possession, or cultivation of marijuana.”
Another tribe-specific provision was also featured in a House spending bill that advocates will be tracking.
“SEC. 130. None of the funds appropriated by this Act to the Department of Justice or its agencies or bureaus or the Department of the Interior, Bureau of Indian Affairs, Office of Justice Services, including those agency funds distributed to any Indian tribe (as such term is defined in the Federally Recognized Indian Tribe List Act of 1994 (25 U.S.C. 5130(2))) via the Indian Self-Determination and Education Assistance Act (25 U.S.C. §5301, et. seq.), may be used to enforce federal laws criminalizing the use, distribution, possession, or cultivation of marijuana against any person engaged in the use, distribution, possession, or cultivation of marijuana in Indian country (as defined by 18 U.S.C. § 1151), where tribal laws authorize such use, distribution, possession, or cultivation of marijuana, subject to the following:
(1) unless federal law subjects the Indian lands (as such term is defined in the Indian Gaming Regulatory Act (25 U.S.C. 2703(4)) to the civil and criminal laws of the state and the tribal laws authorizing the use, distribution, possession, or cultivation of marijuana do not comply therewith or the Indian lands are not in a state that has legalized marijuana for any purpose; and
(2) provided the governing Indian tribe (Federally Recognized Indian Tribe List Act) takes reasonable measures under tribal marijuana laws to ensure that marijuana is prohibited for minors; marijuana is not diverted to states or tribes where marijuana is prohibited by state or tribal law; marijuana is not used as a means for trafficking other illegal drugs or used to support organized crime activity; and marijuana is not permitted on Federal public lands.”
Both the House and Senate spending legislation for the next fiscal year currently omit a rider that’s prevented D.C. from implementing a regulated adult-use cannabis market. That will also be an important test for the final deal, as the marijuana prohibition has been widely criticized, with appropriators facing repeated calls to end the blockade.
Use and possession of marijuana by immigrants could not be used as the sole basis for penalization by the Department of Homeland Security under another House provision.
“Sec. 536. No Federal funds may be used by the Department of Homeland Security to deny any benefit application for admission, or protection available to an individual under the Immigration and Nationality Act on the sole basis of any event, conduct, finding, admission, history of substance use disorder, arrest, or juvenile adjudication related to cannabis possession, consumption, or use, or to a conviction solely based on such possession, consumption, or use.”
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Another provision says that the Federal Communications Commission could not use federal funds to penalize TV or radio broadcasters for airing cannabis ads in jurisdictions that permit the sale of such products.
“SEC. 512. Notwithstanding section 421 of the Controlled Substances Act, or any other provision of law, none of the funds made available in this Act to the Federal Communications Commission may be used, with respect to an authorization for radio or television stations, to deny, fail to renew for a full term or condition the authorization, decline to approve an application for authority to assign the authorization or transfer direct or indirect control of the licensee, require an early renewal application, or impose a forfeiture penalty because the station broadcast or otherwise transmitted advertisements (a) of a business selling cannabis or cannabis-derived products, the sale or distribution of which is authorized in the State, political subdivision of a State, or Indian country in which the community of license of a station is located, or (b) of a business selling hemp, hemp-derived CBD products or other hemp-derived cannabinoid products.”
There is banking language to safeguard financial institutions that work with state-legal marijuana or hemp businesses.
“SEC. 631. None of the funds made available in this Act may be used to penalize a financial institution solely because the institution provides financial services to an entity that is a manufacturer, a producer, or a person that participates in any business or organized activity that involves handling hemp, hemp-derived cannabidiol products, other hemp-derived cannabinoid products, marijuana, marijuana products, or marijuana proceeds, and engages in such activity pursuant to a law established by a State, political subdivision of a State, or Indian Tribe. In this section, the term ‘State’ means each of the several States, the District of Columbia, and any territory or possession of the United States.”
House spending legislation also stipulates that no federal funds can be used to interfere in lawful hemp programs.
“SEC. 741. None of the funds made available by this Act or any other Act may be used—
(1) in contravention of section 7606 of the Agricultural Act of 2014 (7 U.S.C. 5940), subtitle G of the Agricultural Marketing Act of 1946, or section 10114 of the Agriculture Improvement Act of 2018; or
(2) to prohibit the transportation, processing, sale, or use of hemp, or seeds of such plant, that is grown or cultivated in accordance with section 7606 of the Agricultural Act of 2014 or Subtitle G of the Agricultural Marketing Act of 1946, within or outside the State in which the hemp is grown or cultivated.”
House and Senate appropriations legislation currently maintain language that advocates say unnecessarily inhibits research into controlled substances like cannabis and psilocybin. On the House side, Rep. Alexandria Ocasio-Cortez (D-NY) previously tried to remove it through an amendment, but it twice failed in floor votes.
“SEC. 507. (a) None of the funds made available in this Act may be used for any activity that promotes the legalization of any drug or other substance included in schedule I of the schedules of controlled substances established under section 202 of the Controlled Substances Act except for normal and recognized executive-congressional communications.
(b) The limitation in subsection (a) shall not apply when there is significant medical evidence of a therapeutic advantage to the use of such drug or other substance or that federally sponsored clinical trials are being conducted to determine therapeutic advantage.”
In the House version, there’s additionally a section prevent the Department of Education from penalizing universities simply because the institutions are conducting research into marijuana.
“SEC. 314. None of the funds appropriated by this title for the Department of Education shall be withheld from an institution of higher education solely because that institution is conducting or preparing to conduct research on marihuana as defined in 21 U.S.C. 802(16).”
Beyond the drug policy provisions that could be included in the final appropriations legislation itself, both the House and Senate also included marijuana and psychedelics policy issue in attached reports.
They touch on a variety of issues, including reforming federal employment requirements with respect to marijuana, promoting research into psychedelics, encouraging CBD marketing regulations, revising federal hemp regulations in accordance with industry requests and more.
What gets left in the final deal and what is ultimately ceded following negotiations will be revealed when the text of the package gets released on Monday.
Photo courtesy of Philip Steffan.