The chuckle factor. That’s how Rep. Ed Perlmutter described his colleagues’ reaction to his bill granting legal marijuana businesses access to financial services. He’s been on this path since 2013.
“When I first started bringing it up, people would chuckle,” the Arvada Democrat said. “There’s no more chuckle factor. Everyone knows this is a serious issue that Congress needs to address.”
Forty-seven states have legalized marijuana either for medical or recreational use. But under federal law, cannabis remains an illegal schedule 1 drug on par with heroin and LSD. Many banks have refused to work with legal marijuana businesses for fear of running afoul of the federal government or the gordian knot of red tape banks and companies have to cut through to prove the money is all above board.
It’s this conflict between federal and state law — one that falls short of the legalization of cannabis — that lawmakers are trying to resolve.
Perlmutter, alongside Reps. Steve Stivers and Warren Davidson of Ohio, and Nydia Velazques of New York, has again re-introduced the bipartisan Secure and Fair Enforcement (SAFE) Banking Act.
“Thousands of cannabis businesses and employees across the country have been forced to deal in cash, piles of cash,” Perlmutter said.
And for an industry generating billions of dollars, Perlmutter said, much of that money remains unbanked and that is a public safety concern.
Self-proclaimed as the unlikeliest of co-sponsors, Stivers does not support the recreational use of marijuana. The Ohio Republican was convinced Congress needed to act though by businesses in his state — not marijuana businesses, but companies that worked with or had legal cannabis clients.
“They’re a fertilizer business, but they’re potentially going to lose some of their banking relationships because of their dealings with these legal cannabis businesses,” Stivers explained.
The SAFE banking bill passed the House for the first time in 2019 with strong bipartisan support. It also passed the House as part of Democrats COVID-19 relief package called the Heroes Act, but failed to get a hearing in the Senate.
The House members are working with Sens. Jeff Merkley of Oregon and Steve Daines of Montana. Daines replaces former Colorado Sen. Cory Gardner, who sponsored the bill in the last Congress.
When Republicans controlled the Senate, the chair of the banking committee, Sen. Mike Crapo of Idaho, one of a handful of states where marijuana remains illegal, had concerns about the bill.
Now Democrats control the chamber, with Sen. Sherrod Brown as chair and Sen. Pat Toomey of Pennsylvania as ranking member of the Banking committee. Both of their states have legalized medical marijuana.
While Perlmutter is focused on getting the bill passed out of the House first, he said he does expect the Senate to move on the bill once it gets there.
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