Historic Marijuana Banking Bill Clears Senate Banking Committee

In a groundbreaking development, the Senate Banking Committee has approved the Secure and Fair Enforcement Regulation (SAFER) Banking Act, marking a significant milestone in the quest to bridge the gap between financial institutions and cannabis-related businesses. The legislation aims to address a long-standing financial impasse that has forced cannabis companies to operate primarily with cash.

The SAFER Banking Act, which has been presented in various committee iterations since 2015, has now advanced to the Senate floor, representing the first time the bill has garnered committee approval and progressed to the broader Senate arena.

The flourishing marijuana market in the United States has been hampered by federal legal ambiguity, resulting in cash-only transactions fraught with risks and uncertainties.

Before the Bell recently conducted an interview with Senator Jeff Merkley, a Democrat from Oregon and a co-sponsor of the bill, to gain insights into the road ahead for this landmark legislation.

Interview Excerpt:

Before the Bell: You first introduced a version of this bill in 2015; why do you think that it’s taken nearly eight years to get it this far?

Senator Jeff Merkley: More and more states have created medicinal cannabis programs or recreational cannabis programs over those eight years. The issue and problems of a pure cash economy have grown across the country, and more senators are aware of the challenges in their home state. That has slowly built the level of concern and attention to a point where we think a significant majority of the Senate will now support changing things. In Oregon we have a robbery at a dispensary about every other day because the dispensaries are full of cash. Employees are mugged when they come out of their offices because people think they’re carrying cash. A cannabis business owner drove from Portland to Salem to deliver his taxes, and he had a backpack with $70,000 cash in it. More of the country has seen the problem and has built a coalition, and now we’re ready to play.

Key Points:

• The SAFER Banking Act aims to enable financial institutions to provide services to cannabis-related companies, thus alleviating the burdens associated with cash-only transactions.
• Senator Merkley attributes the delay in advancing the bill to the growing number of states adopting cannabis programs and the increasing awareness of the challenges posed by the all-cash economy.
• The bill addresses concerns related to banking services, cannabis scheduling, and tax provisions, but Senator Merkley sees these issues as independent and not interconnected. Part of the bill focuses on preventing regulators from pressuring banks to terminate accounts based on moral judgments.
• The bill also incorporates elements of restorative justice by addressing unjust cannabis prosecutions, promoting equity and diversity in the industry, collecting data on various business demographics, and facilitating homeownership for individuals previously excluded due to cannabis-related income.

The passage of the SAFER Banking Act by the Senate Banking Committee marks a significant step toward reshaping the landscape for cannabis-related businesses, potentially unlocking new opportunities for growth and financial stability within the industry. The legislative journey ahead promises to be challenging, but the bipartisan support in the committee underscores the importance of resolving the financial conundrum faced by cannabis companies.