August recess is winding down, and soon, Members of Congress will return to D.C. for the remainder of the year. This year, however, was a benchmark year for cannabis policy, and we still have four months left to go! Let’s take a look back on how 2018 compared to 2019 (so far!).
2:
Number of Congressional hearings held on cannabis issues in the 115th Congress (2017-2018)
6:
The number of Congressional hearings as of August 2019 in the following committees:
House Small Business Committee House Veterans Affairs Committee (2) House Financial Services Committee Senate Banking Committee House Judiciary Committee
95:
The number of cosponsors the House version of the SAFE Banking Act garnered during the entire 115th Congress.
206:
The number of cosponsors on H.R. 1595, the SAFE Banking Act, just in the first seven months of 2019.
0:
The number of Congressional markups held on a cannabis bill in the 115th Congress.
1:
The number of Congressional markups held on a cannabis bill in the 116th Congress. In March 2018, the House Financial Services Committee marked up H.R. 1595: the SAFE Banking Act. It passed out of Committee by a vote of 45-15.
$108,550:
Total NCIA-PAC dollars raised for the 115th Congress (2017-2018)
$61,780:
Total NCIA-PAC dollars raised in the first 7 months of 2019. Our goal to raise $100,000 by the end of the year, so make sure you learn more about the NCIA-PAC here!
We have been busy this year advocating for pro-cannabis policy reform and will continue pounding the pavement on Capitol Hill. We look forward to all of the successes yet to come in 2019 and beyond!
Today’s SAFE Banking Act Committee Markup
[updated 11:00 AM ET, Thu March 28]
Today, H.R. 1595, the Secure and Fair Enforcement (SAFE) Banking Act of 2019, received a markup by the House Financial Services Committee and passed in a vote of 45-15. This is the first time in history that a cannabis banking bill has reached this point in the legislative process. As a reminder,a markup is the process by which a congressional committee debates, amends, and rewrites proposed legislation.
Now that the bill has passed out of the House Financial Services Committee, it will continue in the legislative process and be sent to the House Judiciary Committee. It is unclear whether or not the Judiciary Committee will waive its rights to the legislation. If the Committee does waive its rights, the SAFE Banking Act will then be referred to the powerful House Rules Committee before receiving a floor vote from the full House.
If you remember, HR 1595: the Secure and Fair Enforcement (SAFE) Banking Actwas just introduced in the House of Representatives by Reps. Ed Perlmutter (D-CO) and Denny Heck (D-WA) less than two weeks ago. In a stunning, historic surprise, the legislation was introduced with a whopping 108 original cosponsors, and that number has already risen to 151.
There were multiple amendments agreed upon by the committee, however, most were technical and required minimal change. Of note, however, included an amendment from Rep. Ed Perlmutter which would add provisions requiring the federal government to track and issue recommendations on how to expand financial services to minority-owned and women-owned cannabis businesses. Rep. Katie Porter (D-CA) also introduced an amendment that would provide the same protections to de novo financial institutions, which was agreed to. In addition, one of the bill’s lead sponsors, Rep. Steve Stivers (R-OH) offered an amendment that would give much needed clarity for insurers that wish to provide financial services in states that have legalized cannabis.
As a refresher, the SAFE Banking Act would prevent federal banking regulators from punishing banks for working with cannabis related businesses that are obeying state laws or halting their services, taking action on loans made to those businesses, or limiting a depository institution’s access to the Deposit Insurance Fund. The bill would also protect ancillary businesses that work with the cannabis industry from being charged with money laundering and other financial crimes, and requires the Financial Institution Examination Council to develop guidance to help credit unions and banks understand how to lawfully serve cannabis businesses.
Interested in helping with these efforts? You can:
Call your representative and ask them to cosponsor HR 1595: the SAFE Banking Act. If they’re already a cosponsor, thank them for their support. You can find out how to contact your member of Congress and find some helpful tips here.
As our readers saw in last week’s blog, this month has been a milestone for cannabis banking reform.
Earlier this month, the Subcommittee on Consumer Protection and Financial Institutions held its first ever hearing on marijuana and financial services, entitled: Challenges and Solutions: Access to Banking Services for Cannabis-Related Businesses. Up for discussion was a new draft of the Secure and Fair Enforcement (SAFE) Banking Act, which is expected to be introduced any day. The bill is being sponsored by Reps. Ed Perlmutter (D-CO) and Denny Heck (D-WA) in the House, and by Sen. Jeff Merkley (D-OR) in the Senate. All of them have been longtime champions of this cause.
Watch this video for an update on the February 13 hearing:
Because cannabis remains illegal under the federal Controlled Substances Act, individuals who grow, possess, use, sell, transport, or distribute cannabis remain subject to federal criminal prosecution. Under current law, financial institutions providing banking services to legitimate and licensed cannabis businesses under state laws are subject to criminal prosecution under several federal statutes such as “aiding and abetting” and money laundering.
Regardless of whether they’re state or federally chartered, all banks are federally regulated (by FDIC, OCC or the Fed), and thus subject to these rules.
The SAFE Banking Act seeks to harmonize federal and state law by prohibiting federal banking regulators from:
Threatening or limiting a depository institutions’ access to the Deposit Insurance Fund
Discouraging, prohibiting, or penalizing depository institutions for servicing cannabis related businesses
Taking any action against a loan made to a covered business
Forcing a depository institution to halt providing any kind of banking services to state-legal cannabis related businesses
The bill has a few changes from last Congress, including:
Protections for ancillary businesses from money laundering and other laws
Changes the language addressing businesses in Indian Country.
Adds requirement that Financial Institution Examination Council develop guidance to help credit unions and banks understand how to lawfully serve cannabis businesses.
Adjusts the definition of “Cannabis-related legitimate business” to match up with the definition used in last session’s Senate language
Once the SAFE Banking Act is introduced, NCIA will begin gathering cosponsors from both sides of the aisle for the legislation, and will be working with the House Financial Services Committee and its members to advocate for a mark-up of the bill.
While NCIA is making change and advancing our issues every day, there’s still much work to do! Make sure to mark your calendars for our 9th Annual Cannabis Industry Lobby Days in Washington, D.C. on May 21-23 so that you can tell congressional offices your personal story. There’s strength in numbers, and we can’t do it without you!
Show Me The Money! Banking Hearing Held In Congress Last Week
by Michelle Rutter, NCIA Government Relations Manager
A week ago today, the House Financial Services Committee made history.
On Wednesday, the Subcommittee on Consumer Protection and Financial Institutions held its first ever hearing on marijuana and financial services, entitled: Challenges and Solutions: Access to Banking Services for Cannabis-Related Businesses. Up for discussion was a new draft of the Secure and Fair Enforcement (SAFE) Banking Act, which is expected to be introduced at the end of the month by Reps. Ed Perlmutter (D-CO) and Denny Heck (D-WA) and Sen. Jeff Merkley (D-OR) in the House and Senate, respectively. Compared to last session’s SAFE Banking Act (H.R. 2215), the discussion draft of this session’s bill has some differences: it adds protections for ancillary businesses providing products or services to a cannabis-related legitimate business; specifies how businesses on tribal land could qualify; and requires the Federal Financial Institution Examination Council to develop guidance to help financial institutions lawfully serve cannabis-related legitimate businesses.
NCIA was proud to work closely with the offices leading the effort, members of the subcommittee, and witnesses leading up to this historic hearing. NCIA submitted written testimony that was introduced for the record by Congressman Ed Perlmutter (D-CO) during the hearing. In addition to submitting our own testimony, NCIA called upon its members to submit their own stories and tell us why the cannabis banking crisis needs to be fixed. By doing so, we were able to submit nearly 100 personal stories that are now a part of the congressional record. Congressman Perlmutter even read three of those testimonies aloud at the hearing!
According to the hearing documents, “An increasing number of financial institutions have expressed interest in providing banking services to state authorized cannabis-related businesses as nearly all states have authorized various degrees of cannabis use, such as for medical use. However, many financial institutions are refraining from offering banking services to these businesses based on several legal and compliance risks. Furthermore, public safety and other concerns have been expressed by stakeholders, including state and local government officials regarding cannabis-related businesses having difficulties accessing basic banking services, such as depositing large sums of cash from their business activity.”
Witnesses for the majority (Democrats) included :
Congressman Ed Perlmutter (D-CO)
Fiona Ma, California State Treasurer
Maj. Neill Franklin (Ret.), Baltimore City & Maryland State Police Departments and Executive Director, Law Enforcement Action Partnership (LEAP)
Rachel Pross, Chief Risk Officer, Maps Credit Union, on behalf of Credit Union National Association (CUNA)
Gregory S. Deckard, President, CEO and Chairman, State Bank Northwest, on behalf of Independent Community Bankers of America (ICBA)
Corey Barnette, Owner, District Growers Cultivation Center & Metropolitan Wellness Center
The minority (Republicans) invited Jonathan Talcott, partner at Nelson Mullins and board member of Smart Approaches to Marijuana (Project SAM) to speak at the hearing. Interestingly, in 2018, Nelson Mullins was paid $200,000 to lobby on behalf of cannabis company WeedMaps. The company has since found another firm to represent them.
This hearing was an historic and important first step in solving the cannabis banking crisis. In the coming months, we are hopeful that the House Financial Services Committee will hold an additional hearing and potentially even a mark-up on the SAFE Banking Act. You can also take a behind the scenes look at this video from the hearing day.
While NCIA is making change and advancing our issues every day, there’s still much work to do! Make sure to mark your calendars for our 9th Annual Cannabis Industry Lobby Days in Washington, D.C. on May 21-23 so that you can tell congressional offices your personal story. There’s strength in numbers, and we can’t do it without you!
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