National Cannabis Industry Association logo

Join Now

The Burning Question – When Will SAFE Banking Get A Vote?

by Michelle Rutter, NCIA Government Relations Manager

With Congress returning from their annual August recess, all I seem to be asked is “when will we get a vote on SAFE Banking?” And while it’s unclear whether that vote will be in September or beyond, it’s important to remember that this is the farthest a standalone, pro-cannabis bill has ever gotten in the U.S. House of Representatives. Since the House Financial Services Committee hearing on this topic earlier this year, it seems like the momentum to pass this legislation has only increased. Let’s take a look back and what’s happened and what’s to come:

First, in February, 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 at the time was a draft of the Secure and Fair Enforcement (SAFE) Banking Act. Later, in March, HR 1595/S. 1200: the Secure and Fair Enforcement (SAFE) Banking Act was introduced in the House of Representatives by Reps. Ed Perlmutter (D-CO) and Denny Heck (D-WA) and in the Senate by Sens. Jeff Merkley (D-OR) and Cory Gardner (R-CO). In a stunning, historic surprise, the legislation was introduced with a whopping 106 original cosponsors in the House. By July, that number rose to include more than 205 cosponsors.

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.

After the bill was introduced, the House Financial Services decided to take the next step in the legislative process and schedule a mark-up of the bill. A markup is the process by which a congressional committee debates, amends, and rewrites proposed legislation. 

The bill is read for amendment, one section at a time, with committee members offering their amendments to each section after it is read but before the next section is read. Committees do not change the texts of the bills they mark up. Instead, committees vote on amendments that their members want to recommend that the House adopts when the House considers the bill on the floor. The bill passed out of committee with flying colors — by a margin of 45-15. 

In May, we got another signal that the SAFE Banking Act is being taken very seriously on Capitol Hill- the Congressional Budget Office (CBO) released a cost estimate, or “score” of the legislation. The report stated, “CBO estimates H.R. 1595 would decrease net direct spending by $4 million over the 2019-2029 period.” 

Then, in July, we couldn’t believe our eyes and ears when it was announced that longtime cannabis opponent and Chairman of the Senate Banking Committee, Sen. Mike Crapo (R-ID) planned to hold a hearing entitled, “Challenges for Cannabis and Banking: Outside Perspectives,” to discuss the current banking challenges faced by the legal cannabis industry and to assess the unintended consequences and public safety risks associated with commercial businesses operating in an all-cash environment. 

Chairman Crapo dedicated much of his time to understand how the SAFE Banking Act would regulate financial institutions and ensure the banking industry could and operate in compliance with a business selling a Schedule I product. Towards the end of the hearing, Crapo said, “I think the case has been made pretty strongly here today about the need to get the banking industry issues relating to cannabis resolved.”

This week, Congress returns to Washington, and we at NCIA are preparing for a House Floor vote on SAFE in the next one to two months. In the meantime, we need you to call your Representative and Senators and ask them to ask leadership to hold a vote on HR 1595/S. 1200, the SAFE Banking Act! You can find tips and talking points here.

Progress on the SAFE Banking Act in the House and Senate

Less than two months ago, H.R. 1595: the Secure and Fair Enforcement (SAFE) Banking Act was marked up by the House Financial Services Committee, where it passed out of committee by a margin of 45-15. While the bill must still come to the House floor for a vote by the full chamber and then be taken up by the Senate, let’s take a look at where the bill currently stands.

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. In the House, the legislation was introduced by Reps. Ed Perlmutter (D-CO) and Denny Heck (D-WA), while the Senate bill was introduced by Sens. Jeff Merkley (D-OR) and Cory Gardner (R-CO).

When the House version of the SAFE Banking Act was introduced in March, you’ll remember it had a historic 108 original cosponsors. As of the beginning of May, the legislation currently has a whopping 172 cosponsors, with 17 members getting on the bill in April alone.

The Senate version of the SAFE Banking Act (S. 1200) was introduced in April with 21 original cosponsors. Currently, the bill is up to 25 cosponsors – that’s a quarter of the entire Senate! Notably, there are six Senators who are running for President in 2020 that have signed onto the legislation.

In addition to gaining more cosponsors in both houses of Congress, other government officials have also thrown their support behind the bill. In April, 27 state banking supervisors signed a letter addressed to congressional leadership that stated, “We urge Congress to consider legislation that creates a safe harbor for financial institutions to serve a state-compliant business or entrusts sovereign states with the full oversight and jurisdiction of marijuana-related activity.”

Even with all this progress and positive signs for the future, we still have some roadblocks in our path to ensuring this legislation crosses the finish line during the current session.

In the House, Republican support is still lagging despite bipartisan original sponsorship. With Republicans making up only 11% of the current cosponsors, we still have much work to do convincing the GOP members of the House to support this sensible legislation.

In the Senate, we will need all the support we can get in Congress to overcome the objections of a key committee head, Sen. Mike Crapo (R-ID), who is the chairman of the Senate Banking Committee. Sen. Crapo will determine whether the SAFE Banking Act can get its first hearing in the Senate, and his recent statements at a conference hosted by the Independent Community Bankers of America (ICBA) that this issue should be left to the Department of Justice highlight the need for us to keep building consensus and momentum to convince him otherwise.

Essentially, we’ve come farther than many thought we would, but there is still much work to do, and we want you to join us!

In just two short weeks, hundreds of cannabis industry professionals from all over the country will descend on Capitol Hill this month for the 9th year in a row for NCIA’s Annual Lobby Days. It’s more important than ever before to make your voice heard and advocate for the federal reforms our industry needs to truly thrive. Whether it’s access to banking for your business, much-needed federal tax reforms, or some of the many other struggles faced by our industry that could be remedied by congressional action, we need you to tell your stories on Capitol Hill with us on May 21-23. See you there!

This site uses cookies. By using this site or closing this notice, you agree to the use of cookies and our privacy policy.