by Michelle Rutter Friberg, NCIA’s Deputy Director of Government Relations
There’s no getting around it: last week was a mixed bag for cannabis policy in Washington, D.C. While there was excitement around the introduction of two bills in the House of Representatives, it was tempered by the fact that congressional leaders removed the SAFE Banking Act language from the America COMPETES/USICA trade bill.
SAFE Banking: what happened and what’s next?
The cannabis industry (and many others) were disheartened to learn that the SAFE Banking Act language that had been attached to the House’s America COMPETES Act was stripped out during negotiations last week. Over the last couple of months, both parties have been scrambling to negotiate the legislation into something that could pass both chambers and get across the President’s desk. Unfortunately, Majority Leader Schumer (D-NY), Minority Leader McConnell (R-KY), Speaker Pelosi (D-CA), and Minority Leader McCarthy (R-CA) decided to put the SAFE Banking Act on the chopping block again despite pleas from businesses, financial institutions, and numerous state officials.
While SAFE will not be included in this legislative package, lead sponsor Rep. Ed Perlmutter went to Twitter to talk about what’s next:
“By excluding the#SAFEBankingAct from the#USICA/#COMPETES bill, the Senate continues to ignore the public safety risk of forcing cannabis businesses to deal in all cash. In the wake of the Senate’s inaction, people continue to be killed and businesses continue to be robbed. I will continue to push for#SAFEBanking to be included in COMPETES, other legislative vehicles, or for the Senate to finally take up the standalone version of the bill which has been sitting in the Senate for three and a half years.”
But don’t give up just yet: there’s been much talk on Capitol Hill about a “SAFE+” package of some type. Read more about that here.
New bills: the CLIMB Act and the Veterans Equal Access Act
Last week, we saw the introduction of two cannabis bills in the House: one was a new bill that’s never been introduced, while the other has been introduced in many Congress’ past. The former: the Capital Lending and Investment for Marijuana Businesses (CLIMB) Act; the latter: the Veterans Equal Access Act.
Led by Reps. Troy A Carter, Sr. (D-LA) and Guy Reschenthaler (R-PA), the CLIMB Act looks to:
Provide safe harbor for private financial institutions to offer lending services state-legal American businesses. Due to federal prohibition, a majority of American banks will not offer loans or lending options to small, minority and veteran-owned cannabis businesses.
Protect government agencies such as Community Development Financial Institutions (CDFI) and the Small Business Administration (SBA) and Minority Business Development Association (MBDA) from issuing grants and other sources of government funding. The CLIMB Act will allow entrepreneurs and small businesses to apply for funding to start and grow their business in the cannabis industry, particularly in areas most adversely impacted by the War on Drugs.
The Veterans Equal Access Act has been introduced in the past; this session, the bill is again led by champion Rep. Earl Blumenauer (D-OR) and newcomer to the legislation and Cannabis Caucus co-chair Brian Mast (R-FL).
The bill states that the secretary of the VA must “authorize physicians and other health care providers employed” by the department to 1) “provide recommendations and opinions to veterans who are residents of states with state marijuana programs regarding the participation of veterans in such state marijuana programs” and 2) “complete forms reflecting such recommendations and opinions.”
The bill has previously cleared the House Veterans’ Affairs Committee and was then turned into an appropriations rider; however, it has never been passed into law.
One thing is clear: we have our work cut out for us as we look to the last six months of this Congress. Want to get more involved with our government relations efforts? Consider becoming an Evergreen Roundtable member today, and mark your calendar for September 13-14, as we return in-person for lobby days in Washington, D.C.!
Victories and Challenges For Cannabis Policy Reform
By Morgan Fox, NCIA’s Director of Media Relations
On April 19, the House of Representatives approved legislation once again that would provide legal protections for financial service providers to work with cannabis businesses that are in compliance with state laws. The Secure and Fair Enforcement (SAFE) Banking Act, or H.R. 1996, was reintroduced in March by a bipartisan group of sponsors and had 177 total cosponsors by the time of the vote.
The legislation was approved by a vote of 321-101 and included 106 Republicans voting in favor of the measure, a small majority that represents a growing trend of increasing conservative support since the last time this bill was approved in the House in 2019. No Democrats voted against the bill. This is the fourth time that the House has approved the language of the SAFE Banking Act, initially as the first standalone cannabis policy reform bill ever passed by either chamber of Congress two years ago and two more times last year as part of pandemic relief packages that were not approved in the Senate.
In the time that elapsed between the last vote on the SAFE Banking Act and this one, a number of factors have added momentum and boosted the pressure on federal lawmakers to more seriously consider cannabis policy reform generally and bills like the SAFE Banking Act.
First, cannabis businesses were nearly unanimously declared essential in states with regulated markets during the pandemic, adding to the legitimacy of the industry in the eyes of many while providing uninterrupted healthcare, jobs, and tax revenue in a very challenging economic and public health environment. However, despite increased sales over the last year, the operational costs required to keep employees and customers safe have taken their toll, compounded by the added costs and other challenges associated with limited access to banking services or traditional loans.
These obstacles were felt even more keenly by cannabis businesses because they could not avail themselves of the federal stimulus packages approved by Congress, such as PPP or funds available through the Small Business Administration. Helping to ease the worsening financial burdens facing the cannabis industry during such a difficult time was a major reason for the inclusion of SAFE Banking language in the House-approved aid bills. Recently, standalone legislation has also been reintroduced by Small Business Committee Chair Nydia Velazquez to allow direct and indirect cannabis businesses to be able to access SBA-backed loans and other assistance programs.
Unfortunately, the inclusion of cannabis language in House stimulus packages was used as a political attack tool in the leadup to the election by some lawmakers, likely leading to a postponement of a House vote on the MORE Act, which would remove cannabis from the schedule of controlled substances and help repair the damage done by prohibition. Those attacks significantly died down in November, however, when five states approved adult-use or medical cannabis ballot initiatives by heavy margins, including the red states of Mississippi, Montana, and South Dakota. These victories paved the way for the historic passage of the MORE Act in the lower chamber in December. Three additional state legislatures have passed adult-use laws since then, including the first Southern state of Virginia.
This combination of political will, the feasibility of passing cannabis policy reform measures both comprehensive and incremental, and the introduction of eight new regulated cannabis markets in just a few short months has lawmakers of all stripes taking a much closer look at this issue than ever before. Even staunchly opposed legislators are being forced to reexamine their positions on bills that would directly benefit their constituents and businesses in their states, particularly in light of the urgent need for jobs and taxes as the pandemic response begins to pivot toward economic recovery. This is on top of record public support nationally for legalization. It is becoming increasingly clear to lawmakers that standing in the way of reform is a losing proposition.
With the passage of the SAFE Banking Act, it is likely that the House will move its attention to amending and approving the MORE Act for a second time, as well as considering several other pieces of cannabis-related legislation. The fate of the SAFE Banking Act now lies with the Senate. Senate Majority Leader Chuck Schumer said recently that he would prefer to wait for further consideration of that or other incremental reforms until after the introduction of his much-anticipated comprehensive descheduling bill in the coming weeks. We are confident that debate and progress on these bills is not mutually exclusive, and moving both pieces of legislation through the upper chamber simultaneously is both possible and likely, especially given the broad bipartisan support that the SAFE Banking Act enjoys.
Historic Victory in the House: The MORE Act
by Madeline Grant, NCIA’s Government Relations Manager
On Friday, December 4, the House of Representatives made history by voting to approve H.R. 3884, the Marijuana Opportunity, Reinvestment, and Expungement (MORE) Act. The MORE Act would remove marijuana from the federal Controlled Substances Act and work to repair the social and personal harms caused by federal marijuana enforcement. This is the first time since marijuana was made federally illegal that either chamber of Congress has held a floor vote on- or approved- a bill to make the substance legal again. The final vote count of 228-164 fell mostly along party lines, with five Republicans crossing the aisle to support, and six Democrats voting to oppose.
This monumental victory shows just how far Congress has come over the years. Although this vote more closely aligns the House of Representatives with the majority of voters who overwhelmingly support cannabis legalization, the Senate is a different story.
As we have seen over and over again, the Senate Republicans continue to obstruct cannabis reform measures. The House passed the SAFE Banking Act in September 2019 and included the SAFE Banking language in two COVID-19 relief packages, however, there has been little activity on these topics in the Senate. Republican Senators have repeatedly spoken out in opposition of bringing up cannabis policy amidst the pandemic, stating that it’s not the time or place. But as I mentioned before, it’s also important to note that the House has passed not one, but two COVID relief packages in the last 6+ months that the Senate (namely, Leader McConnell) has refused to take up. That being said, despite a global pandemic, support for cannabis reform remains strong, a recent Gallup poll showed a record 68% of Americans support making cannabis legal. On Election Day, voters in Arizona, Montana, and New Jersey approved measures to regulate cannabis for adults, while Mississippians overwhelmingly approved a medical cannabis referendum, and voters in South Dakota passed both adult-use and medical initiatives. The vote and passage of the MORE Act on the House show that House leadership is listening.
The MORE Act, sponsored by the House Judiciary Committee Chairman Jerry Nadler (D-NY) and 120 cosponsors, would not only mitigate the federal-state conflict by removing cannabis from the Controlled Substances Act, but it would also require the expungement of past federal cannabis convictions. The bill would also establish a Cannabis Justice Office to administer a program to reinvest resources in the communities that have been most heavily impacted by prohibition, funded by a tax on state-legal cannabis commerce. It would also allow the Small Business Administration to provide loans and grants to cannabis-related businesses and support state and local equity licensing programs, permit doctors within the Veterans Affairs to recommend medical cannabis to patients in accordance with applicable state laws, and prevent discrimination based on cannabis consumption during immigration proceedings.
When the House version of the MORE Act was originally introduced in 2019, it was referred to eight Committees (with the Judiciary Committee being primary). Each Committee had provisions of the bill that fell under its jurisdiction and had authority to hold hearings and or amend specific jurisdictional provisions. Two Committees (Energy and Commerce and Ways and Means) were expected to be very active on language affecting regulations and taxes. The Energy and Commerce Committee even held a legislative hearing on MORE in January, and were expected to hold more… and then COVID hit… and priorities changed.
Before the Floor vote, the main sponsor of MORE, Judiciary Chairman Jerry Nadler, offered a “manager’s amendment.” The majority of the language was taken straight from H.R. 1120/S. 420: the Marijuana Revenue and Regulation Act. It included a graduated tax, and language on federal permitting and bonding. During debate, Congressional leaders gave assurances to include the cannabis industry advocates in future discussions and listen to cannabis industry concerns. Although passage of the MORE Act is historic, no legislation is perfect and NCIA staff will continue working with congressional champions to improve MORE and eventually get it passed into law.
Now, as we near the end of the 116th Congress, the NCIA team will continue to work and strategize various ways forward in Washington, D.C– on SAFE Banking, the MORE Act, and beyond. As we see more and more legislative victories each Congress, it is important to relish in our success and continue to propel the momentum forward (we could all use a moment to celebrate after 2020!). The MORE Act vote, being the most comprehensive cannabis bill on Capitol Hill, gives us the momentum to accomplish more in the next congressional session. Thank you to each and everyone one of you who took the time to call your Representative. Stay tuned for the 117th Congress!
Senate Race Runoffs in the Peach State
By Michelle Rutter Friberg, NCIA’s Deputy Director of Government Relations
As you’ve probably heard by now, which party controls the Senate won’t be known until January 5 — but those results could quite literally determine if marijuana will become federally legal over the next few years.
In Georgia, no candidate can advance through a primary or a general election system without first earning more than 50% of the votes. If no one does, the top two vote getters advance to a runoff election, ensuring that one will earn the majority of votes cast.
This year, the state’s two Senate races — one regular, the other a special election to fill the remainder of a retired senator’s seat — have gone to a runoff. The first will be between incumbent Sen. David Perdue (R) and Democrat Jon Ossoff; the latter will be between Republican Sen. Kelly Loeffler and Democrat Rev. Raphael Warnock. If Democrats win both seats, the Senate will be tied 50-50, and Vice President-elect Kamala Harris would be the tie breaking vote.
It can’t be overstated that the Democrats have an uphill (but not impossible!) battle ahead. In November, Sen. Perdue garnered 86,000 more votes than Ossoff, while Warnock benefited from the fact that two Republicans — both Sen. Loeffler and Rep. Doug Collins — were on the ballot in his race, splitting the party’s votes.
And of course, it’s 2020, so I would be remiss not to mention the pandemic! The runoff is taking place in an off-election year in (what will likely still be) the middle of a serious surge of COVID-19 cases. On top of that, Republicans historically have a stronger track record of turning out in runoffs in the state.
Despite all of that, Democrats are working hard to turn out the vote and organize early. In addition to relying heavily on both first-time voters and Black voters, Democrats are also hopeful that young voters will be the key to winning the runoff in January. Ossoff recently said:
“There are 23,000 young people here in Georgia who will become eligible to vote just between the November election and this January 5 runoff, and a decade of organizing, much of this work led by Stacey Abrams, has put the wind in our sails here in Georgia. What we’re feeling for the first time in four years is hope.”
As I said before, which party controls the Senate could quite literally be the difference between whether or not cannabis could become federally legal in the next one to two years. Senate Minority Leader Chuck Schumer (D-NY) was interviewed in October and said:
“I’m a big fighter for racial justice, and the marijuana laws have been one of the biggest examples of racial injustice, and so to change them makes sense. And that fits in with all of the movement now to bring equality in the policing, in economics, and in everything else. Our bill is, in a certain sense, at the nexus of racial justice, individual freedom and states’ rights.”
Schumer was referencing the bill he introduced, the Marijuana Freedom and Opportunity Act, which would remove cannabis from the Controlled Substances Act, allowing states to set their own policies. It also includes provisions to help funding to cannabis businesses owned by women and people of color through the Small Business Administration; funding studies on traffic safety, impairment detection technology, and health effects of cannabis; restricting advertising that could appeal to children; and setting aside $100 million over five years to help states develop streamlined procedures for expunging or sealing prior cannabis convictions.
Time is of the essence. Voters must be registered by December 7 in order to participate in the runoff election. If you’re in Georgia, or know anyone who is a resident, please check out the Cannabis Voter Project to learn more and make sure you’re ready to vote. If you can, consider making a donation to the Ossoff campaign or the Warnock campaign. The future of cannabis legalization in this country depends on it!
A (Mostly) Non-COVID-19 Legislative Update
by Michelle Rutter Friberg, NCIA’s Deputy Director of Government Relations
I don’t know about you, but it seems no matter where I look, everything is about COVID-19. And with good reason — many of us are still working from home, helping their families with distance learning, and overall dealing with the effects of the virus. That being said, this week I wanted to take a look at two pieces of cannabis legislation — non-COVID related — and update you on where things stand, since we’re already nearly halfway through 2020!
The SAFE Banking Act
Last September, the SAFE Banking Act became the first piece of cannabis reform legislation to ever pass out of the United States House of Representatives by an astounding bipartisan vote of 321-103. The first iteration of the bill, named the Marijuana Businesses Access to Banking Act, was introduced to the 113th Congress back in 2013 and has made a long journey to get to this point in the legislative process.
Now that the SAFE Banking Act has passed the House, its journey has continued in the more conservative, Republican-controlled Senate. However, just before Christmas, Senate Banking Committee Chairman Mike Crapo (R-ID) issued a press release detailing his opposition to cannabis policy reform — including the SAFE Banking Act as it’s currently written. In the release, Chairman Crapo said,
“I remain firmly opposed to efforts to legalize marijuana on the federal level, and I am opposed to legalization in the State of Idaho. I also do not support the SAFE Banking Act that passed in the House of Representatives. Significant concerns remain that the SAFE Banking Act does not address the high-level potency of marijuana, marketing tactics to children, lack of research on marijuana’s effects, and the need to prevent bad actors and cartels from using the banks to disguise ill-gotten cash to launder money into the financial system.”
Even now with COVID-19, NCIA is virtually lobbying for the SAFE Banking Act, or some of its provisions, to be included in the next coronavirus relief package. Before COVID-19, the all-cash situation cannabis businesses face created an unnecessary public safety risk and undue safety burden on state and local tax and licensing authorities who must receive and process large cash payments. Now, as recent reports show that viruses can live on cash for up to 17 days, the public safety concerns of this cash-only system compound. The lack of access to financial institutions places industry workers, government employees, and the public-at-large at risk as banknotes circulate from consumers and patients to businesses to government.
NCIA is continually working with Sen. Crapo, congressional and committee staff, coalition partners, and the bill’s cosponsors to ensure that all parties have the materials and information that they need in order to solve this pressing public safety– and now, public health– issue and pass the SAFE Banking Act into law!
The MORE Act
In November, by a vote of 24-10, the House Judiciary Committee approved the Marijuana Opportunity Reinvestment and Expungement (MORE) Act of 2019, or H.R. 3884. This bill was introduced by House Judiciary Committee Chairman Jerrold Nadler (D-NY) and currently has 73 cosponsors. This was the first time that a congressional committee held a vote on – let alone approved – a comprehensive bill that would make cannabis legal. Perhaps even more significantly, this bill recognizes and works to address the disproportionate impact prohibition has had on marginalized communities and people of color while helping to increase access and opportunity in the legal cannabis industry.
The bill still has a long way to go, though. While the House Judiciary Committee has passed the legislation, there are still six more congressional committees with jurisdiction over the bill, including the Energy and Commerce, Agriculture, Education and Labor, Ways and Means, Natural Resources, and Oversight and Reform committees. In January, the House Small Business Committee waived its jurisdiction over the MORE Act.
While the MORE Act does not contain an explicit regulatory structure for cannabis after it is descheduled, Chairman Nadler said in a press conference the day before the markup vote that it was possible amendments could be added to the bill as it moves through the House.
All that being said, it’s unclear what Congress’ schedule will look like for the rest of the year. The Senate returned to Washington yesterday, however, the House remains out of session as concerns about legislating in the age of COVID-19 remain. On top of that, 2020 is an election year, which complicates matters (and scheduling) even more. Regardless, I hope you can rest assured knowing that NCIA’s government relations team is working around the clock to advocate for the cannabis industry — whether that be banking reform, ending cannabis criminalization, or allowing for SBA relief. From D.C. to wherever you are, stay healthy!
Action Alert: Tell Congress To Include Cannabis In The Next COVID-19 Relief Bill!
While we all continue to do our jobs to flatten the curve in the age of COVID-19, our lobbying team in D.C. has been hard at work on your behalf. We have been working every angle and are exploring any and all opportunities to provide relief for our industry.
The offices of Congressman Blumenauer (D-OR) and Senator Jacky Rosen (D-NV) have taken the lead on sending a letter to congressional leadership asking that they address the exclusion of state-legal cannabis and ancillary businesses from the recently passed CARES Act. But now, we need your help.
In order for these letters to be seriously considered by congressional leadership, we need to get as many members of Congress to sign on as possible. Please consider calling your representative and Senators today and ask them to sign on to the appropriate letter. You can find your member of Congress and how to contact them here.
“Hi, I am calling/writing today to ask that you sign onto Congressman Blumenauer/Senator Rosen’s letter to leadership. This letter asks that state-legal cannabis businesses have access to Small Business Administration programs to ensure they have the financial capacity to undertake the public health and worker-focused measures experts are urging businesses to take. This current lack of access will undoubtedly lead to unnecessary layoffs, reduced hours, pay cuts, and furloughs for the workers of cannabis businesses who need support the most. As your constituent, I ask and urge that you sign on to Congressman Blumenauer/Senator Rosen’s letter as soon as possible. Our industry, our businesses, and our employees cannot wait.“
Update On the Prospects of Federal Relief for the Cannabis Industry
by Michelle Rutter Friberg, NCIA’s Deputy Director of Government Relations
The last few weeks have been difficult for everyone, and most people are justifiably concerned about what the future holds for their health, safety, and livelihoods. This is certainly the case in the cannabis industry, so we wanted to provide an update about where things stand regarding cannabis businesses and federal relief.
As the debate over the most recent federal coronavirus aid package was raging, NCIA and our allies were working tirelessly to urge members of Congress to make legal cannabis businesses eligible for loans and direct payments. A coalition of trade groups also sent a letter to congressional leadership and key committees specifically asking them to include cannabis businesses in consideration for loans through the Small Business Administration.
Unfortunately – but understandably – lawmakers were more concerned with providing assistance to all Americans in need as quickly as possible, and did not incorporate many requests related to special issues and disproportionately impacted industries. However, we received a lot of positive feedback from a number of congressional offices.
As things currently stand, individual cannabis industry employees who filed taxes last year should be eligible for the direct household payments included in the latest relief legislation as long as they meet the standard criteria. It may also be possible for states to use some of the funds they receive from the federal government to support the industry. But for the time being, cannabis businesses are not eligible for SBA loans or direct federal funding.
This battle is far from over though. Congress is in recess until the end of April, at which point efforts will commence on approving the next stage of coronavirus relief funding. Rest assured, NCIA’s dedicated Government Relations and Public Policy team is working night and day to make sure that the cannabis industry is included in the next round of funding so that we can continue to provide our communities – particularly medical cannabis patients – with the safe and reliable access they need. In addition to pushing for SBA loans and direct funding eligibility, we are also exploring ways to remedy some of the other financial problems caused by outdated federal policies, as well as urging state governments and regulators to continue to allow some form of cannabis access for the duration of the pandemic response.
At a time when cannabis businesses are being increasingly recognized as a vital component of public health and economic well-being, they deserve to be treated fairly and have access to the same benefits other businesses are receiving. We will keep you posted on any developments, and please contact your members of Congress to respectfully request that they explicitly include the cannabis industry in future federal aid packages.
MORE Act Approved by House Judiciary Committee
by Morgan Fox, NCIA’s Media Relations Director
It’s been quite a year for cannabis policy reform in Congress, with an unprecedented number of bills introduced, landmark hearings in both chambers, and the overwhelming passage in the House of Representatives of the SAFE Banking Act – the first standalone cannabis bill to receive a floor vote. Momentum continues to build, and today’s victory marks the latest and potentially most far-reaching to date.
In a vote of 24-10, the House Judiciary Committee approved a bill that would effectively end marijuana prohibition on Wednesday. The Marijuana Opportunity Reinvestment and Expungement (MORE) Act of 2019, or H.R. 3884, was introduced by House Judiciary Committee Chairman Jerrold Nadler (D-NY) and currently has 55 cosponsors.
This is the first time that a congressional committee has held a vote on – let alone approved – a comprehensive bill to make cannabis legal. Perhaps even more significantly, this bill recognizes and works to address the disproportionate impact prohibition has had on marginalized communities and people of color while helping to increase access and opportunity in the legal cannabis industry – an unmistakable sign that the debate over legalization is moving from “if” to “how.”
The MORE Act would federally decriminalize cannabis by removing it from the Controlled Substances Act, and would require the expungement of past federal cannabis convictions. The bill would establish a Cannabis Justice Office to administer a program to reinvest resources in the communities that have been most heavily impacted by prohibition, funded by a 5% tax on state-legal cannabis commerce. It would also allow the Small Business Administration to provide loans and grants to cannabis-related businesses and support state and local equity licensing programs, and would permit doctors within the Veterans Affairs system to recommend medical cannabis to patients in accordance with applicable state laws, among other provisions.
While this bill does not contain an explicit regulatory structure for cannabis after it is descheduled, Chairman Nadler said in a press conference the day before the markup vote that it was possible amendments could be added to the bill as it moves through the House. NCIA’s dedicated in-house government relations team will be working to include provisions based on recommendations we released last month outlining a federal regulatory structure for different types of cannabis and hemp products through existing federal agencies so that cannabis products can be effectively regulated similarly to alcohol and other consumables. Even without a clearly defined plan for regulation, the passage of this bill would be a huge win for the cannabis industry and a victory for justice.
The MORE Act is the most comprehensive cannabis policy reform measure to progress this far in the legislative process, and support is growing in Congress. Last week, a Pew Research Center survey showed that a record 67% of Americans are in favor of making cannabis legal, and the ongoing efforts of advocates and forward-thinking lawmakers is convincing an increasing number of legislators to listen to the people on this issue. Reformers are winning new allies every day.
With luck, we may even see a floor vote on the MORE Act in this legislative year, though certain political realities and current events unrelated to cannabis may make that difficult. And even if the House approves this legislation, we still have the Senate to convince. However, every step forward is helping to bring the end of prohibition closer, and we are picking up speed.
By Morgan Fox, NCIA’s Director of Media Relations
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