Backers of pot banking bill see the finish line in House
WASHINGTON — A key House sponsor of cannabis banking legislation expressed hope that the chamber is close to voting on the bill, but questions still remain about its chances in the Senate.
The Secure and Fair Enforcement Banking Act was approved in March by the House Financial Services Committee. The bill would bar federal regulators from penalizing depository institutions for servicing marijuana businesses in states where the substance is legal.
“We’re hoping that this will come up within the next month, in which case then it will go to the Senate, and we’re going to have to work very hard over on the Senate side,” said Rep. Ed Perlmutter, D-Colo., the bill's chief sponsor, at a legislative briefing held on Capitol Hill by the National Cannabis Industry Association.
Perlmutter said the bill would go to the House Rules Committee before it can be considered on the floor. But the legislation faces a tougher challenge in the Senate, where GOP leaders have been reluctant to loosen federal rules for cannabis despite state legalization efforts. Marijuana is banned as a Schedule I drug under federal law.
In the Senate, the SAFE Banking Act has some bipartisan support, and is sponsored by Sen. Cory Gardner, R-Colo., and Sen. Jeff Merkley, D-Ore. Perlmutter pointed to the bill’s biggest obstacles in the Senate as Banking Committee Chairman Mike Crapo, R-Idaho, and Senate Majority Leader Mitch McConnell, R-Ky.
But the banking industry is urging Crapo to add the SAFE Banking Act to the committee's agenda. On Monday, banking trade groups from all 50 states signed onto a letter urging him and Sen. Sherrod Brown, D-Ohio, the ranking member of the committee, to hold hearings on “the merits of providing cannabis-related businesses access to banking services.”
“As a result of congressional inaction and the lack of regulatory clarity, legal cannabis businesses must operate on an all-cash basis, subjecting their employees and the general public to serious risk of criminal activity and harm,” the letter said.
The letter, which was signed by the Idaho Bankers Association from Crapo’s home state, increases the probability that the Banking Committee will hold a hearing, said Jaret Seiberg, an analyst with Cowen Washington Research Group, in a note.
“We see this letter increasing the pressure on Sen. Crapo to hold a hearing on the SAFE Act in the coming months,” he said. “And we believe that once he holds a hearing on the bill that it will become easier to then attach that bill to a broader legislative package such as a spending bill.”
McConnell could also be persuaded to consider the SAFE Banking Act, said Perlmutter.
“The fact that the hemp industry has been struggling, where they expect a big production out of Kentucky, McConnell is worried about that,” he said. “If we can include hemp and other things in the SAFE Banking Act, that will make it more attractive to him to move the bill forward.”
When the bill moves to the House floor, it is poised to pass with “something between 250 or more votes,” said Perlmutter.