A Senate committee approved legislation Thursday that would offer some protection from federal authorities to banks and credit unions doing business with state-authorized marijuana merchants.
The Senate Appropriations Committee voted 16-14 to attach the amendment, proposed by Sen. Jeff Merkley, an Oregon Democrat, to a financial services spending bill.
The amendment that won committee approval is narrower than a bipartisan bill on the same issue that Merkley introduced earlier this month. The amendment would simply prohibit the funds being appropriated under the bill from being used to go after financial institutions for their relationships with pot merchants.
The bill that Merkley introduced on July 9 would go further by prohibiting federal banking regulators from penalizing banks that provide services to cannabis businesses in states where the drug is legal.
Oregon is one of four states that have legalized the recreational use of marijuana. Due to conflicts with federal law, pot-related businesses in Oregon, Colorado and other states have struggled to find banks willing to take their business.
Many financial industry representatives maintain that small tweaks in federal law will not be enough to provide comfort to banks and credit unions that remain wary of cannabis merchants. They argue that the situation will not change significantly unless marijuana is legalized at the federal level.
Still, marijuana industry groups have continued to push for incremental, more politically feasible changes to federal law.
Last year, the House of Representatives voted to restrict the use of federal funds to penalize banks with connections to the pot industry, similar to the amendment adopted Thursday by the Senate Appropriations Committee. But the 2014 measure did not survive negotiations between the House and Senate.
"It's encouraging to see members of the Senate stepping up and joining the House to address the banking crisis facing our industry," said Aaron Smith, executive director of the National Cannabis Industry Association, Thursday in a press release. "Bipartisan coalitions in both chambers are supporting these reforms. It's time to make them the law of the land."