The debate within the cannabis ecosystem – industry, lawmakers, and other stakeholders – over whether to support the passage of a banking bill has become, in many ways, a debate over the future of cannabis reform.
Those in favor of passing the SAFE Banking Act, which would expand cannabis industry access to banks and financial services, argue that the Act also advances equity and public safety. Those opposed argue that political energy should be spent on broader reforms, like federal decriminalization with equity components, that more directly accomplish those aims.
A bill that would both end the federal criminalization of cannabis, and achieve the aims of the SAFE Banking Act, while also establishing a robust regulatory framework for legal cannabis, was introduced last week: the Cannabis Administration and Opportunity Act (CAO Act).
But during a “Hill briefing” on the SAFE Banking Act on Wednesday, hosted by the United States Cannabis Council (USCC), the speakers walked a tightrope between reforms, but the CAO Act was framed as potentially “hard to pass.”
“It is a sweeping piece of legislation and has really some excellent provisions in it. Question is: is it of such a magnitude that it is going to be hard to pass in the Senate or maybe even hard in the House?” said Rep. Ed Perlmutter, lead sponsor of the SAFE Banking Act.
“Well, what we do know is that there is plenty of support for SAFE Banking,” he continued, after noting that the bill is with the Senate in two forms. There is the standalone Act, which has passed out of the House multiple times, including this year, and there’s the Act as part of the National Defense Authorization Act, which passed out of the House last month.
The briefing was focused on making the case for the SAFE Banking Act as a necessary step toward broader reform, and toward improving public safety by easing the industry’s reliance on cash. In addition to lawmakers who support the SAFE Banking Act, like Rep. Earl Blumenauer, speakers included Dennis Brown, whose son Jordan Brown was killed during a dispensary robbery in Washington state, and Chandra Brady, the director of enforcement and education for the Washington State Liquor and Cannabis Board.
USCC also showed two ads that the organization recently created, urging viewers to call on Congress to pass the SAFE Banking Act. In one, Brown described when he learned that Jordan had been killed, and then turned to the issues posed by the cash-heavy nature of the industry. “There’s been a lot of victims from this. My son was the ultimate victim. He lost his life,” he said.
Sen. Jeff Merkley then told a story about he tagged along with an Oregon cannabis business owner as the entrepreneur went to pay tens of thousands of dollars in state taxes in cash, passing through various checkpoints as part of the process. Merkley called the situation “the theater of the absurd.”
In urging participants to put pressure on Senators to pass the SAFE Banking Act, Merkley turned to an idea that has been making the rounds: adding some criminal justice provisions to the SAFE Banking Act. Earlier in the briefing, Perlmutter called this plan “SAFE Banking Plus.”
“It’s a challenge to have a broader perspective of also doing criminal reform along with SAFE Banking,” Merkley said, emphasizing that he supports broader reforms. “If we can add them and keep that coalition,” he continued, referencing Republican support for the banking bill, “I’m all for that. But we can’t.”
Blumenauer agreed with Merkley, emphasized that he supports broader reforms, and argued that the passage of the SAFE Banking Act would help, not hinder, those reforms.
The SAFE Banking Act, he said, “will be the path forward to complete legalization,” and will help in “breaking the logjam in terms of cannabis legislation.”
In response to an audience question about Sen. Cory Booker’s previous statements that he would not support a banking bill ahead of a bill with criminal justice and equity provisions, Blumenauer said that he “made the point to him that the very people that he cares about most in terms of equity and inclusion are the people who are paying the price.”
Booker is, along with Senate Majority Leader Chuck Schumer and Sen. Ron Wyden, leading the CAO Act. During a press conference about the Act’s draft form last year, Booker said, “I will lay myself down to do everything I can to stop an easy banking bill that’s going to allow all of these corporations to make a lot more money off of this, as opposed to focusing on the restorative justice aspect.”
This argument took hold from the moment the House first voted on the SAFE Banking Act, in 2019. Groups like the Drug Policy Alliance and the American Civil Liberties Union argued that the bill would “undermine broader and more inclusive efforts to reform our country’s marijuana laws” and “would benefit the marijuana industry, not communities who have felt the brunt of prohibition.”
The end of the briefing got away from the broader debate over how best to proceed with reform, and returned to the subject of public safety. Brady gave an overview of Washington state’s efforts in response to a rise in retail robberies. In March, cannabis regulators hosted a roundtable on the issue, as Cannabis Wire reported at the time. And in April, for example, the state’s Department of Financial Institutions published a list of “financial institutions providing services to cannabis retailers in Washington,” and began to provide “crime prevention training.”
“We believe a root cause of these violent robberies is the fact that these stores rely on cash transactions that can make them a target for crime,” Brady said. “We’ve heard that the TV news coverage of these robberies and associated videos scares people from entering the stores themselves. So instead of creating a safe environment for people to purchase a legal product, we risk entering a time in which people are afraid to go to the retail stores.”