21 governors urge Congress to pass the SAFE Banking Act
A bipartisan group of twenty-one state governors sent a letter to the leaders of Congress Monday calling on lawmakers to support a bill that would give legal cannabis companies access to traditional banking services. The measure, entitled SAFE Banking Act (Secure and Fair Enforcement), was approved by the House of Representatives on Monday this week and is now being forwarded to the Senate for further consideration.
Before the House vote, 18 Democratic governors joined three of their Republican counterparts in calling on Congress to back the move, noting that federal regulations make obtaining shared banking services like payroll and checking accounts nearly impossible.
“With few banks and credit unions offering these services, state-licensed cannabis companies operate mostly on a cash basis,” the governors wrote in the letter. “Without banking services, government-licensed cannabis companies cannot write checks, make and receive electronic payments, use payroll, or accept credit and debit cards.”
Governors found that lack of access to financial services leads a cannabis industry to run largely on cash, negatively impacting public services and making marijuana companies particularly vulnerable to crimes such as robbery, theft and corruption.
“Cash-only companies pose a significant risk to the public safety of customers and employees,” the governors added. “The cash-only environment also puts a strain on state and local government agencies who have to collect tax and fee payments in person and in cash, creating additional public spending and employee safety risks.”
The green wave of legalization goes beyond the SAFE Banking Act
The bipartisan group of governors also found that 36 states, four US territories, and the District of Columbia have legalized the medicinal use of cannabis, and 18 states, two territories, and DC have passed laws prohibiting the recreational use of cannabis by adults legalize. The heads of state encouraged lawmakers in Congress to pass laws authorizing banking services for licensed cannabis companies.
“We urge you to pass the SAFE Banking Act of 2021 or similar law that provides a safe haven for custodians offering a financial product or service to a state-licensed cannabis company in states that have legalized cannabis,” it said the governors concluded their letter.
Among the heads of state who signed the letter to lawmakers was Michigan Democratic Governor Gretchen Whitmer, who said it was time for the nation’s laws to reflect the wave of legalization that is sweeping across state, territorial and government Spreading tribal governments.
“Although legalization continues nationwide, we still have federal laws on the books that prohibit financial institutions from legally working with marijuana companies under state law,” Whitmer said in a press release. “To be honest, legalization is great for business: it creates jobs and increases tax revenue that can be used for our schools, communities and first responders. This legislation ensures that Michigan’s marijuana businesses can grow and access the same resources as any legal business. “
Democratic Governor Jared Polis of Colorado, where voters legalized medical marijuana in 2000 and used adult cannabis in 2012, also signed the letter calling for the SAFE Banking Act to be passed. In a press release, he called on lawmakers to “make the sensible decision to allow state-licensed cannabis companies to have normal bank accounts.”
“Colorado has been a model of the success of these companies for more than a decade, and we long ago allowed them to join our banking system,” said Governor Polis.
The SAFE Banking Act was passed by the House of Representatives on Monday, the eve of the cannabis community’s 4/20 celebration. To become law, the law must also be passed by the Senate by a Democratic majority and signed by Democratic President Joe Biden.