SAFE Banking has a “perfect opportunity” to pass Congress soon, says legalization leader

Earler today Rep. Earl Blumenauer (Oregon), one of the leading proponents of legalizing marijuana in Congress, said cannabis banking reform could be passed in months, if not weeks.

The SAFE Banking Act, which would protect banks and credit unions from federal penalties for servicing state-legal cannabis businesses, has passed Parliament six times in the past few years. But it always failed in the Senate.

A version of SAFE Banking is currently embedded in the America COMPETES Act of 2022, a massive economic revitalization bill. The House and Senate each passed slightly different versions of the bill. The House version included SAFE Banking; the Senate version does not.

Members of the House and Senate are now undertaking the long and tedious process of drafting a compromise bill that both houses can agree on. SAFE Banking may or may not survive this conference committee process. A similar attempt late last year – which embedded SAFE banking in the National Defense Authorization Act – foundered when the conference committee removed SAFE banking language from the final bill.

In a press conference today, Blumenauer described the COMPETES Act as the best chance yet for proponents to enact cannabis banking reform.

“There is a strong base of support for the stance [cannabis banking reform] in the bill,” said Blumenauer. “This is not a momentum that we have had before in terms of a clear path to implementation. This legislation is a high priority for Senate leadership. We think this is a perfect opportunity to get some movement in the SAFE Banking Act.

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Why is the COMPETES Act different?

After many failed attempts in the Senate, Blumenauer explained why he thinks these efforts may finally succeed. First, the fact that SAFE Banking actually made it to the conference committee is in a bill that has bipartisan support and strong momentum.

Unlike last year’s Defense Authorization Act, COMPETES can be seen as a more proper and natural vehicle for SAFE banking regulations, as the comprehensive omnibus bill aims to improve business terms for American companies.

There is growing recognition in Congress that “cash-only” rules have led to real physical and economic violence – particularly against smaller operators and people of color.

More importantly, however, is the growing recognition in Congress that people in the cannabis industry are suffering real trauma, violence and economic harm due to a lack of access to banking services. Forcing state-legal cannabis companies to operate as cash-only businesses has exposed them to a recent spate of armed robberies. Hundreds of legally tax-paying companies have been harassed in recent months. Employees at the front were murdered.

“We’ve seen 200 violent attacks on state-legal cannabis companies in Oregon in the last year,” Blumenauer said. “That’s an increase of 150%. Washington state has had 196 incidents since January, including people killed committing these crimes. This poses a particular threat to the smaller operators, the minority cannabis entrepreneurs who can only deal in cash. It is hopelessly unfair.”

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In recent years, Sen. Cory Booker (D-New Jersey) has vowed to block passage of SAFE Banking, arguing that it should wait behind full legalization legislation that includes social justice measures. But Booker’s argument has lost steam in recent months, as the wave of robberies exposed the vulnerability of smaller operators, minority entrepreneurs and white-collar workers.

When it comes to justice, according to Blumenauer, it’s about “the people who pay the price [right now] in case of violence. This is a direct attack on low-income people of color, people in emerging economies — they are the ones vulnerable to this violence. I want that solved. The people we worry about [with regard to equity provisions] are smaller operations, people of color – and they are on the front lines of this violence.”

New voices enter the conversation

As evidence, Blumenauer pointed to a recent media event hosted by Senator Patty Murray (D-WA), where she urged her Senate peers to include SAFE banking in the final COMPETES Act bill.

Murray is best known for her work supporting working-class families and military veterans, not legalizing marijuana. But she made a point of speaking out on April 20 this year — because her constituents were literally being killed.

“It makes absolutely no sense for legal cannabis companies to be forced to operate exclusively with cash,” Murray said. “It’s dangerous – and sometimes fatal – for the staff behind the checkout, but this situation is also completely avoidable. I urge each of my colleagues to come together so we can finally pass the SAFE Banking Act.”

Murray’s vocal support was particularly notable because she serves as the chief negotiator on the conference committee settling differences between the House and Senate versions of the America COMPETES Act.

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Bruce Barcott

Leafly senior editor Bruce Barcott oversees news, investigations and feature projects. He is a Guggenheim Fellow and the author of Weed the People: The Future of Legal Marijuana in America.

Check out Bruce Barcott’s articles

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