Cannabis rumors on Capitol Hill
The saga of federal cannabis legalization continues as the democratically controlled House of Representatives continues to pass extensive legalization laws that (to date) have received little support in the divided U.S. Senate. (Shortcut). The result has fueled speculation across the cannabis community as activists, entrepreneurs, and people with cannabis beliefs wait for the federal government to act.
And while it’s impossible to say exactly what a final cannabis reform bill will look like, connoisseurs (such as the editors of an unidentified cannabis newsletter) have learned some interesting things from the smoke signals from Capitol Hill.
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Chuck will have a lot to say
As Politico recently wrote, “Chuck Schumer loves to talk about weeds.” (Shortcut). Indeed, cannabis reform has become the driving force behind the high-ranking New York Senator as he continues to campaign for comprehensive legalization that could include anything from criminal justice reforms to regulations that allow plant-touching companies access to the US -Capital markets enable.
Leaflet sources have confirmed that Schumer will be the goalkeeper (at least for now) of what ultimately goes down, and that he’s committed to enforcing a more global law on legalization before moving on to a smaller law like the SAFE Banking Act (more further below). Schumer sees the budget vote – the bureaucratic process through which Congress often passes budget-related laws – as a potential vehicle for his favorite cannabis legalization bill and plans to get his bill out in the next few weeks.
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The bill itself may be released in the coming days and is expected to begin its legislative tour with the Senate Finance Committee, chaired by Washington Senator Ron Wyden. If the bill fails (as many in Schumer’s own warehouse expect), Schumer will likely move on to Plan B – the SAFE Banking Act.
The votes (May) are for SAFE Banking
The SAFE Banking Act was passed in May 2020 and would prohibit federal regulators from penalizing financial institutions for doing business with state-legal cannabis companies. It could also solve the cannabis industry’s Section 280E problem (read our article on it above if you missed it). (Shortcut).
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Several senators within the Democratic caucus have made it clear that the removal of Section 280E is of particular concern, and the House-passed version of the SAFE Banking Act provides that revenue from a state-legal cannabis business is not the proceeds of an illegal activity – cannabis- Companies can take the same normal business deductions that their colleagues in other industries can take. However, some Capitol Hill insiders are skeptical that this particular provision of the House version has the necessary Senate votes.
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However, leaflet sources have indicated that there may already be enough votes in the Senate to pass some form of SAFE Banking. And while this may disappoint some in the industry, it would nonetheless be a significant step forward in the fight for increased (if not full) legalization of cannabis. It could also set the table for a bigger cannabis bill in the months and years to come.
Rich Trotter is a litigator with the New York-based law firm Feuerstein Kulick, one of the leading cannabis law firms in the country.
This article originally appeared in Feuerstein Kulick’s monthly cannabis newsletter, The Leaflet, to which you can subscribe here. For more information, you can contact Rich at firstname.lastname@example.org or at (201) 410-4737, or email The Leaflet at email@example.com.