Cannabis Banking Reforms Delayed Once Again After Being Stripped From Defense Bill

In a 363 to 70 vote, House lawmakers on Tuesday night passed a new version of a bicameral defense spending bill that doesn’t include cannabis banking reforms, sparking disappointment and frustration among advocates and stakeholders.

Back in September, the House had approved an initial version of the National Defense Authorization Act (NDAA) with provisions to protect financial institutions that work with cannabis businesses in states where weed is legal.

But the provisions didn’t make it into the latest bill.

The Secure and Fair Enforcement (SAFE) Banking Act’s core purpose is to prohibit federal regulators from penalizing banks that provide financial services to cannabis businesses. Across the country, cannabis operators have struggled to access basic financial services – from opening a bank account to getting a basic loan – because most banks won’t take the legal risk of working with them. As a result, many cannabis businesses operate exclusively in cash, making them an easy target for robberies.

Rep. Ed Perlmutter, a Democrat from Colorado who is the lead sponsor of the SAFE Banking Act, said on Tuesday that failing to pass cannabis banking reforms leaves people and businesses exposed.

“People are still getting killed and businesses are still getting robbed because of a lack of action from the Senate,” Perlmutter said in a statement. “The SAFE Banking Act has been sitting in the Senate for three years and with every passing day their unwillingness to deal with the issue endangers and harms businesses, their employees, and communities across the country.”

Perlmutter filed an amendment to attach the banking provisions on Tuesday, though he ultimately opted not to force a vote on the measure to avoid jeopardizing the larger defense bill, which Congress has struggled to pass.

“My work on this bill is far from over,” he said. “As Speaker Pelosi and Senate Majority Leader Schumer are aware, going forward, I plan to pursue every possible avenue to get SAFE Banking signed into law.”

There’s a growing rift among pro-cannabis lawmakers in Congress on how and when to tackle cannabis reforms. Sen. Majority Leader Chuck Schumer, who earlier this year unveiled a comprehensive bill to legalize cannabis at the federal level, has insisted that equity-focused reforms should be prioritized over all else, including financial reforms.

That approach has angered some pro-cannabis members of Congress, who say the majority leader is unnecessarily holding things up. Several members of the House Rules and Armed Services committees attacked Schumer on Tuesday for slowing down the process on cannabis banking reforms.

“The Senate Majority Leader – I don’t really quite know what the hell his problem is,” said Rules Committee Chairman Jim McGovern (D-Mass.). “He’s making it very difficult for a lot of small businesses—and minority-owned businesses – to deal with the issue of cannabis, to be able to move forward and to expand and to hire more people.”

Last month, a coalition of banking, insurance, real-estate and labor groups penned a letter to Senate leaders urging them to include the cannabis banking reforms in this year’s defense spending bill.

“Despite 36 states and several territories permitting cannabis use, a growing number of Americans and legal businesses continue to face civil and even criminal liability if they service state-licensed cannabis business and ancillary companies,” said the letter, which was co-signed by the American Bankers Association.

Despite the SAFE Act’s failure to pass on Tuesday, experts say the bill enjoys broad support across the political spectrum and will eventually pass.

Cannabis Banking Reforms Delayed Once Again After Being Stripped From Defense Bill

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