Advocates are still searching for ways to get the law that will allow legal cannabis businesses access to banks, after a failed attempt to include it in the must-pass defense spending bill was defeated. In the National Defense Appropriations Act – an annual budget that finances the military, the bill’s proponents hoped to incorporate provisions from the banking bill known as Secure and Fair Enforcement(SAFE Banking Act), into the bill. However, the latest version released Tuesday of the NDAA didn’t include cannabis-related language.

Federal banking regulators will be forbidden from penalizing banks who choose to service cannabis businesses in compliance with state law under the SAFE Banking Act. Current regulations make it illegal for banks to serve such firms under federal money laundering laws. This leaves the cannabis industry in an unregulated environment. 

In 2013, the House was presented the legislation by Ed Perlmutter, a Democratic Representative from Colorado. Each subsequent cycle of Congress has seen the bill reintroduced. Since 2019, the House of Representatives has passed the bill seven times, however the Senate has not brought the legislation up for vote.

A second amendment, which was supported by advocates for cannabis policy reform and would have granted the states aid in the expungement of past marijuana-related criminal convictions, also fell short of being included in the final version the defense spending bill. The NDAA’s latest text was not released until Tuesday. However, Senator Chuck Schumer from New York stated to reporters that he is still trying to get the cannabis banking bill passed.

“It’s a priority for me,” Schumer said. “I’d like to get it done. We’ll try and discuss the best way to get it done.”

Republicans Resist Adding SAFE to the Defense Bill

Later in the day, Senator Minority Leader Mitch McConnell from Kentucky warned Democrats about attaching amendments to the spending bill that were not directly related to defense.

“Even now, House and Senate Democrats are still obstructing efforts to close out the NDAA by trying to jam in unrelated items with no relationship to defense,” McConnell said on the Senate floor on Tuesday. “We’re talking about a grab bag of miscellaneous pet priorities — like making our financial system more sympathetic to illegal drugs, or the phony, partisan permitting-‘reform’-in-name-only language that already failed to pass the Senate this year.”

“If Democrats wanted these controversial items so badly, they had two years to move them across the floor. These matters could have been scheduled for voting this week, if they wanted to. But no — we’re doing more mid-level nominations, while Democrats keep half-threatening to take our Armed Forces hostage over these extraneous matters,” said McConnell, adding “The Democrats’ failure to plan ahead for unrelated liberal pet priorities should not be creating uncertainty and confusion for the brave servicemembers who keep us safe. My colleagues across the aisle need to cut the unrelated hostage-taking and put a bipartisan NDAA on the floor.”

What’s Next?

The potential of passing the marijuana banking legislation in Congress before it adjourns next week is hampered by the failure to include SAFE Banking Act within the NDAA. Morgan Fox, the national policy reform group’s political director, stated that SAFE can be added to an omnibus bill of appropriations or approved separately.

“I’m glad that we still have other options,” Fox said Wednesday. “It’s pretty disappointing.”

“While there has been momentum and optimism around getting SAFE included in the National Defense Authorization Act, it has been known for some time that getting this through would be a challenge,” Sahar Ayinehsazian, partner at the cannabis law firm Vicente Sederberg LLP, wrote in an email to Chronic News. “The focus now is on the omnibus appropriations bill, which congress is currently negotiating. SAFE has growing support on both sides of the aisle and I, and many others in the industry close to this issue, think that there is a still a chance that movement can be made on SAFE via the omnibus bill during this session of Congress.”

A bipartisan coalition consisting primarily of senators and representatives from the states where medical cannabis or adult-use marijuana has been legalized is backing the SAFE Banking Act. It passed the House by an overwhelming vote of 321 to 110 in 2011. Senators of both political parties also supported the bill.

“The Senator is continuing to work every day to build consensus so we can pass “SAFE Banking” into law this year,” a spokesperson for Montana Republican Senator Steve Daines said in an email on Wednesday.

The senior senator from Montana, Senator Jon Tester, a Democrat, also said he “would like to see it pass this Congress.”

Nearly two dozen governors from states with liberalized cannabis policy support the banking bill. Conor Cahill (a spokesperson for Democratic Colorado Governor Jared Polis) praised Perlmutter’s work and stated that he expected the legislation to be passed this year.

“Governor Polis has long advocated for the passage of the SAFE Banking Act, and has repeatedly called upon Congress to pass this important legislation to protect cannabis-related businesses, support minority, women, and veteran-owned small businesses owners, create jobs, and strengthen public safety in Colorado communities and in the states,” Cahill wrote in a Tuesday email. “We hope and expect to see the final passage of his decade-long effort by the end of the lame-duck session.”