There were numerous fits and starts with the Secure and Fair Enforcement Banking Act (the “SAFE Banking Act”) in 2019, and 2020 is off to a similar start with U.S. Representatives asking Senator Mike Crapo (R-ID), the Senate Banking Committee Chairman, to reconsider proposed changes to the SAFE Banking Act.
The issue came to the surface in December when Senator Crapo suggested changes to the SAFE Banking Act, the most significant (and troubling) of which was a cap on the content of cannabis products at 2% THC. This is a significant provision because the THC content of many cannabis products far exceeds 2%.
According to a recent article in PoliticoPro, in response to the proposed changes, four representatives—Ed Perlmutter (D-CO), Steve Stivers (R-OH), Denny Heck (D-WA), and Warren Davidson (R-OH)—recently sent Senator Crapo a letter expressing their opposition. They stated, in part, that “[w]e should exercise caution before adding limitations to the legislation’s safe harbor that would impose unworkable burdens on financial institutions, or would jeopardize the larger, bipartisan effort to address public safety concerns associated with cash-only transactions.” They further reiterated that the SAFE Banking Act “is focused solely on taking cash off the streets and aligning federal banking laws with the decisions states are already making regarding cannabis.”
It is not clear where this goes from here. If Senator Crapo presses forward with his proposed changes, he will likely produce a bill that can pass the Senate, but may no longer be able to pass the House. And if he walks back the proposed changes, he risks having a bill that cannot pass the Senate. Our hope continues to be that common sense will prevail, and all sides can find a solution that will allow state-legal cannabis companies to use financial institutions and access capital in a productive way. We will keep you posted on our blog.