Colorado Governor Calls For Passage Of Marijuana Banking Bill

Democratic Gov. Jared Polis of Colorado and a group of state officials on Monday called on congressional leaders to pass a bill that would give regulated cannabis business access to traditional banking services. In a letter sent to party leaders of both houses of Congress, Polis and officials including the lieutenant governor and the attorney general wrote that the lack of financial services “has become a dire public safety issue for highly regulated cannabis businesses operating in compliance with state law.”

In the letter, the Colorado state leaders called on Congress to pass “the Secure and Fair Enforcement (SAFE) Banking Act of 2021 or similar federal legislation that allows licensed cannabis businesses access to banking and financial services and send it to the President’s desk for enactment.” The bill, which was originally introduced in Congress nine years ago by Democratic Rep. Ed Perlmutter of Colorado, has been passed by the House of Representatives seven times but has failed to gain the approval of the U.S. Senate. The letter was signed by Colorado Lt. Governor Dianne Primavera, state Attorney General Phil Weiser, Treasurer Dave Young and Stan Hilkey, the executive director of the Colorado Department of Public Safety.

“The bipartisan SAFE Banking Act provides a critical pathway for banks, credit unions, and other financial institutions to offer broad scope banking services to legally-operating, state regulated cannabis businesses without fear of punishment by federal regulators, while also enhancing transparency by providing broader access to reliable sources of information for purposes of regulatory oversight,” the state officials wrote in their letter.

The letter from Colorado state officials just days after President Joseph Biden announced he would pardon all federal convictions for marijuana possession and explore reducing restrictions on the drug. The letter was addressed to Senate Majority Leader Chuck Schumer, Speaker of the House Nancy Pelosi, Minority Leader Mitch McConnell and Minority Leader Kevin McCarthy.

The SAFE Banking Act

The SAFE Banking Act (H.R. 1996) would permit banks and other financial institutions to provide traditional business banking services to the legal cannabis industry. Under current regulations, providing such banking services including loans and payroll, checking and deposit accounts is tightly regulated by the federal government, resulting in few financial institutions agreeing to work with marijuana businesses. Critics note that the current policy forces cannabis companies to operate primarily in cash, leaving businesses vulnerable to robbery and other crimes.

The SAFE Banking Act was first introduced in Congress by Perlmutter in 2013. Since then, the House of Representatives has passed the bill seven times as either a standalone bill or attached to other legislation, most recently as an add-on to a must-pass defense appropriations bill that is pending in Congress. Each time the cannabis banking bill or its provisions have been approved by the House, however, the legislation has failed to gain the approval of the Senate.

In their letter, the Colorado state leaders maintain that the lack of access to banking presents a safety issue for cannabis companies operating under state law, noting that regulated businesses in “Colorado have experienced break-ins and robberies resulting in millions of dollars of damage, stolen property, and even death.” They also noted that the lack of banking services compounds challenges to creating an inclusive cannabis industry that reflects the communities they operate in.

“This lack of access to financial systems has only compounded the barriers historically faced by minority, women-, and veteran-owned cannabis small businesses and the barriers faced by Coloradans to access capital needed to establish and sustain their businesses,” Polis and the state officials wrote. “As a result, many cannabis small businesses with cash-only operations have served as a convenient target for robberies and fraud, triggering significant public safety risks and placing small and underrepresented businesses at a distinct disadvantage.”

Bipartisan support for the SAFE Banking Act is strong. In addition to gaining approval in the House seven times, the legislation is co-sponsored in the Senate by 42 senators, including 31 Democrats, nine Republicans and two independents. But Colorado officials and politicians in the nation’s capital aren’t the only ones who believe that Congress should pass the SAFE Banking Act. In a poll released last month by the Independent Community Bankers of America, 65% of voters said they support legislation to provide traditional banking services to licensed cannabis companies.

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