Merkley, Daines Urge Colleagues to Build Pathway Forward for Bipartisan Legislation To Ensure that Legal Cannabis Businesses Can Access Crucial Financial Services

Washington, D.C. – Oregon’s U.S. Senator Jeff Merkley and U.S. Senator Steve Daines (R-MT) are urging the Chair and Ranking Member of the Senate Banking, Housing, and Urban Affairs Committee to schedule a markup for the Secure and Fair Enforcement (SAFE) Banking Act, bipartisan legislation introduced by Merkley and Daines that would finally allow legal cannabis businesses to access banking and other financial services.

“This is not simply a matter of banking,” the senators wrote in their letter to Banking Committee Chairman Sherrod Brown (D-OH) and Ranking Member Pat Toomey (R-PA). “The inability of these state-legal entities to bank their significant cash reserves is an issue of public safety. According to the Oregon Liquor Control Commission (OLCC), there have been 135 robberies and armed burglaries against cannabis dispensaries in the state since May 2020.  Montana is no exception to this. In Yellowstone County, two medical marijuana dispensaries were burglarized on the same day in March.”

“According to reporting, the majority of Americans now have access to legal cannabis – through laws allowing for either recreational or medical use.[1] Further, according to BDSA, legal sales in the United States in 2020 generated $17.5 billion, with the expectation that those sales will reach $41.3 billion by 2026.[2] For the good of our communities, we cannot allow huge proportions of these funds to remain unbanked,” they continued. “We owe this to our constituents to hold a markup on this bill and further the legislative process.”

To address the safety concerns resulting from these state legal businesses being shut out of banking services, the SAFE Banking Act would prevent federal banking regulators from:

• Prohibiting, penalizing or discouraging a bank from providing financial services to a legitimate state-sanctioned and regulated cannabis business, or an associated business (such as an lawyer or landlord providing services to a legal cannabis business);
• Terminating or limiting a bank’s federal deposit insurance solely because the bank is providing services to a state-sanctioned cannabis business or associated business;
• Recommending or incentivizing a bank to halt or downgrade providing any kind of banking services to these businesses; or
• Taking any action on a loan to an owner or operator of a cannabis-related business.

The bill also creates a safe harbor from criminal prosecution and liability and asset forfeiture for banks and their officers and employees who provide financial services to legitimate, state-sanctioned cannabis businesses, while maintaining banks’ right to choose not to offer those services. The bill also provides protections for hemp and hemp-derived CBD related businesses.

The bill would require banks to comply with current Financial Crimes Enforcement Network (FinCEN) guidance, while at the same time allowing FinCEN guidance to be streamlined over time as states and the federal government adapt to legalized medicinal and recreational cannabis policies.

Full text of the senators’ letter is available here, and follows below.

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Dear Chairman Brown and Ranking Member Toomey,

We write today imploring you to schedule a markup for the Secure and Fair Enforcement (SAFE) Banking Act (S. 910). This legislation, which would create common sense reform to the state-legal cannabis industry, has strong bipartisan support in the Senate with 37 co-sponsors, plus ourselves. On April 19^th, the SAFE Banking Act passed the House of Representatives for the second time, also with strong bipartisan support in a vote of 321-101.

This is not simply a matter of banking. The inability of these state-legal entities to bank their significant cash reserves is an issue of public safety. According to the Oregon Liquor Control Commission (OLCC), there have been 135 robberies and armed burglaries against cannabis dispensaries in the state since May 2020.  Montana is no exception to this. In Yellowstone County, two medical marijuana dispensaries were burglarized on the same day in March.

And yet, we continue to see movement in states towards legalization. In the November 2020 election, New Jersey, South Dakota, Montana, and Arizona passed measures to support recreational use. Laws have also been passed in New Mexico, with retail sales to go into effect by April 2022; New York; and Virginia. According to reporting, the majority of Americans now have access to legal cannabis – through laws allowing for either recreational or medical use.[3] Further, according to BDSA, legal sales in the United States in 2020 generated $17.5 billion, with the expectation that those sales will reach $41.3 billion by 2026.[4] For the good of our communities, we cannot allow huge proportions of these funds to remain unbanked.

We owe this to our constituents to hold a markup on this bill and further the legislative process. To foster success rather than gridlock, we believe this markup on S. 910 is necessary and should focus on policies with robust bipartisan support.

We ask that the committee take action on this legislation without delay.

Sincerely,