Cannabis legislation in the US Congress is ramping up with an eye towards banking.
New year, new Congress, new cannabis legislation? That is, indeed, the way it’s shaping up at the moment. While there are multiple bills making the rounds in both the House and the Senate, one in particular caught our eye and we wanted to talk about it in this weeks blog.
The House has the first hearing of the year scheduled for tomorrow – Feb 19 – with the House Financial Services subcommittee and the Consumer Protection subcommittee taking the reins on this one. Of course we expect that it will be a lot of talk and no action, but now that Congressman Pete Sessions has been sent back to his home state of TX and the Dems have taken over the House, it’s possible that this one might present us with some pleasant surprises.
Bipartisan cannabis legislation introduced into the House
Walking in lockstep with this hearing is a new bill that’s being presented to start paving the way for state licensed, compliant cannabis industry businesses to be eligible for banking services. The co-authors of the bill – Reps. Ed Perlmutter (D-CO), Denny Heck (D-WA), Steve Stivers (R-OH) and Warren Davidson (R-OH) – make it a bipartisan affair, and that’s a significant sign that perhaps there will be positive movement towards getting it passed and signed into law.
Cannabis legislation often ends up derailed, especially when other things are attached to it, although most of the decent laws on the books came about because they were tagged onto other, mostly unrelated bills centering around appropriations and budgeting.
Who will benefit from this new cannabis legislation?
Ancillary businesses look to be getting specific protection under the new law, which should lead to way fewer accountants, architects, or lighting manufacturers waking up to find their bank accounts frozen and their business no longer wanted by their long time bankers. Paypal and Square are also mentioned by name in a memo that accompanies the text of the bill as it makes the rounds on Capitol Hill.
Indian tribes also get a nod in this new cannabis legislation, along with smaller financial institutions, as well as directions for the Federal Financial Institutions Examination Council to develop “uniform guidance and examination procedures for depository institutions that provide financial services to cannabis-related legitimate businesses.”
Last but certainly not least – the Board of Governors of the Federal Reserve System, the Bureau of Consumer Financial Protection, the Federal Deposit Insurance Corporation, the Office of the Comptroller of the Currency and the National Credit Union Administration are being instructed to each issue guidelines to banks for working with cannabis businesses.
It’s a rather comprehensive piece of cannabis legislation and we can only hope that it will wend it’s way through the process and land on the president’s desk sometime this year; we’re not holding our breath though, given that the last version of this bill had 95 co-sponsors and still was not allowed to come to a vote in committee – effectively killing the chances for it to go anywhere at all.
Fingers crossed that cannabis legislation gets through committee and into the full House quickly!
If you’d like to read the full text as it’s currently circulating, here’s the link to the Scribd site – https://www.scribd.com/embeds/399353646/content