After months of telling the public that they were working on a federal cannabis bill, Senate Majority Leader Chuck Schumer, the Finance Chairman Ron Wyden, and Senator Cory Booker have unveiled their legislation for public comments. However, before Congress has the chance to look at and advance the Cannabis Administration and Opportunity Act, a Congressman would like lawmakers to pass a cannabis banking bill. Rep. Ed Perlmutter, who introduced a bill that would protect banking institutions which work with businesses in the cannabis space, has urged lawmakers to pass the legislation while lawmakers consider broader cannabis reform.
Despite being allowed in more than two dozen states, cannabis is still considered a Schedule I drug by federal law. Consequently, cannabis businesses have been locked out of a variety of crucial services including banking. Fearing reprisals from the federal government, banks as well as credit institutions have refused to work with the state-legal cannabis industry, compelling cannabis firms to work on cash-only terms. The Secure and Fair Enforcement (“SAFE”) Act was introduced to protect banks that work with businesses in the legal cannabis space without fear of federal retaliation.
Now that the Cannabis Administration and Opportunity Act has been unveiled for public comment, Perlmutter says the industry urgently needs the SAFE Banking Act to pass. Forced to rely on only cash payments, cannabis businesses often have large sums of money on-site, putting them at great risk of burglaries and robberies. Additionally, the coronavirus can survive on paper currency for up to 28 days, meaning businesses that don’t use cashless payment platforms increase the likelihood of both their employees and customers contracting the virus.
Thanks to its narrow focus, the legislation also has a much higher chance of advancing in the Senate compared to the comprehensive legislation bill. Speaking at a recent interview, Perlmutter stressed that it was important to pass the SAFE Banking Act as soon as possible to reduce the risk associated with keeping large sums of money on-site. It is the first of many federal cannabis reforms, he says, and it will help make the industry significantly safer and more equitable.
Despite the fact that this bill could have positive and wide-ranging effects on the state-legal cannabis industry, it has plenty of detractors, especially in the Senate. Some lawmakers feel that advancing the SAFE Banking Act would be putting industry interests over social equity, and Booker has said that he will block any senator who tries to push the cannabis banking legislation before comprehensive cannabis reform advances.
The enactment of policy reforms easing the regulatory hurdles and grey areas faced by cannabis companies such as Simply Sonoma Inc. would go a long way toward facilitating further growth in this sector. which employs a significant number of people and brings other benefits to society.
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