GOP lawmakers in the U.S. House of Representatives this week removed legislative provisions to protect banks that serve cannabis businesses from a federal funding bill after resistance from fellow Republicans. The legislation was removed from the financial services and general government bill that provides annual funding for the Treasury Department and federal payments for the District of Columbia and the Securities and Exchange Commission, as well as other federal agencies, according to a report from The Hill.
The cannabis banking provisions of the bill would have blocked federal funds from being used to “penalize a financial institution solely because the institution provides financial services” to businesses involved in the hemp and state-legal cannabis industries. The legislation was included in the Republicans’ initial draft version of one of the dozen annual funding bills GOP leaders hope to pass into law before election season heats up this fall.
GOP Representative Dave Joyce of Ohio, the co-chair of the Congressional Cannabis Caucus and the chair of the House subcommittee responsible for drafting the funding bill, said that the cannabis banking provisions were struck from the legislation after some of his fellow Republicans had “taken issue” with the measure.
“With over 40 states enacting some degree of cannabis reform, it is past time that the federal government respect the will of these states. This issue is especially pertinent as cannabis regulations have been proven to increase public safety and quality of life for Americans,” Joyce said at a subcommittee markup hearing for the legislation earlier this month, The Hill reported.
“My Financial Services and General Government bill included provisions to do just that and ensure states’ rights to make the best choices for their unique constituencies are protected,” the lawmaker added.
During the subcommittee markup hearing, North Carolina GOP Representative Chuck Edwards attacked the cannabis banking provisions of the funding bill, characterizing the legislation as “affirmative authorization disguised as a limitation” and noting that marijuana is still illegal under federal law.
“Our country has never allowed a federally illegal activity to be banked, and it’s important to note that, despite some states trying to legalize marijuana, still a Schedule I drug, marijuana is still illegal,” Edwards told his fellow lawmakers on the subcommittee. “And I believe that it should remain illegal. It’s dangerous, and more and more evidence is being found that it causes irreparable harm, particularly to younger minds.”
Cannabis Banking Legislation An Elusive Goal
Although the Biden administration has taken steps to reclassify cannabis under the Controlled Substances Act, the full legalization of recreational marijuana at the federal level is still seemingly years away. While Congress is still opposed to comprehensive legalization, many lawmakers, particularly from states that have legalized medical marijuana or adult-use cannabis, want to see federal banking restrictions on cannabis businesses eased. Under federal drug and money laundering laws, financial institutions are subjected to onerous federal restrictions on cannabis business accounts, making banking services for weed companies expensive or unattainable.
Legislation to ensure equal access to banking services for businesses in the cannabis industry, the Secure and Fair Enforcement (SAFE) Banking Act, has been passed in the House, either as standalone legislation or attached to another bill, more than half a dozen times. But so far, the Senate has failed to bring the legislation, including a revamped measure known as the Secure and Fair Enforcement Regulation (SAFER) Banking Act, up for a vote by the full chamber.
After the cannabis provisions were stricken from the funding bill, Joyce vowed to continue efforts to ease banking restrictions on marijuana businesses.
“While the provisions maintain strong bipartisan support, as Chairman, I will work to alleviate their concerns but will not delay my responsibility to fund the government and therefore my legislation in the meantime,” he said Thursday. “However, let me be clear, I will not abandon this effort in Congress and will continue to work with my colleagues in good faith to ensure they become law.”
