It seemed like cannabis banking would become a reality this summer, but Senate Committee Chairman Mike Crapo has put a damper on legislative proceedings. Despite his commitment to pushing for a vote, the Department of Justice and Treasury Department remain unconvinced as to the legality of the proposed banking reforms. Thus, it seems lobbying efforts will have to be significantly increased if we are to see cannabis banking pass through the Senate anytime soon.
1. Chairman’s Goal for Marijuana Banking Bill May Not Come to Fruition
The recent push for a federal banking bill for marijuana companies by House Financial Services Committee Chairman Maxine Waters may be a fruitless effort. Despite the heightening tension between the federal government and states with legalized marijuana, it is unlikely the proposed legislation will become law anytime soon.
The proposed bill seeks to clarify the current marijuana banking regulations and provide financial services for marijuana-related businesses. However, since the sales of marijuana products are still illegal under the federal Controlled Substances Act, most banks are hesitant to do business with companies in the marijuana industry. Furthermore, its passage through Congress is not likely in the near future. Senate Majority Leader Mitch McConnell has said he will be a ‘short circuit’ for any marijuana-related legislation, and with a Republican-controlled Senate, its passage appears to be a distant possibility. Despite Chairman Waters’s dedication to the cause, it is unlikely her singular vision for a federal banking bill for marijuana companies will come to fruition.
- The proposed bill seeks to clarify the current marijuana banking regulations
- Marijuana products are still illegal under the federal Controlled Substances Act
- Senate Majority Leader Mitch McConnell acts as a ‘short circuit’ for any marijuana-related legislation
2. Lobbying Group Reports on Potential Delays
As all projects involving significant bureaucratic steps go, there are bound to be delays of any sort. The lobbying group tasked with overseeing the project’s progress has been diligently monitoring the situation and, unfortunately, have reported some potential delays.
Their reports highlight a few major factors:
- Organizational Readjustment: With the recent reshuffling of departmental duties, some redundancies and inefficiencies have been noticed.
- Resource Overlap: Discrepancies between the sources and availability of materials and personnel have also raised concerns.
- Funding Snake Pits: Dealing with the bureaucratic maze that often comes with filing for reimbursement or grants has drained the project’s timeline.
Overall, the lobbying groups assures the public that they are doing their utmost to ensure the project runs as smoothly as possible and are actively trying to reduce or remove any sources of delay. They urge the public to be patient and trust that they will get to the finish line soon.
3. Cannabis Banking Addressed By Senate Committee
The Senate Committee addressed the complex issue of banking for cannabis businesses this week. Voting to advance legislation, the committee acknowledged the critical need to provide financial services to legitimate companies in the marijuana industry, as those businesses are now unable to access such services due to federal laws that have categorized cannabis as an illegal drug.
The proposed legislation is in response to a growing economic problem faced by numerous states whose citizens have voted to legalize the recreational and medical use of marijuana. It would grant exemptions from certain federal criminal laws and regulations to cannabis-related businesses as long as those businesses adhere to applicable state laws. Additionally, financial institutions would be protected from liability for providing services to cannabis-related businesses.
- Senate Committee votes to advance legislation
- Federal criminal laws and regulations will be exempted
- Financial Institutions protected from liability
4. Summer Vote on Banking Legislation Called Into Question
The latest attempts to push for bank legislation over the summer months have been brought into question by several players in the industry. The small window of change, due to the short summer legislative calendar, has posed a significant hurdle for many of the proposed changes. This has raised several eyebrows among banking professionals and political commentators alike.
The concerns revolve around the amount of material covered in a short space of time. The all-to-short summer is always a test for lawmakers, but this time the call for a banking overhaul has added an unprecedented layer of complexity. Many lobbyists are viewing the situation with skepticism about whether the right foundations can be laid down in just a few months. Will attempts to make a lasting change in banking regulations be feasible in such little time? Many are rightly concerned that the bills will be rushed through, without the necessary in-depth scrutiny.
- Pros: Chance of needed updates to legislation
- Cons: Limited time for robust debate and draft review
At this time, it looks like banking reforms for legal cannabis businesses won’t be voted on during the summer session of Congress. Despite the Senate Committee Chairman’s goal, the bill may have to wait its turn in the Senate schedule. We’ll have to stay up to date on how this affects the cannabis industry in the United States.