U.S. House Passes SAFE Banking Act as Part of New Corona Virus Relief Bill: UPDATE
On Friday, the U.S. House passed a $3-trillion relief bill aimed at the economic pressures of the coronavirus pandemic. Included in the bill was the legislative language of the SAFE Banking Act, which would allow cannabis businesses to work freely with banks.
The stimulus bill is known as The Health and Economic Recovery Omnibus Emergency Solutions (HEROES) Act.
Despite cannabis businesses being deemed essential in nearly every state with legal cannabis programs, other federal relief efforts do not extend to the industry due to federal prohibition.
“I do think that there will be continued conversations around reform efforts to make it more mainstream for these businesses to operate because at a time like this, where you are talking about cannabis being an essential service yet doing so with one hand tied behind their back, I think people are saying, ‘Look, if these are essential businesses and have been deemed so by some of the states if not all of them that have put these shelter-in-place orders in place, we need to make it easier for these businesses to do business so they can continue to provide these essential services,'” Jonathan Havens, co-chair of the Cannabis Law Practice and chair of the Food and Beverage Practice at Saul Ewing Arnstein & Lehr, told Cannabis Business Times.
For Havens, the House’s passage of the banking provisions is a natural next step following the cannabis industry’s essential status during the COVID-19 pandemic.
“Maybe this was House Democrats’ way of providing some delayed relief to the cannabis industry by fixing one of the primary challenges of the cannabis industry, which is lack of ready access to banking, commercial lending and … capital markets,” Havens said. “I guess it’s surprising, but at the end of the day, not all that unexpected given that the House has acted on the SAFE Act before and has passed it.”
Now, the bill heads to the U.S. Senate, which has never passed cannabis banking legislation. Top Republican senators, as well as President Trump, have voiced opposition to the HEROES Act, citing political disagreements on the crisis. As Marijuana Moment points out, Senate Majority Leader Mitch McConnell (R-KY) took a moment on the floor to specifically call out the cannabis banking provisions in the bill.
“I would be surprised if it passed the Senate, just given Senate Majority Leader Mitch McConnell’s statements on the SAFE Act previously, and given his statements in the last 24 hours about his reaction to it being included in the House bill,” Havens said. “It’s not enough that the House is going to do this. The Senate really needs to act on this in concert, and it doesn’t sound like they’re going to do that if you take your cues from McConnell.”
“People forget that our federal drug policies have been the way they are for several decades,” he added. “It’s kind of like steering a big, rusty, creaky ship in a different direction than it’s been going. It’s tough to turn that wheel over.”