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For safety and economic recovery, Congress must prioritize cannabis banking
As COVID-19 cases continue to climb, people are staying home, limiting trips outside the house except for essential business. For millions of Americans, those essential trips include visits to cannabis dispensaries. Despite its federal status, cannabis has been deemed essential in most states where it is legal for medical or adult use.
Yet the cannabis industry and those that it serves are disadvantaged by federal laws, which now, more than ever, have introduced avoidable risk and danger into the legal cannabis market. Federal lawmakers must act quickly to address these issues.
Currently, under federal law, cannabis businesses that comply with state laws are blocked from access to the most basic banking services, such as holding checking accounts or accepting credit card payments. This means companies like mine, a multistate cannabis company, conduct all our sales in cash. In this COVID-19 environment, there are two main risks associated with operating in physical currency.
First, cash itself is "dirty" to handle. As other essential businesses implement contactless payments and protocols to limit cash transactions in an effort to minimize the spread of the virus, the cannabis industry cannot, exposing employees and customers to additional and unnecessary risk.
The cruel irony is the cannabis industry serves many immunocompromised persons - medical cannabis is often prescribed to patients with cancer, multiple sclerosis and other comorbidities to manage chronic pain. We should be able to provide these people with the option to take the handling of money out of the equation for the safety of all involved.
Second, cash puts cannabis workers, law enforcement, patients and customers at risk. Just as other essential businesses have in the past weeks, cannabis companies have adapted to offer increased curbside pickup and delivery options in order to minimize human contact. In one notable case, the state of Nevada restricted all cannabis sales to delivery-only. This means a significantly higher number of cash transactions are occurring outside the safety of dispensary walls.
Federal legislation such as the Secure And Fair Enforcement Banking Act (SAFE Act) would address these challenges and lawmakers have an immediate opportunity to advance it.
The SAFE Act would create protections for financial institutions that provide services to legitimate cannabis-related businesses. This would empower cannabis companies with access to traditional banking tools, eliminating the costs and danger associated with operating in large amounts of cash. After passing the House in September, the legislation had yet to make any movement in the Senate this year.
However, federal lawmakers, led by Rep. Ed Perlmutter (D-Colo.) and Sen. Cory Gardner (R-Colo.), are working to get language from the SAFE Banking Act into the next coronavirus relief and response bill, and that language was included in the Health and Economic Recovery Omnibus Emergency Solutions Act (HEROES Act) that was passed by the House earlier this month. Lawmakers should support this provision to bring improved safety and security to law enforcement, essential workers in the cannabis industry and the patients and customers they serve.
Furthermore, the passage of the SAFE Banking Act would allow cannabis companies to pay local, state and federal taxes with checks and bank drafts at a time when this tax revenue may be more important than ever. Reform of cannabis banking regulations will allow for parity for businesses operating in regulated, safe markets and further ensure the safety of employees and the public.
By passing the SAFE Banking Act language included in this round of coronavirus response legislation, lawmakers also have the chance to bring economic fairness to an industry that is creating new jobs in agriculture, manufacturing, R&D, retail, delivery and logistics, and supporting numerous ancillary businesses while driving additional tax revenue at a time when other industries are shrinking. I hope that leadership in the Senate will recognize the immediate public safety and business implications and retain this language in any Senate version of response legislation.
In less than eight years, 11 states and Washington, D.C. have made recreational cannabis legal, and 33 other states have approved it for medical use. The sizable industry that now exists in states where medical and adult use cannabis is legal deserves the same financial access as any other business, especially when it means that essential cannabis businesses will be able to operate more safely during a national health crisis.
As Washington plans for additional economic stimulus and relief efforts for individuals and businesses impacted by the COVID-19 crisis, the passage of the SAFE Banking Act language is too important to millions of industry workers, patients and customers to delay any longer.