Schumer Aims To Bring Newly Revised Marijuana Banking Bill To The Floor ‘With All Due Speed’ After Next Week’s Committee Vote
Published 16 hours ago on September 19, 2023By Kyle Jaeger
A marijuana banking bill that’s set for a Senate committee markup next week has an updated title and several new provisions related to federal financial regulations, guidance and reporting requirements, according to a summary that is circulating. And Senate Majority Leader Chuck Schumer (D-NY) said on Tuesday he intends to “bring this legislation to the floor with all due speed.”
The title of the measure is being extended by one word. The bill that’s being circulated ahead of the Senate Banking Committee vote is now being called the Secure and Fair Enforcement Regulation (SAFER) Banking Act.
Importantly, the summary, first reported by Politico, offers a first look at the types of compromises senators appear to have made in order to bolster bipartisan buy-in. Several new provisions are described under Section 10—a component of the reform that Republicans have strongly favored and certain Democrats opposed over concerns it could undermine broader banking regulations.
“We have worked hard to get a common-sense agreement that allows legal cannabis businesses across America access to financial services while protecting the capacity of federal regulators to stop bad actors,” Schumer said in a statement shared with Marijuana Moment on Tuesday. “This legislation will improve public safety, protect small businesses, and finally achieve action on cannabis reform. I intend to bring this legislation to the floor with all due speed.”
Representatives of the offices of Senate Banking Committee Chairman Sherrod Brown (D-OH) and the lead sponsors of the bill, Sens. Jeff Merkley (D-OR) and Steve Daines (R-MT), did not respond to requests for comment by the time of publication.
What are the proposed changes?
It should be noted that while the section-by-section summary largely aligns with the original Secure and Fair Enforcement (SAFE) Banking Act, the provisions are only briefly described and the full text of the revised legislation has not been released. Accordingly, it’s difficult to assess the substance and scope of the changes.
The summary of the first new subsection of Section 10 says that it “provides that while Federal banking agencies have a duty to ensure that banks and credit unions are operating in a safe and sound manner, personal beliefs or political motivations used to restrict access to financial services for lawful businesses have no place at a Federal banking regulator.”
On the one hand, this seems to reinforce a policy position supported by GOP members who have sought to use the cannabis bill as a vehicle to prevent financial regulators from discriminating against certain industries, such as the gun trade and lending institutions.
But Cat Packer, vice chair of the Cannabis Regulators of Color Coalition (CRCC) and director of drug markets and legal regulation at the Drug Policy Alliance (DPA), told Marijuana Moment on Tuesday that there’s another interpretation of the summary that could also support social equity objectives, such as those she proposed as part of a recent report on opportunities to improve the marijuana banking legislation.
While the provision “may have been” designed to appeal to GOP members, “the language can work towards both ends,” Packer said.
“I do think that that’s generally in line with what CRCC and DPA have been advocating—just recognizing, in part, that banking is extremely discretionary,” she said. “And banks have had the opportunity—and will have the opportunity—to make a discretionary decision about who they bank. Historically, it’s been minority, Black and brown communities who have been underbanked.”
The last three subsections of Section 10 also appear to be new, and two of them similarly appear to be at least partly responsive to policy recommendations promoted by equity advocates.
Subsection (f) would require federal banking regulators to work with state banking supervisors and the secretaries of commerce and treasury and, within two years of enactment, “promulgate tailored rules or guidance to increase access to deposit accounts for businesses and customers and to enable banks and credit unions to more effectively maintain customer relationships—especially for those in rural, low-and moderate-income areas, Tribal communities, and unbanked businesses and consumers.”
The description of increased access and the focus on underserved communities is welcomed by advocates—though, again, the actual text is not yet available.
Subsection (g) would require the Federal Deposit Insurance Corporation (FDIC) to “conduct a biennial survey and report to identify barriers to accessing deposit accounts for small-and medium-sized businesses.”
The changes “run along the same vein” as what equity advocates have encouraged, Packer said. “I’m interested now to see the specific text of these provisions, in part because I think that they are well-aligned with some of the points that we’ve been raising.”
Another potential change to the bill is the mention of tribal communities in Section 10 and Section 11, which requires federal regulators to submit a report to Congress on access to banking for historically underbanked communities. Tribes are now listed beside minorities, veterans, women and state-sanctioned cannabis businesses as subjects of that report—which is not the case in the SAFE Banking Act as introduced.
There’s also another summary of a new subsection of Section 10 that says it “establishes a rule of construction that does not limit the ability of a Federal banking regulator from identifying or discussing issues with a depository institution’s financial condition, governance, consumer protection, internal controls, unsafe or unsound conditions, the Bank Secrecy Act, anti-money laundering or countering the financing of terrorism.”
All told, if the summary does represent the latest bipartisan agreement, it appears that the proposed additions could satisfy both sides of the aisle, with Section 10 kept “intact,” as Banking Committee member Sen. Kevin Cramer (R-ND) said this week, but also with new provisions to promote equity in the financial system.
