Ready to Inhale: The Senate Tilts Toward Pot Reform
The U.S. Senate is sometimes referred to as “the world’s greatest deliberative body.” However, during this fractious election year, the chamber has more closely resembled a kindergarten on the Potomac.
That’s about to change. When Congress reconvenes in January 2021, bipartisan agreement is likely to coalesce around major legislative initiatives, such as infrastructure spending, fiscal stimulus, and yes…marijuana legal reform.
The Democratic-controlled House already has shown its propensity to support marijuana legalization; the GOP-led Senate has been the impediment. But with the 2020 election cycle behind us, it appears that Senators are ready to embrace weed.
Notably, the U.S. Senate Banking Committee is expected to be marijuana-friendly next year, regardless of whether Democrats or Republicans control the chamber.
That’s good news for the Secure and Fair Enforcement (SAFE) Banking Act, which is set to take the fast track in the Senate in 2021. SAFE is federal legislation that would give marijuana companies greater access to conventional financial services, which in turn would provide a major boost for cannabusinesses and their investors. Most pot companies are forced to primarily deal with cash, even in states where marijuana is legal, because banks are leery of federal reprisals.
Marijuana industry leaders are encouraged that the likely incoming chair of the Senate Banking Committee, Pennsylvania Republican Pat Toomey, has recently expressed his support of SAFE.
Toomey, who will chair the committee if the GOP keeps its majority in the chamber, said that marijuana banking legislation is “something we should work on.” SAFE has passed the House but remains stalled in the Senate.
Without access to banking, marijuana businesses can’t get loans. They also lack the ability to process credit card payments, deposit cash, and write checks to suppliers, among other vital functions.
SAFE also would undercut the growing black market in marijuana sales and improve the industry’s financial transparency in legal cannabis states.
Senator Toomey told the press last week that he was “sympathetic to the idea that people who are involved in (the) cannabis industry, in an entirely legal fashion, in the state in which they operate, ought to be able to have ordinary banking services. That’s my starting point, and then there’s a lot of details to work out, but I am open to that.”
When it comes to major initiatives from the House, including marijuana legalization, Senate Majority Leader Mitch McConnell (R-KY) has been obstructionist. However, McConnell recently met with marijuana lobbyists who pressed their case. What’s more, Kentucky farmers are in dire need of a cash crop to replace tobacco. In recent years, as anti-smoking laws and regulations gain ground, cash receipts for tobacco in the Bluegrass State have plummeted. McConnell’s opposition to SAFE is showing signs of softening.
The smoothest path to marijuana banking reform would be if Democrats gained control of the U.S. Senate by winning both Georgia Senate runoff seats on January 5. However, polls are tight and the races could go either way.
State level marijuana news…
A racial equity task force convened by North Carolina Gov. Roy Cooper (D) recommended that the state decriminalize marijuana and study broader cannabis legalization. The state attorney general and several police chiefs and sheriffs are on the panel.
“You cannot talk about improving racial equity in our criminal justice system without talking about marijuana,” Attorney General Josh Stein (D), who co-chairs the Task Force for Racial Equity in Criminal Justice, said on Wednesday. The following tweet posted on November 18 amplifies Stein’s views:
The Madison, Wisconsin Common Council on Tuesday unanimously voted to allow marijuana use in public without any local penalty.
Alderman Michel E. Verveer (D), who introduced the legislation, said at the meeting: “It’s preposterous and outrageous that the Wisconsin state legislature has not moved long ago toward legal and regulated adult use of cannabis, like so many other states have across the country, including many of our neighboring states.”
As these federal and state political developments show, the mainstreaming of marijuana enjoys powerful tailwinds. New laws that lift pot restrictions result in new markets for cannabusinesses…and new profits for investors.
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John Persinos is the editor-in-chief of Marijuana Investing Daily.