Federal officials would no longer be able to penalize banks for working with marijuana businesses. This move comes under the annual funding bill released by the congressional democratic leaders.
A House subcommittee would review the bill and remove the longstanding block that stops the city from legalizing sales of recreational cannabis.
The Bill Lets Banks Transact with Cannabis Businesses without Fear
Despite increasing numbers of states regulating and legalizing marijuana, several banks have been hesitant to work with licensed marijuana-related businesses. This is because of the fear of dealing with federal penalties.
The new House Bill is going to put these hesitations to rest, which also includes punishing financial institutions from maintaining accounts of cannabis businesses that are legal under the state.
None of the banks would now be penalized for maintaining accounts of producers, manufacturers, or any other individual participating in any organized activity or business associated with marijuana.
This provision is applicable to spending legislation that covers the Treasury Department. A more permanent and comprehensive proposal for shielding financial institutions from serving businesses associated with cannabis industry.
Secure and Fair Enforcement Act [SAFE] was approved in March by the House Financial Services Committee. A similar proposal was presented in the Senate by more than 30 lawmakers for safeguarding financial institutions working with legalized marijuana businesses without any hesitation.
Mike Crapo, the chairman of the Banking Committee, has so far denied offering any commitment to the bill. However, the pressure is slowly mounting to offer freedom to financial institutions. The proposal has also been endorsed by the banking associations in all 50 states, the National Association of Attorneys General and the National Association of State Treasurers.
The report issued by the Congressional Budget Office projects that the Funding Bill would result in an increase in deposits in credit unions and banks. This would eventually result in savings of the federal government.
A similar bill was presented earlier in 2014 in the House of Representatives, but it was not sanctioned. The current bill takes additional steps for offering protection to financial institutions offering banking services to legitimate cannabis businesses.
The chief sponsor of cannabis banking bill, Rep, Ed Perlmutter stated that he is looking forward to the House passing the SAFE Banking Act to address the issues associated with maintaining revenue generated by cannabis businesses.
A ballot measure was approved in 2014 by Washington D.C. voters that permit home cultivation and low-level possession of cannabis. Those who are not medical marijuana patients cannot be in possession of the drug in any manner.
A marijuana legalization bill was referred previous month to the council members by Muriel Bowser, the District of Columbia Mayor in anticipation of the removal of ban by Congress. The proposal could be amended at any stage and could be merged with parallel legislation in the Republican-controlled Senate.
This hints that the initial draft policy is still far away from being enacted into law. The inclusion in the Funding Bill still looks quite promising for the advocates waiting for the legalization of the SAFE act.
The Senate Appropriations Committee has for long been in favor of making cannabis amendments despite not favoring the proposal the previous year. With advocates strongly voicing their opinions, the bill may receive an approval by the concerning authorities.