Four Ways Cannabis Banking Could Cross the Finish Line in 2022
Source: American Banker
The legalization of cannabis banking looks as likely as ever, but the road lawmakers will take to get there remains an open question.
After years of stasis, many policy analysts are suddenly bullish on the reform’s odds of passage by the end of the year, and there are four main legislative avenues for the SAFE Act to become law before 2023.
The Cannabis Administration and Opportunity Act (CAOA)
Both the simplest and least likely approach to legalizing cannabis banking in the near term, the Cannabis Administration and Opportunity Act — championed by Senate Majority Leader Chuck Schumer — would fully decriminalize the plant and remove cannabis from the federal government’s list of controlled substances. The bill, which has circulated as a discussion draft but not as a final bill, would remove virtually all the legal obstacles faced by banks interested in cannabis firms today.
But most analysts believe CAOA will be dead on arrival in the 50-50 Senate, where Republicans and some Democrats have expressed reservations with comprehensive cannabis legalization.
The U.S.-China competition bill
Since the beginning of May, House and Senate lawmakers have been negotiating the finer points of a massive bipartisan bill to bolster American economic competitiveness with China by subsidizing semiconductor production and scientific research.
When the House passed its version of the package in early February — the America Competes Act — the bill contained the SAFE Banking Act, marking the sixth time that Perlmutter’s bill has passed his chamber. The Senate’s version, however, did not include the law.
When the House passed its version of the package in early February — the America Competes Act — the bill contained the SAFE Banking Act, marking the sixth time that Perlmutter’s bill has passed his chamber. The Senate’s version, however, did not include the law.
The FY2023 National Defense Authorization Act
Cannabis banking is no stranger to military spending legislation, and the next iteration of the National Defense Authorization Act could very well include some version of the SAFE Banking Act later this year.
The must-pass NDAA is one of Congress’s most reliable legislative vehicles; the Anti-Money Laundering Act was folded into the package and enacted in January 2021, for instance, and while the SAFE Banking Act was included in the House version of that bill, it was removed after negotiations with the Senate.
The must-pass NDAA is one of Congress’s most reliable legislative vehicles; the Anti-Money Laundering Act was folded into the package and enacted in January 2021, for instance, and while the SAFE Banking Act was included in the House version of that bill, it was removed after negotiations with the Senate.
SAFE-Plus legislation
For a long time, it’s been relatively rare for Congress to pass significant legislation as stand-alone bills. Thanks to the 60-vote threshold of the Senate filibuster, lawmakers have made a habit of cramming a lot of legislative work into a relatively small number of packages, including the budget reconciliation process and massive military spending laws. In 2020, the 116th Congress enacted just 28 bills out of the more than 5,000 introduced by lawmakers.
But the SAFE Banking Act could buck that trend thanks to its enduring bipartisan popularity. When the bill introduced by Rep. Perlmutter (pictured) first passed the House in 2019, it did so with the support of nearly 100 Republican lawmakers and 321 affirmative votes in total. And in the Senate, the bill’s inability to pass has had less to do with finding votes than specific decisions made by the chamber’s leadership.
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