SAFE Banking Act Passes House with Overwhelming Bipartisan Support

Strategic Insights -

The U.S. House of Representatives has once again passed the Secure and Fair Enforcement (SAFE) Banking Act of 2021, landmark legislation to reform federal cannabis laws and reduce the public safety risk in communities across the country. Authored by U.S. Rep. Ed Perlmutter (CO-07), the bill would allow marijuana-related businesses in states with some form of legalized marijuana and strict regulatory structures to access the banking system. The bill passed with overwhelming, bipartisan support by a vote of 321 to 101, including 106 Republicans.

Key Takeaways:

  • The SAFE Banking Act has been passed by the U.S. House of Representatives for the second time, with overwhelming bipartisan support, including 106 Republicans, with a vote of 321 to 101.
  • The bill, authored by Rep. Ed Perlmutter (CO-07), would allow marijuana-related businesses in states with legalized marijuana to access the banking system, reducing the public safety risk in communities across the country.
  • The bill has been cosponsored by 180 members, including Reps. Nydia M. Velazquez (D-NY-07), Steve Stivers (R-OH-15), and Warren Davidson (R-OH-08).
  • Forty-seven states, four U.S. territories, and the District of Columbia, representing 97.7% of the U.S. population, have legalized some form of recreational or medical marijuana, including CBD.
  • The current law restricts legitimate licensed marijuana businesses from accessing banking services and products, resulting in businesses operating in all cash, which is a serious public safety risk for communities, inviting theft, robberies, and burglaries.
  • The SAFE Banking Act provides protections from money laundering laws for any proceeds derived from these state-legal marijuana businesses, getting cash off the streets and into the financial system which is built to root out fraud and illicit activity.
  • The bill includes protections for hemp and hemp-derived CBD related businesses, which still struggle in accessing financial services despite the legalization of hemp in the 2018 Farm Bill.
  • The current version of the bill has been updated slightly to include minor technical changes to the safe harbor, strengthened hemp provisions, and other technical updates.
  • The U.S. cannabis industry continues to grow at a rapid rate, with the current value estimated at $17.7 billion, a substantial amount of which remains unbanked.
  • As of January 2021, the legal cannabis industry supports 321,000 jobs across the country, with job growth in this market projected to climb 250% over the 2018-2028 period, the fastest rate for any sector in the U.S.

Statistics:

  • 321-101 vote in favor of the SAFE Banking Act in the U.S. House of Representatives.
  • 106 Republicans voted in favor of the bill.
  • 180 members cosponsored the bill.
  • 47 states, 4 U.S. territories, and the District of Columbia have legalized some form of recreational or medical marijuana, representing 97.7% of the U.S. population.
  • $17.7 billion: current value of the U.S. cannabis industry.
  • 321,000: number of jobs supported by the legal cannabis industry as of January 2021.
  • 250%: projected job growth in the cannabis industry over the 2018-2028 period.

Sources:

  • The office of Colorado Rep. Ed Perlmutter
  • U.S. House of Representatives
  • U.S. Congress
  • Cannabis industry reports and studies
  • National Association of State Treasurers
  • 21 state governors and territories.