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House Passes SAFE Banking Act Again, MORE Act Also Expected To Advance

September 28, 2021

The U.S. House of Representatives has again passed the SAFE Banking Act, and is expected to advance the wider-ranging MORE Act as well this week. The SAFE Banking Act, which would allow banks to extend financial services to cannabis businesses, was included in a broader military spending bill passed by the House. Larger cannabis operators have found workarounds to circumvent being cash-only businesses, but smaller players, particularly at the retail tier, often still have to contend with the problems of working exclusively with physical money. But the financial services extend far beyond that—the bill would pave the way for cannabis companies to access the sort of loan programs open to other industries.

This is the fifth time the House has passed the SAFE Act. The bill now heads to the Senate, where opposition remains much steeper. The perception of the SAFE Banking Act has shifted noticeably since it was originally introduced. Once considered the prudent cannabis bill—one that cleared up some financial snarls without going so far as to federally legalize the substance—it’s now subject to criticism for not doing enough. There is dissatisfaction in the industry that it doesn’t address the ban on cannabis stocks listing on the public exchanges or reform the notorious 280E rule that prevents cannabis companies from deducting business expenses on their taxes.

Additionally, there are criticisms coming from both sides of the aisle. Broadly speaking, Republican lawmakers still oppose legalization and loosening restrictions on the industry. But prominent Democrats have also expressed concern over tackling business issues before undoing the federal prohibition on cannabis. Announcing the MORE Act in July with Senators Chuck Schumer and Ron Wyden, Senator Cory Booker said he could not support standalone banking reform. “I don’t know about other members of the Senate but I will lay myself down and do everything I can to stop an easy banking bill that’s going to allow these corporations to make a lot more money off of this, rather than focusing on the restorative justice aspects,” he said.

The MORE Act, or the Marijuana Opportunity, Reinvestment, and Expungement Act, which would essentially enact federal legalization by removing cannabis from the Controlled Substances Act and establishing a tax structure on it, will also receive attention in the coming days. The House Judiciary Committee will vote on the bill tomorrow, where it should advance, given that the full House passed it last year before failing in the Senate. As with all things cannabis, its chances in the upper chamber are shaky. Nonetheless the bill continues to garner new sponsors, with seven more signing on in the last week to bring its total to 66 cosponsors.—Danny Sullivan

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