The U.S. House of Representatives has passed a bill allowing banks to provide services to businesses in the country’s legal marijuana industry. Two of Arkansas’ four Congressmen voted for the bill, which now heads to the U.S. Senate.
HR 1595, sponsored by U.S. Rep. Ed Perlmutter, D-Colo., changes federal banking law in three key areas.
• Prevents the federal government from terminating or limiting the deposit insurance or share insurance of a depository institution under the Federal Deposit Insurance Act if the bank provides services to a legitimate cannabis business.
• Prevents the federal government from doing anything that would discourage a bank from providing services to a legitimate cannabis business.
• Prevents the federal government from issuing a recommendation or creating an incentive for banks to not provide services to a legitimate cannabis business.
The bill – known as the SAFE Banking Act – received 321 votes for, 103 votes against, with nine members not voting. U.S. Rep. French Hill, R-Little Rock, and Steve Womack, R-Rogers, voted for the bill. U.S. Rep. Bruce Westerman, R-Hot Springs, voted against the bill, and U.S. Rep. Rick Crawford, was one of the nine who did not vote on the bill.
Arkansas voters in 2016 approved the use of medical marijuana. Nationwide, 33 states and the District of Columbia have legalized the use of marijuana for recreational or medical use.
The Arkansas Bankers Association supports the bill.
“By providing clarity on cannabis banking for the financial sector it allows banks to meet banking needs and reinvest the industry’s revenue into their communities and state economy,” the association noted in a statement. “There are clear public benefits to bringing cannabis businesses into the banking system. Banks play a critical role in helping law enforcement combat money laundering, terrorist financing, human trafficking and more. It will also ensure that ancillary businesses like landlords, law firms, vendors, and employees will not be shut out of the banking system.”
The bill faces a tough challenge in the Senate in that Senate Majority Leader Mitch McConnell, R-Ky., has said he opposes any changes to federal law that enables the use of marijuana. While McConnell successfully pushed for the legalization of hemp farming for non drug use, he has said marijuana is hemp’s “illicit cousin which I choose not to embrace.”
Talk Business & Politics has asked the offices of U.S. Sens. John Boozman, R-Ark., and Tom Cotton, R-Ark., for their respective stances on the SAFE Banking Act.