Cannabis '21: SAFE Banking causes a rift among advocates
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Cannabis ’21: SAFE Banking exposes a rift among advocates

P. Aiden Hunt December 13, 2021

As the congressional year came to an end last week, advocates and lobbyists found cause for hope. Cannabis banking reform was part of the national defense bill. It looked like federal reform might get a win in 2021.

Not everyone was pleased, though. Senator Cory Booker (D-NJ) made his position clear during a July press conference.

“I will lay myself down to do everything I can to stop an easy banking bill,” Booker told reporters, “as opposed to focusing on the restorative justice aspects.”

The bill previewed at Booker’s press conference wasn’t introduced this year, but the vow he made was tested. Rep. Ed Perlmutter (D-CO) included SAFE Banking as an amendment to appropriations and defense bills. Appropriations had failed, but the defense bill was still rushing toward passage.

After SAFE Banking was left out of the final version of the National Defense Authorization Act (NDAA), a rift in the legal cannabis movement came to the fore. While some advocates had expressed optimism about the amendment, others sent Congress a clear message that they agreed with Booker’s hard line.

The frustration that failure provoked could delay reform in 2022.

SAFE Banking in 2021

The Secure and Fair Enforcement (SAFE) Act would remove restrictions on banks and credit unions that provide services for cannabis business. The bill acts as a workaround to federal prohibition; allowing state-legal industries access to banking services while leaving cannabis as a Schedule I narcotic. It’s a popular measure with industry stakeholders, who are forced to follow an all-cash business model.

It’s also popular with U.S. House members.

SAFE Banking passed the House with a vote of 321 to 101 in April. With 154 Democrat and 26 Republican co-sponsors, it was the House’s second straight session passing the bill with ease. It was introduced in the Senate on April 20, the international cannabis holiday, receiving plenty of press attention.

“Drug Policy Alliance could not throw its weight behind the strategy of including SAFE Banking in the NDAA because it really falls short of what we need.”

Maritza Perez, Drug Policy Alliance

But that’s where it stopped. Leadership referred the bill to the Senate Banking Committee, where it still sits. Despite calls from advocates, lobbyists and colleagues, no further action is scheduled or expected.

Then SAFE Banking language began showing up as amendments to larger House bills. First, it was attached to the annual appropriations bill. When that failed, Perlmutter added it to the NDAA in September, just before the defense bill was approved and sent to the Senate.

Many welcomed the move.

A bipartisan group of 21 governors, led by Jared Polis of Colorado, supported SAFE Banking’s inclusion in the NDAA. Both of Colorado’s senators publicly backed the measure. Sen. Jacky Rosen (D-NV) led colleagues from the Armed Services Committee in encouraging leadership to include SAFE Banking in the final bill. Business associations pressed Congress to let it through.

Not all advocates were on board, though. Some wanted to hold out for more substantial reforms.

“We can and must move comprehensive marijuana reform–centered in equity, justice and community reinvestment.” said Kassandra Frederique, in a statement. “Then, and only then, can we talk about banking inconvenience.” 

DPA opposes SAFE Banking in the NDAA

Frederique leads the Drug Policy Alliance (DPA), a nonprofit that advocates for ending America’s drug war and repairing the harms it has caused. While groups like the Marijuana Policy Project and U.S. Cannabis Council issued statements encouraging senators to retain the banking language, DPA stood out in opposing it.

“Drug Policy Alliance could not throw its weight behind the strategy,” Maritza Perez told Profiles in Legalization, “because [SAFE] really falls short of what we need.”

Perez is the director of national affairs for DPA. During a phone interview last week, she talked about the group’s reasoning. According to Perez, it’s all about priorities and where to focus energy. She wanted to see attention for the MORE Act instead of just banking.

“It really wasn’t any beef with the SAFE Banking bill itself.” Perez told us. “It was more about the priority that Congress was choosing, the message that would send.”

While DPA stood out in this case, their position isn’t new or unique. Since legalization began, there’s been friction between parts of the community and the growing industry. With federal reform ever closer, the movement’s cracks become easier to see.

Is it “SAFE Banking or nothing”?

Many were upset when the NDAA passed without the Perlmutter amendment.

Kaliko Castille, president of the Minority Cannabis Business Association, wrote an op-ed expressing his frustrations for Marijuana Moment. He called out activists who opposed SAFE Banking, writing that the banking bill is the only measure that had a chance this session.

According to Castille, it’s “SAFE Banking or nothing.”

“The decision to pull SAFE Banking from the [NDAA],” Castille wrote, “is further proof that even incremental change is hard on Capitol Hill.”

Castille took a pessimistic view on comprehensive reform bills like the MORE Act and an expected Senate legalization bill. He wrote that these, unlike the narrower banking bill, “will face the same filibuster hurdle that is currently impeding progress on issues with more bipartisan support than equitable cannabis reform.”

DPA’s Perez said she’s surprised by Castille’s criticism. She had a different suggestion.

“Why don’t we look at SAFE and think about ways that we can actually improve the market in order to make sure that there is technical and financial support for minority-owned businesses?” asked Perez. “I would think the MCBA would want to support that, given their constituency.”

Perez said she thinks the Cannabis Administration and Opportunity Act will be introduced early next year and “it will be a game-changer.”

SAFE Banking in 2022

This isn’t officially the end for the SAFE Banking Act of 2021. While the bill faces stiff opposition, Perlmutter vowed to keep pushing it.

“My work on this bill is far from over.” Perlmutter said, in a December 7 statement. “As Speaker Pelosi and Senate Majority Leader Schumer are aware, going forward, I plan to pursue every possible avenue to get SAFE Banking signed into law.”

It isn’t the end to the disagreement among cannabis advocates, either. Still, Perez hopes the conversation shifts to more equity-based approaches.

“We have always advocated for marijuana reform that really centers on reparative justice,” said Perez, of DPA’s position, “and accounts for the harms that have been done to communities of color and low income communities.”