Marijuana advocates have been stacking victories over the last few years at the state level with nearly 20 U.S. states having now approved adult recreational marijuana use.
But even as momentous as those changes have been, reform at the federal level has proved elusive — until now, if you trust the confidence coming from the leaders of America's largest cannabis companies.
This week, Trulieve CEO Kim Rivers and Curaleaf Executive Chair Boris Jordan both wagered on Yahoo Finance Live that the nation's onerous banking restrictions on cannabis companies could finally be lifted as soon as early next year. Due to the fact that cannabis is still illegal at the federal level, cannabis businesses have largely been locked out of the traditional banking system and often operate cash-only storefronts.
One bipartisan plan, dubbed the SAFE Banking Act, seeks to fix that by allowing banks to work with cannabis companies in states where cannabis has been legalized. The bill has already passed the House of Representatives four separate times, including by way of an easy 321-101 House vote back in April, but has never made it to a vote in the Senate under Republican control and has yet to clear that hurdle this year under Democratic leadership. Key progressive Democrats, like Senate Majority Leader Chuck Schumer (D, N.Y.) and Sen. Cory Booker (D, N.J.) have expressed concerns that banking reforms don't go far enough and have pushed for their own federal marijuana reform plan, which includes sweeping social reforms and criminal expungements.
U.S. Senate Majority Leader Charles Schumer (D-NY), joined by Sen. Cory Booker (D-NJ) and Sen. Ron Wyden (D-OR), speaks at a press conference on ending federal cannabis prohibition on July 14, 2021. (Photo by Kevin Dietsch/Getty Images) ·Kevin Dietsch via Getty Images
Citing his conversations with Democrats in the Senate, however, Jordan told Yahoo Finance that he believes the SAFE Banking Act could finally pass the Senate as soon as the first quarter of 2022.
"I think they are first going to vote in the fourth quarter [of 2021] on a more comprehensive bill. I don't think it will get through," he said Wednesday, pointing to a high hurdle of attracting the 10 Republican votes needed to clear a 60-vote threshold in the Senate. "I do think, though, we've got the votes in the Republican party to get SAFE Banking through."
Jordan highlighted a lack of Republican support for the progressive reforms that Democrats are seeking, which includes emulating at a federal level what some states have done to redirect cannabis tax revenues to communities of color. Data shows that despite roughly equal cannabis use as compared with white Americans, Black and Latino Americans have suffered disproportionately from criminal enforcement. Democrats have also criticized the low number of minority-led cannabis companies winning the limited licenses to operate.
For his part, Booker previously said at a conference rolling out his more sweeping reform plan that he'd do everything in his power to stop more moderate bills, like the SAFE Banking Act, that don't also include restorative justice components. When pressed on that stance during an interview with Yahoo Finance, Booker later clarified his support for the SAFE Banking Act, but hoped it could be used as a sweetener to get more support to help those hurt by America's War on Drugs.
"I’m hoping that all the industries out there that know that they’re going to make tremendous profits join me in standing up for what I think is the greatest act of patriotism there in saying, ‘I’m not going to put my interest alone. I’m actually going to look out for my fellow American. I’m actually going to pledge to them that I’m going to fight for those people who are in economic devastation because of a nonviolent marijuana charge, that I’m going to make sure that we take care of everybody,'” Booker said.
On the businesses front, marijuana reform advocates point out that many minority cannabis entrepreneurs struggle with the same issues around accessing banking that their white counterparts do. While larger cannabis giants might have an easier time raising massive funding rounds at lower rates, Jordan said Curaleaf has also helped minority groups around the country get businesses off the ground.
"I'm telling every politician — [Sen.] Booker, [Senate Majority Leader] Schumer, I've talked to everybody. I'm saying, 'Guys, SAFE Banking will really charge up the social justice issues in the minority communities. It will really help tremendously in getting these people to open up businesses, open stores and to function in the cannabis world. Doing nothing, does nothing. That's the point," he said.
Rivers, the CEO of Florida-based cannabis giant Trulieve, also reiterated her belief that the SAFE Banking Act is likely the first federal reform that will make it across the finish line and echoed Jordan's timeline of next year.
How long progressives might want to wait to use the moderate banking reforms as a sweetener to their more social justice push remains to be seen. To be fair, there seems to be no sense of urgency coming from the executive branch. White House Press Secretary Jen Psaki noted that President Biden's views on marijuana reforms have not progressed from his preference of decriminalization on the very same day that Schumer unveiled his sweeping marijuana reform plan.
Zack Guzman is an anchor for Yahoo Finance Live as well as a senior writer covering entrepreneurship, crypto, cannabis, startups, and breaking news at Yahoo Finance. Follow him on Twitter @zGuz.
