Anna Moneymaker / The New York Times
Senate Majority Leader Chuck Schumer, D-N.Y., talks during a news conference Tuesday, April 20, 2021, in Washington. Schumer, in a speech Tuesday on the Senate floor, announced his support for ending the federal prohibition on marijuana and said he hoped legislation doing so would be signed into law by April 20, 2022.
Wednesday, April 21, 2021 | 2 a.m.
Nevada’s recreational marijuana industry produced $692 million in cash sales during fiscal 2020, but dispensary owners — as has been the case since the state legalized recreational marijuana sales — couldn’t deposit their daily receipts in the safety of a bank.
That could be changing.
Marijuana is a prohibited substance under the federal Controlled Substances Act, meaning banks that provide services to cannabis businesses can be penalized under federal money laundering laws.
In a move supported by both the cannabis industry and the Nevada congressional delegation, the U.S. House of Representatives passed the Secure and Fair Enforcement (SAFE) Banking Act on a bipartisan 321-101 vote Monday. The legislation was passed through the House three times before, as standalone legislation in 2019 and as part of two COVID-19 relief packages, but stalled each previous time in the Republican-controlled Senate.
With Democrats now in control of the Senate and Joe Biden in the White House, there’s momentum that the legislation will finally become law.
Tuesday on the U.S. Senate floor, Senate Majority Leader Chuck Schumer, D-N.Y., said the banking law should be included in legislation that puts an end to the federal prohibition on marijuana — it’s legal in 17 states for recreational use; 36 for medical purposes.
“Today is what you might call a very unofficial American holiday: 4/20,” Schumer said. “It’s as appropriate a time as any to take a hard look at our laws that have over-criminalized the use of marijuana and put it on par with heroin, LSD and other narcotics that bear little or no resemblance in their effects either on individuals or on society more broadly.”
The 4/20 observance has its roots in a foggy 1970s ritual involving a group of Northern California teenagers who liked to smoke marijuana at 4:20 p.m. daily.
Schumer added that he hoped Congress would complete marijuana reforms by April 20, 2022.
That’s a message the local cannabis community can get behind, especially when it comes to bringing much-needed ability to use banking to the industry.
Since 2017, marijuana has been legal in Nevada, where adults 21 and over can possess up to one ounce of the substance or 1/8 ounce of cannabis concentrate.
David Goldwater, a partner at Inyo Fine Cannabis Dispensary, said some of the 80 dispensary licensees in Clark County pay up to seven figures annually in state taxes — all in cash. Employees did not sign up for “that kind of risk” in having that amount of cash on hand, he said.
Even though marijuana is legal under state law, banks are regulated federally and have steered clear of the marijuana business in an effort to stay on the right side of federal law.
“At the end of the day, whatever activity they’re trying to prohibit, whether it be money laundering or … dealing in an illegal commodity, the safety concerns of people should far outweigh any benefit they’re getting from this prohibition,” Goldwater said.
Kema Ogden, a co-owner of Top Notch THC in Las Vegas, pays contractors to secure the shop’s money in a secure location — of course, that’s confidential.
And, of course, it’s costly.
“We have to pay high rates and fees and transportation fees,” she said.
Layke Martin, executive director of the Nevada Dispensary Association, said having access to banking would open the door for dispensaries to stabilize their business, especially when it comes to employee safety. She said Sens. Catherine Cortez Masto and Jacky Rosen, D-Nev., were proponents of the Safe Banking Act — and advocates for the marijuana industry.
“They see what it has done for Nevada in terms of tax revenue,” Martin said. “They see it has employed 10,000 people during the pandemic.”
Schumer also sees the benefits, saying Tuesday that’s “it’s time for a change” in how marijuana is regulated nationally. That’s why he also intends to push for making the substance legal.
He talked about those who “have been arrested and jailed for even carrying a small amount of marijuana — a charge that often came with exorbitant penalties and a serious criminal record, from which they might never recover.”
It’s a mindset shared by Nevada lawmakers in the U.S. House, all of whom — including Mark Amodei, the lone Republican in the Nevada congressional delegation — voted Monday in favor of the banking legislation. Amodei also backed the measure in 2019.
“In Nevada, legal businesses that directly or indirectly serve the cannabis industry have been shut out of the banking system,” Rep. Dina Titus wrote in a Twitter post. “I voted to pass the #SafeBanking Act to help bring federal financial laws into the 21st century.”
