For the first time since 2011, the Democrats have the majority in the House of Representatives, and it appears that reforming federal marijuana laws is one of their highest priorities. While 33 states so far have legalized medical and/or recreational use, cannabis remains federally prohibited, further complicating the implementation and regulation of the nation’s growing legal marijuana industry.
A bill that would establish a state bank for the “handling of marijuana-related funds” is awaiting a hearing in the New Jersey Assembly financial institutions and insurance committee.
The legislation, A4510, introduced on Oct. 15 by Assemblyman John McKeon, calls for the bank to provide “marijuana-related businesses with a place to deposit cash, as well as by providing those businesses with access to capital.”
Because of the federal prohibition against marijuana, most banks will not handle cannabis industry accounts.
More Marijuana (Cannabis) Ideas
Assemblyman John McKeon has an op-ed in the Star-Ledger on what he’d need to see to vote in favor of legal marijuana, and a lot of it has to do with “self-medicating” which is weird and seems to be about protecting the medical-marijuana industry. But there’s also some stuff about a “strong, independent New Jersey bank” which seems interesting. Do you know how much money we pay investment banks and law firms and financial advisors every time we do one of those bond issues?
Since federal regulators began reinterpreting the United States’ position on marijuana in 2014, the number of state-sanctioned marijuana-related businesses (MRBs) has exploded, leaving MRBs with an abundance of cash, but not many places to deposit it. The New Jersey Department of Health approved six alternative treatment centers (ATCs), which pro-vide qualifying patients with medicinal marijuana and related paraphernalia. These ATCs are a type of MRB. On July 16 of this year, the department released a request for applications (RFA) for up to six additional ATCs.
As such, any establishment of a legal recreational structure should operate in a fashion so as to subsidize the continued existence of the medical product marketplace. Exemption from taxation on the medical front or price supports may also be necessary.
In addition, it is significant that the deposits of investors into the accounts of recreational dispensaries must be made via the creation of a strong, independent New Jersey bank.
The Assembly Financial Institutions and Insurance Committee gave approval yesterday to Assembly Resolution 183, which urges Congress to pass the federal “Secure and Fair Enforcement (SAFE) Banking Act of 2017.” According to the resolution, this bill would prohibit “federal bank regulators from punishing banks that service marijuana businesses and by prohibiting federal bank regulators from discouraging banks to do business with marijuana companies”, which would “improve public safety in New Jersey and would allow marijuana businesses to fully utilize the banking services offered in the Stat
Sen. Cory Booker says businesses that sell even medical marijuana can’t get bank accounts, issue payroll checks or get loans — even in states like New Jersey, which legalized medical marijuana in 2010. That’s because federal law classifies marijuana as a Schedule I illegal drug — the same as heroin — and federal treasury officials might prosecute.
This week, a Senate committee voted to kill a federal budget amendment that would have protected banks willing to serve the cannabis industry from federal interference. Under current law, any bank that handles funds related to an illegal drug can face money laundering charges, a situation which forces the cannabis industry to operate on a cash-only basis. Pro-cannabis legislators have floated a number of bills and measures to address the issue, but so far without success.
The nation's banks are taking on Attorney General Jeff Sessions over pot with a big lobbying push to loosen federal restrictions on the surging legalized marijuana industry.
Emboldened by support from both President Donald Trump and Sen. Elizabeth Warren (D-Mass.) — two relentless foes on most other issues — top banking trade groups are pressing policymakers to make it easier for their members to serve cannabis businesses that are now legal in states like California and Colorado.
It's the problem faced by every single marijuana dispensary in the nine states that already sell marijuana for recreational purposes.
The fact is, "legal weed" isn't entirely legal. And if New Jersey legalizes marijuana, it will come with unique challenges — and solutions — for those looking to find success in cannabis.
The U.S. Department of Justice still considers marijuana a "Schedule 1" drug, a classification that indicates it has no medicinal value, despite 29 states having some kind of medical marijuana program.