GOP Batters House COVID-19 Package Over Pot Banking Bill

By Sam Reisman
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Law360 (May 14, 2020, 8:29 PM EDT) -- Republican lawmakers have seized on language that would broaden the cannabis industry's access to banking in House Democrats' proposed coronavirus relief package as a rallying cry to oppose the bill.

Addressing the Senate on Thursday, Majority Leader Mitch McConnell, R-Ky., excoriated the proposed Health and Economic Recovery Omnibus Emergency Solutions, or HEROES, Act as an "1800-page seasonal catalog of left-wing oddities" and a "totally unserious effort."

McConnell singled out a provision that instructs regulators to produce an annual report geared toward expanding women and minority ownership of cannabis businesses, which he sarcastically described as the "cherry on top, the bold new policy from Washington Democrats that will kick the coronavirus to the curb and save American families from this crisis."

Almost as soon as the bill was released on Tuesday, Republicans on the House Oversight Committee took to Twitter to criticize "Nancy Pelosi's wish list bill," specifically calling attention to the prevalence of the word "cannabis," which appears 68 times in the proposed legislation.

The theme of the word's frequent appearance was picked up by multiple GOP lawmakers, including Sen. Ted Cruz, R-Texas, who tweeted on Wednesday that it was "not terribly surprising, since we know smoking pot can make you repeat yourself." The tweet included a GIF of Matthew McConaughey's stoner character Wooderson from the 1993 teen comedy "Dazed and Confused" saying, "Alright, alright, alright."

The cannabis language at issue is lifted largely from the SAFE Banking Act, which passed the House 321-103 with bipartisan support in September, but has made little progress in the Republican-controlled Senate.

Senate Banking Committee Chairman Mike Crapo, R-Idaho, said in December that he did not support the House's version of the SAFE Banking Act in part because it did not address topics such as marijuana potency or the industry's marketing tactics. The Senate version of the SAFE Banking bill has 33 co-sponsors, including five Republicans, but remains in committee.

The first coronavirus-related omnibus relief bill, signed into law March 27, did not include any carveouts for the federally illegal cannabis industry, even as several states deemed their medical and recreational markets "essential."

The introduction of the SAFE Banking language in the latest proposed package follows efforts from marijuana trade groups urging lawmakers to pass legislation that would protect financial institutions that service state-legal cannabis businesses. The industry groups said in a letter to U.S. House of Representatives leaders on May 8 that the COVID-19 pandemic had presented new health risks for cannabis industry workers forced to deal largely in cash.

"It is unfortunate that some lawmakers are fixated on something as irrelevant as word count without considering the much-needed public health and job saving benefits of allowing banks to work with cannabis businesses," Morgan Fox, a spokesperson for the National Cannabis Industry Association, told Law360 on Thursday.

"This provision of the legislation has broad bipartisan support as we saw in September, and is integral to protecting essential workers and businesses in their time of need," he added. "Its inclusion in this relief package is appropriate and necessary."

The House is expected to vote Friday on the HEROES Act.

--Editing by Jack Karp.

For a reprint of this article, please contact reprints@law360.com.

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