Those who have been following the federal marijuana reform efforts on Capitol Hill over the past year can tell you that Congress has been more active than ever on this subject. But with all this progress, the question remains: Will any of this effort result in actual changes to federal laws? 

The stakes are high as it is uncertainty around federal law that has kept billions of dollars of institutional capital out of the cannabis industry and caused U.S. exchanges to not list U.S. companies (though they’re happy to list Canadian cannabis companies, to the U.S. industry’s detriment). It’s hard to overstate the impact that some of these bills, if enacted into law, could have on the cannabis industry. 

It is now a little past the halfway mark of the 116th Session of Congress, so it’s worth looking at some of those more notable efforts and their chances of success before this session ends next January. 

Is the SAFE Banking Act on the ropes? 

The Secure and Fair Enforcement (SAFE) Banking Act made history in 2019 when it became the first standalone marijuana bill to be passed by a House floor vote. The bill, which would enable banks to offer loans and other banking services to marijuana businesses, including contractors and vendors who never touch the plant, passed the House with strong bipartisan support—nearly half of House Republicans joined the near-unanimous support from their Democratic counterparts. However, since this landmark House vote, the bill has largely languished in the Republican-controlled Senate.  

While many had hoped that Senate Banking Committee Chairman Mike Crapo (R-ID) would hold a committee vote on the bill, nobody really knew what to expect. After all, Sen. Crapo comes from one of the few states in the country that has not passed any type of medical cannabis or CBD-focused legislation. On the other hand, he already held a hearing on the bill back in July. So there was excitement in the air when the senator announced an intention to hold a vote on the bill back in September.  

Since that time, the excitement has fizzled. Instead of announcing a committee hearing date, Crapo began hinting that he would prefer to introduce his own legislation to address the issue. In December, he published a lengthy set of concerns with the version of SAFE Banking Act passed by the House. While some of these concerns are relevant to banking policy, the Banking Committee Chairman also is seeking to impose severe restrictions on existing state programs. For example, Crapo wants to impose a default 2% THC cap on state programs unless they set their own THC caps, which would effectively turn the legislation into a bill to protect hemp and CBD businesses rather than the cannabis industry.  

Attempts to impose THC limits have generally been difficult to implement and enforce at the state level. New Jersey, once the only state in the country to have a THC limit on its medical cannabis program, eliminated the cap last year. Attempts to enforce marijuana laws where hemp is legal have led to numerous issues, from hemp industry workers getting arrested for misinterpreting the THC limit, to police jurisdictions throwing their hands up in the air and giving up efforts to determine whether personal quantities of the plant are hemp (which may be legal) or arrestable marijuana.

Crapo has also said he wants to ban high-THC vapes and certain types of edibles. While the vape ban he seeks is likely born of a well-intentioned desire to prevent future cases of vaping-related lung illnesses, banning access to regulated and lab-tested vaping products would only increase the public’s potential exposure to harmful products from the illicit market. The overwhelming majority of THC vaping illness cases came from products from the illicit, unregulated market, according to the Centers for Disease Control’s report. States with regulated cannabis programs were able to recall potentially harmful products and pull them from the shelves.  

Crapo has shared other concerns that are more relevant to banking and could spawn potentially welcome changes, such as directing the U.S. Treasury to issue new rules around the Suspicious Activities Reports that banks file when working with cannabis businesses. On the other hand, some of his other concerns, such as whether the bill would inadvertently legalize interstate cannabis commerce and his desire to strike federal studies on minority-owned and women-owned cannabis businesses, are more problematic, but are issues that could likely be worked through during a committee markup hearing and vote.  

And while Crapo may ultimately grant a committee vote on SAFE or his own yet-to-be-introduced bill, the legislation would still have at least one more hurdle in the form of Senate Majority Leader Mitch McConnell (R-KY). Over the past several years, McConnell has become one of the biggest champions of Congressional hemp reform and has even embraced the “Cocaine Mitch” nickname his opponents attempted to brand him with, turning it into a fundraising opportunity for his reelection. But even as McConnell has proudly leaned into those things he has continued to refer to marijuana as hemp’s “illicit cousin,” and it remains to be seen whether he would grant a floor vote on a marijuana banking bill.

If Kentucky ultimately signs into law the medical cannabis bill that had a successful committee vote in its state legislature last week, that could spur McConnell to give it floor time. More likely, the bill would have to be attached as an amendment to another bill that McConnell is willing to bring to the floor. Ultimately, the decision to allow any sort of cannabis banking legislation through the Senate may come down to whether McConnell thinks the vote will help Republicans’ chances of holding onto the chamber—for example, if it might help endangered Sen. Cory Gardner score much needed votes with the pro-cannabis Colorado electorate. 

Slow and steady progress on the MORE Act 

Meanwhile, back in the House, the Marijuana Opportunity, Reinvestment, and Expungement (MORE) Act continues to make slow but steady progress. The bill would remove marijuana from the Controlled Substances Act and would create several grant programs to repair some of the harms created by prohibition and foster social equity in the industry. These programs would be exclusively paid for through a modest excise tax on sales from cultivators to processors, while cannabis businesses would see significant tax relief, as Section 280E of the Internal Revenue Code would no longer apply to them. 

House leadership demonstrated that the MORE Act is a priority by making it one of the last things the House Judiciary Committee held a vote on prior to impeachment proceedings. With two Republicans joining all of the Democrats on the committee in voting in favor of the MORE Act, it became the first bill that would end federal marijuana prohibition to be approved in any Congressional forum since the adoption of the CSA in 1970. However, due to the comprehensive nature of the bill, it has been referred to several committees that will either need to hold their own hearings and votes or waive their jurisdiction over the bill before it can come up for a vote before the entire House. 

The Small Business Committee announced in January its intention to waive jurisdiction. Other committees may join Small Business, but at least two committee are likely to go through the regular order of hearings and a markup vote. One of these committees, the Energy and Commerce Committee, held a hearing on the bill shortly after the Small Business Committee announced its intent to waive. Energy and Commerce has oversight over several federal agencies, including the FDA, Federal Trade Commission, and Environmental Protection agency. Therefore, it’s conceivable the committee may seek amendments or its own companion legislation to further facilitate research, restrict advertising to minors, or address pesticide issues.  

Another committee that may not waive jurisdiction over MORE is the Ways and Means Committee, whose oversight includes all federal taxation. Given that the MORE Act would create a new tax for cannabis businesses, it seems likely that Ways and Means will want to put the bill through the regular order process of a hearing and markup vote. In short, while the MORE Act appears to have the greatest likelihood of passage in the House, it still has a long way to go. 

Assuming for a moment that MORE makes its way through each committee and is ultimately approved by the House, its chances for success in the Senate in 2020 are probably between slim and nonexistent. This is because the main Senate gatekeeper over legislation to end federal marijuana prohibition is Judiciary Chairman Lindsey Graham. So far, Graham has shown little interest in taking up any bill that would address the conflict between state and federal marijuana laws. But it was not always that way. Back in 2016, Graham became one of the few Senate Republicans to cosponsor the CARERS Act, which at the time was the most comprehensive medical marijuana bill introduced in Congress. But whatever initial enthusiasm Graham once showed for marijuana reform has not been seen since, as he has refused to cosponsor subsequent versions of the CARERS Act and has not given the senate version of the MORE Act any attention.  

The STATES Act lacks bipartisan support 

Some advocates and industry lobbyists have criticized the MORE Act as being too radical for a Republican Senate to take up and have insisted that the STATES Act could reach the president’s desk this year. However, this notion does not seem likely, as Chairman Graham has ignored the bill entirely, despite it being introduced with an even balance of bipartisan support back in April. Surely if STATES stood a chance in the Senate, Graham would have at least given the bill faint praise by this point. Graham may change his tune if South Carolina passes a comprehensive medical marijuana bill this year or if he’s facing a tough time with his Democratic challenger come election time, otherwise Graham will likely continue to suffer from legislative couchlock. And further complicating the STATES Act’s route to passage is that Democratic leadership has indicated that it does not go far enough to address social equity and communities harmed by the War on Drugs, making it a likely non-starter in the House. 

Appropriation amendments still in play 

Finally, we will likely see a similar slate of marijuana amendment to various Appropriations bills as came up in 2019. These amendments are spending restrictions to the bills that fund various federal agencies. The most notable of these was first passed in 2014 (known then as Rohrabacher-Farr) and prohibits the Department of Justice from prosecuting individuals and businesses acting in compliance with state medical cannabis programs. Last year, the adult-use version of the amendment passed the House for the first time with strong bipartisan support but was stripped out of the final version of the bill by Senate Republicans. There will likely be similar amendments offered to other agency’s appropriations bill to prevent the federal interference in the areas concerning banking, veterans, tribal lands, and physicians receiving Health and Human Services grants. These efforts may remain symbolic but with more states looking to adopt medical and adult use programs in 2020, the odds may become more favorable. 

While Congress may not finish the job on any of these bills before the 116th Session ends next January, not reaching the finish line should not be viewed as a failure. It is true that all of the bills will have to be reintroduced and go through the committee process once again. However, bills that pass in one chamber this session should move swiftly through that chamber next session. For example, if the MORE Act goes through the full committee process this year, the next version of the bill stands a greater chance of getting waivers in each committee. If this happens, we could see the MORE Act end up on House Leadership’s 100-day agenda for the start of the next session.   

Additionally, there may be some reshuffling of the deck when it comes to the Senate. The November elections could yield a change in control of the Senate, which would significantly increase the likelihood passing marijuana reform bills in both chambers. Short of flipping the Senate, it is also possible the Chairman Graham could be defeated by a Democratic challenger, as he is facing his toughest challenge in years back home in South Carolina. Whether the Republicans next in line after Graham would be any better on the issue is unknown, it’s hard to imagine them doing less on this issue than the current chairman. 

With 11 months to go in this session of Congress, it’s possible that we may see passage of the SAFE Banking Act or similar legislation in the Senate. It’s conceivable that we may see passage of MORE Act in the House. The best way for advocates and the industry to turn these possibilities into realities is to continue urging their members of Congress to support these bills and to work to pass and improve comprehensive adult use and medical marijuana programs in their home states. After all, those are the forces that have brought us this far and they will be what will carry us over the finish line.