“The reality of the status quo is that if SAFE doesn’t pass, only the largest and most connected MSOs will have enough money to see them through.”
In Kaliko Castille, Minority Cannabis Business Association
With the 2022 midterm elections wrapped up and only a run-off remaining to determine whether Democrats will secure a one-vote majority or 50-50 votes in the Senate, all eyes (at least in the marijuana industry) are on lame-duck conferences and Hopefully the Senate will finally send the Safe and Fair Enforcement (SAFE) Banking Act to President Joe Biden’s desk.
The Minority Cannabis Business Association (MCBA) has supported the SAFE Banking Act in its current form for many years, but has also devoted significant resources over the past two years to advocating for specific amendments that would improve SAFE without scaring away Any Republicans will need to convince them to support this bill.
This time last year, I wrote a column for Marijuana Moment called “Cannabis Reformers Can Get Safe Banking from Congress or Nothing—What’s It?” Last chance to pass SAFE Banking (read: any marijuana industry legislation) this term.
In that article last year, the MCBA not only called for SAFE Banking to be passed, but also asked for it to be amended to include “protections for community financial depository institutions (CFDIs) and minority depository institutions (MDIs) that have a history of lending to black and brown communities.”
I’m here again to remind people of #SAFECantWait and I’m proud that so many other thought leaders have likewise been pushing for an improved Safe Banking Act to pass
Recently, a good friend of mine, Amber Senter of Supernova Women, published a thoughtful article in Marijuana Moment saying:
“Without improvements to the bill, SAFE risks widening the gap between already successful white-owned MSOs and emerging entrepreneurs from the communities most victimized by racist cannabis enforcement.”
Another well-respected organization, the Cannabis Regulators of Color Coalition, published a thoughtful paper with a number of proposals to improve SAFE, including recommendations like the push to incorporate CDFI and MDI.
MCBA will continue to push for three policies over the next few weeks that we believe will not only achieve the bill’s original goals, but also provide substantial improvements for minority entrepreneurs:
Include Community Development Financial Institutions (CDFIs) and Minority Depository Institutions (MDIs) in the bill’s safe harbor language because these entities have the authority and track record to provide loans to minority communities. By ensuring these institutions can participate in the emerging legal cannabis industry, we will open up trusted partners closest to their communities to become conduits for capital flow.
End the discriminatory practice of excluding cannabis-related entrepreneurs from the Small Business Administration (SBA), which has the ability to issue microloans of $500 to $50,000 and the 7( a) Program interest loans. Additionally, it will give cannabis entrepreneurs access to a nationwide network of technical support from SBA offices in Portland, Maine to Portland, Oregon, and all legal markets in between.
Incorporated into the HOPE Act, which would encourage and provide resources to state and local governments to develop removal programs for cannabis crimes. While this is not a banking-related reform, it is critical to improving the economic status of the millions of black and brown Americans who are prevented from fully participating in the economy because of discriminatory background checks.
We have been fighting for these improvements for years, both lobbying Congress and persuading the white-owned, MSO-led lobby to acknowledge credible concerns about the limited nature of SAFE as it was originally drafted. In fact, it was one of my predecessors who worked with the Small Business Council on the drafting of the SBA bill and testified before Congress in support of it.
And Congress in a bipartisan fashion – specifically Senate Majority Leader Chuck Schumer (D-NY) and Senators. Cory Booker (D-NJ), Steve Daines (R-MT) and Sherrod Brown (D-OH) all gave positive reviews.
The reality of the status quo is that if SAFE does not pass, only the largest and most well-connected MSOs will have enough money to tide them over. But even in that case, the legalization movement would take a step backwards, and that wouldn’t be good for their bottom line.
Now that we have a real opportunity to create an improved SAFE Plus bill, it is critical that all players coordinate to ensure a successful vote.
The MCBA recently hosted a ‘safety can’t wait’ town hall in partnership with Minority Medical Marijuana (M4MM), Women’s Growth and Cannabis Matters, and I used the football analogy where we need to kick a field goal to score some points as we head into halftime Previous Board (New Congress).
At this point, SAFE is not just about public safety and access to banking business – it boosts the morale of thousands of entrepreneurs risking their livelihoods while being deprived of the basics that any other small business can get business services.
The current reality is already one of “yes” and “nothing” – which means only the most well-capitalized and well-connected entrepreneurs get banking – it’s time we eliminate basic commerce for cannabis entrepreneurs and SAFE-Plus Serving any obstacles out of the way is a good place to start.
#SAFECantWait Let’s kick that field goal and score on the board.
Kaliko Castille is president of the Minority Cannabis Business Association and co-founder of digital strategy firm ThndrStrm Strategies. Disclosure: He also supports the work of Marijuana Moment by making monthly pledges on Patreon.
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Photo courtesy of Philip Steffan.