Will Cannabis Banking Reform Occur During The Lame Duck Now That It Isn't In The NDAA?

Cannabis banking reform could finally be a reality for the industry if lawmakers pass a bill during the current lame duck session. After years of possible reform never coming about, recent reports suggest that Senate could take action on banking while also creating grants for states to expunge previous cannabis convictions. 


The two pieces of proposed legislation, the Secure and Fair Enforcement (SAFE) Banking Act and the Harnessing Opportunities by Pursuing Expungement (HOPE) Act, have long been discussed on Capitol Hill. Still, no cannabis bills have yet to make it through Congress. However, hope runs high after President Biden signed the first piece of cannabis legislation, the Medical Marijuana and Cannabidiol Research Expansion Act, into law in early December. 


The news brings significant hope, but those following DC movements know that high hopes have yet to result in action. The SAFE Banking Act is a glaring example of reform's potential running into obstructionist roadblocks on Capitol Hill. Despite passing the house seven times, SAFE and the cannabis industry remain in limbo.


Still, this time, the bill has more momentum than ever. Majority Leader Chuck Schumer and Senator Jeff Merkley have reportedly been discussing the natter with the minority party and several of its Senators.

Could we see bipartisan lawmaking unfold?

Cannabis loans by FundCanna

That is the hope. But hope doesn't always result in the will of the people happening in Washington DC. The Schumer-led plan would see the inclusion of the two cannabis bills in the annual National Defense Authorization Act (NDAA). Since the news broke, Minority Leader Mitch McConnell has come out against the inclusion of non-defense-focused legislation in the bill. McConnell called cannabis banking and other included items "pet priorities." The Kentucky Senator added that cannabis banking would make the US financial system more sympathetic to a federally illegal drug, though many have pushed back on such assertions in the past. 


Cannabis reform isn't the only provision that could cause the NDAA's passage being delayed. However, as much of the nation agrees that the US should legalize cannabis in some federal form or fashion, Congress's failure to take action can be puzzling or downright frustrating. With McConnell serving as one of the most influential lawmakers in US political history, his opposition to the SAFE and HOPE Acts could doom their inclusion in the NDAA. Time will only tell, but McConnell has been instrumental in blocking other pieces of legislation and other actions in the past. 


With less than a month in the lame duck session, cannabis banking and criminal record reform passage remain in the air. With a bipartisan effort pushing their inclusion, we may finally see substantial reform happening on the federal level. However, as instrumental leaders and political dealings take shape, no one is certain if we will see change come in the final days of 2022. The next iteration of Congress is slated to begin on January 3, 2023. 


If we do not see progress now, it may be challenging to do so for at least the next two years. In theory, a divided Congress could lead to a bipartisan bill freestanding from the NDAA. However, recent history has indicated that the two ruling parties rarely come together on legislation. With cannabis still a hot button issue among lawmakers, despite most of the public already agreeing on the subject, the time for action is hopefully now. The latest news suggests that won’t happen.


As of December 7th, neither provision was included in the NDAA. Additional reform parameters were also cut. While a substantial blow to advocates, the NDAA does still include language that would compel the Secretary of Defense to study the efficacy of pharmacologic or potential plant-based therapies on conditions including PTSD and chronic pain. The decision does not specifically include cannabis or psychedelics in the study. 


The loss of the NDAA inclusion is a setback, but isn’t the end of lame duck efforts. Rep. Ed Perlmutter, a SAFE Act sponsor, said he is working on including SAFE in the pending omnibus appropriations legislation. Its fate remains unclear.