by Kris Krane
6 Jan 2021
The 2020 Elections are (mercifully) behind us, so the time has come to turn our attention to what the results of this year’s election mean for the future of cannabis policy reform in the near-term.
We now know that in 2021 we will have unified Democratic control of the White House and Congress for the first time since 2008. Democratic Party leadership has come a long way in their evolution on cannabis policy during that time, and the cannabis advocacy community and industry will be expecting real change to come from the new Congress and the Biden administration.
During this election the Biden campaign touted their support for cannabis decriminalization and Senate Majority Leader Chuck Schumer stated that legalization would be a major priority in a Democratic controlled Senate. Now is the time for party leaders to show that their words were more than empty campaign rhetoric and take swift action on a series of meaningful cannabis policy reforms.
And make no mistake, the window for reform is likely a short one. While the Republican party rank and file are in majority support of legalization, GOP leadership in Congress, and Mitch McConnell in particular, has been no supporter of legalization. Historically, the party in control of the White House tends to lose seats during a mid-term election, particularly when they Control all branches of the federal government. Democrats must govern under the assumption that Republicans will take back at least one chamber of Congress in the 2022 midterm elections. If they retake the Senate and Mitch McConnell reassumes his role as Majority Leader, any hope of significant cannabis reform will likely go out the window.
If the incoming Democratic government is serious about cannabis reform, there are a few proposals that will quickly come up for consideration. Here is what we should expect to hear about in the coming two years:
SAFE Banking Act
The SAFE Banking Act would allow banks and financial institutions to legally do business with the cannabis industry without fear of federal arrest or prosecution or other punitive actions. This proposal had been considered the most likely piece of cannabis legislation to pass in the current Congress, and will likely get new life in the incoming session.
In fact, there is still the possibility, albeit small, that it becomes law during the lame duck session before the Democrats officially take power in January. This is because the SAFE Banking language has been included in the Covid relief package passed by Democrats earlier this year, which never became law due to Senate inaction. Should the current Congress decide that they want provide relief for American families struggling under the Covid related economic downturn before the new Congress takes power, there is a reasonable that this SAFE Banking language would be included in the final proposal. [Author’s Disclaimer: This was written before the stimulus bill passed Congress, which did not include SAFE Banking language].
But even if the lame duck Congress fails to pass Covid relief, or does so without protections for banks doing business with the cannabis industry, the SAFE Banking Act has the best chance of any proposals of becoming law in the next Congress. Should the lame duck Congress fail to pass a Covid stimulus package, doing so would likely be the top priority for the new unified Democratic government early next year. Given that House leadership has already included SAFE Banking in prior iterations of a stimulus bill, and that Senate leadership has expressed strong support for the proposal, chances are good that the banking industry will be free to do business with cannabis companies sometime in early 2021.
Even if not passed through a stimulus bill, SAFE Banking would have a reasonable chance of passing both houses of Congress as a standalone bill. After all, the Democratic controlled House already passed the bill earlier this year. But it has been stalled in the GOP Controlled Senate, primarily by Banking Committee chairman Sen. Mike Crapo (R-ID). Next year Crapo will be replaced by Sen. Sherrod Brown (D-OH), who would be unlikely to hold up a proposal that has been a top priority for Democratic leadership.
For the past few years the cannabis industry has primarily pushed for the passage of the STATES Act, which would recognize states’ ability to legalize cannabis at the state level without the risk of federal intervention. This is a largely federalist approach to legalization, recognizing that the current GOP leadership in the Senate (and in the House prior to the 2018 midterms) would likely never consider actual federal legalization.
While some may consider this to be a good compromise bill moving forward for centrist congressional Democrats from swing states and districts, chances are that the STATES Act becomes a non-starter in a unified Democratic government. During their time in the wilderness over the past eight years, Democratic party elected officials have become much better informed on the details of cannabis policy and cannabis reform. In particular, the Congressional Black and Latino caucuses have paid close attention to how legalization has played out in states across the country, and the need for proposals that address racial and social equity that begin to prepare some of the damage caused to predominantly black and brown communities under marijuana prohibition
Prominent Democratic leaders in the Senate, including Sen. Cory Booker (D-NJ) and incoming Vice-President Kamala Harris (D-CA) have expressed doubts about the STATES Act because it lacks any provisions to address racial inequities and social equity. With full Control of Congress for the first time a decade, it is hard to see Democratic leadership prioritizing a bill that would anger a large portion of their caucus. Which leads us to the most likely vehicle for federal legalization in the upcoming Congress…
The MORE Act, which would fully remove cannabis from the Controlled Substances Act, has been the preferred legalization proposal of House Democratic leadership in the current Congress, with the lead Senate sponsor being none other than the incoming Vice President of the United States. Democratic leadership has been so supportive of the proposal that they have repeatedly promised a vote this year. While a planned vote this summer was delayed, leadership continues to promise that it will receive a vote on the House floor during the lame duck session, where it is expected to pass, positioning the MORE Act as the most likely vehicle for wide ranging cannabis reform in the coming Congress. [Author disclaimer: The MORE Act passed the House of Representatives in December 2020]
It goes without saying that a bill that is already being championed by the current Speaker of the House and the incoming Vice President would stand a good chance at becoming law next year. But the reality is not quite that simple. In addition to the very real prospect that moderate Democrats may shy away from reform while in power, or that the GOP Senate minority may try to filibuster any proposals that are seen as a priority of Democratic leadership, there are real issues with the MORE Act that will likely have to be addressed before it can become law.
This is part of the difference between being a opposition party and a majority ruling party. Parties in control of a legislature without the executive often introduce bills that are not fully fleshed out in order to make a statement about their most important policy priorities. But once a bill has a chance to become an actual law, the minute details of the proposal come into focus and become increasingly important in securing the votes needed for passage.
While the MORE Act goes a long way to achieving legalization, including removing cannabis from the Controlled Substances Act and addressing social equity in the cannabis industry, it is light on details around federal regulation and taxation, issues that will be critical to address in a comprehensive legalization scheme. The MORE Act will not likely be passed as currently written, but instead will serve as the foundation for a more comprehensive descheduling bill with a more robust regulatory framework that could be passed by both houses of congress and supported by a Biden administration.
To see how this might play out in practice, we can look to how legalization played out in Illinois, the only state to date to have passed legalization through the state legislature rather than a voter approved ballot initiative. From 2015 – 2018, there was believed to be majority approval for legalization among the Democratic controlled state House and Senate. But actually passing a bill that could become law was impossible with then Republican Governor Bruce Rauner a strong opponent of legalization. Yet each year Senator Heather Steans and Representative Kelley Cassidy introduced a legalization bill in the legislature anyway, believing that having an active proposal in both houses would keep the issue fresh in the minds of their colleagues and allow for legislators to begin working through the details that would allow for it’s eventual passage.
When Democrat J.B. Pritzker assumed the governorship in 2019 after having made a campaign pledge to legalize marijuana, this placeholder bill suddenly became a top legislative priority. With a friendly administration in place, Senator Steans and Representative Cassidey went to work discussing and negotiating the details of their legalization proposal, eventually reintroducing a new version of the bill that was more comprehensive and robust than the placeholder they had introduced the prior four years. The new bill included concerns and priorities from their legislative colleagues and the governor, allowing it to become law in June 2019.
Next year incoming Congressional leadership that cares about legalization will need to work with the new Biden administration to craft a piece of legislation that will be palatable to a president who has been less than a full throated legalization supporter. They will also need to address the concerns of Black and Latino caucus members who will need to see racial equity addressed in order to win their support, without turning off moderate and swing district Democrats wary of being perceived as too progressive to win reelection in the mid terms.
By having introduced, debated, and advanced the MORE Act in the House of Representatives for the past two years, Democratic leadership have effectively chosen that bill to serve as the foundation for comprehensive reform in the incoming 117th Congress. The big question is, now that they are in an actual position to pass and enact legislation, can they work with the various factions within their party to turn the MORE Act, or something new, into a comprehensive legalization bill that can be passed in the next two years. If not, cannabis voters will surely remember their failures in future election cycles.