04.05.19

Gardner, Warren Reintroduce STATES Act with Broad Bipartisan Support

Washington, D.C. – U.S. Senators Cory Gardner (R-CO) and Elizabeth Warren (D-MA) reintroduced the Strengthening the Tenth Amendment Through Entrusting States Act (STATES Act) with broad bipartisan support that spans the political spectrum. Not only does this commonsense legislation have bipartisan support, it also brings together key players across the business community. The overwhelming support for the STATES Act shows that the time has come for the federal government to respect state decisions on this issue. 

What They Are Saying

The American Banker Association: “On behalf of the American Bankers Association (ABA), I am writing to express our support for the Strengthening the Tenth Amendment Through Entrusting States (STATES) Act. We would like to thank you for your efforts to address this important issue, as the conflict between state and federal cannabis laws has become a challenge for many of our nation’s communities and the banks that serve them.”

Credit Union National Association: “The STATES Act would provide credit unions and other financial institutions accepting deposits from, extending credit or providing payment services to an individual or business engaged in marijuana-related commerce in states where such activity is legal with legal protections, so long as they are compliant with all other applicable laws and regulations. Furthermore, the legislation makes clear that compliant financial transactions do not constitute trafficking or result in proceeds of an unlawful transaction, providing additional clarity to credit unions and the members they serve. This is a reasonable and sound approach. We look forward to working with you to advance your legislation into law.” 

Cooperative Credit Union Association: “The Association is supportive of your bill and there is much about this narrowly designed proposal that is laudable. First, we firmly believe that the bill strikes a careful balance between federal and state governance on marijuana enforcement. The Association has held the longstanding position that states should function as their own laboratories of democracy.”

National Conference of State Legislatures: “We appreciate the leadership of the STATES Act sponsors in introducing this bill. We are grateful for your recognition of the importance of the Tenth Amendment and your willingness to recognize that states have the right to create thoughtful and meaningful marijuana policy if they so choose.” 

Veterans Cannabis Project: “Veterans applaud the leadership of Sens. Gardner and Warren and Reps. Blumenauer and Joyce on this essential legislation and thank President Trump for his public support of the STATES Act. Veterans Cannabis Project hopes to build on this bill’s momentum to give veterans a safer alternative to the potentially lethal opioids and benzodiazepines often used to treat the PTSD, traumatic brain injury, and chronic pain our veterans suffer disproportionately, and we urge Congress to include provisions that will address veteran-specific access issues in the final legislative package.”

California State Association of Counties: “On behalf of the California State Association of Counties (CSAC), I am writing to thank you for introducing legislation – the Strengthening the Tenth Amendment Through Entrusting States Act, or the STATES Act – that would allow states to determine their own cannabis policies. While cannabis would continue to be illegal at the federal level, the STATES Act would create an exemption to the Controlled Substances Act (CSA) for states that have legalized cannabis in one form or another. The bipartisan measure also would require states to abide by certain restrictions, including a minimum age for marijuana sales and employment.” 

Mashantucket Pequot Tribal Nation: “The STATES Act would eliminate the uncertainty at the federal level and help ensure that investments into this industry are protected. In particular, the Mashantucket Pequot Tribal National appreciates the inclusion of Indian Country within the legislation.”

Electronic Transactions Association: “The conflict between state and federal laws forces businesses to operate on a cash-only basis and has created significant legal and compliance concerns for financial institutions that wish to provide banking services, including electronic payments, to marijuana related businesses in states where it is currently legal. The STATES Act would allow legitimate marijuana businesses to access the safety and security of the broader banking ecosystem in states that have legalized marijuana. Having access to the broader financial ecosystem makes it easier for businesses to track revenues for taxation purposes, decreases a public safety threat as cash intensive businesses are often targets for criminal activity, and allows proper tracking of finances for BSA/AML compliance.”

Americans for Tax Reform: “Section 280E of the tax code prevents businesses with expenditures connected to “illegal” drug sales from utilizing deductions or tax credits. . . . Because of this, cannabis businesses nationwide face income tax rates as high as 90%. This bill will remove cannabis businesses from the arbitrary measures of Section 280E and entitle them to the same deductions and credits any other legal business… As a result of federal prohibition and the disparity between federal and state law, many banks will not allow dispensaries to deposit revenues into bank accounts and makes it extremely difficult to pay electric bills, leases, and so on. Roughly 70% of dispensaries are forced to carry thousands of dollars in cash, making them a huge target for bad actors. The STATES Act would allow retailers in states with legal cannabis to put their revenues into bank accounts, correcting complications paying bills and encouraging safe sale and use of cannabis.” 

Some organizations point to specific implications of the bill, like enhanced tribal sovereignty and banking law clarity:

"While ABA does not take a position on the legalization of cannabis and the STATES Act is not a banking specific bill, removing the federal prohibition on cannabis in states that have legalized its use would allow banks to accept deposits and provide basic financial services to state licensed cannabis businesses and their service providers," wrote Rob Nichols, President and CEO of the American Banking Association. "That, in turn, would help those communities reduce cash-motivated crimes, increase the efficiency of tax collections, and improve the financial transparency of the cannabis industry.”

"The National Congress of American Indians (NCAI) strongly advocates for the recognition of tribal sovereignty and inclusion of tribal governments in national legislation," said Jefferson Keel, President of the National Congress of American Indians. "We appreciate the re-introduction of the STATES Act, which would bring certainty in federal law for tribal nations as separate jurisdictions. Tribal nations, as sovereign governments, and in the spirit of self-determination, must be able to make independent  decisions about their own economic, cultural, and social futures at the local, tribal level.”

Additional Supporters of the STATES Act:

The STATES Act is supported by the American Bankers Association, ACLU, American Council of Independent Laboratories, Americans for Prosperity, Americans for Safe Access, Americans for Tax Reform, American Trade Association for Cannabis and Hemp, Brennan Center for Justice, California Cannabis Industry Association, California State Association of Counties, Campaign for Liberty, Cannabis Trade Federation, Center for Freedom and Prosperity, Citizens Opposing Prohibition, Colorado Bankers Association, Competitive Enterprise Institute, Cooperative Credit Union AssociationCredit Union National Association, Drug Policy Alliance, Electronic Transactions AssociationFederated Indians of Graton Rancheria, Florida Credit Union Association, the Hoh Indian Tribethe Jamestown S'Klallam Tribe, Law Enforcement Action Partnership, Massachusetts Bankers Association, Marijuana Policy Project, Minorities for Medical Marijuana, the Muckleshoot Indian Tribe, National Cannabis Industry Association, National Cannabis Roundtable, National Conference of State Legislatures, National Organization for the Reform of Marijuana Laws, New Federalism Fund, New York Medical Cannabis Industry Association, New Jersey CannaBusiness Association, the Nisqually Indian Tribe, Oklahoma Cannabis Industry Association, the Passamaquoddy Tribe at Indian Townshipthe Puyallup Tribe of Indians, R Street, Safe and Responsible Banking Alliance, the Squaxin Island Tribethe Suquamish Tribethe Utu Utu Gwaitu Paiute Tribethe Veterans Cannabis Projectthe Mashantucket Pequot Tribal Nation, the Mountain West Credit Union Association, Free the People, Los Angeles Area Chamber of Commerce, Freedom Partners, Institute for Liberty, Muckleshoot Indian Tribe, Northwest Credit Union Association, Ohio Credit Union League, Professor Ilya (Professor of Law at George Mason University Antonin Scalia School of Law), and the Taxpayers Protection Alliance.

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