HARRISBURG – Today the Senate Banking and Insurance Committee gave bipartisan approval to legislation authored by its Chairmen John DiSanto (Dauphin/Perry) and Sharif Street (Philadelphia) to afford state-legal cannabis businesses better access to banking and insurance services.
Pennsylvania is one of 37 states having legalized medical cannabis. This quickly emerging industry has brought new businesses, jobs, and investment to Pennsylvania and has provided several hundred thousand patients access to safe and regulated products for the treatment of health conditions.
While the U.S. Treasury’s Financial Crime Enforcement Network (FinCEN) issued guidance in 2014 for servicing cannabis-related businesses, federal law does not immunize financial institutions from prosecution. As a result, licensed cannabis businesses have struggled to access conventional banking and insurance services. This industry’s reliance on cash operations has been a public safety risk as dispensaries are targets for robberies that jeopardize patients, employees, and communities.
Senate Bill 1167 authorizes, but does not require, financial institutions and insurers to provide services to state-legal cannabis businesses. The proposal grants safe harbor protections from adverse state regulatory or legal action for servicing the industry.
The legislation also permits Pennsylvania’s medical cannabis industry the ability to deduct ordinary business expenses when filing state taxes. Current U.S. IRS Code prohibits these deductions despite being standard practice for all existing non-cannabis businesses. Tax fairness removes a punitive hurdle for operating a successful legal business.
“Access to financial and insurance services is essential for operating any business and it is against the public interest to relegate a multi-billion-dollar industry to deal in piles of cash,” DiSanto said. “Banking this cash safely in Pennsylvania provides certainty for businesses, is a huge opportunity to grow our economy, and should ultimately lower costs for medical cannabis consumers.”
“The Pennsylvania Cannabis Coalition applauds Chairmen DiSanto and Street for their work on state safe banking legislation. SB 1167 will not only expand financial access for Pennsylvania’s legitimate cannabis-related businesses but will also create significant tax savings for medical marijuana operators that can be passed on to patients without significant loss of revenue for the Commonwealth,” said executive director Meredith Buettner.
CONTACT: Chuck Erdman 717-787-6801 email@example.com