A last-minute legislative effort to create a first-of-its-kind banking cooperative for Colorado’s marijuana industry skipped through the House early Monday but is headed for an uncertain future in the Senate.
Without much fanfare following days of heated debate, House Bill 1398 breezed through its third reading on the House floor. Introduced only Wednesday, the measure quickly stirred a few heated words at the three committee hearings it faced, gutted by one and then reinstated by another.
Some Republicans seethed at how an important bit of legislation wasn’t offered until the waning days of the session.
“We had less than 24 hours to review a complex 43-page bill that will drastically impact the marijuana industry in our state. I agree we need to find a solution, but we were not elected to pass bills based solely on good intentions,” said Rep. Libby Szabo, R-Arvada, the ranking member of the House Business, Labor, Economic and Workforce Development Committee, which first debated the bill.
Szabo was one of two votes against moving the bill along in House committee hearings; the other was Rep. Dan Nordberg, R-Colorado Springs.
The bill aims to create — yet no one says that it actually will succeed — a credit union-like co-op specifically for medical and recreational marijuana businesses that have long fought for the right to banking services.
Said Rep. Chris Holbert, R-Parker: “Failing to give a bill of this magnitude proper vetting is truly reckless and beneath the respect this new industry deserves.”
Holbert initially voted in favor of the bill while in committee, then against it when it made it to the floor of the House.
Though HB 1398, sponsored by Rep. Jonathan Singer, D-Boulder, carries pages of regulatory framework to establish the financial services, supporters agree that it’s little more than an effort at putting federal authorities on notice that they must address the problem.
Senate sponsor Pat Steadman, D-Denver, said he reluctantly agreed to chaperone it through his branch of the legislature, unconvinced it would have an easy or successful outcome.
“I had a similar bill a couple of years ago, and it was very difficult, the banking lobby fighting it tooth and nail,” Steadman said.
“I just don’t think we can solve the problem in Denver. But we need to try.”
Because marijuana remains illegal under federal law, and because banks are regulated by federal agencies, marijuana businesses cannot easily access banking services like other legal businesses.
Federal regulators and prosecutors in February offered guidance for banks wanting to work openly with marijuana businesses — many do so quietly — but the rules were little more than additional paperwork with no fewer headaches, banking insiders have said.
Bill supporters said the measure intended to force the federal government into definitively saying whether marijuana businesses can access banking services.
The bill requires approval for any cooperative from the Federal Reserve Bank, which controls the nation’s money system. Without approval from the Reserve’s board of governors, Colorado’s measure simply fades away by 2017.
It is scheduled to be heard Tuesday before the Senate Finance Committee.