Senate passes medical cannabis banking fix
CHARLESTON — The bill fixing the banking issue for medical marijuana could be on the governor’s desk this week.
The West Virginia Senate Tuesday passed House Bill 2538, providing banking services to medical cannabis, in a 29-4 vote with no debate. The bill’s next stop is the desk of Gov. Jim Justice for his signature.
HB 2538 solves a problem plaguing the state Medical Cannabis Program: how to handle fees, penalties and taxes derived from a drug that remains on the federal Schedule 1 list along side heroin and cocaine.
The bill allows banking institutions — credit unions, national banking associations, bank and trust companies, savings and loan associations, building and loan associations and mutual savings banks — to bid to provide financial services to the office of the state treasurer. The bill creates a separate fund to deposit application fees and other deposits for growers, processors and dispensaries involved with medical cannabis.
“What it attempts to do is seek to find a mechanism for financial institutions to compete and provide financial services related to the West Virginia Medical Cannabis Act,” said Senate Judiciary Committee Chairman Charles Trump, R-Morgan.
Signed into law in 2017, the Medical Cannabis Act legalizes marijuana for medical use. After July 1, marijuana can be prescribed by pill, oil, topical forms and vaporization or nebulization. It specifically excludes smokable marijuana.
It could be used for several ailments, including cancer treatment, post-traumatic stress disorder, seizures, chronic pain and terminal illnesses.
Last year, the state treasurer ran into issues with the banking portion of the law. Federal law prohibits banks insured by the Federal Deposit Insurance Corporation from accepting money generated from illegal drug activity.
An advisory opinion issued in January from the state attorney general gave lawmakers the green light to proceed with the Medical Cannabis Program, noting that there have been no federal actions against other states with a similar program.
Additionally, Congress has not funded efforts of the U.S. Department of Justice to shut down medical marijuana in states where it is legal. A previous Justice Department memo also protected these states from enforcement actions, but it’s still a liability for banks to handle revenue generated from medical marijuana.
HB 2538, along with additional money provided in the draft budgets of both the House and the Senate for the Medical Cannabis Program managed by the Department of Health and Human Resources, should help the program when it launches July 1, though delays in applications are still possible.