Maine – Opportunities for Marijuana Establishments to Access Financial Services

Authored By: Hannah King

 

Opportunities for Marijuana Establishments to Access Financial Services: Recent Advancements at the State and Federal Level
Proposed Legislation in Maine
Currently, marijuana businesses and their employees are not able to deposit funds from their businesses into federally insured financial institutions or obtain loans from financial institutions because marijuana remains illegal at the federal level. The result is that these businesses are cash-only businesses whose only access to capital is through private-equity. This has had a significant impact on marijuana businesses operating in compliance with Maine law across the state.  
On Tuesday, March 26th a bill introduced by Representative Berry of Bowdoinham (LD 1402) was released in the Maine State Legislature in an effort to expand state legal marijuana businesses’ access to financial services. Specifically, LD 1402 would allow state-chartered credit unions to obtain private deposit insurance, which would, in turn, make it possible for state credit unions to provide financial services to dispensaries and caregivers that have been registered under Maine’s medical marijuana program. The bill will also apply to any marijuana establishment that receives a license from Maine’s adult use program in the future. In addition, the bill creates opportunities for employees of these businesses to access state credit unions. It is unclear whether this bill pertains to financing, but it may remove one barrier preventing marijuana businesses from getting business loans in the future (although credit unions may still have other business-related reasons for declining to loan to marijuana businesses).
While this bill would be a huge step forward for the legal marijuana industry in Maine, the current version of the bill omits coverage for medical marijuana manufacturing and testing facilities. We suspect this omission was an oversight rather than an intentional exclusion, and Drummond Woodsum will submit testimony advocating for an amendment to the bill that would expand coverage to all marijuana establishments that have been authorized to operate under state law. 
The full text of the emergency legislation may be found here. As emergency legislation, the law would immediately go into effect (rather than becoming effective 90 days after adjournment) and will require approval by 2/3 of the State Legislature. 
Proposed Legislation in Congress
Progress is being made at the federal level as well. On Friday, March 28th the House Financial Services Committee voted to advance the Secure And Fair Enforcement (SAFE) Banking Act to the full legislative body for consideration. Under the approved bill, federal banking regulators would not be able to punish financial institutions just because they work with marijuana businesses that are legal under state, local, or tribal laws. Currently, the bill has 152 cosponsors, including 12 Republicans, which is the most support any standalone piece of marijuana legislation has received in Congress to date. 
Drummond Woodsum’s Regulated Substances and Government Relations & Campaigns practice groups will continue to monitor developments in this area. 

 

Author Bio

Hannah King is a member of the School and Local Government Group and the Regulated Substances Group. In both practice areas, Hannah advises on and litigates complex regulatory matters.

Hannah’s school law practice includes special education, employment and labor, and general school law, with a concentration in special education and disability rights law, and legal issues involving student rights. She has advised both public and private schools on a variety of issues, including disability rights, anti-discrimination laws, student and parent handbooks, and employment issues. Hannah has represented school districts in special education due process hearings, state complaint investigations, and in federal Office for Civil Rights investigations, as well as in a variety of civil lawsuits. Hannah has also practiced in both federal and state courts, including cases before the First Circuit Court of Appeals and the U.S. District Court. Hannah regularly presents at a number of at school law conferences across the State, has presented at a national conference on Title IX issues, and has been an instructor for a graduate-level school law course for the University of Southern Maine.

Hannah is also a member of the regulated substances practice group. Her unmatched understanding of the local and national status of cannabis legalization gives her clients an advantage in a dynamic and rapidly changing industry. Hannah advises local municipalities, medical dispensaries, and entrepreneurs on medical and adult use marijuana regulatory and licensing issues. She also advises tribal clients across the country looking to enter the cannabis space on business strategy and development of tribal regulatory regimes. Hannah is an advisory board member of Maine Professionals for Regulating Marijuana, a collection of Maine professionals advocating for safety, quality, and transparency in the marijuana industry, and has been involved in drafting proposed legislative changes to Maine’s Marijuana Legalization Act and the Maine Medical Use of Marijuana Program. As a member of The ArcView Group, a cannabis angel investment platform, 15 member selection committee, Hannah vets investment opportunities in the cannabis industry for consideration by ArcView members. She has been a mentor presenter at Canopy Boulder, a business accelerator and venture fund for the cannabis industry.

In her labor and employment practice, Hannah counsels employers on achieving and maintaining compliance with federal and state employment laws, the development of personnel policies, and employment contracts. Hannah also conducts investigations for employers into a variety of matters including employee misconduct, discrimination and sexual harassment complaints.

Before coming to Drummond Woodsum, Hannah worked as an Assistant Public Defender with the Alaska Public Defender Agency where she practiced in both the trial and appellate units. She represented clients in Superior Court against the most serious criminal charges and argued cases before the Alaska Court of Appeals. She was named “2011 New Litigator of the Year” by the Alaska Public Defender Agency.

While in law school, Hannah served as Editor-in-Chief of the Ocean and Coastal Law Journal and co-chair of the Environmental Law Society. She received the 2009 Edward S. Godfrey Leadership Award and the 2009 Award for Outstanding Scholastic Achievement in Environmental and Marine Law.

More Information At

http://www.dwmlaw.com/PROFESSIONAL?id=38

Sean Hocking

Sean Hocking


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