PRINTER'S NO. 470
THE GENERAL ASSEMBLY OF PENNSYLVANIA
SENATE BILL
No.
465
Session of
2019
INTRODUCED BY STREET, FOLMER, LEACH, FARNESE, GORDNER, KILLION,
YAW, MUTH, BOSCOLA, BREWSTER, LAUGHLIN, VOGEL AND
TARTAGLIONE, MARCH 21, 2019
REFERRED TO BANKING AND INSURANCE, MARCH 21, 2019
AN ACT
Amending the act of May 15, 1933 (P.L.565, No.111), entitled "An
act relating to the powers and duties of the Department of
Banking and Securities and the Secretary of Banking and
Securities in exercising supervision over, and taking
possession of and conducting or liquidating the business and
property of, corporations, associations, and persons
receiving deposits or otherwise transacting a banking
business, corporations acting as fiduciaries, and building
and loan associations; providing for the payment of the
expenses of the Department of Banking by supervised
corporations, associations, or persons, and appropriating the
Banking Department Fund; authorizing the Department of
Banking, under certain circumstances, to examine
corporations, associations, or persons affiliated, or having
business transactions with supervised corporations,
associations or persons; authorizing appeals to the Supreme
Court, and prescribing and limiting the powers and duties of
certain other courts and their prothonotaries, registers of
wills, recorders of deeds, and certain State departments,
commissions, and officers; authorizing certain local public
officers and State departments to collect fees for services
rendered under this act; regulating securities; providing
penalties; and repealing certain acts and parts of acts,"
providing for Cannabis Banking Commission.
The General Assembly of the Commonwealth of Pennsylvania
hereby enacts as follows:
Section 1. The act of May 15, 1933 (P.L.565, No.111), known
as the Department of Banking and Securities Code, is amended by
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
adding an article to read:
ARTICLE XI-B
CANNABIS BANKING COMMISSION
Section 1101-B. Legislative declarations and intent.
(a) Declarations.--The General Assembly declares as follows:
(1) The medical cannabis program has been providing
medical cannabis to seriously ill patients across this
Commonwealth for over two years.
(2) The Department of Health of the Commonwealth issued
25 grower/processor permits and 50 dispensary permits in the
first three years of implementation of the medical cannabis
program in this Commonwealth. This is the maximum number of
permits available under the act of April 17, 2016 (P.L.84,
No.16), known as the Medical Marijuana Act, demonstrating the
steadily growing level of patient demand and success of the
program.
(3) The continued Federal classification of cannabis as
a Schedule I drug under the Controlled Substances Act (Public
Law 91-513, 84 Stat. 1236) inhibits financial institutions,
which are subject to Federal law, from providing banking
services to the medical cannabis industry in Pennsylvania.
(4) Consequently, despite the success of the program and
its contribution to the health and economy of the
Commonwealth, the many grower/processor and dispensary
permittees providing medical cannabis in this Commonwealth
are compelled to pay business bills, employees, suppliers and
taxes in cash only.
(5) Dealing in such large amounts of cash puts these
cannabis organizations, their employees and customers at risk
of violent crime, and continues the stigmatization of
20190SB0465PN0470 - 2 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
operating a cannabis organization as a transparent, tax-
paying participant in the Commonwealth's economy.
(b) Intent.--It is the intent of the General Assembly to
create a commission within the department, comprised of several
cooperating Commonwealth agencies, to resolve the many conflicts
that prevent Pennsylvania's cannabis industry from accessing
financial services and prevent financial institutions from
providing those services in this Commonwealth.
Section 1102-B. Definitions.
The following words and phrases when used in this article
shall have the meanings given to them in this section unless the
context clearly indicates otherwise:
"Cannabis." The term shall include the following:
(1) Medical cannabis.
(2) Marijuana for adult use, for purposes other than
medical, if approved pursuant to the laws of this
Commonwealth.
"Cannabis organization." A medical marijuana organization as
defined in section 103 of the act of April 17, 2016 (P.L.84,
No.16), known as the Medical Marijuana Act;
"Commission." The Cannabis Banking Commission.
"Financial institution." A bank, a national banking
association, a bank and trust company, a trust company, a
savings and loan association, a building and loan association, a
mutual savings bank, a credit union or a savings bank.
"Medical cannabis." Medical marijuana as defined in section
103 of the Medical Marijuana Act.
"Medical cannabis program." The medical marijuana program
established under section 301 of the Medical Marijuana Act.
Section 1103-B. Cannabis Banking Commission.
20190SB0465PN0470 - 3 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
(a) Establishment.--The Cannabis Banking Commission is
established within the department. The commission shall consist
of the following members:
(1) The secretary or a designee.
(2) The Secretary of Health or a designee.
(3) The Secretary of Agriculture or a designee.
(4) The Secretary of Revenue or a designee.
(5) Two members to be appointed by each of the
following, who shall be knowledgeable and experienced in
issues relating to the provision of financial services to
businesses in the cannabis industry or in operating as a
cannabis organization in this Commonwealth:
(i) The President pro tempore of the Senate.
(ii) The Minority Leader of the Senate.
(iii) The Speaker of the House of Representatives.
(iv) The Minority Leader of the House of
Representatives.
(6) Two members appointed by the Governor, who shall be
principals, operators, financial backers or employees of
cannabis organizations in this Commonwealth.
(7) Three members to be appointed by the Governor from
the financial services industry as follows:
(i) One member who is knowledgeable and experienced
in providing financial services through a financial
institution.
(ii) One member who is knowledgeable and experienced
in providing financial services through a credit union.
(iii) One member who is knowledgeable and
experienced in providing financial services through
technology to facilitate end-to-end payments via the
20190SB0465PN0470 - 4 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
Internet.
(b) Terms.--Except as provided under subsection (g), the
members appointed under subsection (a)(5), (6) and (7) shall
serve a term of four years or until a successor has been
appointed and qualified, but no longer than six months beyond
the four-year period.
(c) Chairperson.--The secretary, or a designee, shall serve
as chairperson of the commission.
(d) Voting and quorum.--The members under subsection (a)(1),
(2), (3) and (4) shall serve ex officio and shall have voting
rights. A majority of the members shall constitute a quorum for
the purpose of organizing the commission, conducting the
commission's business and fulfilling the commission's duties. A
vote of the majority of the members present shall be sufficient
for all actions of the commission unless the bylaws require a
greater number.
(e) Attendance.--A member of the commission appointed under
subsection (a)(5), (6) or (7) who fails to attend three
consecutive meetings shall forfeit the member's seat on the
commission unless the secretary, upon written request from the
member, finds that the member should be excused from a meeting
for good cause. A member who cannot be physically present may
attend meetings via electronic means, including video
conference.
(f) Governance.--The commission shall have the power to
prescribe, amend and repeal bylaws, rules and regulations
governing the manner in which the business of the commission is
conducted and the manner in which the duties granted to the
commission are fulfilled. The commission may delegate
supervision of the administration of commission activities to an
20190SB0465PN0470 - 5 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
administrative secretary and other employees of the department
as the secretary shall appoint.
(g) Initial terms.--The initial term of a member appointed
under subsection (a)(5), (6) or (7) shall be for one, two, three
or four years as the secretary shall determine at the time of
appointment. All other members shall serve for a term of four
years.
(h) Vacancy.--In the event that a member appointed under
subsection (a)(5), (6) or (7) shall die or resign or otherwise
become disqualified during the member's term of office, a
successor shall be appointed in the same manner and with the
same qualifications as set forth in this section and shall hold
office for the unexpired term. An appointed member of the
commission shall be eligible for reappointment.
(i) Expenses.--A member appointed under subsection (a)(5),
(6) or (7) shall receive reimbursement for the amount of
reasonable travel, hotel and other necessary expenses incurred
in the performance of the duties of the member in accordance
with Commonwealth regulations, but shall receive no other
compensation for the member's service on the commission.
(j) Duties.--The commission shall have the following duties:
(1) Examine and analyze the statutory and regulatory law
and issues relating to the provision of financial services by
financial institutions to cannabis organizations and other
businesses in the cannabis industry in this Commonwealth.
(2) Examine and analyze the law, issues and potential
solutions in other states and the nation with respect to the
provision of financial services by financial institutions to
businesses in the cannabis industry.
(3) Accept and review written comments from individuals
20190SB0465PN0470 - 6 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
and organizations.
(4) Develop and implement short-term and long-term
strategies as necessary to encourage existing financial
institutions to provide financial services to cannabis
organizations and other businesses in the cannabis industry
in this Commonwealth, including, but not limited to:
(i) education within the financial services industry
and cannabis industry;
(ii) cross-department data aggregation and sharing;
(iii) advocacy for legal and regulatory reform at
both the Federal and State levels; and
(iv) coordination of stakeholders within the
financial services industry, cannabis industry, Federal
and State Government for purposes of sharing information
and facilitating education and advocacy for Federal
policy changes.
(5) Provide resources regarding the current law to
financial institutions considering whether to provide
financial services to cannabis organizations and other
businesses in the cannabis industry in this Commonwealth on
the commission's publicly accessible Internet website.
(6) Issue, two years after the effective date of this
section, a written report to the appointing authorities under
subsection (a)(5), (6) and (7), the chair and minority chair
of the Banking and Insurance Committee of the Senate and the
chair and minority chair of the Commerce Committee of the
House of Representatives. The written report shall include
recommendations and findings as to the following:
(i) Potential short-term, immediate solutions to
improve the ability of the Commonwealth to manage
20190SB0465PN0470 - 7 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
cannabis-related cash payments.
(ii) Proposed changes to statutory or regulatory law
and policy that would allow and encourage existing
financial institutions to provide financial services to
cannabis organizations and other businesses in the
cannabis industry in this Commonwealth.
(iii) Strategies to encourage existing financial
institutions to provide financial services to cannabis
organizations and other businesses in the cannabis
industry in this Commonwealth.
(7) Beginning one year after the effective date of this
section, and every year thereafter, issue an annual written
report to the appointing authorities under subsection (a)(5),
(6) and (7), the chair and minority chair of the Banking and
Insurance Committee of the Senate and the chair and minority
chair of the Commerce Committee of the House of
Representatives. The annual report shall include:
(i) A summary of the commission's activities
relating to its duties under this section.
(ii) At the commission's discretion, any other
information related to the provision of financial
services to cannabis organizations and other businesses
in the cannabis industry in this Commonwealth by
financial institutions.
(k) Written reports.--The written reports required under
subsection (j)(6) and (7) shall be adopted at a public meeting
of the commission and the report shall be a public record under
the act of February 14, 2008 (P.L.6, No.3), known as the Right-
to-Know Law.
Section 2. This act shall take effect in 30 days.
20190SB0465PN0470 - 8 -
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30