Mark Brnovich, Arizona’s Attorney General, just solidified his position as the most marijuana-friendly elected official who’s also a Republican.
Last week, he joined with 37 other attorneys general around the country to urge passage of the congressional SAFE Banking Act, or something like it, to bring financial order to the cannabis business community. The act was introduced in March to the U.S. House of Representatives, and aims to immunize banks from penalties for dealing with marijuana-related businesses, which still aren’t legal under federal law. Thirty-three states now have recreational or medical marijuana laws on the books.
Because of the federal ban, dispensaries in Arizona and elsewhere run cash-based operations, setting up ATMs in the lobby that customers use to obtain cash to pay for their medicine. Then, that cash must be collected and transported to a bank. As Phoenix New Times covered in a December 29, 2014, cover article, “Banking on Pot,” dispensaries hide their true identities from banks, and change banks often, like money launderers. It’s a cumbersome system, fraught with risks of theft and the potential for corruption.
In joining the national push by AGs to get behind the SAFE Banking Act, Brnovich is the most prominent supporter of state-legal marijuana among Arizona’s GOP. He just gets it.
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"This is a public safety issue," Brnovich said in a statement about his position. "Regardless of individual opinions on the matter, medical marijuana was approved by Arizona voters and is the law in our state. Greater financial transparency and increased accountability will improve regulatory compliance and move commerce involving this heavy cash flow industry out of the shadows."
With billions of dollars passing through the industry, regulators find it difficult to track revenue for taxation and compliance with financial rules, Brnovich stated.
Paul Hickman, president and CEO of the Arizona Bankers Association, praised Brnovich in a statement in Brnovich’s news release.
“On behalf of the over 65 banks and over 110,000 Arizona-based bank employees, we would like to thank Attorney General Brnovich for his support," Hickman said. "This is an important issue that has become a major challenge for many Arizona communities and the banks that serve them.”
The SAFE Banking Act has 172 co-sponsors in Congress, including Democrats Ann Kirkpatrick, Ruben Gallego, Greg Stanton, and Raul Grijalva. Democrat Tom O’Halleran and all the Republican Arizona delegation are missing from the list. Arizona Governor Doug Ducey, also a Republican, has been a staunch foe of legal marijuana, and helped raise millions of dollars in 2016 to defeat a measure that would have legalized personal amounts of marijuana for all adults 21 and older.
Two powerful Republican prosecutors have helped lead anti-marijuana efforts: Maricopa County’s Bill Montgomery and Yavapai County’s Sheila Polk. And most Republican state legislators have held strong opposition to the nationwide legalization movement.
On the subject of pot, Brnovich, a lawyer and ex-Goldwater Institute activist who won a second four-year term in 2018, has been a clear outlier among Arizona’s GOP leadership. He’s also a Grateful Dead fan who nevertheless denies using marijuana, LSD, or any illegal drug in his life.
Brnovich has stepped forward previously to lend support to Arizona’s medical marijuana law, or at least to support state voters’ support of the law.
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In October 2018, during the final weeks before the election, Brnovich switched sides in the all-important cannabis concentrates case, State v. Rodney Jones. The appeal case, which is still pending before the Arizona Supreme Court, was being fought by Polk and also by Brnovich’s office, for a time. Brnovich could have helped Jones to lose his appeal, and situation that would also cause the total loss of cannabis products with resin extracts, like edibles and vape cartridges, for the state’s medical marijuana community. Brnovich’s withdrawal of opposition to the appeal was seen as a positive sign that the upcoming Supreme Court ruling wouldn’t devastate the industry.
Brnovich made a similar departure in 2017 from a legal attack by Montgomery on the state medical pot law.
Below: The letter signed by Brnovich and 37 other attorneys general of the states and territories.