Bill Introduced to Protect Entities Serving the Legal Marijuana Industry

Legislation introduced in the Delaware General Assembly aims to protect banks and other businesses that provide financial services to marijuana cultivators, distributors, and retailers who operate within Delaware’s legal cannabis marketplace. House Bill 355, sponsored by Representative Ed Osienski and Senator Trey Paradee, and in partnership with State Treasurer Colleen Davis, clarifies that these financial services are legal under Delaware state law and aims to reassure financial service providers that they can safely provide their services to legal marijuana businesses without risking criminal liability.

“Banks and credit unions are hesitant to serve the marijuana industry because of concerns regarding federal prosecution or penalties since marijuana remains illegal under federal law,” said Treasurer Colleen Davis. “H.B. 355 will provide state-level legal protection, and a clear legal framework for banks, payment processors, and other financial service providers to follow. It can also ease concerns about federal enforcement and regulatory compliance among these businesses – since it allows them to demonstrate to federal agencies that they’re following a clear legal framework, ultimately leading to a safer and more transparent marijuana industry.”

Key provisions of the legislation include:

  • Protection: Provides state-level legal protection, thereby reducing banks’ fear of prosecution or penalties.
  • Enables Secure Transactions: Allows marijuana businesses to utilize traditional banking methods, eliminating the dangers and inefficiencies associated with managing large amounts of cash.
  • Boosts Local Economy: Facilitates investment and growth within the Delaware marijuana industry, leading to increased revenue and job opportunities.
  • Enhances Safety: Promotes greater safety for retailers and their customers, as cash-intensive activity is more prone to theft, robbery, & violence.
  • Competition: Encourages more financial-related service providers to enter the legal marketplace, which will result in more competition, lower prices, improved services, and potentially decrease the amount of marijuana business taking place within the black market.

“Across the country, we’ve witnessed dispensaries and banks alike struggling with legal uncertainty surrounding financial and accounting services for cannabis businesses. This uncertainty not only undermines the operations of state-compliant dispensaries but also hinders their access to basic business functions such as access to banking, acquiring loans, or paying taxes,” said Rep. Ed Osienski. “We want Delaware’s safe and regulated industry to out-compete the black market. By providing dispensaries with a secure avenue to banking and compliance services, we empower them to contribute positively to our economy, keep costs down for the industry and customers, employ local talent, and fulfill their tax obligations.”

“At the end of the day, cannabis retailers in Delaware are small businesses. They serve our communities. They will hire Delawareans. They will pay their taxes. They will contribute to the economic development of this State. But with an over-reliance on cash-transactions, retailers are at a disadvantage in terms of their banking, compliance, and safety needs,” Sen. Paradee said. “With the passage of this legislation, the State can ensure that these types of businesses have a clear path towards access to those critical services.”

Protecting banking services will also serve to make operations safer for other businesses in the industry.

“The inability to access traditional banking services presents a serious challenge for Delaware’s marijuana businesses,” says Rob Coupe, Delaware’s Marijuana Commissioner. “Cash-intensive operations leave the businesses vulnerable to theft and other crimes, and present additional obstacles in their efforts to comply with tax laws.”

“This legislation will give Delaware cannabis retailers access to essential CPA services to ensure their financial success,” said Dana Rubenstein, President & CEO, Delaware Society of Certified Public Accountants.

The full text of H.B. 355 can be found here.


Treasurer Davis Honored for Delaware EARNS

Delaware Treasurer Colleen Davis has received the 2024 Distinguished State Leader Award from the Georgetown University Center for Retirement Initiatives (CRI) at the McCourt School of Public Policy for her work in the adoption and implementation of Delaware EARNS.

The Delaware Expanding Access for Retirement and Necessary Savings (EARNS) program will provide a convenient way for all workers to save for retirement, particularly middle and low-income workers who lack access to employer-sponsored plans, and allows small businesses previously unable to provide such a benefit to do so at no cost.

“Since first taking office in 2019, I have maintained my top three priorities of bolstering retirement security, creating pathways to economic empowerment, and providing a culture of financial excellence,” Treasurer Davis said. “Delaware EARNS accomplishes all three of those priorities for hard working men and women who have no other effective way to save for retirement.”

In announcing the award, Angela Antonelli, Executive Director of the CRI credits Treasurer Davis for bringing people from both sides of the political aisle on board.

“The bipartisan adoption and ongoing implementation of DE EARNS is a model for the nation and other states considering such programs,” Antonelli said.

“It’s extremely validating to have the CRI support Delaware EARNS and what it stands for,” Davis said. “For almost 10 years now, they have been bringing states together on a regular basis, regardless of where they are in the process and regardless of the politics.”

Previous winners of the award include Illinois Treasurer Michael Frerichs, Colorado Treasurer Dave Young, Oregon Treasurer Tobias Read, and former Connecticut Comptroller Kevin Lembo.

“While I’m truly humbled to receive this award, it’s important to remember it isn’t about me, it’s about the important work that so many in our office do on a daily basis to help make sure everyone in Delaware has a smooth road to retirement,” Davis said.


Statement from Delaware State Treasurer Colleen Davis

“I want to share a personal update with you regarding my upcoming schedule and why I won’t be able to participate in some important meetings and events over the next few weeks.

Due to health issues with some members of my family, I recently underwent medical testing to determine if I too were at risk for the possibility of serious medical conditions. Test results showed genetic mutations that put me at an increased risk of both breast and ovarian cancer. It turned out that testing would become the first of a three-step process for me and my family.

Late last year marked the second step, during which I took a two-day leave to undergo surgery to remove my ovaries. I am pleased to report that the procedure went smoothly, and the brief recovery period was successful.

The third step, which is scheduled for later this week, involves a temporary leave as I undergo a preventative bilateral mastectomy. While I am recovering, my exceptionally talented staff will be covering a number of in-person meetings and operations in the office will continue seamlessly during my absence.

I want to assure you that, despite these personal health measures, my commitment to serving the people of Delaware remains unwavering. The work we do is of utmost importance, and I look forward to rejoining the team soon.

In the meantime, I urge you to prioritize your own health by staying vigilant about medical appointments, tests, and procedures for yourself and your loved ones. Together, we can ensure a healthy and vibrant future for Delaware.

Thank you for your understanding and support.”


Colorado and Delaware Enter Partnership for Automatic Retirement Savings

The Partnership for a Dignified Retirement expands with the addition of Delaware EARNS

DENVER, COLORADO: Last week, the Colorado SecureSavings Program and Delaware EARNS established a partnership to help more savers prepare for their future retirement.

“This is an important step towards expanding sustainable and dignified retirement options across the nation. We appreciate the vote of confidence from the Delaware EARNS Board, and we are looking forward to working closely with Treasurer Colleen Davis and her team.” Dave Young, Colorado State Treasurer

“We are grateful to the EARNS Program Board for supporting our entry into this innovative consortium with Colorado and Maine. Doing so will ensure that Delawareans have the highest quality choice when it comes to retirement savings,” said Delaware State Treasurer Colleen C. Davis. “Nearly 150,000 Delaware workers currently have no way of saving for retirement through their workplace. Today, we took a major step toward closing that gap.”

“Delaware joining the Partnership for a Dignified Retirement is an important milestone. The ability of employers to provide an accessible option to savers will help significantly improve the financial lives of families across the country.” Hunter Railey, Director of Colorado SecureSavings Program

“The Delaware EARNS Program Board was pleased to support this historic interstate collaboration to bring a much-needed retirement savings vehicle to Delaware workers,” said EARNS Board Chair Fayetta M. Blake. “Through joining this interstate effort, we’ll greatly accelerate the launch of the EARNS program. Not only will we save start-up time and costs, but we’ll also allow Delaware participants to benefit from economies of scale that will help them grow their savings over time.”

“We’re delighted to see innovation in state savings programs continue as Delaware joins the Partnership for a Dignified Retirement,” Douglas Magnolia, Chief Customer Officer and President of Vestwell State Savings. “Vestwell is proud to power Delaware EARNS and help close the savings gap for the nearly 40% of private sector employees that do not have access to retirement savings.”

The Delaware EARNS Program Board has voted to join the Partnership for a Dignified Retirement. This partnership helps the State of Delaware offer a cost-friendly, state-run retirement program for workers who don’t have access to a retirement savings program. Vestwell, in partnership with BNY Mellon, serves as the Program Administrator, providing recordkeeping, custodial, and administrative services to employers and employees in participating partner states. The Partnership for a Dignified Retirement provides a proven avenue for smaller states to offer a pathway to financial security for savers.

This partnership will help pave the way for more savers to be able to sign up for a retirement program through their work. It expands the program and focuses on the simplicity for employers and savers that other states can adopt. It is a state-facilitated retirement program for private-sector employers and their employees. The program leverages the benefits of compound interest, allowing retirement funds to grow faster. The longer retirement funds are invested, the more growth is expected.

Partnership programs are tied to the employee instead of the employer, making the account portable when the employee leaves and changes jobs. These retirement programs are an easy and accessible way for states to provide a critical tool for financial security to working people.

With the successes of the state-run retirement savings programs in California, Illinois, Oregon, and elsewhere, the expansion of the Partnership for a Dignified Retirement represents the next step in extending low-cost, portable retirement savings options to workers without access to a savings program.

House Bill 205 in Delaware requires employers with five or more employees to provide a private retirement plan or sign up for their state program. The goal of the Delaware EARNS program is to provide workers and employers access to low-cost retirement savings plans de.gov/earns.
Colorado business owners need to decide on their retirement plan options by December 31, 2023. For more information please visit coloradosecuresavings.com. The Colorado SecureSavings Program has over 124,000 savers, and 13,000 registered employers so far.


Delaware’s DE529 Education Savings Plan Upgraded

Morningstar, the country’s most widely cited and influential investment plan rating group issued its annual report and upgraded the DE529 Education Savings Plan from Bronze to Silver status. Morningstar specifically credited the oversight of the plan as a major factor for the upgrade.

“Delaware earns an Above Average Parent rating driven by its multiple layers of oversight and engaged partners. The state’s 11-member plans management board, two subcommittees, and an external investment consultant review any recommended changes to the plan,” according to the report.

Delaware also saw an increase in its People Pillar score, a rating measuring the strength and weakness of an investment team. Morningstar noted, “It’s a topnotch group in the 529 space worthy of a People Pillar upgrade to High from Above Average.” The DE529 Education Savings Plan is managed by Fidelity Investments.

“We have seen tremendous growth in our 529 plan over the past year,” said Treasurer Colleen Davis. “With this ratings upgrade, continued quality oversight by the Plans Management Board, and superior plan management by Fidelity Investments, we expect to grow even more with hopes of reaching Gold status in the future.”

As of September 30, 2023, there were 2,149 new DE529 accounts opened this year, an increase of 41% over the same time last year.

Of the 54 529 plans offered throughout the country, only two have Gold status with just 15 more achieving Silver.

“We are thrilled to have our rating boosted by Morningstar,” said Donna Vieira, executive vice president and chief commercial officer for Sallie Mae who serves as Chair of the Delaware Plans Management Board, the entity that oversees the state’s investment programs. “Saving for college is an important step, and families should feel good knowing that industry experts see the DE59 Education Savings Plan as a sound investment and a safe place for their money.”

“There is no doubt the State’s commitment to the plan, including the General Assembly approving tax incentives for contributions to DE529 accounts helped grow our numbers and lead to our upgrade” Treasurer Davis said. “We’re proud to offer a good, competitive product to help people save.”

Click here to read “Morningstar 529 Ratings: The Best Plans of 2023.”