SACRAMENTO, Calif. — The California Senate has approved legislation that would set up a state bank to process cannabis business transactions.
Senators were mostly on the same page, as the vote passed by a margin of 29-6. SB 930 would create a state bank license that would be handled by the State Department of Business Oversight. According to the bill’s text, SB 930 should “provide banks and credit unions with the authorization to use special purpose checks issued by those institutions for specified purposes.”
SB 930 has been gaining support over the course of the past few months. In April, the Humboldt County Board of Supervisors drafted a letter in support of the legislation.
“Cannabis is legal in California but still classified at the federal level as a Schedule I drug, which prohibits cannabis-related deposits into federally-insured institutions.” the letter read, “Privately-funded banks that receive this charter would be able to provide limited banking services to cannabis-related businesses.”
Humboldt County Supervisor Rex Bohn is looking to modernize the way dispensnaries have to do business.
“Anything we can get that will take the cash element out of the cannabis business and to allow them to operate with checks for paying taxes and for paying their bills would be great and I would be all in favor,” Bohn told the Times-Standard. “The biggest issue Colorado elected officials found was the large amount of cash that their people have to deal with and anything that addresses the issue to make it easier for local business we support.”
Keeping the cannabis industry as cash-only sets up major issues including making dispensaries and operators a target by criminals.
“I had a member of the growers alliance call me after he left a retail outlet with cash. He was followed then jumped and beaten and he lost his money and his product,” Humboldt County Growers Alliance executive director Terra Carver said Thursday. “This is a fundamental public safety issue and it’s a problem that has to be fixed.”
Providing access to banking for cannabis companies would also make life easier for tax collectors.
“The passing of SB 930 should, once banking facilities for cannabis cash are available, make our operations much more productive by being less time consuming because we will not be required to process so much cash,” Humboldt County Treasurer-Tax Collector John Bartholomew said. “At present, we have to run all cash through currency counters which not only counts the money but also checks for counterfeit bills while at the same time records all the serial numbers from each bill. Those many thousands of serial numbers then become part of our record keeping along with the tax bill stubs for each transaction.”
The bill will now be taken up by the California Assembly.