California’s Working Group on Marijuana Banking Has Issued Its Report. Here’s What They Have to Say.
The state’s working group on marijuana and banking has finally issued its report on the litany of banking challenges facing California’s legal marijuana industry. And while it does recommend a number of measures to alleviate the industry’s difficulties, it ultimately concludes that real improvement will require some change at the federal level.
The full report is available here. Below, some takeaways.
• Cannabis sales are projected to hit $7.6 billion in California by 2020 and produce 1 billion in estimated new tax revenue.
• It is the opinion of the treasury that “the cannabis industry’s inability to get basic banking services is an urgent public policy issue requiring concerted action by state and local governments, the cannabis industry, and financial institutions.”
• While the idea of setting up a public bank has received plenty of traction and publicity, the group sees it as a highly difficult undertaking. California Treasurer John Chiang would like to see further study.
• Right now, the group is recommending some stopgap measures for the state to take until there is some movement at the federal level. These steps include contracting with an armored courier service that will collect taxes and licensing fees from California’s pot businesses. The armored couriers would pick up the cash and deliver it to the appropriate government agencies.
• The group also recommends creating a single portal to aggregate data on cannabis businesses, including personnel names, product lists, supply sources, financial records and a history of citations. Chiang believes this increased transparency would assuage some banks that are currently hesitant to work with growers and retailers and encourage more cooperation.
• Again, the report concludes that there simply must be some change at the federal level. California will continue to be a lobbyist in that regard.