On Aug. 30, Senate Majority Leader Bob Hertzberg (D-Van Nuys) applauded the decision of the Assembly Appropriations Committee to clear Senate Bill 51 for a vote on the Senate floor.
SB 51 would establish the framework to allow licensed cannabis businesses – and people or companies that do business with them – to open bank accounts. Despite the legalization of cannabis in California, it remains illegal to bank because of its federal classification as a Schedule I drug. As a result, cultivation, distribution and retail businesses alike have been forced to operate on a cash-only basis. This has proved impractical from an accounting perspective, and it also presents significant public safety issues.
“It has required creative thinking to figure out how to move forward into this uncharted territory, and this option not only works, but it’s the only option left on the table,” Hertzberg said. “After over two years of working on this, one thing has been crystal clear: everyone agrees on the urgency of this public safety issue.”
The system envisioned under SB 51 would create an environment where private banks could apply for a newly created limited-purpose, state-chartered bank license that doesn’t interact with the federal system, allowing cannabis-related businesses to open accounts and deposit income.
“I’m proud and appreciative that the committee decided this is a viable solution,” said State Treasurer Fiona Ma, co-sponsor of the measure. “With minimal progress on the federal level, it’s clear California must lead on this issue.”
Last year, SB 930, legislation that promoted the same concept, stalled in the Assembly Appropriations Committee. SB 51 next heads to the Assembly floor for a vote before heading back to the Senate for concurrence and the governor’s desk.
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