Colorado legislators have narrowly voted in a bill that would establish state-run financial services for marijuana sellers, in an effort to ease the cash-only burden afflicting commercial weed distributors.
The bill, which is pending approval from Colorado Governor John Hickenlooper and then the Federal Reserve, would set up "cannabis credit co-ops" throughout the state. Because the sale of marijuana is still federally illegal, Colorado's pot sellers have found it difficult to find national banks willing to offer financial services for their businesses. This, according to Representative John Singer, has made marijuana businesses targets for criminals (with so much cash lying around) and hindered the state's ability to track revenues for tax purpose. Singer, the proposal's main backer, said that the co-ops would be "the final piece to our pot puzzle."
The vote was the ultimate compromise for legislators who wanted to keep the cooperatives limited to marijuana businesses. But industrial hemp farmers had voiced problems about accessing banking services, specifically with co-mingling loans on crops such as wheat and corn with hemp. "Two farmers with lines of credit were threatened, one told outright that if he grew hemp, the bank would terminate his line of credit," said Samantha Walsh of the Rocky Mountain Hemp Association.
The co-ops would be a step towards ameliorating what Attorney General Eric Holder referred to as a public safety problem. He said in January that "Huge amounts of cash, substantial amounts of cash, just kind of lying around with no place for it to appropriately deposited is something that would worry me from just a law enforcement perspective."
Representatives from Hickenlooper's office said that he will sign the bill. However, it still might not solve anything, as it's likely to be ultimately blocked by the Federal Reserve, because there's no provision for deposit insurance, which is required by other banks.