California Senate votes in favor of marijuana banks

The California state Senate voted overwhelmingly on Tuesday in favor of creating special banks and credit unions to work with marijuana businesses.

Currently, most banks shy away from marijuana businesses out of fear of running afoul of the federal government, which views the cannabis industry as illicit but has signaled limited tolerance for pot banking. This has left California tax collectors in peculiar situations, having resorted at times to arranging for marijuana businesses to deliver huge quantities of cash in order to pay their state taxes.

SB 51, which passed the Senate on a 35-1 vote Tuesday, would establish marijuana limited charter banks and marijuana limited charter credit unions. Under the proposal, the limited charter banks and credit unions could issue checks that could be used for the paying taxes, fees and rent, as well as paying vendors located in California and for purchasing state and local bonds.

Following Tuesday’s vote, the bill heads to the state Assembly.