(Sacramento) Today the California Growers Association (Cal Growers) representing nearly 500 members in 45 counties throughout California announced support Assembly Bill 2149, which authorizes the Board of Equalization to collect cash payments on behalf of state agencies that regulate medical cannabis businesses.
Because marijuana is still a Schedule 1 controlled substance under the federal Controlled Substance Act, most banks refuse to accept medical marijuana businesses as customers because they fear enforcement action by the federal Department of Justice in regards to the Racketeer Influence and Corrupt Organizations Act (RICO Act). Violation of this act could risk the forfeiture of a bank’s assets or collateral used to secure loans.
“The all cash nature of the cannabis industry is already straining the cash collection capacity of regulatory agencies,” said Executive Director Hezekiah Allen. “We want to ensure that the lack of financial services does not continue to inhibit our members’ ability to meet financial obligations associated with state and local regulatory requirements or taxes. This problem will only get worse as comprehensive regulatory programs are brought online over the next two years.”
AB 2149 was introduced by Assemblymember Susan Bonilla. Bonilla is a democrat representing Assembly District 14 which includes the communities of Concord, Antioch, and Vallejo. According to a fact sheet provided by the author, "AB 2149 will allow the state to centralize its cash collecting infrastructure, streamline the locations which have an increased security need, and ensure that California businesses can meet their state financial obligations."
AB 2149 would authorize the State Board of Equalization, and its twenty-two (22) regional field offices throughout the state, to collect cash on behalf of state agencies for the payment of license fees, taxes and other regulatory payments. The bill is intended to assist with the timely and efficient payment of fees to regulatory agencies – namely the Department of Consumer Affairs, the Department of Food & Agriculture, the Department of Public Health and the State and Regional Water Boards.
“Our members live with the challenges and risks of an all cash industry. The lack of financial services is so severe that many in the industry say this is the highest priority public policy challenge. Without access to banking services, common financial activities like retirement savings and purchasing health insurance coverage is very difficult. By and large, our industry keeps our savings in cash, placing our families – and our financial futures – at risk. AB 2149 will not solve all of these problems, but it will help ensure California businesses can meet financial obligations associated with regulation, compliance and licensure.”
The bill would build on the Board of Equalization’s existing regional presence and capacity to accept cash payments for tax collection.
“Assemblymember Bonilla has identified a clear and specific solution that will help ease the licensing process. We are happy to offer our support for this important legislation.”