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California Considers Creating Bank for Marijuana Businesses

SACRAMENTO -- It's a $7 billion industry, but there's no place to put the money.

"The state of California estimated $1 billion of tax revenues. We don't want to create a shadow economy, we don't want violence in local communities," said California State Treasurer John Chiang.

Tuesday, Chiang committed to exploring the idea of building a state bank -- one that doesn't fall under the control of the federal government and its marijuana prohibition.

"Think about how many times you get online and say 'Pay SMUD, pay phone bill...' We don't get that. We have to run out with cash," said Lynette Davies.

Davies runs the dispensary Cana Care. She says the cash-only nature of her business doesn't generate the kinds of records other businesses take for granted. So everything -- collecting money, paying employees, paying growers, paying taxes -- it all becomes more difficult and potentially dangerous.

It's not like she hasn't tried to get banking services. But what she gets is a letter saying the banks can't help her. It says the bank can't do business with her because she's violating federal law by selling marijuana.

"You want to feel like you're doing something wrong? Be thrown out of a bank because you sell cannabis to sick and dying patients," Davies said.

Chiang says some banks were making overtures, starting to embrace the cannabis business and the big dollars it brings in.

But then, at the beginning of the year, US Attorney General Jeff Sessions put cannabis back on the list of federal drug enforcement priorities.

So Chiang says it's time for the state to consider going it alone in banking.

"To make sure we can push upon Washington, D.C., so we don't have just Jeff Sessions being the voice on this issue," Chiang said.

"California has always been a leader in this country. We were the very first state to ever legalize cannabis at all. Why should we not be the very first state to bring forward banking law to make it accessible ... every avenue of it," Chiang said.