SACRAMENTO — In California’s cannabis industry, cash is still king.
“We are a cash-only business. Every single customer is paying in cash,” Humble Root Director Javier Hernandez said.
Most banks won’t accept money from pot businesses since it’s still illegal on a federal level and they don’t want the liability. So businesses like Hernandez’s have issues finding places to store their profits.
“There’s a lot of safety concerns when it comes to storing large amounts of cash, which is why we have to typically split it up into multiple locations,” Hernandez said.
They’re forced to keep all the money their business makes in several secret buildings, locked in safes with armed security.
“How can you avoid the problems with the federal government on the one hand and create a reasonable system to handle all the cash on the other?” California Senate Majority Leader Bob Hertzberg said.
Hertzberg’s bill, Senate Bill 51, would allow private banks and credit unions to apply for a state-chartered bank license that is separate from the federal system, allowing marijuana businesses to open bank accounts.
The bill was put on hold under the next legislative session begins.
“Because I had written it with what’s called an urgency provision. So as soon as the governor signs the bill, it’s the law,” Hertzberg said. “And I still have an urgency provision in it. So the focus is not really to make any changes. It’s supposed to give the governor’s office time to get all their bureaucracies in order.”
But for Hernandez time is of the essence. He says every day this bill isn’t passed, his employees’ lives could be in danger.
“It’s very frustrating,” he said. “We’ve been licensed for going on two years now here and there’s still no solution for the biggest issue we have, which is the cash handling.”