Legislation that would allow for the creation of a special class of state-chartered banks and credit unions that could service California’s legal marijuana industry has been passed by the full Senate.

“The status quo for our growing legal cannabis industry is unsustainable,” says Senator Robert Hertzberg (D), who filed Senate Bill 930. “It’s not only impractical from an accounting perspective, but it also presents a tremendous public safety problem. This bill takes a limited approach to provide all parties with a safe and reliable way to move forward on this urgent issue.”

The measure was approved by the full Senate yesterday in a 29 to 6 vote. The vote sends the bill to the House of Representatives, where passage would send it to the desk of Governor Jerry Brown.

The proposed law would allow for the creation of special state-chartered banks and credit unions that could legally process transactions by licensed marijuana businesses. These “marijuana banks” would be regulated by the Department of Business Oversight.

More specifically, Senate Bill 930:

“establishes the creation of cannabis limited charter banks (CLCBs) and cannabis limited charter credit unions (CLCCUs) to provide limited banking services to the cannabis industry. Under the administration of the Department of Business Oversight (DBO), CLCBs and CLCCUs can accept and maintain cash deposits as well as issue special purpose checks that can only be used for the following:

To pay fees or taxes to the state or local jurisdiction,

To pay rent on property that is associated with the account holder’s cannabis business,

To pay vendors located in California for expenses related to goods and services associated with the account holder’s cannabis business, or

To purchase bonds or interest-bearing notes or warrants backed by the full faith and

credit of the state, or bonds or warrants of any local jurisdiction.”

The full text of Senate Bill 930 can be found by clicking here.