BY MICHAEL R. BLOOD
ASSOCIATED PRESS
LOS ANGELES (AP) California Treasurer John Chiang on Friday appealed to President-elect Donald Trump for guidance on how the states projected $7 billion marijuana industry can participate in the nations banking system while pot remains illegal under U.S. law.
California voters last month approved Proposition 64, which legalized the recreational use of marijuana, beginning in 2018. Largely at issue is how the state will collect an estimated $1 billion in annual taxes from legal pot sales and cultivation, when cannabis businesses can face obstacles opening bank accounts, getting loans or obtaining insurance.
The conflict between federal and state rules creates a number of difficulties for states that have legalized cannabis use, including collecting taxes, increased risk of serious crime and the inability of a legal industry under state law to engage in banking and commerce, Chiang wrote to Trump.
We have a year to develop a system that works in California and which addresses the many issues that exist as a result of the federal-state legal conflict, he added. Uncertainty about the position of your administration creates even more of a challenge.
The California vote on Nov. 8 represented the national legalization movements biggest victory to date. The new law will attempt, at least in theory, to tame a market that now ranges from legal, medicinal production and sales to vast illegal grows operated by drug cartels.
With pot illegal on the federal level, its unclear what stance the incoming Trump administration will take with the new California pot economy and other weed-friendly states. Trumps pick for attorney general, Alabama Sen. Jeff Sessions, has called marijuana a danger that should not be legalized.
Twenty-eight states and Washington, D.C., allow marijuana for medical or recreational purposes.
In other states, the business of legal marijuana has created a patchwork of banking and tax practices.
In Oregon, officials have built a fortified office, with bulletproof glass, security cameras and armed guards, for collecting huge cash payments for pot taxes. In Washington, most businesses are paying taxes electronically, a sign of better access to bank accounts.
And the number of U.S. banks and credit unions willing to handle pot ...
