ARE OUT THERE AND CAN SEND THEIR
MEMBERS OVER. TO BANKING THAT
WOULD BE GREAT.
AND I SEE MISTER CHOI IS HERE SO
WE CAN.
WE CAN START AS A SUB COMMITTEE --
AND TILL WE HAVE OTHER MEMBERS
HERE SINCE WE HAVE.
THE AUTHOR HERE -- YEAH
[inaudible]
HE WAS.
THANK YOU SENATOR HERTZBERG NAY.
YOU WILL BE PRESENTING SPF.
FIFTY ONE PLEASE FEEL FREE
PROCEED.
LOST MY THIRTY TWO MILLION
LISTENERS OKAY WE GOT A SEARCH
[inaudible]
MILLION [inaudible]
OKAY THE TOGETHER WITH THE
TREASURE OF THE CITY CALIFORNIA
FIONA MAW I AGAIN PRESENT THIS
MEASURE THAT WE PRESENTED LAST
YEAR.
THE VOTERS OF THE STATE OF
CALIFORNIA PASSED PROPOSITION
SIXTY FOUR BY A VOTE OF 57% TO
LEGALIZE RECREATIONAL MARIJUANA.
THAT CREATED A MANAGEMENT
CHALLENGE WHICH INFORMED BY A
TENSION BETWEEN THE FEDERAL
GOVERNMENT AND STATE GOVERNMENT.
THE FEDERAL GOVERNMENT SAYS THAT
MARIJUANA IS A SCHEDULE ONE DRUG.
AND AS SUCH YOU COULD NOT USE
PROCEEDS FROM THE SALE OF THAT
DRUG AND DEPOSITED INTO BANKS.
SO THE QUESTION IS HOW DO WE ON
THE ONE HAND AND MANAGE THE
EXPECTATIONS OF THE VOTERS.
DEAL WITH THE PUBLIC SAFETY
ISSUES THAT INFORM THIS ISSUE
DEAL WITH THE THE ACCOUNTING
ISSUES AND DEAL WITH THE TAX
COLLECTION ISSUES OF AN INDUSTRY.
THAT'S ANYWHERE EXPECTED WIEN
FIVE EIGHT BILLION DOLLARS AND
REQUIRED TELLS ME THAT HE THINKS
THERE'S TWO BILLION DOLLARS
BURIED IN NORTHERN CALIFORNIA
HIS DISTRICT A FORTY MILLION
DOLLARS IN A TRACTOR TRAILER.
IT IS A PROBLEM WE HAVE SEEN
STORIES THROUGHOUT CALIFORNIA.
WHERE THERE HAS BEEN THE
HORRIBLE -- BOB BERRY IS DEATHS
AND ALL KINDS OF HORRIBLE THINGS.
AND SO THE QUESTION IS WHAT WE
DO HOW DO WE FIGURE OUT UNTIL
THE FEDERAL GOVERNMENT.
ALLOWS US TO BANK THIS MONEY
WHAT WE DO.
AND SO ARE HONESTLY THIS IS NOT
A THAT WAS CHAIRMAN OF THE WITH
THE COMMITTEE WAS IT NEAR THE
SENATE THAT THE REVENUE TAX
COMMITTEE IN THE LOCAL
GOVERNMENT GOVERNMENT FINANCES
CALLED IN THE SENATE.
AND ON THIS ISSUE CAME BEFORE ME
WITH A NUMBER OF MEMBERS.
AND AS SOMEONE WHO HAD
EXPERIENCE IN THIS AREA THE LAW
MANY YEARS AGO MY THOUGHT WAS TO
COME UP WITH A LIMITED CHARTER
BANK WHAT DOES THAT MEAN.
WE HAVE THIS KIND OF INTERREGNUM
WHERE WE'RE TRYING TO COME UP
WITH THE PROCESS BUT WE DON'T
WANT TO COME TO DO SOMETHING AND
THAT SOMETHING BRAND NEW.
SO THE IDEA WAS TO BOLT ON A
LIMITED CHARTER BANK AND ON
CREDIT UNION INTO THE BANKING
SYSTEM UNDER THE BANKING
COMMISSIONER WE CHANGE THE NAME
TO THERE ARE NO IT'S CALLED BUT
I STILL CALL.
THE BANKING COMMISSIONER AND SO
THE BOTTOM LINE IS WHAT WE DO
AND WE CREATED THIS BANK WE
FOUND OUT THAT THERE'S NINE
HUNDRED AND TWENTY BRANCHES
AROUND CALIFORNIA THE BEEN
CLOSED SO WE COULD LITERALLY
IT'S NOT VERY DIFFICULT TO HAVE
ALL THESE SAFES ALL OVER THE
PLACE TO PUT.
MONEY IN THE BANKS.
OR CREDIT UNIONS THE CASE MAY BE.
AND WE CAME UP WITH FOR PURPOSES
THAT WE WOULD LIMIT THIS TO
PURPOSE NUMBER ONE IS TO PAY
TAXES FEES LOCAL GOVERNMENT
STATE GOVERNMENT AND THE LIKE
WHERE YOU COULD USE A CHECK.
FROM THE LIMITED CHARTER BANK
THE CHECK WOULD LOOK LIKE THIS.
AND IT WOULD JUST BASICALLY SAY
THIS CHECK IS ISSUED BY S. P.
FIFTY ONE CANNABIS BANK IN THE
ONLY DEPOSIT CASH IN THE LIMITED
CHARTER BANK.
YOU COULDN'T DEPOSITS INTO
ANOTHER FEDERAL BANKER STATE
BANK THE ONLY COULD DEPOSITED
INTO YOUR BANK OR TO ANOTHER
BANK WHY IS THAT IMPORTANT.
WELL IF YOU'RE GONNA GO PAY YOUR
RENT IF YOU CAN GO PAID MONEY TO
THE GOVERNMENT WHAT WE SEE IS
BUDGET CHANGE PROPOSALS MANY OF
THEM.
WHERE WERE PAYING FOR HIGHER
PATROL TO ACTUALLY -- ESCORT THE
MONEY WE'RE PAYING FOR BULLET
PROOF GLASS I TALKED TO ET DE ID
NUMBER THE DEPARTMENTS AND THE
CASH AND AND TO MANAGE TO COUNT
ALL THE KINDS OF CASH SOMETIMES
A MILLION DOLLARS A DAY THAT
COMES INTO A GOVERNMENT OFFICE.
WELL THE SAID YOU GET A MUCH OF
CHECKS NOW THE GOVERNMENT CAN
TAKE THESE CHECKS AND GO.
CATCH THEM AT THE AT THE CHARTER
BANK OR CREDIT STONE ACCOUNT IF
THEY WILL BUT IT'S A CONVENIENCE
CASH MANAGEMENT SYSTEM IF YOU
WILL.
SO WE SAID WHAT ARE THE FOUR
THINGS THAT WE COULD DO THAT
KIND OF LOW HANGING FRUIT THAT'S
NOT TOO COMPLICATED ONE ALL YOUR
GOVERNMENT FEES.
WITHIN THE OPTION OF THE LOCAL
GOVERNMENT. TO YOUR RENT.
THE IDEA IS THAT YOU HAVE A
LANDLORD WHO IS TEN FOLKS THAT
ARE OUT THERE THAT ARE RENTING
TO WHY THEY HAVE TO COME IN WITH
BIG PILES OF CASH EVERY MONTH
THAT GET A CHECK.
AND DELIVER THREE YOUR VENDORS
EUROPE EUROPE PLUMBER AND RATHER
HAVING GIVE TWENTY TWO HUNDRED
BUCKS TO A PLUMBER -- IN CASH
YOU CAN ACTUALLY DELIVER CHECK
AND PAY THE BILLS AND LASTLY TO
INVEST THE MONEY.
A AT THE STATE TREASURY WHERE
IT'S WITHIN THE STATE OF
CALIFORNIA.
AND IN ESSENCE JUST TO KIND OF
CUT TO THE CHASE OF HAPPY TO
ANSWER THE QUESTIONS WHAT WE'RE
REALLY DOING IS IT'S WE COULD
CALL THE BANK.
AND THE IDEA IS THAT ULTIMATELY.
WENT WHEN THE FEDERAL GOVERNMENT
CONFORMS AND THEY WILL AT SOME
POINTS BECAUSE OTHER STATES HAVE
SIMILAR KINDS OF ISSUES WHEN THE
FEDERAL GOVERNMENT CONFORMS.
YOU WANT TO BE ABLE TO TAKE
THESE INSTITUTIONS AND ROLL THEM
INTO EXISTING BANKS THE THE BIG
BANKS WE'VE SEEN THIS WITH
COMMITTEE BANKS ALL OVER THE
STATE OF CALIFORNIA.
AND SO IT BECOMES EASY BECAUSE
THE ALL OF THE RULES AND
REGULATIONS OF BANKING WILL
APPLY WE DON'T WANT TO REINVENT
A WHOLE NEW WORLD FOR THIS.
SO THAT MEANS THAT THE PRODUCE
YOUR OBLIGATIONS THE ROLE OF
DIRECTORS THE AUDIT PROVISIONS
ALL OF THE THINGS THAT INFORM
WHAT BANKING.
N. N. N. H. N. DOUG WITH THE
COLUMN -- CREDIT UNIONS ARE.
BASICALLY BAY FALL WITHIN THIS
FRAMEWORK AND ANSWER THE LAST
QUESTION IS WHAT HOUSES ALL PAID
FOR WHAT REALLY HAPPENS OHIO HAS
DONE THIS TO SOME EXTENT.
DID YOU KNOW BANK WHAT IS
BANKING BANKING IS I TAKE YOUR
DEPOSIT I GIVE YOU THIS MUCH
INTEREST I CAN I TAKE YOUR MONEY
I LANDED TO SOMEBODY ELSE AND I
MAKE THE BIG.
RIGHT I PAY MY EXPENSES MY MAKE
A PROFIT ON INTEREST WITH NO
INTEREST BECAUSE NO LOANS IN
THIS BANK IT'S NOT GONNA BE
NORMAL BANK.
IT'S LITERALLY DEPOSITORY
INSTITUTION AND THE WAY IT'S
GOING TO WORK AS YOU CAN CHARGE
FEES.
AND SO MY QUESTION TWO THOUSAND
DOLLARS THREE THOUSAND DOLLARS A
MONTH KEEP AN ACCOUNT AND MY
QUESTION HOW DOES A CHECK BUT
IT'S A LOT LESS MONEY IN
SECURITY ALL THE OTHER RISKS AND
STUFF ASSOCIATED.
THE FINAL POINT I WANT TO MAKE
IS THAT ONE OF THE BIG ISSUES IN
BANKING IS IS INSURANCE NO ONE
WANTS TO TAKE THE MONEY GIVE IT
TO A BANK AND THEN THE BANK IT'S
ROBIN YOU LOSE ALL YOUR MONEY OR
SEIZED OR WHATEVER THE CASE MAY
BE.
THE FEDERAL DEPOSIT INSURANCE
CORPORATION IS NORMALLY THE
ENTITY.
THAT INSURERS I'VE MET WITH A
NUMBER OF IT PRIVATE IN THE
INSURANCE COMPANIES THAT FOR A
FEE.
THEY WILL PROVIDE THE INSURANCE
A TWO HUNDRED TWO THOUSAND
DOLLARS PER COUNT ON LIKE THAT
FEDERAL DEPOSIT CHURCH
CORPORATIONS TO EARN FIFTY
THOUSAND DOLLARS PER PER.
CUSTOMER I HAVE TEN ACCOUNTS A
GET TWO POINT FIVE MILLION OF
INSURANCE SO WE WE IF COME UP
WITH A PRETTY ELEGANT APPROACH.
EIGHTY FOUR VOTES THROUGH BOTH
HOUSES LAST TIME ONLY ELEVEN
THOSE BIPARTISAN AND BASICALLY
WENT TO THE SYSTEM.
AND AND IN ESSENCE THE
GOVERNOR'S OFFICE THE FORMER.
BANKING COMMISSIONER SAID WE
DON'T WANT TO DEAL WITH AT THE
END OF THE TERM SO THE
GOVERNOR'S OFFICE CALLED THE
CHAIR OF APPROPRIATIONS
COMMITTEE I'M INFORMED I COULD
BE WRONG BUT I THINK I'M PROUD
PRETTY RIGHT.
AND SAID HOLD THIS BILL THAT'S
WHAT HAPPENED THIS IS AN URGENCY
BILL IT'S GONE THRUGH -- THE
OTHER HOUSE I THINK ALMOST
UNANIMOUSLY.
AND THE IDEA IS TO COME UP WITH
AN APPROACH IS A PERFECT I DON'T
KNOW BUT YOU KNOW THE BOTTOM
LINE OF THIS THING IS WE GOT A
PROBLEM.
AND WE'VE GOT IT GOVERNMENT TO
STEP UP TO THE PLATE AND TRY TO
FIGURE OUT IF IT MEANS WE AT
AMENDED LATER AND FIX STUFF
LATER WE'LL FIGURE IT OUT.
BUT HOW CAN WE SIT BACK AND
LEAVE ALL THIS CASH THAT NOW
THEY'RE IN THE SYSTEM AND NOT
PROVIDE A THOUGHTFUL APPROACH I
THINK THIS IS PRETTY SMART
PROCHE ASK YOUR SUPPORT OF THIS
MEASURE.
OFF THE TREASURER'S OFFICE THANK
YOU AND I WILL DO A QUICK
INTERMISSION JUST BECAUSE WE DO
HAVE QUORUM RIGHT NOW SO I WANNA
OFFICIALLY START THE HEARING.
AND WE WILL START WITH A IF WE
CAN JUST DO THE ROLL CALL PLEASE
[inaudible]
THANK [inaudible]
LEóN [inaudible]
CHEN [inaudible]
ERA CAN [inaudible]
BURKE [inaudible]
CERVANTES [inaudible]
CHOI [inaudible]
APRIL [inaudible]
GRAYSON [inaudible]
MELENDEZ [inaudible]
STONE.
WEBER.
WICKS HERE.
THANK YOU AND I DO WANT TO MAKE
IT QUICK AND NOW ANNOUNCEMENT
ITEM NUMBER FOUR IN OUR AGENDA
SB FIVE FORTY JONES HAS BEEN
RESET FOR OUR NEXT HEARING ON
JULY EIGHTH.
AT THE REQUEST OF THE AUTHOR.
SO WITH THAT WE WILL GO BACK TO
THE SUPPORTERS OF THE BILL SURE
THANK YOU MADAM CHAIR OTHER
MEMBERS OF THE COMMITTEE HI MY
NAME IS CASEY O'CONNOR
LEGISLATIVE DIRECTOR FOR STATE
TREASURER FEE ON A MOCK.
AS ALTHOUGH ALSO WITH AS MUCH OF
DIRECTOR WHEN WE'RE AT THE BOARD
OF EQUALIZATION AND DURING HER
TENURE ON THE BOARD WE WERE THE
AGENCY THAT HAVE BEEN COLLECTING
SALES AND USE TAX PAYMENTS IN
THE CANNABIS INDUSTRY SINCE.
NINETEEN NINETY SIX UP UNTIL
RECENTLY WHEN CD TFA TOOK THAT
OVER AS ONE THEIR AND ACCORD TO
THE ALEJO'S OFFICE AFTER THE
FIRST SIX MONTHS OF TWENTY
EIGHTEEN CALIFORNIA RECEIVED A
HUNDRED AND ONE MILLION DOLLARS
LESS IN TAX REVENUE THAN WAS
FORECASTED.
AND THIS IS DUE IN PART TO SNIFF
AGAIN TAX BURDEN COUPLED WITH
THE LACK OF ACCESS TO SAFE
RESPONSIBLE BANKING UNLIKE MOST
BUSINESS AS AS A SENATOR TOUCHED
ON CANNABIS BUSINESSES ARRIVE TO
GOVERNMENT.
CANNABIS BINS AS ARRIVE TO THE
GOVERNMENT OFFICES WITH DUFFEL
BAG FULL OF CASH AS THEY DID ARE
BE A WE OFFICE THEY WOULD SHOW
UP WITH THEIR TAX REVENUE IN
DUFFEL BAG SOME OF THEM WOULD
DRIVE THROUGH UNDER FIFTY MILES
BECAUSE THERE BE A WE OFFICES.
WOULD NOT TAKE IT IN CERTAIN
AREAS OF CALIFORNIA THE BE
ARRIVING TO OUR OFFICES WITH
THEIR BAGS WE COUNT IT THERE
CLOSE UP SHOP HAVE TO CALL THE
BANK LET THEM KNOW YOU'RE COMING
WITH THIS REVENUE.
TELL YOU WHAT -- THE HIGHER THE
ARMY CORPS YOUR SERVICES THEY
WOULD DRIVE IT FROM OUR OFFICE
TO THE BANK OF AMERICA
BANKAMERICARD CLOSE FOR ABOUT
TEN HOURS -- BECAUSE THE AMOUNT
OF CASHWOULD HAVE WE GOT WHEN
WE CAN AGAIN WITH THEM IT'S NOT
A VERY RESPONSIBLE ARE SAFE WAY.
TO HANDLE IT AND ALSO FOR
AUDITING PURPOSES THE BOARD
WOULD -- WE HAVE BOARD OF
EQUALIZATION PEOPLE STAY OUTSIDE
DISPENSARIES FOR ABOUT SIX DAYS
THREE HOURS A DAY DIFFERENT IS
THE MONTH THEY WOULD COUNT HOW
MANY PEOPLE GO INTO THAT
DISPENSARY.
THEY WOULD PUT A BASE -- A
NUMBER ON ABOUT EIGHTY DOLLARS
WITH THE AVERAGE.
A PAYMENT THERE THEY WITHIN
EXTRAPOLATE BACK AND TRY TO
GUESS WHAT THEY WERE GOING TO BE
RECEIVING AN TAXES.
IT PROVED TO BE A BARRIER PROVED
TO BE AN OFFICIAL AND APPROVED
TO NOT BE VERY ACCURATE SO THE
CHARGERS BEEN ACTIVELY INVOLVED
IN FINDING A VIABLE WAY TO BANK
THE CANNABIS INDUSTRY FOR YEARS
NOW.
SB FIFTY ONE OF THEM PARTNERING
WITH THE CENTER HERTZBERG SINCE
THE BEGINNING WE SEE THIS AS A
NECESSARY REAL SOLUTION TO
GETTING CASH OFF THE STREETS.
HI IN PUBLIC SAFETY INCREASE TAX
COLLECTION AND TRANSPARENT
AUDITING OF THE MONEY FROM
CANNABIS TO INCENTIVIZE
COMPLIANCE.
WE JUST RESPECTFULLY ASK YOUR
AYE VOTE WE APPRECIATE THAT
COMMITTEE SUPPORT LAST YEAR AND
I WANT TO GIVE ME CHEN CAN
SOMETIME AS WELL.
THANK YOU CASEY THANK YOU
SENATOR MADAM CHAIR AND MEMBERS
AMY JENKINS ON BEHALF OF THE
CALIFORNIA CANNABIS INDUSTRY
ASSOCIATION ALSO -- VERY PROUD
TO SUPPORT THIS BILL FOR THE
SECOND TIME IN ONE I THINK THE
SENATOR FOR HIS LEADERSHIP -- AS
HAS BEEN MENTIONED PREVIOUSLY
AND I'LL GIVE YOU A COUPLE REAL
WORLD EXAMPLES AND WE WE HAVE
HAD UNAVOIDABLE PUBLIC SAFETY
AND BUSINESS MANAGEMENT ISSUES
OUR MEMBERS AS WELL AS THE
ASSOCIATION -- TO PUT IN
PERSPECTIVE WE HAVE ONE MEMBER
COMPANY THAT IS FORCED TO
TRANSPORT AS MUCH AS A MILLION
DOLLARS THAT'S JUST ONE COMPANY.
IN A MONTH IN CASH TO SEE THE
TFA IS REGIONAL OFFICE TO
PREPARE FOR PAYMENT THIS COMPANY
HAS FOR STAFF MEMBERS FULL TIME
THAT DO NOTHING BUT COUNT CASH.
WHICH IS THEN TRANSPORTED BY AN
ARMED GUARD COMPANY IN TOTAL
THIS PARTICULAR CANNABIS
OPERATOR SPENDS -- MILLIONS OF
DOLLARS EACH YEAR SIMPLY
SECURING AN COUNTING CASH NOT TO
MENTION THE COST OF PURCHASING
CASHIER'S CHECKS TO PAY RENT AND
OTHER BUSINESS SERVICES
INCLUDING TO PAY THE I. MEMBER%
ASSOCIATION DUES.
SO AND AND AND AS I SAID THESE
ISSUES DO NOT SIMPLY A FACT THE
CANNABIS INDUSTRY THAT TOUCH THE
PLANT BUT ALSO ANCILLARY
ENTITIES -- CCA ITSELF HAS --
HAD ITS BANK ACCOUNTS SHUT DOWN
SIMPLY BECAUSE WE HAVE THE NAME
CANNABIS IN OUR ASSOCIATION
TITLE OUR PACKET COUNT HAS BEEN
SHUT DOWN NUMEROUS TIMES.
WE SPEND COUNTLESS HOURS TRYING
TO FIND NEW CREDIT UNIONS OR
FINANCIAL INSTITUTIONS TO BANK
OUR INDUSTRY -- AND WE HAVE A
FULL TIME STAFF PERSON THAT IS
SIMPLY DEDICATED TO CONTACTING
MEMBERS EACH MONTH BECAUSE THEY
TOO ARE GOING THROUGH BANK
ACCOUNTS ON A FAIRLY REGULAR
BASIS OR JUST SIMPLY -- WE HAVE
TO JUST ARRANGE TO TO GET THE
CASH SO THERE'S A LOT OF ISSUES
THAT ARE INVOLVED WE HAVE BEEN --
PARTNERS AND WORKING WITH THAT
THE STATE TREASURER'S OFFICE WE
TESTIFIED AND AT THE FEDERAL
LEVEL -- BUT REALLY BELIEVE THIS
BILL IS -- A SENSIBLE SOLUTION
WHILE THE FEDS -- DELIBERATE AND
HOPEFULLY CHANGE THEIR POLICY
GOING FORWARD WHICH IS WHY WE'RE
PROUD TO SUPPORT THIS BILL TODAY
THANK YOU.
THANK YOU ANY ADDITIONAL
WITNESSES AND SUPPORT PLEASE TO
STATE YOUR NAME AND YOUR
POSITION CHAIR MEMBERS ROSSBACH
THEM GOT TO SEE IF SACRAMENTO IN
SUPPORT.
MADAM CHAIR MEMBERS BRANDS TO
GRAB HOP UP LA COUNTY DEPART ACT.
BOARD OF SUPERVISORS STRONG
SUPPORTER THANK YOU.
IN AFGHAN BLAST SHEPHERD ON
BEHALF OF THE CAL ASIAN CHAMBER
OF COMMERCE IN SUPPORT.
ANY WITNESSES IN OPPOSITION
[inaudible]
WE'LL BILL.
OKAY.
SO NOTICES OPPOSITION WE HAVE A
MOTION AND A SECOND [inaudible]
MEMBERS [inaudible]
ANSWER QUESTIONS.
MR CHOI.
SENATOR.
I WOULD LIKE TO KNOW HOW WHAT
THOSE STAYS -- THAT HAVE
LEGALIZED SO YOU CAN WAS
BUSINESS ON A COLORADO OREGON
HOW ARE THEY HANDLING I HAVEN'T
DONE ANY RESEARCH ALSO.
WHAT THANK YOU SIR IS A QUESTION
I HAVE I'VE TALKED TO A HIGH OF
TOOK TO WASHINGTON OF TALK TO
COLORADO IF TALKED A NUMBER OF
THE STATE'S EXPERTS?
FOLKS IN THE LEGISLATURE AND YOU
KNOW PART OF WHICH IS TO HIT
MISS WITH AS WAS INDICATED
TRYING TO OPEN BANK ACCOUNTS
THERE WAS AN AGREEMENT WITH THE
FEDERAL GOVERNMENT COLORADO
RELATING -- TO WHICH MCCALL IT --
TO BANKING DEAL THERE A HIGH --
HAS A CHARGING BANKS BUT IT'S
REALLY HIT AND MISS IT'S REALLY
BEEN HARD WASHINGTON'S REALLY
BEEN.
A JOURNALIST STRUGGLING WITH IT
AND AND AND QUITE FRANKLY
THEY'VE ALL CALLED US AND
LOOKING AT THIS HIGH TIER
BECAUSE THEY THINK IT'S A PRETTY
GOOD IDEA.
I MEAN BASICALLY YOU UNDERSTAND
THIS IS A PRIVATE BANK NOT A
PUBLIC BANK SO WHAT'S GOING TO
HAPPEN IS INVESTORS ARE GOING TO
COME ALONG.
JUST LIKE YOU DO WHEN YOU FORM A
BANK AND THEY'RE GONNA PUT UP
TEN MILLION DOLLARS OR WHATEVER
THEY'RE GONNA PUT UP IN CAPITAL
THEY GET TO INVEST THE MONEY
THEY'RE GONNA RENTED A BANK
BRANCH.
AND THEY'RE GONNA OWN A BANK AND
THEY'RE GONNA HOPEFULLY MAKE
MONEY ON IT AND I THINK PROBABLY
WHAT THEY'RE LOOKING FOR IS A
YOU KNOW A LOT OF PEOPLE THE
INDUSTRY OF COME AND TALK TO US
BECAUSE THEY WANT TO BANK TO BE
ABLE TO JUST LIKE REAL ESTATE.
DEVELOPERS DO TO GET A BANK TO
HELP THEM IN THEIR OWN
BUSINESSES AND THEN WHAT'S GOING
TO HAPPEN IS ONCE IT BECOMES
LEGALIZED AS I INDICATED MY
OPENING.
THE THE LARGER BANKS ARE GOING
TO COME IN AND AND AND ROLL THEM
UP AND THEY'RE GONNA MAKE BIG
PROFITS CAUSING OLYMPIC AGAIN A
FIVE ONE MILLION DOLLARS IN
DEPOSITS OR WHATEVER IT IS AND
THEY'RE GONNA WANT TO BANK WITH
THOSE FOLKS.
ANDTHEY'LL BUILD RELATIONSHIPS
SO THE IDEA IS IT'S FORMED
AROUND REALLY QUITE FRANKLY IT
WAS MY ADVERSE REACTION TO THE
PUBLIC BANK IDEA BECAUSE I
THOUGHT THAT WOULDN'T HAPPEN IN
TEN YEARS.
AND THE IDEA WAS WE HAVE A SENSE
OF URGENCY HERE TO GET THIS UP
AND RUNNING AS QUICKLY AS
POSSIBLE FOR THE PUBLIC SAFETY
FOR ACCOUNTING FOR ALL THOSE
REASONS I WOULD SUSPECT.
THAT GOVERNMENT IS NOT RECEIVING
AS MUCH MONEY AS IT SHOULD
BECAUSE THE HASSLE OF JUST
DEALING WITH THE CASH VERSUS
WRITING A CHECK TO PAY THE
VARIOUS GOVERNMENTAL ENTITIES
ONE OF THE REASONS WHY THE
ESTIMATES IN MY JUDGMENT IS
LOWER THAN IT SHOULD BE.
I REALIZE THAT THAT THIS ISSUE
YOUR INTERIM MEASURE THAT'S
RIGHT I A WONDER AT THE WRIST --
AND THE MOVEMENT.
TO ESTABLISH A PUBLIC BANKING
AND IN THAT THE BANKING
COMMITTEE.
I ASKED THAT QUESTION WHETHER
THE DO REAL HIDDEN MOTIVATION OF
THAT THE IDEA WAS SET TO
ACCOMMODATE THIS -- CANNABIS --
INDUSTRY -- MONEY AND EVERYBODY
IN THE AGAINST HIS OWN PEOPLE.
IT.
IF THAT IDEA PUBLIC BANKING
COURSED THROUGH.
THEN NOW -- WILL THE PUBLIC
BANKING -- LUCKY CITIES AND
COUNTIES OR WHATEVER AND LOCAL
UNITS -- SET UP -- UP OUR ARE
THEY AVAILABLE FOR ALL OF TIME
NEEDED TO TAKE THAT THIS KIND OF
A CAN IT WAS -- WELL WE'VE
LOOKED AT AND THAT WAS A NUMBER
OF LAWYERS ON THE SITUATION IN.
THE PROBLEM WHETHER IT'S A STATE
INSTITUTION OR A PRIVATE
INSTITUTION THE NOTION OF
WORKING TO THE FEDERAL CLEARING
HOUSES.
AND THE NOTION OF HAVING FDIC
INSURANCE ALL INFORMS THE EXACT
SAME PROBLEM THAT WE'RE TRYING
TO AVOID.
BASICALLY THE NOTIONS HERE'S
WHAT'S CALLED A CLOSED LOOP
SYSTEM SO THAT YOU ONLY CAN
DEPOSIT MONEY OR TAKE MONEY OUT
OF YOUR BANK BRANCH NOW LET'S
ASSUME THERE'S IT IN IT IS --
TEN COMPANIES TO COME ALONG AND
FORM BANKS THEY COULD FORM IN
IRAQ INNER BANKING AGREEMENTS
AMONG THEM SO I COULD GO IN CASH
MY CANNABIS BANK SAY IN IN IN
ANOTHER IN ANOTHER COUNTY IF
THEY HAD ONE AND THEY COULD HAVE
AGREEMENTS AMONG THEMSELVES.
BUT THE KEY FRAMEWORK IS IT HAS
TO OPERATE ONLY WITHIN THE STATE.
WE CANNOT USE FEDERAL INSURANCE
AND I CAN'T USE THE FEDERAL
CLEARING HOUSE IT HAS TO BE WITH
IN THE STATE OF CALIFORNIA AND
WITHIN OUR CONSTITUTIONAL
CONSTRAINTS SO THAT WOULD I
WOULD NOT THINK.
THAT A PUBLIC BANK COULD COULD
REALLY DO CANNABIS THE PUBLIC
BANKING IS ALL ABOUT TRYING TO
REDUCE COSTS AND AFFORDING
WHETHER IT'S STUDENT LOANS OR
LOW INCOME HOUSING OR THOSE
KINDS OF THINGS.
IS REALLY THE THE IMPETUS OF THE
PUBLIC BANKING SYSTEM AS FAR AS
I CAN DETECT.
THANK.
ANY ADDITIONAL QUESTIONS
[inaudible]
AT CNN SENATOR HERTZBERG CAN YOU
COMMENT JUST A LITTLE BIT ON
WHAT YOU FEEL SOME OF THE
DEPARTMENT OF BUSINESS OVERSIGHT
CONCERNS HAVE BEEN AND HOW.
THEY COULD OR COULD NOT BE
ADDRESSED YES IT'S HARD OKAY
THIS IS HARD I MEAN I DON'T OKAY
I'M NOT.
THIS IS HARD IT IS WHAT IT IS
AND I THINK THAT YOU KNOW
REGULATORS ARE CONCERNED ABOUT
HOW LONG IT'S GOING TO TAKE IN
WHATEVER AND I'M PUSHING THEM.
AND BECAUSE I THINK THERE'S A
REAL PUBLIC INTEREST HERE AND
AND THAT YOU KNOW A NUMBER OF
MEETINGS WITH THAT WITH WITH THE
COMMISSIONER OWNS WAS FANTASTIC
OF OUR FOREVER AND ALL THE RICH
IT PRE PREVIOUS JOBS IN THE LIKE.
BUT I THINK THEY WERE JUST
FEARFUL OF A HARD IT WAS GOING
TO BE A MET WITH THE NEW
COMMISSIONER WHOSE FANTASTIC.
AND YOU KNOW THEY'RE WORRIED AND
I TOLD WILL HELP THEM BUT BUT
YOU KNOW THIS IS ONE OF THESE
CHALLENGES IN PUBLIC LIFE WHERE
YOU'VE GOT THIS UNBELIEVABLY
DIFFICULT PROBLEM WITH ALL THIS
CASH THAT'S THAT IMPACTS SO MANY
ASPECTS OF GOVERNMENT AND
PRIVATE LIFE.
AND PUBLIC SAFETY AND SOMEHOW WE
JUST GOT TO GO FOR IT AND THE
BAND AND WILL HAVE TO FIGURE IT
OUT ISN'T IT IS A LITTLE BIT OF
A WORK IN PROGRESS IT IS GOING
TO BE TOUGH THERE IS NO QUESTION.
THEIR WORD ABOUT THE REGULATIONS
THEY'RE WORRIED ABOUT HOW TO
MAKE IT HAPPEN AND AND AND AND
AND AND AND THE LIKE I DON'T
BLAME THEM BUT BUT YOU KNOW
THERE SOMETIMES WHERE ARE YOU
GONNA DO YOU GONNA JUST TAKE
ACTION AND WE'RE IN THIS
HORRIBLE POSITION IN CALIFORNIA.
AND THAT'S WHAT INFORMS MY
DECISION TO CARRY THIS
LEGISLATION WITH THE US THEY
TREASURE AND FORMERLY THE CHAIR
OF THE BOARD OF EQUALIZATION.
THANK YOU I KNOW IT IS VERY
DIFFICULT AND AS YOU SAID I
THINK THAT THERE'S BEEN SOME
DESCRIPTIONS OF WHAT THE REAL
WORLD EVERY DAY A LIFE IS -- FOR
A LOT OF THE FOLKS ON INTERSTATE
IN TERMS OF CASH AND SO IT WE
ARE CERTAINLY LOOKING FORWARD.
TO SOME KIND OF SOLUTION AND
THAT SOLUTION NOT SUPER CLEAR
BUT A THINK OUR STATE IS A VERY
MUCH IN FAVOR OF TRYING TO FIND
A SOLUTION FOR THIS THANK YOU
SAID ONE THING MANAGER.
IS LOCAL WE THOUGHT ABOUT THIS
THING IN A LOT OF PEOPLE HAVE
COME OF ALL THIS COCKAMAMIE
IDEAS AND CREDIT CARDS AND THIS
AND THAT DO THIS STUFF.
WE WOULD TALK A TREASURE'S
OFFICE TOOK AN EXTREMELY
CONSERVATIVE VIEW ABOUT WHAT
THIS OPENING ACT LOOKS LIKE WE
KNOW THAT IF THERE'S A LONGER
PERIOD OF TIME BEFORE CANNABIS
BECOMES RECOGNIZED IN THE
FEDERAL SYSTEM WE'RE GONNA HAVE
TO MAKE SURE THIS BANKING MODEL.
RIGHT BUT WE STARTED WITH THE
SUPER SIMPLE WE YOU KNOW BRANCH
SUPER BASIC THINGS WHICH WORKS
WITHIN A CLOSED LOOP SYSTEM MORE
MONEY TRANSFERS WITHIN THAT
WORLD.
AND THEN THE GIVEN OPPORTUNITY
AND THERE'S SOME CHALLENGES IN
THIS IS NO QUESTION WE SOUGHT.
TO IF SOMEONE HAS A BUNCH OF
MONEY WHATEVER ECONOMY DOLLARS
IN THE BANK I CAN'T TUNING WITH
IT WELL I CAN GIVE IT TO THE
STATE OF CALIFORNIA AND GET
INTEREST ON IT.
AND THE STATE GET SOME MONEY FOR
A BOND OR A MUNICIPAL ENTITY
CAUSES WITHIN THE STATE YES SIR
CHALLENGES NO QUESTION.
BUT THAT WAS THE THINKING SUPER
CONSERVATIVE LIMITED APPROACH.
ALL THESE OTHER FOLKS WITH ALL
THESE OTHER ELECTRONIC IDEAS AND
CREDIT CARD SYSTEMS AND THAT
KIND OF STUFF WE LIMITED IT.
AND AND WE THINK THAT THAT'S THE
RIGHT THING FOR AN OPENING -- ON
THIS CUT SOMETHING AS
COMPLICATED AS THIS.
THANK YOU WOULD YOU LIKE TO
CLOSE I THINK THAT WAS IT THANK
YOU VERY MUCH ALL RIGHT SO WITH
THAT WE WILL GO AHEAD AND VOTE.
ON THE BILL THIS DOES HAVE A
MOTION OF DO PASSED TO THE
ASSEMBLY BUSINESS AND
PROFESSIONS COMMITTEE.
AG SECRETARY PLEASE CALL THE
ROLL.
LEóN I CHEN.
THANK YOU SIR WHERE CAN
BURKE [inaudible]
CERVANTES [inaudible]
CHOI [inaudible]
GABRIEL [inaudible]
GRAYSON [inaudible]
MELENDEZ [inaudible]
STONE [inaudible]
WEBER [inaudible]
WICKS HI.
THE BILL HAS EIGHT VOTES IT DOES --
HAVE ENOUGH VOTES TO MOVE
FORWARD THEY CAN THANK YOU VERY
MUCH YOU MEMBERS THANK YOU.
THANK YOU WE HAVE A MOTION FOR A
CONSENT TO AND I THINK I HEARD A
SECONDS FROM ASSEMBLY MEMBER
GRAYSON FOR CONSENT.
WE'LL GO AHEAD AND CALL THE ROLL
FOR CONSENT.
AT THE CONSENT CALENDAR AT AND
IN JUST SO EVERYBODY HEARD IF WE
DID PULL.
ITEM FOR FROM THE GENDER FROM
CONSENT SB FIVE FORTY AND THAT
WILL BE HEARD AT THE NEXT
HEARING ON JULY EIGHTH -- IS THE
ONE EIGHTY SEVEN TO PASS. TO
JUDICIARY RECOMMENDS CONSENT.
AND SB TWO FIFTY ONE TO PASS TO
CONSENT.
LIMóN.
HI.
CHEN [inaudible]
BEAR CAM [inaudible]
BURKE.
CERVANTES.
CHOI [inaudible]
GABRIEL [inaudible]
GRAYSON [inaudible]
MELENDEZ [inaudible]
STONE [inaudible]
WEBER [inaudible]
WICKS.
THE CONSENT CALENDAR HAS TEN
VOTES.
AND WE WILL WAIT TO ASK FOR A
COUPLE MINUTES TO DO ANY ADD ONS
BUT OTHER THAN THAT OUR BUSINESS
IS CONCLUDED [inaudible]
THANK YOU
--
ALRIGHT WE'LL GO
AHEAD AND DO ADD ON'S AND WE
WILL START WITH TO ADD ON TO SB
[inaudible]
FIFTY ONE BURKE.
ALL RIGHT NEXT WE WILL GO TO THE
CONSENT CALENDAR WE PULLED SB
FIVE FORTY OFF THE CONSENT
CALENDAR AND IT'S NOW SB ONE
EIGHTY SEVEN AND SB [inaudible]
TWO FIFTY ONE BURKE [inaudible]
THANK YOU [inaudible]
YOU HAVE.
ON HER WAY
-- UHHUH [inaudible]
ONLY.
YEAH YEAH THAT WILL BE ACCESS
AND YEAH [inaudible]
CREATION
-- FOR A LONG.
THIS BILL AS WELL [inaudible]
YEAH SO WITH THAT THEY HAVE THE
OPTION -- AB [inaudible]
FIVE FIVE VETERANS -- THE UHHUH
[inaudible]
CAPTION.
IT LOOKS LIKE SOME OF OKAY YEAH.
OVER AND IRATE WE WILL DO ADD
ON'S.
A ADD ON FOR SB FIFTY ONE
HERTZBERG [inaudible]
CERVANTES.
AND NEXT WE WILL ADD ON FOR
CONSENT TO SB ONE EIGHT SEVEN
WILL KOWSKI AND SB TWO FIFTY ONE
BANKING AND FINANCIAL
INSTITUTIONS WE DID REMOVE SB
FIVE FORTY JONES FROM THE
CONSENT CALENDAR AND THAT WILL
BE HEARD AT THE NEXT HEARING
[inaudible]
CERVANTES.
PERFECT AND WITH THAT WE WILL GO
AHEAD AND TURN OUR MEETING