Marijuana

CO-OPS KEY TO INDUSTRY'S "LEGITIMACY"

Colorado's medical-marijuana industry, already subject to the most
comprehensive cannabis-business regulations in the country, might
soon have another national first to its credit: a bank, of sorts.

Two state lawmakers said they plan to propose a bill that would allow
the industry to form a "financial cooperative" to provide banking
services to medical-marijuana businesses. The cooperative would work
like a credit union, with membership limited to industry members. But
it would be free of the kinds of federal insurance requirements that
exist with banks and credit unions and that have made those
institutions reluctant to work with medical-marijuana businesses.

State Sen. Pat Steadman, a Denver Democrat who is one of the bill's
proponents, said the cooperative would plug a hole in state
medical-marijuana regulations.

"The inability to have a financial institution to do their banking
with real ly hinders regulatory enforcement," Steadman said. "So it's
in everybody's interest that these people don't have piles of cash
lying around . . . and, instead, there's a paper trail."

Steadman - who is working with state Rep. Tom Massey, R-Poncha
Springs, on the measure - said he plans to introduce the bill next week.

The bill is expected to be the major focus of
medical-marijuana-related lobbying at the state Capitol during this
year's legislative session, which starts today. Massey said he thinks
legislators - after two previous sessions of furious
medical-marijuana law-making - are content this year to see how the
regulations are working.

"I hope we let it work a little bit before we start tinkering with
it," Massey said.

The difficulty in finding banking services is a persistent complaint
for the medical-marijuana industry. In October, the last bank in
Colorado to openly work with dispensaries closed those accounts. That
followed a series of account closings at other banks that were wary
of federal law that makes all marijuana distribution illegal.

Last year, Massey proposed that the state create and oversee
investment trusts for the industry, an idea ultimately rejected over
concerns it would make the state an active conspirator in federal
crimes. Colorado U.S. Attorney John Walsh also criticized that proposal.

In a letter to Colorado Attorney General John Suthers, Walsh wrote he
would "consider civil and criminal legal remedies regarding those who
invest in the production of marijuana . . . even if the investment is
made in a state-licensed fund of the kind proposed."

A spokesman for Walsh could not be reached for comment about the new
bill. A spokesman for Suthers, who also opposed the investment
trusts, said it was too early to comment on the new proposal.

The head of the Medical Marijuana Industry Group, the most
influential cannabis-industry lobbying organization at the Capitol,
said passing the bill will be its top priority this session.

"The creation of financial co-ops is critical for the continued
legitimacy of the industry," Mike Elliott, the group's executive
director, said in a statement.