Los Angeles’ City Council president wants to establish a municipal bank to serve marijuana businesses, including providing financing.
The proposed bank would also serve affordable housing developers and small businesses, the Los Angeles Daily News reported.
According to the newspaper, Council President Herb Wesson likely will direct a committee to study the practicality of a municipal bank.
Lack of access to banking services is a significant issue for marijuana businesses. Most financial institutions steer clear of the industry because cannabis remains illegal at the federal level.
Los Angeles isn’t the first city to consider creating a public bank for the cannabis industry.
According to the East Bay Times, the cities of Oakland and Santa Rosa, California; Santa Fe, New Mexico, and Philadelphia have considered or are considering creating municipal banks to serve marijuana businesses.
The states of Arizona and Maryland are also studying how to provide banking services for the cannabis industry.