With the passage of Amendment 64 in 2012, Colorado became the first state (along with Washington state) to legalize recreational cannabis in the United States. Residents are now allowed to grow up to six plants (three of which can be mature) for private use and keep anything their plants produce as long as it stays where it was grown. Residents can also carry up to one ounce outside their homes and gift up to one ounce to anyone 21 or older.
Unsurprisingly, the demand has been huge, and Colorado’s 10 percent sales tax and 15 percent excise tax generated nearly $73.5 million dollars in 2015, out raising taxes generated from alcohol and setting records due to the growth of Colorado’s cannabis tourism industry.
“Those numbers are showing that our pot tourism is surely increasing,” said Tyler Henson, president of the Colorado Cannabis Chamber of Commerce. “People want to come here and try this out and tell their friends and family that they came to Colorado and tried some of the best cannabis the world has to offer and they had a great time.”
But as profits continue to soar, both for dispensary owners and state tax collectors, the biggest issue cannabis business owners now face is what to do with all the cash that most banks refuse to take due to federal laws that still consider cannabis illegal.
One bank, however, Fourth Corner Credit Union in Denver, is the first to take on the United States Federal Reserve Bank in court in a move that may determine the future of the industry.
“This isn’t something that is going away,” said Attorney Mark Mason during his oral arguments at court in December 2015, according to the International Business Times. “This is something that is going to be a part of the next generation and the future, and we need to get it right. And if we are not going to have banking… and have millions and millions of dollars on the streets where bad things can happen, that is not responsible.”
So far, the Federal Reserve has argued that it should not be forced to handle money the federal government still considers as being obtained illegally. Even though in 2014 the U.S. Treasury offered some guidelines for dealing with cannabis businesses, effectively giving banks the OK to accept accounts as long as they are closely monitored.
Though the Fed refuses to budge, Colorado policymakers are in favor of the Fourth Corner Credit Union and gave them a charter at the end of 2014.
“Both the governor and I thought it was a pretty good short-term solution to getting cash off the streets and bringing some measure of financial accountability to the marijuana industry,” said Andrew Freedman, Colorado’s marijuana policy coordinator, according to the IB Times. “Secondly, as we talked to banks, a lot of them feel like they are getting yellow blinking lights when it comes to marijuana. The existence of a marijuana credit union would give more faith to other banks and credit unions that they are able to bank marijuana.”
The case now rests in the hands of Judge R. Brooke Jackson, who is dubious of the Federal Reserve’s reasons for denying Fourth Corner Credit Union its master account necessary to do business. Still, the judge worries that siding with Fourth Corner Credit Union might set a precedent for forcing banks to open accounts for other types of crime the federal government sees as illegal even if the state has legalized it.
“The issue for me to decide is, do I force the Federal Reserve Bank to give you a master account?” Judge Jackson said to Mason. “The problem I have with that is I would be forcing the Federal Reserve Bank to give a master account to an institution that has stated it will participate in an illegal activity.”
In the meantime, Colorado continues to see cannabis culture going mainstream. Libraries, the fount of public knowledge, are carrying more cannabis-related books and circulation has gone up 35 percent since 2014. Entrepreneurs like Brett Davis are cashing in on cannabis tourism by starting social clubs that hold sushi and joint rolling classes, pot-pub crawls and bus tours. There is even a Stoner Jesus Bible Study started by Deb Button, a suburban mother of two, that has attracted a diverse group of people interested in how cannabis can affect religious study.
“I think the plant is sacred,” said Cynthia Joye, a 51-year-old mother and group member, according to New York magazine. “It puts people in a frame of mind where you think of God.”
As the first state to legalize recreational cannabis, all eyes are on Colorado to see the effects of legalization, and as the destigmatization and mainstreaming of cannabis continues to develop, other states will continue to follow suit.