California’s arguably largest cash crop, marijuana, is becoming a cash-only purchase at medical marijuana dispensaries, escalating a fight between the state, which regards them as legal, and the federal government which considers the product they sell illegal.
The U.S. Treasury has reportedly been quietly informing banks and other institutions that extend credit/debit card services that they will be liable if they are found to be facilitating operations at dispensaries. A number of Bay Area dispensaries publicly mentioned their change of policy to cash-only.
Harborside Health Center in Oakland, one of the largest dispensaries in the state, announced the switch on its website. “Due to continuing federal threat of seizure against financial institutions, we will now only be able to accept debit cards, not regular credit cards. We are trying out a new system, and do not yet know if it will even accept all debit cards, but we trust that it will accept most.”
At San Francisco’s most well-known dispensary, Haight Street’s Vapor Room, the owners assessed the deteriorating political and financial situation, took a deep . . . breath, and announced they were going out of business July 31.
Dispensaries have been whipsawed by conflicting signals from local, state and federal authorities about the legality of their operations. California legalized medical marijuana in 1996, followed by an uneven application of the law throughout the state by localities that tried to ban it, turned it loose unsupervised or sought some middle ground.
But the federal government turned the situation upside down last year when it began to aggressively apply federal law, which bans marijuana. The state’s four U.S. Attorneys have joined with the Internal Revenue Service (IRS) and the Drug Enforcement Agency to shut down at least 500 cannabis dispensaries over the past eight months, while a horde of lawsuits careen through the legal system.
–Ken Broder
To Learn More:
Cash-Only Pot: Credit Cards No Longer Accepted at Medical Marijuana Dispensaries (by Chris Roberts, San Francisco Weekly)
Approval Denied: Treasury Department Cuts Credit and Debit Card Use at Local Dispensaries (by David Downs, East Bay Express)
Vapor Room Closing: Beloved San Francisco Pot Shop Succumbs To Federal Pressure (by Carly Schwartz, Huffington Post)
State Court Guts Local Ban on Marijuana Dispensaries Although Feds Have Closed 500 Pot Shops (by Ken Broder, AllGov)