CHARLESTON, W.Va. — A credit union in this state has submitted the winning proposal to act as the financial institution to handle transactions for the state medical cannabis program.
As CUToday.info reported here, the credit union has been one of five finalists to win the contract.
Element Federal Credit Union submitted the winning proposal, according to the state of West Virginia. The state said it has begun meeting and negotiating to complete the issuance of the purchase order. An official purchase order and more information are expected to be released next week, pending the successful conclusion of negotiations.
Element’s estimated annual cost, according to the proposal it submitted to the treasurer, is $104,275.44. Included among costs for other services is $132,000 for armored car/courier service, according to the state. After the issuance of the purchase order, the treasurer and Element— assuming successful negotiations – will announce additional information, including long-term goals and interim procedures for medical cannabis banking, according to the West Virginia Treasurer’s Office.
Process Started in March
This selection process got its start in March, upon legislative passage of HB 2538, intended to address the cannabis program’s banking problem. Because medical cannabis money is still federally illegal, the bank holding the state’s checking account, BB&T, won’t handle cannabis money, MetroNews reported. It added HB 2538, which expanded the definition of financial institutions that could bid on the medical cannabis banking business, the treasurer said.
House Bill 2538 created the Medical Cannabis Program Fund to receive license fees, penalties and taxes associated with the program, and the Treasurer’s Medical Cannabis Fund is to receive all oversight and compliance fees charged to the financial institution chosen to handle the program fund.
Others Bidding on Business
Other institutions that had sought to win the account included MVB Bank; JPMorgan Chase Bank, and DMTLP – Delivering Marijuana Teaming Logistics Planning – which did not offer a banking proposal but submitted an offer to devote 90 days to build a closed-loop cash management infrastructure platform to bridge the time until cannabis is federally legal.
Each vendor will have until noon Sept. 3 to file a written protest regarding the award.
“My staff has worked tirelessly to make this program viable,” said Treasurer John Perdue in the release. “I look forward to awarding this contract and moving forward with a banking process. My main priority is to help people in our state who want this medical option for either themselves or a family member.”