There is a lot of debate surrounding this issue. Many believe that, although there will be some teething troubles for the first few months or so, the recreational market will hit the ground running. Other believe that the recreational marijuana market will take several years to work out all the kinks, and that businesses will face a long, uphill struggle to be seen as truly legitimate. Sadly, with the new L.A. draft legislations, it looks like the latter might be correct.
The reason why? Because, come recreational legalization on January 1, 2018, many companies with the exception of a handful of dispensaries will have to close down their businesses until permits reopen. Businesses will then have to reapply for their permits. Many believe that this will lead to a “vacuum” for at least a few months, as existing operators shut down and time is needed to look through all the applications and come to a decision.
What Do the Newly Drafted Legislations Say?
The 42-page document has a lot to say, so we’ll try to stream it down to its most essential parts. The department regulating the recreational marijuana is the City of Los Angeles Cannabis Regulation Commission, which we shall refer to as the “Department”.
- Recreational cannabis users must be aged 21 or older.
- The laws surrounding medical marijuana users and their caregivers will remain the same – those aged 18 or over and have a valid medical marijuana card and recommendation may enter a dispensary.
- There must always be a staff member present in the dispensary and on the shop floor during opening hours and when there are patients/customers in the retail area.
- A business conducting Retailer Commercial Cannabis Activity may only be open between the hours of 6:00 am and 9:00 pm PST.
- The premises must be locked, secure and fitted with an alarm system outside of business hours.
- Applications must be filled in online or in print, with all fees paid (fees include application costs, pre-inspection and audit).
- Any application deemed “incomplete” will have a 6-month window to correct all deficiencies/mistakes. Any application going over this time limit will be considered “abandoned”. Fees are non-refundable.
- Once the application is accepted, the Department will provide a Proper Notice at least 45 days in advance of scheduling a public hearing or making a determination. “Proper Notice” means that occupants and property owners within 500 feet of the cannabis business will be informed of your business. Larger operations that cover 30,000 square feet or more, whether retail or non-retail must go through a public hearing.
- Priority will be given to those who complete their applications early and are already Established Medical Marijuana Dispensaries (EMMDs) – within 60 days commencing 01/01/2018.
- It is unlikely that on-site growing of cannabis plants will be allowed after 2020.
- There is no pre-determined amount of time the Department must respond to the applicant by – this is up to the discretion of the Department!
- Appeals for rejected applications must be made within 15 days of the decision. The Commission must make a act on an appeal within 60 days, or 15 days if the appeal is going to the City Council.
- Any retail cannabis business found to be operating illegally after 04/01/2018 will be banned from applying for a license for 5 years.
- Many of L.A.’s existing cannabis businesses will be shut down come January 2, 2018, with the exception of several existing medical marijuana dispensaries.
For now, these are just draft proposals, so it is by no means finalized as of yet, and there is still a lot of room for negotiation. However, seeing as California hasn’t even got its regulatory scheme properly in place yet (they were given until September 30, 2017 to do it, and it is not complete), it looks like there will be a lot of back-and-forth over the next few years on these issues, and a lot of businesses will continue to operate in a legal grey area, even if it’s unwittingly so!
Are the New Proposals All Good or All Bad?
There are both pros and cons to the new draft legislation, as can be expected with any legislation. Responsible operators, who may have already made applications and have been waiting patiently for 01/01/2018 to come along so they could trade legitimately, pay taxes and join the legal market, are likely to be ahead of the pack come January. Yet, in the meantime, many could well lose their jobs and, without access to cannabis, a burgeoning black market will likely come back into play.
Yes, the new proposals might well be a bit fairer to those who played the ball earlier on as well as giving new entrants an opportunity to compete, but not every cannabis-related business operating in California is illegal. This means that the new regulations as they currently stand could lose a lot of people their jobs. Some of them could have established ties with patients in their communities, and cooperatives will likely have a glut of produce they cannot legally sell to anyone.
Another problem arising from all of this is whether or not new regulatory frameworks will require stringent testing for safety and efficacy, which is of utmost importance for medical patients, but is certainly important for non-medical cannabis users as well. Nobody wants molds and heavy metals on their flowers, after all!
What About the Rest of California?
Remember: these draft proposals are for Los Angeles only. Different cities will have different regulations, and some might not accept any application for cannabis-related business at all. However, as L.A. is so large and populated, it would not be surprising to see other cities in California, or even throughout the U.S., following L.A.’s suite should it prove successful. Let’s hope that L.A. gets it right sooner rather than later, lest other cities follow L.A. into oblivion and destroy the cannabis industry before it even gets started.
What About Medical Cannabis Users?
No major changes in terms of laws, protections and rights for medical marijuana patients, although they might see some of the dispensaries they used to use close down. In some ways, medical marijuana patients may start benefiting from the introduction of a “recreational” market, as those who aren’t creating medical-standard cannabinoid-based medications no longer have to try and pass themselves off as “medical” in order to do business. The shame for these businesses comes from the possibility that they might well be producing excellent products, but now have to shut-up-shop due to the new regulatory regime.
So, to answer the question in the title, “No, L.A. will not likely be fully and truly ready for legalization come January 1, 2018, but it will be as ready as many other cities in the U.S. that have allowed for the sale of ‘recreational’ cannabis.” I.e. not very ready at all, and prone to shortages due to the lack of joined-up thinking and rushed-through legislation that was thought up of at the last minute! Sure, we’ll see businesses and dispensaries operating throughout 2018, but expect a bumpy road for a few years yet. Getting yourself a medical marijuana card might still be of use for several years with regards to accessing cannabis, and could well save you a little bit of money on tax as well.