Delivery businesses specializing in cannabis have a unique set of rules to follow. They must abide by the laws in the local jurisdiction in which their home base is located. But they also have to take into consideration laws that dictate transport. This has led to a particular set of challenges in Sacramento County, according to the Sacramento Bee.

While adult-use marijuana was legalized in the state Jan. 1, under Proposition 64, each local government was allowed to set its own terms. Under the law, deliveries can only be made between cities that allow it. This can be a real disadvantage to patients, some who have difficulty leaving their homes, and business owners. And product must be kept in the city where the business has a license.

In Sacramento County, as of now only the city of Sacramento has plans to receive deliveries. The city has not issued any permits yet, but eight delivery companies have registered while the permit program is being established. Meanwhile Sacramento’s pot czar says many businesses are operating without licenses, and he is on a mission to rein them in. A recent tally on a marijuana delivery website showed about 200 delivery businesses in the county.Our experienced marijuana delivery business service attorneys in Los Angeles know it’s difficult establishing a new company with numerous laws and regulations to consider. We know the challenge intensifies when you have to follow regulations that span across multiple city lines. And when your business is just getting off the ground, fees and taxes can be intimidating. Further, when you see peers skipping these important steps, it might be tempting to follow suit. But doing so can not only get you in trouble, it can hurt the marijuana industry as a whole, hurting other businesses that are in compliance.

Some delivery services might think they fall under the umbrella of a collective, which would allow them to operate without a permit until next year. But there are specific requirements that must be met to be considered a collective, namely that it must be a nonprofit. They would also need to be registered with the California Department of Tax and Fee Administration.

Regardless, the days of operating permit-free won’t last for long. Sacramento marijuana regulators are working with city police to establish an enforcement plan. Warning letters have already gone out to operations across the state.

It’s important that businesses who are not operating with a permit or who aren’t sure they are in compliance get legal counsel to advise them on how to move forward. Our experienced attorneys have the know-how to advise you on business plans, assist you with business licensing, and offer guidance on establishing collectives. Otherwise owners could face fines, lose their business, or more. Avoiding these regulations might not seem like a big deal now, but any money being saved in the short term could cost your business big time in the long run.

The Los Angeles CANNABIS LAW Group represents growers, dispensaries, collectives, patients, defendants, workers and those facing criminal marijuana charges. Call us at 949-375-4734.

Additional Resources:

Are You Getting Marijuana Delivered to You? If So, It’s probably Illegal, Feb. 16, 2018, By Brad Branan and Phillip Reese, The Sacramento Bee

More Blog Entries:

City of Los Angeles Targets Another Marijuana Delivery Service, May 21, 2016, Cannabis Law Group

Many cities especially are passing regulations in order to limit the influence of the state on how the city chooses to oversee marijuana delivery services, growers, collectives, and edible and concentrate producers. Delivery services in particular must navigate a continually growing list of rules, ranging from methods by which the businesses can make deliveries to where they are allowed to set up. In Hesperia, California, for example, the city council approved an amendment that expands the area approved for establishing delivery services and affirms cannabis activity regulations, according to an article from The Daily Press. Marijuana delivery businesses in the cannabis Commercial Industrial Business Park zone district of Hesperia must be located at least 600 feet away from residential and agricultural zones, schools, day cares, playgrounds and parks, places of worship, among other restrictions. These rules are in line with regulations on other restricted businesses in the city, such as adult businesses, residential care units, and liquor stores. The majority of the city council voted in favor of expanding the area in which delivery services could operate, citing medical marijuana use and a desire to show compassion and offer relief to residents who are suffering. But the one dissenting councilperson brought up a recurring concern that such expansions not only increase accessibility for medical users, but could also open up the possibility for more irresponsible marijuana use. He cited an alleged increase of homelessness and a leap in drug violations in schools in Colorado in the five years since legalization occurred in that state. He pointed the finger at an increase in drivers involved in fatal crashes testing positive for marijuana use, though it’s not clear if it is correlation or causation that has led to this jump. While the compassionate response toward medical cannabis users has helped to further the cause in a positive way, there are still many negative perceptions and misunderstandings that have led to a myriad of added regulations and restrictions. This is why it is so important for entrepreneurs looking to set up marijuana delivery services to speak to a cannabis lawyer. It is challenging enough to keep up with California state laws, but when laws differ from city to city, it’s extremely difficult to keep up. An experienced marijuana business lawyer can give you the guidance you need to prevent potential future legal trouble that can be very costly or endanger your business. Not to mention, it’s essential for business owners to remember that marijuana is still a Schedule One substance on the U.S. Controlled Substances Act of 1970 (USCSA), opening the door to many more legal considerations when properly setting up your marijuana delivery business. Our cannabis business attorneys will show you how to navigate potential federal legal obstacles while also being compliant with state and city regulations. The Los Angeles Cannabis Law Group represents growers, dispensaries, collectives, patients and those facing marijuana charges. Call us at 949-375-4734.

Additional Resources:

Hesperia council votes to expand cannabis business zone, November 26, 2017, By Rene Ray De La Cruz, The Daily Press

More Blog Entries:

New Regulations Require Cannabis Delivery Services to Rethink Their Business Models, October 9, 2017, by Cannabis Law Group

How Delivery Services Are Adapting Their Business Models Marijuana delivery services in California have taken many creative approaches to the question of how to develop a business strategy around delivery restrictions and regulations. TechCrunch reports that Eaze – a marijuana delivery service – has recently raised $27 million in Series B financing after spending $24.5 million in venture capital. This large influx of cash is supporting an aggressive growth strategy. When questioned about the wisdom of spending $1 million per month in cash, CEO Jim Patterson responded that the company is investing in growth before the imminent legalization of sales of recreational marijuana. Patterson also dismissed concerns over large delivery logistics companies, such as Amazon, getting into the marijuana delivery market, citing the complications of marijuana regulations at the federal level. Delivery services have particular business opportunities in geographic areas where marijuana sales are only permitted via delivery. According to the North Bay Business Journal, Marin County is considering an ordinance that would allow delivery-only medical cannabis businesses to operate within the county. Other cannabis businesses are prohibited from the county entirely. This, too, raises larger issues of how delivery services can sustain both short and long-term business growth. In developing successful business plan, the first and most important step is to ensure compliance with all state, county, city, and other local regulations. NBC San Diego reports that thousands of unlicensed delivery services are learning this lesson the hard way. After spending the past eighteen months targeting unlicensed retail marijuana stores, the San Diego Police Department’s Narcotics Unit has now shifting its focus to unlicensed marijuana delivery services. NBC’s investigation revealed that less than 5% of the San Diego marijuana delivery services it found were properly licensed. Now, those business owners face criminal charges, seizure of their assets, fines, and other costly penalties. Successful businesses must comply with myriad regulations at the state and local levels while avoiding federal prosecutions. They must also compete with larger retailers and delivery logistics companies, as well as new and developing technology in the sector.An Orange County cannabis business licensing lawyer can help marijuana delivery services stay compliant with upcoming changes in recreational use laws, while also creating business plans that will sustain profitable operations. The Los Angeles Cannabis Law Group represents growers, dispensaries, collectives, patients and those facing marijuana charges. Call us at 949-375-4734. Additional Resources: California to Ban Legal Cannabis Delivery By Robot, Drone, Bicycle or Boat, September 14, 2017, by Janet Burns, Forbes More Blog Entries: California: No Marijuana Delivery With Drones, September 17, 2017, by Cannabis Law Group