The money will be earmarked to:

• Extend technical assistance.
• Waive or reduce licensing fees.
• Help with recruitment.
• Training and retention of a workforce that’s not only qualified but diverse.
• Measures of business resilience, like emergency preparedness plans.

At least $23 million will be set aside for no- or low-interest loans to cannabis businesses or applicants from places disproportionately impacted by disparate marijuana prohibition enforcement. The goal is to right the wrongs of past discrimination and also promote diversity.

Among the designated areas where pot shop owners can apply to receive equity business development grants include:

• Oakland – $5.6 million
• Los Angeles – $6 million
• San Francisco $5 million
• Sacramento – $3.8 million

Criminalization of the plant had a more sizable impact on these communities and populations throughout the state, in part resulting in these individuals having a more difficult time successfully breaking into the burgeoning industry. They had less access to capital to launch a business, in turn making it tougher to secure the space, tech support and help with regulatory compliance issues.

The grant money is intended to help with these elements, which not only bolsters these individuals but helps to reduce the threat of black market sales in California.

California isn’t alone in taking such action. Washington state also recently did the same thing.

But social equity programs still don’t eliminate the disproportionate impact.

Disparity in Marijuana Possession Enforcement Persists

The ACLU recently reported that even as overall marijuana arrests have fallen since Prop. 64 was passed in 2016, enforcement continues to be disparate along racial lines.

In some states where marijuana has yet to be decriminalized, police are arresting black individuals at a 10-fold higher rate than their white counterparts, despite being no more likely to use or sell the drug. Nationally, black people are nearly four times as likely to be arrested for marijuana possession as white people. There is not a single state where marijuana possession arrests are relatively equal across racial lines.

In 2018, arrests for marijuana still accounted for almost half of all drug-related arrests. Nearly 90 percent of those were for simple possession.

Although legalization has slashed the number of overall marijuana arrests across the board, it has not substantially reduced or eliminated the much higher arrests rates of black individuals. On average, states where marijuana is legal tend to have lower racial disparities in enforcement, but they still exist.

L.A. Marijuana Business Lawyers Can Help With Equity Loan Applications

The lasting damage of the War on Drugs can’t be undone. Still, our L.A. marijuana business lawyers agree with the ACLU’s mitigation recommendations, which are:

• Legalization of marijuana by the federal and all state governments;
• Expunging of prior marijuana convictions;
• Clemency to those still incarcerated on marijuana charges;
• Legal marijuana marketplaces should be made more accessible to those living in communities harmed by the decades-long drug war.

Our marijuana business lawyers are available to assist you in applying for this grant money to secure the capital you need to get your cannabis company off the ground.

The Los Angeles CANNABIS LAW Group represents growers, dispensaries, ancillary companies, patients, doctors and those facing marijuana charges. Call us at 949-375-4734.

Additional Resources:

Cannabis Equity Grants Program for Local Jurisdictions, April 21, 2020, California Governor’s Office of Business and Economic Development

California voted to legalize cannabis use in adults aged 21 and older, three years ago now. And in that time, the legal marijuana industry has grown rapidly. Cannabis market research firm, BDS Analytics, predicts legal cannabis sales will exceed $3.1 billion this year alone, and forecasts sales will continue to grow to an estimated $7.2 billion by 2024.

Growth of this kind has come to fruition despite California’s complex legal structure, which incorporates in excess of twenty different cannabis license types, four varying regulatory agencies, and exorbitant taxes that industry insiders say are driving customers to the illicit market for cheaper alternatives.

Regulating Nimble Markets By current standards, our Southern California marijuana lawyers believe achieving effective regulation of the cannabis marketplace has been a challenge. Perhaps because government agencies are typically rigid institutions, that can struggle to keep pace with the more nimble new industries. Most young marketplaces experience rapid innovation in their early days, with technological updates coming in quick succession, and as those changes roll out, policy updates tend to accompany them. The pace at which those policy updates can be enacted is often the sticking point. And this has certainly been the case for California’s licensed cannabis industry, long crying out for tax reforms to better help legal businesses complete with unregulated sellers.

So Many Regulating Bodies Cannabis in the state of California is currently regulated by no less than three different bureaus. Retailers, distributors, mirco-businesses, delivery services, lab testing and events are overseen by the Bureau of Cannabis Control. While growers and cultivators are regulated by the Department of Agriculture, and manufacturers report to the Department of Public Health.

A Complicated Tax System California’s existing cannabis taxation system is also complicated. Business operators pay local and state taxes, cultivators pay distributors a cultivation tax, which distributors then pay to the state, and on top of that, an excise tax is also in effect.

Consumers ultimately pay the excise taxes, as they are built into retail prices, but they are collected by distributors. Most complicated within the current policy, is the part requiring the state’s tax department to twice a year estimate a wholesale tax rate that will ensure distributors pay taxes equal to 15 percent of gross recipients at retail. The governor’s new proposal instead aims to simplify things dramatically, by calling on retailers to collect tax directly from consumers, before paying it onward to the state.

Implications By streamlining agency efforts and establishing a central Department of Cannabis Control, the industry hope is that feedback can be collected, reforms promoting industry growth enacted, and everyday regulating responsibilities carried out far more efficiently and effectively. Combining regulator efforts will also enable regulators to limit possible contradictions between agencies. While industry insiders are skeptical, after such a long haul on their part to reach this point, they are also hopeful policy changes of this nature will encourage continued innovation, and facilitate a smoother running of business throughout the entire industry.

And while updating the cannabis tax policies will streamline matters, it will also place a greater onus on retailers. With the proposed tax structure, retailers must ensure their account keeping is accurate. If not, and if they fall behind with their monthly taxes, businesses may be forcibly shut down and properties may incur liens.

As California is the nation’s largest cannabis market, statewide industry changes are expected to cause a flow-on affect to other markets that look to California to learn from, and to try to avoid any missteps.

The Los Angeles CANNABIS LAW Group represents growers, dispensaries, ancillary companies, patients, doctors and those facing marijuana charges. Call us at 949-375-4734. Additional Resources: 2020-2021 Governor’s Budget – Proposed Budget Summary (All Chapters)

The Orange County Register reports The Pentagon is reviewing the federal security clearance of California tech billionaire Elon Musk following an on-air marijuana toke on a comedian’s podcast last fall. Musk reportedly refiled the SF-86 security form required of federal contractors and/or employees who seek security clearance. The form requires filers to answer truthfully whether they have used any illegal drugs at any point in the previous seven years. Musk reportedly had a higher-level secret clearance, thanks to his position spearheading a company (Space Exploration Technologies Corp. – SpaceX for short) that is permitted launch of military spy satellites.

The company’s day-to-day operations aren’t overseen by Musk, and the company won several national security space launch contracts in the wake of the podcast, but the Register reports it’s only with the refiling that Musk may have some issues.

Employers, Contractors Allowed to Set Ground Rules for Off-the-Clock Cannabis Use

Los Angeles marijuana employment attorneys know that while most people aren’t grappling with billions of dollars or military spy programs and top-level security clearance, many ARE dealing with employers who are leery of cannabis use.

Some key points for employees to know are:

• Federal law places very few restrictions on employer drug testing of employees or prospective hires.
• The right to drug test employees/potential hires extends beyond just those in government jobs to those in the private sector too.
• California courts have held that the employer’s reason for drug testing does need to be balanced with the right of the employee for privacy.
• State courts have held it is lawful for employers in California to require applicants to pass a drug test as a condition of employment – so long as all applicants for a certain position are tested and there is no singling-out of applicants on an unlawful basis.

Although California law allows individuals to use marijuana for medicine or for recreation, there is no requirement that employers must hire a person who tests positive for marijuana. In fact, the California Supreme Court has held that employers are not required to do so – even if they are prescribed the drug for a disability.

Still, employers may be on less solid legal ground in drug-testing existing employees, absent some reason to suspect drug use.

In most cases, one’s off-the-clock use of the drug in California is increasingly less of an issue, as the stigma of marijuana use subsides. But as Musk found out, even billionaires aren’t necessarily immune from the impact in some cases, particularly considering marijuana use remains a federal crime, despite the fact that nearly three dozen states have taken measures to decriminalize it.

How On-Air Use of Pot Could Impact Musk’s Security Clearance

Musk’s decision to smoke marijuana during a podcast discussion with comedian Joe Rogan highlights the discrepancies between state and federal law pertaining to marijuana, but as many federal attorneys noted, the security clearance challenges should come as no surprise.

Although it’s possible the U.S. Defense Department could simply close the case and update Musk’s record without issue, it should be noted that smoking marijuana is considered a “serious breach of security protocol” and rounds for termination of a federal employee or loss of clearance for a contractor. A department spokesperson said the agency doesn’t comment on individual applications, reapplications and reviews for individual security clearances.

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

Additional Resources:

Elon Musk’s security clearance under review over pot use, March 7, 2019, Bloomberg

More Blog Entries:

San Bernardino Cannabis Landlord Arrested in Raid at Her Home, March 11, 2019, L.A. Marijuana Employment Attorney Blog

Recently in Oregon, a marijuana business owner filed a lawsuit to ask his nephew and former business partner to halt harassment after the business relationship went downhill in the wake of major crop losses. According to Oregon Live, he is seeking $700,000 in damages. In a separate lawsuit filed by attorneys for the marijuana business itself, plaintiff alleges the nephew and one-time co-owner, of defamation and trademark infringement. The company alleges defendant’s inability to produce a marketable flower with any degree of consistency cost the company several million dollars, and is seeking $2.6 million in compensation.

Plaintiff alleges that the flowers grown under defendant partner’s care were total losses in terms of a shelf-worthy flower, and that this was the result of breach of contract on his part. The company owns and operates a production facility on more than 80 acres in Central Oregon, as well as a retail store in a downtown area. The company seeks to grow with retail locations in three other cities, including Portland, where it has applied for a license.

Breach of Contract in Marijuana Business

To craft a marijuana business contract that is going to hold up in court, you need to be working with an experienced marijuana business lawyer. If you aren’t careful, your cannabis contract won’t be worth the paper on which it is written – so long as federal marijuana prohibition remains the law of the land.

In many cases, these contracts must:

• Acknowledge the federal legal status of the drug. Although pointing out the illegality of the substance might seem odd, when you expressly acknowledge that your business includes the process of growing, processing, testing or selling marijuana in contrast to federal law, it gives you a point at which to refute any illegality offense the other side might make.
• Waiver of illegality defense. This goes along the same lines as the other in making it clear no one anticipates being able to make such an argument in the future should a dispute arise.
• Selection of forum. This is important because unlike other businesses and markets, the cannabis is industry is one that is very closed-borders. It must operate strictly intrastate in order to avoid federal scrutiny (to whatever extent that is possible). While the people and businesses with whom you’re dealing hands-on are likely to be located in your home state, our L.A. marijuana lawyers are quick to point out to our clients that a lot of the ancillary businesses with whom you are working may not. These include a number of suppliers of materials used in grow, production and retail. Stipulating the legal forum in which disputes must be resolved can help you avoid getting something dragged into federal court later (where the issue of illegality becomes a bigger one).

Of course, none of this should be construed as legal advice by any marijuana business, but we offer these general tidbits here to help explain why working with an experienced marijuana lawyer for business contracts is so critically important. These contracts are what you are going to be able to use with your employees and business-to-business contacts should a dispute arise.

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

Additional Resources:

Pot business break-up gets ugly, lawsuit says. Sept. 25, 2018, By Noelle Crombie, The Oregonian

More Blog Entries:

New L.A. Bud Businesses Can’t Ignore Legal Snares, Sept. 28, 2018, L.A. Marijuana Business Attorney Blog

marijuana after its city council voted overwhelmingly to regulate industry operations. The council passed a series of amendments that will set guidelines for cultivators, testing labs, distributors, and dispensaries in the city, according to an article from Press-Telegram. The 7-1 vote reflected a strong support from council, with the support of the mayor as well as the residents who voted for Proposition 64 in November 2016.

City staffers estimate the move could bring in about $750,000 in taxes from recreational sales next year and a whopping $4.5 million from medical marijuana taxes. City officials also hope to stimulate the economy with a clause that requires collective-bargaining agreements with United Food and Commercial Workers 324, the union that represents cannabis workers, raising the bar on the quality of jobs provided by local establishments. Long Beach also joins other California cities in creating social equity programs, designed to lift up communities most harmed in the past by reckless marijuana law enforcement policies. Those who qualify will have certain fees waived, have their applications fast-tracked for review, get access to special workshops, and qualify for tax deferrals. Restrictions for the program include meeting certain income requirements. More specifically, a person would need to have less than $250,000 net worth and fall below 80 percent of the local median income. They also would have to have an arrest, conviction, or citation spurred by a marijuana-related offense before recreational marijuana was passed in the state. In lieu of legal troubles, a person could also qualify if they lived in a census tract of Long Beach in which more than half the population lived below 80 percent of the median income.

The city also has a network of rules they are putting in place in regards to licensing, how many dispensaries are allowed to operate, and where all operations are allowed to set up shop. This is where the help of an experienced attorney can make a big difference in how you manage your business. If you’re thinking of opening a new shop, setting up a consultation with one of our skilled Los Angeles marijuana business lawyers is the first step toward success. Our legal team knows the ins and outs of state and local laws, keeping up with changes that occur day by day, and can help you stay in compliance with those laws. This service alone takes a huge weight off your shoulders so you can focus on running your business with confidence knowing you don’t have to look over your shoulder for compliance officers. We also help you with the licensing and application processes, which you might not even realize often require more than just paperwork. Depending on the city, you likely will also have to appear before city council and planning commission for application reviews, a process which is much more relaxed with a knowledgeable attorney by your side.

Smart business owners seek out these services upfront so their operations are built on a solid foundation. Otherwise you might be seeking our help down the road to undo costly mistakes made in the beginning that can cause damage to your reputation and your business’s bottom line.

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:

City Council Moves Forward With Recreational Marijuana Sales Regulations, June 20, 2018, By Chris Haire, The Grunion

More Blog Entries:

Long Beach Moves Forward with Recreational Marijuana Business Plans, Dec. 30, 2017, Cannabis Law Group

concrete relief from the oppressive federal law that continues to bind the hands of marijuana businesses despite state legalization. The STATES Act, Strengthening the Tenth Amendment Through Entrusting States, is a more formal way of declaring that state laws regarding cannabis usurp the federal government’s Schedule I classification under Controlled Substances Act, 21 U.S.C. Section 812.

According to a report from Leafly, the bill allows representatives who refuse to step into the 21st Century to support marijuana businesses without taking a stance on marijuana at all. It turns the matter purely into a states’ rights issue, which has become the great unifier in the cannabis debate. It also removes industrial hemp from the definition of “marijuana,” freeing many industries that create products unrelated to the psychoactive properties of cannabis.The bill would help marijuana businesses owners clear a key hurdle they face daily in running a proper business: lack of banking options. As our L.A. marijuana business lawyers can explain, banks are under federal jurisdiction, and therefore must be in compliance with federal rules. By housing funds for cannabis businesses, they would knowingly be engaging in criminal activity in the eyes of the federal government, regardless of the laws within the state. The STATES bill would establish a federal law that would act as a buffer, declaring that following state guidelines in regards to marijuana would not be considered trafficking, thus freeing the banks. The importance of this step cannot be stressed enough. Not only will it make it easier for businesses to function at a base level, but it also will make operations infinitely safer. No longer will owners have to haul massive amounts of cash down long stretches of highway trying to get funds to tax offices. Retail locations as well will not have safes with troubling amounts of cash on-site. These are legitimate businesses and it is about time they be allowed to operate as such.

The bill has garnered support from banks and business owners, as well as Democrats and Republicans. It was introduced by Sen. Elizabeth Warren (D-MA) and Sen. Corey Gardner (R-CO) and received backing from at least 12 governors petitioning for the bill to advance, including California Gov. Jerry Brown. Sponsors of the bill in the House of Representatives included Rep. Rep. Dave Joyce (R-OH), Rep. Carlos Curbelo (R-FL), Rep. Ken Buck (R-CO), Rep. Jared Polis (D-CO), Rep. Barbara Lee (D-CA), and Rep. Earl Blumenauer (D-OR). Blumenauer has long been a champion of states rights for cannabis, acting as one of the sponsors of the Rohrabacher-Blumenauer Amendment (originally Rohrabacher-Farr), the amendment that has passed each spending bill since 2014. It created a patch that forbid the Justice Department from using funds to go after medical marijuana operations and users in states where it was legal. If passed, the STATES Act would go much further by putting an official law on the books, rather than something that would need to be passed again and again. It also would give blessing to the state activities, rather than the current system which continues to position the activities as criminal and simply prevents punishment of those crimes.

Navigating the tangled web of local, state, and federal cannabis laws can be a challenge for business owners. Our skilled marijuana business attorneys are well-equipped to clear those challenges and help your operations meet compliance standards so you can focus on your business and your customers.

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:

How Marijuana is Going to Become Bipartisan, June 7, 2018, By Paul Waldman, Washington Post

More Blog Entries:

Federal Budget Protects State Medical Marijuana Businesses, For Now, Feb. 14, 2018, Cannabis Law Group

Michigan, where recently an anti-marijuana action committee has flipped its stance in an attempt to try to gain control of state regulations, according to a Detroit Free Press report. The group, The Committee to Keep Pot Out of Neighborhoods and Schools, has been fighting a ballot proposal to legalize recreational marijuana in the state. However, as it is becoming more clear the initiative has growing support, the group is trying a different tactic: encouraging state legislators to fully legalize marijuana by passing an adult-use bill.

As our attorneys can explain, those opposing recreational cannabis in the state see the writing on the wall. They know if they allow the issue to appear on the November ballot, it has a strong chance of passing. However if group members can convince the Legislature to take up the initiative and amend it with strict regulations akin to the current medical marijuana guidelines, they are hoping to get a law on the books that is more restrictive than what voters might pass. One of the key differences would be how licenses are issued. Medical marijuana establishments currently obtain licenses through a board put in place by the governor, as well as House and Senate leaders. The ballot initiative would instead put licensing in the hands of the Licensing and Regulatory Affairs Department. In previous years, in order to pass a marijuana ballot initiative, advocates often had to jump through many hoops. They had to submit to studies to research the effects of marijuana on communities. They had to gather data from other states with marijuana laws. They had to make concessions, often only allowing medical marijuana, and sometimes putting deep, nearly prohibitive restrictions in place.

Now, though, cannabis advocates have a lot more leverage. More than half the states have medical marijuana laws that are helping tens of thousands of Americans with aches, pain, nausea, glaucoma, PTSD, and anxiety, among other health issues. With aging Baby Boomers looking for relief without too many side affects, cannabis has become a very appealing alternative to other medications. In addition, eight states and Washington, D.C., have legalized recreational marijuana without the apocalyptic results some naysayers predicted. In fact, local economies are benefitting from the new marketplace, and responsible users are enjoying an alternative to other traditional social lubricants, like alcohol. The proof is clear, and too many people are seeing the positive effects of cannabis to buy into the tired old propaganda anymore.

It’s no wonder, then, that we would see anti-marijuana groups desperate to keep a grasp on the legal landscape. It’s the old “If you can’t beat them, join them,” adage in some respects. Conversely, some lawmakers are in favor of the idea because they would rather not see a large turnout of people who might not align with them politically showing up at the polls during an important election cycle.

At the end of the day, all of us value safety and responsibility. It’s just more apparent to our Los Angeles marijuana business lawyers and our clients that these values are not in opposition to cannabis legalization. Our attorneys work hard to help marijuana businesses stay in compliance with state and local laws to support strong businesses and healthy and safe communities.

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:

Michigan May Legalize Recreational Marijuana Before November Ballot, April 5, 2018, By Adam Drury, High Times

More Blog Entries:

More States Look to Legalize Marijuana in 2018, Jan. 21, 2018, Cannabis Law Group

cannabis-related activity is still banned: No recreational sales, no medical sales, no commercial growing, no testing, no distribution, no manufacturing. Residents can grow indoors for personal use or if they are a caretaker, but that’s it.

Still, officials know of more than 70 unlicensed sales operations in the city. Law enforcement agencies are stretched thin, however, so they have to prioritize their time and resources.

They recently focused their efforts on one specific dispensary, according to High Times, which was reported to be selling high-potency cannabis candy wrapped in packaging that was appealing to children. Agents seized 150 pounds of the candy and more than $200,000 after a two-month investigation of the dispensary. Six dispensary operators were given misdemeanor marijuana citations.

When it comes to sales of marijuana, which is still considered an illegal Schedule I narcotic under the federal Controlled Substances Act, 21 U.S.C. Section 812, it wouldn’t seem like packaging would be the top priority for law enforcement. However, keeping cannabis out of the hands of children has been a prevalent and important theme for everyone in the legalization process. No one on either side of the issue wants to see cannabis in the hands of children. Relevant restrictions have included keeping cannabis retailers a certain distance from parks, schools, and places where children regularly frequent, as well as making sure tax money is allocated for education and prevention programs geared at students. Further, regulations dictate that “packages and labels shall not be made to be attractive to children,” according to Medicinal and Adult-Use Cannabis Regulation and Safety Act Sec. 74. This is similar to cases involving cigarettes and branding that were deemed appealing to children, such as Joe Camel on Camel Cigarettes. The intent is to reduce the allure of cannabis to children or teens, or like it might be something they would enjoy. In the case of the cannabis candy, the packaging featured cartoon characters with silly names. Unlike cigarettes, candy is something children already consume, so there’s a real risk a child might eat the candy not knowing its true contents, which is something no one wants to see happen. Further, it was determined the candy was above the legal limit of THC for edibles.

If there’s one thing our Los Angeles marijuana business lawyers want our clients to know, it’s that you must, must, MUST run your business cleanly and in compliance with all laws. We understand this can be difficult to do with city laws constantly in flux and a sometimes complex combination of state and local regulations, but naiveté is not a viable defense. We also know marijuana has a playful air to it, so silly packaging might seem harmless or in line with your brand, but that doesn’t mean it’s allowed. Our lawyers stay on top of the law as it forms, and we have extensive knowledge of regulations. We can guide you through basic business decisions so you don’t make simple, but costly, mistakes. Remember, cutting corners on compliance early on can cost you big time down the road.

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:

Fresno Police Raid Marijuana Dispensary and Seize Candy on Concern Children Might Eat It, May 2, 2018, By Lewis Griswold, The Fresno Bee

More Blog Entries:

Los Angeles Medical Cannabis Candy Makers Speaks to Parents about Concerns, Oct. 12, 2016, Marijuana Business Lawyers Blog

In the early days of legalization, before marijuana reached the popularity it is enjoying today, the Internet was the best place for cannabis advocates, business owners, and medical practitioners to learn and to share information. YouTube has always played a big part in that. The highly visual platform was an ideal way to show growing methods and techniques to people on the other side of the country. Today, a bounty of resources exists, but these ground floor YouTube channels still have a wealth of experience to offer.Some say the decision could be related to ad revenue. Given that advertisements randomly appear before videos, advertisers sometimes protest when their ads appear in conjunction with content that does not align with their brand, as happened with some of the more alarming gun videos. However, given that medical cannabis and/or recreational marijuana are legal in 29 states and the District of Columbia (with several states on deck to legalize this year), it is clear the country is trending in a pro-cannabis direction. Therefore, it would be surprising that suddenly a rash of advertisers objected to the content after years of existence. YouTube also has the ability to demonetize a channel, meaning the channel can no longer reap the benefits of advertising. In fact, some of the channels that were shut down reported not being monetized in the first place, making their removal even more confounding. Further, most of the channels were educational in content. YouTube alleges such content is allowed so long as it does not promote or link to content that promotes the sale of illegal drugs (including cannabis, which still resides on the list of controlled substances as a Schedule I narcotic, according to Controlled Substances Act, 21 U.S.C. Section 812). Meanwhile, some banned channel operators have complained, channels that feature people smoking marijuana, dabbing, and other methods of getting high on-air, have largely remained untouched, giving little credence to claims that YouTube is concerned about promoting illegal activity.

Given the desperate attempts by some to stop the burgeoning cannabis industry, this sudden attack on cannabis advocacy videos with little-to-no explanation or communication seems highly suspicious. It is not uncommon for those in power to try to stop progress. That’s why our knowledgeable Los Angeles cannabis business attorneys are using our years of experience to fight alongside the marijuana industry and the residents of California who depend on it. We know the law and will use it to fight for your rights and push back on those who are trying to drag us back into the anti-marijuana dark ages.

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:

The Boring Narcs at YouTube are Banning Marijuana-Related Channels, May 4, 2018, By Mona Zhang, The Outline

More Blog Entries:

Google, Facebook Won’t Friend Cannabis Business Ads, April 14, 2018, Cannabis Law Group

• What? Proposition 64 was approved by voters and made legal adult-use marijuana.
• Who? Residents 21 years or older.
• When? As of Jan. 1, 2018.
• Where? Now, that’s a trickier matter.

Firstly, the state law did not automatically go into effect everywhere. From county to county, city to city, local governments have been making decisions about whether to maintain a ban on recreational cannabis or to legalize and set up regulations. Some of the big cities, like Los Angeles, San Francisco and San Diego have permitted recreational sales. Some areas, like Orange County, cultivation is allowed with restrictions, but manufacturing and retail are banned. Los Angeles took a different route, allowing retail but not cultivation or manufacturing. Other counties, like San Bernadino, don’t permit any recreational cannabis activity.

The confusion intensifies when you put a magnifying glass to one of those regions. Take Los Angeles for example, where the city is still ironing out where businesses are allowed to set up shop. Leaders have already agreed that marijuana retailers should not be within 700 feet of schools or public parks, also known as “sensitive use” locations. But the debate is still boiling as to what constitutes a “sensitive use” location, according to a report from KPCC, Southern California Public Radio.

Some council members have looked at areas where families and children congregate and have proposed adding extra restrictions to prevent marijuana businesses from opening nearby. While this in itself doesn’t seem unreasonable to most, the terms used to identify these regions can be too broad. In particular, city council added areas zoned as “open spaces” to the restricted locations, primarily with the intention of keeping cannabis retailers out of the LA River area. But in doing so, the council unwittingly also excluded streets with traffic medians, which all fall under open space zoning.

Advocates concede to having a buffer zone for the LA River, but point out that applying restrictions too broadly is unnecessary. One group has reached out requesting medians be removed from open space zoning. But while our law firm is pleased to see the city working so hard to cooperate with cannabis businesses and make room for them in the city, it does make it clear that council needs to be more considerate when making these rules. Especially with more restrictions possibly on the way. Council is currently considering creating buffers between parks in other cities that are near the Los Angeles border.

Our trusted cannabis business attorneys in Los Angeles know there are growing pains when introducing a new industry and all of its regulations into a city. We also know some of these regulations are a bit overly cautious, trying to ease the fears of those who are still hung up on myths about marijuana and marijuana users. Marijuana business owners want to comply with reasonable laws, but shouldn’t have to try to hit a moving target. If you’re setting up your marijuana retail shop in Los Angeles, our lawyers have the experience to help you establish yourself while navigating local and state restrictions.

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:

LA is Still Ironing Out Its Rules on Where Pot Shops Can Open, Feb. 16, 2018, By David Wagner, KPCC Southern California Public Radio

More Blog Entries:

Los Angeles Marijuana Businesses Miss Jan. 1 Rollout, Jan. 2, 2018, Cannabis Law Group

Because marijuana is still illegal at the federal level (a fact that seems unlikely to change under the current administration), federally-backed banking institutions are vulnerable to potential seizure of funds by the FDIC if they accept money derived from criminal activity. Essentially, these financial firms can be prosecuted for money laundering. The result is that the majority of marijuana businesses – about 70 percent – don’t have a bank account. There are only a few banks that will accept marijuana business clients, and they rarely advertise it.

As an article in The Economist recently noted, this fact put some cannabis farmers in Northern California in serious financial jeopardy when the wildfires consumed not only their crops, but their cash. In one instance, a cannabis genetics consulting firm lost $250,000 that had been stashed in a cabinet. Another cannabis cooperative in Medicino County reported the loss of hundreds of thousands of dollars by some 20 members who buried their cash and gold stashes – only one of which was buried deep enough to survive destruction.

Although Proposition 64 broadened the legalized use and sale of marijuana in California, it did nothing to ease the federal banking regulations that have financial institutions reticent to take work with cannabis companies. The reality is unless there is some action on this front at the federal level, these kinds of issues will continue to occur.

Our cannabis business attorneys in Los Angeles know that this federal-state conflict sets off a number of other issues.

Because these firms operate primarily in cash, they are at risk of robbery. Cannabis business owners know that if they want to stay operational, they must invest in tight security measures. This is further underscored by the fact that California’s new recreational cannabis regulations require minimal security levels, though most already have some type of system in place.

Authorities have expressed concerns that because these businesses mostly deal with untraceable cash, they will be targets – or facilitators of – public corruption, specifically bribes or kickbacks for profitable licensing and permits.

Another common issue is insurance coverage. We saw this with the recent wildfires too. Although insurance coverage would provide security for natural disasters, many marijuana businesses can’t afford the coverage.

One alternative to which some businesses are turning are so-called “cryptocurrencies.” These are transaction forms such as bitcoin that many are banking on being safer from prosecution, theft or natural disasters. As noted by a Bloomberg analysis earlier this year, these kinds of digital coin services create an intermediary that allows cannabis companies to use bank-issued credit cards for transactions. These operations are still transparent, but don’t require access to traditional banking services. Customers can use their credit cards to buy digital credits for a transaction fee and cannabis companies that accept that type of currency. These digital currency services say they have taken a number of steps to ensure compliance with federal law, but it’s important to discuss your business practices with an experienced marijuana lawyer for maximum protection from federal and regulatory scrutiny.

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

Additional Resources:

Marijuana businesses, excluded from finance, are forced to use cash, Dec. 6, 2017, The Economist

More Blog Entries:

Federal Banking Regulations Make Dispensaries Robbery Targets, Nov. 18, 2017, L.A. Marijuana Business Attorney Blog