The California Cannabis Reform Project and Weed for Warriors organizations are working together to hammer out a ballot initiative that would, among other things, deprive local governments of the power to approve or deny licenses for cannabis business operators. They allege local governments have failed to wield that power effectively, in turn causing more harm than good, giving illegal operators a leg-up while making it harder for many law-abiding consumers in massive swaths of the state to obtain safe, legal cannabis.

As noted by analysis in the New York Times, roughly 8 in 10 of the state’s local governments have outlawed the sale of marijuana within their borders, effectively creating marijuana retail deserts. Local governments’ loss of control is effectively evidenced by the huge – and growing – illicit marijuana market.

Whether the ballot initiative has any hope of passing is questionable. As a Los Angeles attorney practicing cannabis law, I think it’s a fair assumption that local governments aren’t likely to cede any of the control they currently hold. A big part of the battle to pass Proposition 64 was gaining local government buy-in. Assurance of local control, while controversial, made it more digestible and was one of the only reasons some cities didn’t fight it harder.

However, five years in, it’s become clear that reform is necessary if we want to wrest control from the black market. Addressing issues of taxes and local control is going to be critical.

Organizations that represent cities so far haven’t commented on the effort, saying they don’t offer opinions on proposed ballot measures that have not officially qualified. Still, blanket statements were issued to the effect that local control of cannabis issues is something they still staunchly support.

Another element to the proposed ballot measure would be to restructure California cannabis taxes. The proposal would eliminate the cultivation tax, which is $9.65 per ounce of dry cannabis flower, $2.87 per ounce of dry cannabis leaves and $1.35 per ounce of dry weight for fresh cannabis plants. Further, it would reduce the existing excise tax, currently 15 percent of the average market price, to 5 percent. Further, it would bar local government entities from imposing any cannabis taxes. To compensate municipalities, it would grant local governments 1/5 of the total revenue of state excise taxes.

The effort of the cannabis activists is still in the early stages. Just getting the question in front of voters is estimated to cost $6 million on the low-side. The current planning phase involves discussions with lawmakers, lawyers and industry insiders and weighing whether such a measure would be best suited for presentation next year or in 2024.

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:

Should California reform its marijuana laws? Why advocates want cannabis back on the ballot, April 20, 2021, By Andrew Sheeler, Sacramento Bee

More Blog Entries:

California Cannabis Companies Should Expect More Audits, Taxes, March 30, 2021, Los Angeles Cannabis Lawyer Blog

In Desert Hot Springs, property developers are planning cannabis cultivation and distribution businesses that will serve as a prime location for the budding recreational marijuana industry. Leaders see the sites open for business by 2018. For example, one property developer is planning to be Southern California’s first stand-alone cannabis extraction facility in an old welding shop that used to be a barn. Other property owners are planning greenhouses that will span tens of thousands of square feet and destinations for locals and tourists alike.

With the passage of Proposition 64, California voters opened the door to what will soon be the single largest legal marijuana market in the country. Desert Hot Springs is one of those that is preparing to capitalize on that prospect. Characterized as a “bedroom community,” Desert Hot Springs is located in Coachella Valley and has a population of 26,000. It was the first community in Southern California to green light large-scale growth of marijuana. Currently, there are two dozen new marijuana businesses, and the hope is many more will be added over the next two years.

The town council reportedly derived its inspiration from the successes seen in both Colorado and Washington after those states legalized recreational marijuana in 2012 – the first in the nation to do so. Both states have now benefited from tens of millions of dollars annually in additional tax revenues. Further creating an incentive was the fact that Desert Hot Springs had declared a fiscal emergency following the Great Recession. Wading into the marijuana industry seemed like it could be a feasible solution, according to Independent.co.uk.

The mayor wasn’t on board immediately, having actually argued for a moratorium on opening new marijuana businesses when he first took over the post in 2007. He says at the time, he was a “plain No” when it came to marijuana legalization. But his ideology shifted, he said, when his mother and later a close friend were diagnosed with terminal cancer. In the last few months of his mother’s life, he said marijuana was the only substance that relieved her pain. It opened his eyes, he said, and he began holding meetings in the marijuana industry. These weren’t “stoner hippies.” They were doctors, lawyers, investors, dedicated parents and ethical business owners. It changed his viewpoint of what the industry is and how it could help people. From that point forward, his position was a complete 180-degree flip.

One of the property developers in Desert Hot Springs says he too was reticent when it came to entering the cannabis fray. However, he spoke at length with a marijuana business lawyer who explained to him that marijuana cultivation could be done legally.

It’s projected that growth in recreational and medical cannabis sales will near $25 billion by 2020, according to ArcView Market Research. Of course, this assumes that the new presidential administration doesn’t crack down on businesses that abide by state-level laws, but may still run afoul of the arcane – but still in effect – federal marijuana statutes.

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

Additional Resources:

The US town that wants to become the best place to grow cannabis in the world, Dec. 1, 2016, By Tim Walker, Independent UK

More Blog Entries:

Tainted Marijuana Health Alert Issued by Oregon Officials, Nov. 18, 2016, Southern California Marijuana Lawyer Blog