Motley Fool Article: This new study could be the fuel that lights Sessions’ fire
As the Los Angeles Times reported a week earlier, an in-state analysis that the Department of Food and Agriculture commissioned found that California produced at least 13.5 million pounds of weed last year, but that only 2.5 million pounds was consumed. Where’d the other 11 million pounds go? That’s the mystery the state is trying to solve, though experts have suggested that much of it might be illegally leaving the state.
As the Los Angeles Times noted, during a two-day stretch in August, highway troopers in Texas seized some $2.5 million worth of marijuana from vehicles that had originated in California. Nearly 430 pounds were confiscated. Of course, that’s a far cry from the 11 million-pound difference between production and consumption in California last year. This large gap, along with a perceived lack of oversight, could be just what Sessions needs to garner the support required to go after legally operating medical and recreational businesses operating within California.
Then again, it could also be argued that California has already been catching the attention of the federal government. Last year, the U.S. Drug Enforcement Agency seized 5.3 million plants — and 3.78 million of them came from California.
Officials in California plan to address interstate trafficking and oversupply regulations before recreational sales commence in 2018, but you can probably expect the federal government and California’s growers to be on edge.
California’s recreational cannabis market is set to open in January 2018, but regulators have yet to release details for how distribution licensing will work for what looks to be a $500-million logistics industry regionally.
The California Bureau of Cannabis Control is responsible for setting the licensing requirements for distributors. In June, the Medicinal and Adult-use Cannabis Regulation and Safety Act, or MAUCRSA, created one regulatory system for both medicinal and adult-use cannabis. But it has yet to release the rules regarding distribution licensing.
If distribution licensing is not ready to go in January, it “could be a big mess for the industry,” said Alison Malsbury, an attorney with the law firm Harris Brickson, who serves clients in the cannabis industry.
The state has not released much information on the issue, Malsbury said.
Trucks.com contacted the board multiple times for an interview but did not receive a response.
Under the forthcoming regulations, companies that grow their own cannabis or produce their own products will be allowed to use a licensed distributor or self-distribute, Steve DeAngelo, co-founder and chief executive of Harborside Health Center, told Trucks.com.
Harborside is the largest medical cannabis dispensary in the country and reaches more than 200,000 registered and certified patients in California. The company cultivates cannabis at its own farm to sell at its dispensaries in Oakland and San Jose.
“But what isn’t clear to me is if that will be rolled into your regular license or if you’ll need an additional license for self-distribution,” DeAngelo said.
What is clear is that anyone who transports more than an ounce of cannabis will need a distribution license. Distributors will not only be responsible for transportation but also testing, quality assurance and compliance with packaging and labeling, Malsbury said.
This is different from the alcohol industry where there are mandatory separations between distribution and manufacturing.
“It’s going to be a lot more involved with a much higher level of responsibility than we initially thought,” Malsbury said.
CalCannabis Cultivation Licensing, an office within the California Department of Food and Agriculture, is implementing a “track-and-trace” system to record the movement of cannabis through the distribution chain.
Local law would allow first medical marijuana shops in Santa Monica
Three months before California begins issuing business licenses for recreational pot, the City Council will debate a new ordinance to allow medical dispensaries to open for the first time in Santa Monica. The ordinance will prohibit recreational shops while allowing two dispensaries and “light manufacturing” of medical cannabis products within city limits. The Council will consider three main topics when it comes to Tuesday’s discussion: medical, recreational and taxes.
Medical: the City heads into the weeds
Existing law limits the city to two medical pot shops. The new ordinance establishes a selection process to choose two operators of those licenses.
“The RFA evaluation process would rank the applicants,” reads a report from David Martin, director of administration for the City. “The Director of Planning and Community Development, or designee, would review the committee evaluation and background check results from the Police Department, and he/she would be authorized to request additional information to ensure that the rankings are completed fairly.”
Once the business owner receives the correct local and state permits, he or she will pay a $17,000 conditional use permit among other fees and taxes. Medical cannabis is exempt from current sales taxes.
The shops may open in one of three areas designated by the City: on Wilshire Boulevard between Lincoln and Centinela Avenue, Santa Monica Boulevard between Lincoln and 20th Street, or Santa Monica between 23rd Street and Centinela Avenue. The stores are allowed to grow marijuana but can be no larger than 2,500 square feet. The shops may not be within 600 feet of a school, daycare, park, library, social services center, or the other cannabis business.
Governor Jerry Brown signed a bill this summer that consolidated marijuana regulations – basically combining the framework for medical and recreational shops. However, the state is maintaining separate licenses for the two sides of the industry, “presumably so that in the event of greater federal intervention into the cannabis legalization movement by the States, the medicinal program could continue,” according to the report.