In this edition, we are going to start local, San Francisco, then report on activities in the State ending with an interesting new promulgation in Canada which could be emblematic of rules that may eventually permeate south of the Canadian border.

The City by the Bay/San Francisco officials have created the Cannabis Oversight Committee, proposed by Supervisor Sandra Fewer, with the goal of overseeing the Office of Cannabis to figure if they are being effective. I am sure if you asked any cannabis operator in the City, the response would be a unified, no. San Francisco seems to be having an issue in approving “Equity” permits for applicants negatively impacted by the failed War on Drugs and previously created a cannabis equity program as part of The City’s recreational cannabis regulations.  Supervisor Fewer wanted to create a commission with more powers over permitting and personnel in the Office of Cannabis, but had to settle for the committee after the industry pushed back.  “We really want to hear on the ground, is it working?” Fewer said. “Does it need amendments? How should we amend this? How should we meet the needs of our equity applicants?” The committee would have nine voting members and five non-voting members, with representation of labor unions, cannabis business owners, equity applicants and workforce training andedical cannabis patients.

Another huge issue for SF has been its inability to issue new permits.  In January, the City allowed existing medical dispensaries to use temporary permits to start selling retail cannabis, but it has not issued any new permits.  The issues arises over the office of Cannabis, which is charged with the permitting and regulating, has only three full time staff members and, hard to believe, a huge workload.  I digress, a simplistic solution may be to use the excessive taxes imposed on SF cannabis companies and hire more staff, #justsaying. City Administrator Naomi Kelly stated that “with a workload of over 260 permit applications, implementation and further development of the Equity Program, coordination of city enforcement activities, advocacy around state related matters, and community outreach, the continued and growing responsibilities of the Office of Cannabis have already left the three member staff with a workload that has stretched them thin.”  She is working “to address the current and temporary staffing needs in next year’s budget submission.”  The newly minted Oversight committee will commence on January 1st and issue a report within six months. Godspeed!

Not a week goes by without more enforcement against the undocumented cannabis companies.  Paper-up everyone, enforcement is only picking up.   In California, there was a 39-county sting operation of 250 illegal cultivations, with arrests of 53 people and 614,000 plants seized.  The State is picking up the pace of enforcement against black market operators, as it negatively impacts licensed businesses as well as deprives the State of sizable tax revenue.  Here are some of the most recent enforcement activities: The Santa Barbara County Sheriff’s Cannabis Enforcement team destroyed more than 8,500 cannabis plants at two unlicensed grows valued at more than $4.3 million. The Santa Barbara County Sheriff’s Office, in a separate action, destroyed 5,473 marijuana plants valued at $2.7 million at three unlicensed grows.  The Kern County Sheriff’s Office raided three Oildale dispensaries, arrested five men, and confiscated more than 43 marijuana plants, 280 pounds or flower, 1,228 packages of edibles, and more than 17,800 grams of cannabis concentrates. Recreational marijuana is illegal in Kern County.  The Kern County Sheriff’s Office, in a different action, raided two Northwest Bakersfield dispensaries, arrested seven people and seized 73 pounds of marijuana, more than 6,200 grams of concentrates, 1,035 packages of edibles and 17 marijuana plants.  The Humboldt County Sheriff’s Office destroyed 2,139 cannabis plants in a raid on an alleged illegal cultivation operation in Blocksburg. The cultivators face up to $121,000 in violations per day. The California Highway Patrol arrested a Florida man who was transporting 850 pounds of cannabis that he allegedly planned to sell on the black market to cannabis retailers.

Don’t even get me started on San Diego, a difficult spot for cannabis.  Authorities announced the arrest of two people they suspect ran Leaf Life delivery service out of their home, seizing 50 pounds of products, and $3,500 in cash. San Diego might lead the state in delivery busts as it has been at it since medical legalization in 1996.  In August, San Diego authorities announced the arrest of 34 people, seizing 230 pounds and $60,000 in cash. In June, San Diego authorities they apprehended five people running Fast Grass delivery with 30 pounds of weed, four grams of meth, and $1,800 in cash.  Los Angeles also makes delivery interdiction a priority. In September, Los Angeles announced a nine-month arrest tally of 515 people, comprising 101 delivery businesses.  State officials at the Bureau of Cannabis Control recently began delivery enforcement.

The problem is that access to legal cannabis remains spotty in many portions of the state.  It is estimated that only a quarter of the state’s cities and counties allow retail stores and delivery. Cities demand local control over the cannabis trade, but few have the skills or money to regulate it.   More legal delivery options could draw consumers away from the illicit market.  But police, cities, and a cannabis union of physical stores are pressuring the BCC to ban licensed statewide delivery. Police continue to say licensed delivery options are not safe.  Others disagree. Licensed cannabis delivery drivers are required to comply with more state and local rules, than those regulations covering police firearms. The delivery hide and seek game will continue in the near term.

I rarely write about things outside of our bubble we call California, however, there are times when it seems relevant.  Canada is working on how it should treat legal cannabis consumption for off duty for police officers. This goes to the heart of personal consumption of a legal substance with potential employer ramifications. We are addressing off the job consumption by police.  Even after the fall of Prohibition, no laws were promulgated to curtail your at home consumption.  Well, cannabis is not alcohol.  In Canada, so far, there are conflicting rules.  Four Canadian cities have come out in favor of consumption. Vancouver, Ottawa, Regina and Montreal will all let their officers use cannabis off duty, recreationally.  The only caveat should be whether they are fit for service when reporting for duty. Those drafting the policies say they are appealing to “common sense” regulations: “It’s just like any other workplace: you can’t come to work if you’re impaired by alcohol or a drug, even if the drug is prescription medicine,” Supt David Haye of the Saskatoon police stated.

Not all Canadian jurisdictions agree with common sense.  Calgary introduced a zero-consumption policy. “[Officers] who are qualified to use firearms and are able to be operationally deployed, as well as sworn police recruits, are prohibited from using recreational cannabis on or off duty.” Push back by the union representing the officers has already moved forward to counter the harsh policies.  In contrast to harsh Calgary, the Canadian military allows its soldiers to consume or ingest cannabis as long as it is at least eight hours before reporting for duty. Now that full legalization is here, the next issue to permeate the discussion is how to determine cannabis sobriety while driving.  Canada’s justice department has approved the use of a saliva testing kit to test for impaired driving under the influence. Canada is using a kit, used both in Germany and the UK, which will determine cannabis consumption in the last 6 hours.  That begs the question that after six hours are you really still high or impaired?

Tailored Benefits is an employee benefits company that has had cannabis clients for over eleven years. Jeffrey Rosen, Tailored Benefit’s founder, practiced law for ten (10) years in San Francisco, Silicon Valley & Taipei, Taiwan. He has run an employee benefits company for over twenty years. Tailored Benefits’ has evolved over the past several decades to play an integral part in the cannabis industry and specifically Employee Benefits. With the surge in demand for cannabis employees, Tailored Benefits’ specific cannabis employee benefit solutions is how you can set yourself apart, attract and retain valuable employees.

If you need more information on how to insure your cannabis business, Tailored Benefits is here to guide you and keep you informed on local and federal policies.

All the best,

Jeffrey Rosen, President

(415) 974-1114