Dispensaries face an uncertain landscape with changes slated for California’s regulations
By Rachel Cavanaugh
With the buzz still echoing over Alaska and Oregon’s move to legalize recreational cannabis, momentum has been growing in California to follow suit.
The western state – which pioneered medicinal marijuana legislation in 1996 – is now, rather improbably, the only remaining spot on the West Coast where the plant remains illegal for recreational use.
Speculation has been mounting that 2016 will bring an overdue victory for California’s cannabis advocates, giving dispensaries throughout the state reason to begin preparing for the possibility of major changes.
“Luckily, our accountant is a big proponent of future legalization so he has been following Colorado’s efforts closely,” said Leah Abdenour, one of the owners of Los Angeles-based Green Shield Patients Cooperative. “He has us on a proper taxation regimen that will hopefully allow us to be considered at the forefront to apply for a business once legalization hits.”
That means her dispensary is following tax requirements “to the T,” she said, and taking measures to promote and protect its image.
“We do not overwhelm ourselves by pushing too hard too fast. We are not looking to make a profit and split, nor are we looking to burn out quickly,” she said.
If legalized, she said, Green Shield plans to carry “every cannabis product that is consciously sourced and has integral quality,” whether intended for recreational or medical uses.
New infrastructure would likely have to be put in place to get recreational sales online; however, the amount would depend on how many other shops get into the business.
“If I’m just spit-balling, I’d guess I would have to double or triple our staff to accommodate the influx of new customers,” she said.
Yet the business owner noted that many of the sluggish protocols she currently deals with would be eliminated.
For example, dispensaries would no longer have to handle photo IDs in conjunction with medical authorizations, proofs of residency or other red-tape paperwork. Businesses likely wouldn’t have to track caps on how much can be carried, or who can be present during sales.
At the moment, cannabis is approved for medical use in 23 states and for recreational use in Washington, Colorado, Oregon and Alaska. It is also legal for both purposes in the District of Columbia.
In California, at least four legalization initiatives have been filed for the 2016 election. Although it is doubtful all of them will make the 2016 ballot, it is safe to say that some sort of recreational cannabis initiative will likely be put to a public vote next year.
If and when that occurs, there are many signs suggesting it will pass.
According to a Public Policy Institute of California survey released in May, 53% of California residents are now in support of legalization.
On July 7, San Francisco’s Board of Supervisors approved a 22-member Cannabis State Legalization Task Force to prepare the city for the event of legalization. The state Legislature is currently considering several bills related to cannabis decriminalization or a retooling of the state’s medical marijuana program.
Last year, California voters downgraded marijuana possession to a misdemeanor under Proposition 47. President Barack Obama has pushed for making marijuana prosecution a low priority and numerous law enforcement agencies have de-prioritized the arrest of cannabis users. However, dispensary owners and cultivators have continued to remain targets of DEA and local law enforcement raids, more so than any other state in the nation.
Fear of prosecution and drawing the eye of the federal government remain significant concerns for those in California’s cannabis industry, even for businesses that are following the letter of the state law. Most dispensary owners contacted by Marijuana Venture declined to comment regarding their businesses and the potential for future legislation.
Abdenour said decriminalization would help standardize regulations and benefit the industry as a whole.
“I have been in the industry for eight years, either as a budtender, manager, marketer, advocate or consultant,” she said. “Now I am an owner. I have seen the vague structure of the law and how little it is properly regulated. I have seen most collectives and clinics operate in this gray area, which creates frustration and confusion on what the law actually is for business owners and patients.
“So often, people come in for a quick profit, do not follow the medical marijuana protocols, collect the money, then skip out without any accountability for the law. So little regulation is actually being enforced that it eventually makes most of us go, ‘Why bother following the law then?’”
Yet she also stressed that a 2016 victory shouldn’t be viewed as a given. In her opinion, there is about a 75% chance.
“Many people think it is inevitable but I’ve been to some advocate events and that isn’t exactly the case,” she said. “It is still a battle some are fighting every day.”
Certainly there are some that believe the timing is not right for recreational cannabis in California.
Olivia Alexander, founder and CEO of The Crystal Cult, said the scope of national legislation is more important to her than local laws.
The Crystal Cult is California-based online retailer of cannabis-related products specifically geared toward women.
“I’m not preparing for (changes in California’s cannabis laws), to be honest,” Alexander said. “We don’t really feel there’s anything wrong with our medical system.”
She said factors like intellectual property protection and the banking problem are national issues that currently take precedent over revamping local laws.
Even as a business that primarily focuses on paraphernalia, Crystal Cult’s bank account “is always a day away from being cancelled,” Alexander said. “There’s a lot on the line every single day.”
In the long run, the transition to allow all forms of cannabis possession and consumption in California is more about timing, she said.
“Once we go recreational, there’s a lot of doors that get opened,” she said. “I would hate for us to legalize too soon, just because Colorado did it, and then make mistakes. We have a little more work to do before we’re ready for free market.”
As the fight escalates, advocates and opponents alike appear keenly aware of the power California holds to sway national opinion. Most concur that whichever side wins will set the precedent for nationwide cannabis laws, making the debate that much more heated.
Abdenour said her only fear if marijuana becomes legal in California is that regulatory agencies will group it along with alcohol, tobacco and other “naughty stuff.”
“Cannabis is not the naughty stuff,” she said. “It is not something that should be disrespectfully lumped in with tobacco and alcohol. … We have fought too long for it to be recognized as the truly beneficial plant medicine that it is.”