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24 Cities Sue State Over Regulations, Trying To Put An End To Pot Delivery

SACRAMENTO COUNTY (CBS13) — Two-dozen municipalities across California coming together to try to put an end to pot deliveries. Eleven local cities from Solano to Stanislaus counties have joined the lawsuit.

The state policy says marijuana companies can drive around and make home deliveries anywhere in the state, but leaders from 24 cities now want local control over who can deliver and where. Some marijuana companies say regulating deliveries will put the brakes on their businesses for good.

Maisha Bahati is co-owner of a new marijuana business: “Crystal Nugs.” The company only does delivery.

“We fought to get here. It took us two and a half years to get here,” Bahati said.

The Bureau of Cannabis Control developed delivery regulation over a two-year period.

“Everything is regulated to a ‘T.’ Everything is tested multiple times,” Bahati said.

She says the state also requires her to put her product on lockdown, literally. Every delivery has to be under lock and key in the back of her delivery car. She worries if the lawsuit passes, delivery businesses like hers won’t survive.

“That would certainly limit the radius that we could deliver. That could kill a new cannabis business overnight,” Bahati said.

She also worries about her clients who don’t drive and would somehow have to get to a dispensary.

“More so it hurts the consumers who rely on cannabis products. There are a lot of elderly that call us every week,” she said.

Two of the cities in the lawsuit are Ceres and Dixon. We spoke to city managers from both towns who call state-run delivery a “fatal flaw” for cannabis control.

“That’s not really the real local control we were looking for, and promised, with prop 64,” said Dixon City Manager Jim Lindley.

Ceres has two dispensaries, Dixon has one. Those businesses have local permits, but also relationships with leaders and law enforcement. These city managers say delivery drivers do not.

“With a delivery, we have no idea who is doing the delivery.  How is that person vetted? Who is the actual person doing the delivery? We’re not opposed to the delivery service at all. We just think the delivery service needs to be regulated like the rest of the industry,” said Toby Wells, Ceres City Manager.

The lawsuit was served to the Bureau of Cannabis Control on Tuesday. Leaders with the state-run organization said the public voted clearly for statewide delivery in 2016. Unless a Judge halts these services while the case is pending, drivers can continue to deliver.

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California legalized weed, but that doesn’t mean beach cities are embracing dispensaries

More than seven months after marijuana became legal in California for adults over 21, advocates have a lot to be thankful for and yet still much to be desired.

Cities up and down the coast where Proposition 64 in 2016 passed by some of the ballot measure’s highest margins have banned dispensaries.

They have prevented individuals from growing cannabis in their backyards.

And now, with the state’s California Bureau of Cannabis Control poised to adopt new rules permanently governing the adult use of marijuana, cities are lining up in opposition to a provision that would force them to allow delivery services. A 60-day public comment period on the rules ends Aug 26.

“We always wanted to preserve local control,” said Dustin Moore, a Manhattan Beach resident who served as the deputy campaign manager for the Yes on 64 campaign.

Local control was baked into the proposition, he said, giving cities the ability to prohibit if they wished how many dispensaries operated in their city, if any at all.

“Even in the eyes of what’s being interpreted now around delivery services, I would still argue it allows for local control,” Moore said. “What they (cities) don’t have the ability to do is prevent someone from driving on public roads and deliver to a private residence.”

Although many cities passed laws prohibiting delivery services, law enforcement officials have said there is virtually nothing they can do to enforce such restrictions. The issue of delivery services is essential to the original Compassionate Use Act of 1996, which said patients must be allowed safe and legal access to medicinal marijuana, Moore said.

A proposed initiative aims to overturn Pomona’s ban on commercial marijuana use.

A review of Weedmaps.com, a website dedicated to connecting patients to dispensaries, delivery services and doctors, show numerous services that deliver throughout the South Bay – where every city bans the business practice.

Many of those delivery services are not charging taxes or operating under any business license at all, putting them in a sort of gray market, observers say. Some dispensaries, located in unincorporated areas of Los Angeles County, out of the jurisdiction of cities with prohibitions, may also be operating under quasi-legal circumstances.

What cities also can’t control is the ability for an individual to grow up to six plants in the privacy of their own home. The proposition also decriminalized marijuana offenses and expunged past convictions depending on the amount involved.

Among Los Angeles-area beach cities, Long Beach is the only municipality that permits dispensaries through a voter-approved medical-marijuana initiative in 2016, which allows up to 32 licenses. The City Council approved last month rules that set up fees and licensing requirements for medical-marijuana dispensaries that also want to operate as adult-use ones; those fees run between $7,000 and $8,500, but they have yet to take effect.

Ivan Jimenez, a Long Beach resident who grows cannabis for his own business in Northern California, told the council at the time of the rulemaking process that he’d like to open up in his home city but he finds the fees too high.

“I would love to come here and invest money in the same industry,” Jimenez said during public comment. But “I believe the city of Long Beach is taking advantage of the taxing and taking advantage of the fees.”

Devil in details

Since January, when the adult-use law went into effect, dispensaries across the state have been adapting to new emergency regulations put in place to bridge the gap before permanent rules could be established.

Those emergency rules required by July 1 that all products, medicinal and recreational, be tested and labelled. The new rules also barred giveaways and allowed governments to impose taxes, some as high as 35 percent in combined local, county and state taxes.

Moore believes what bans and excessive taxes and fees are doing is “throwing gas on the illicit market.”

In Los Angeles County, where 59.5 percent of voters approved Prop 64, only 20 percent of municipalities allow some kind of operating license to sell pot. That’s not to say, however, that every supporter wants a dispensary around the corner from their house, Moore said.

“When you voted for Prop 64 what did you actually vote for. Were you voting for cannabis to be sold in your neighborhood or for cannabis to be made legal and end the war on drugs.”

Jonatan Cvetko, who heads the non-profit Emerald Angels that works toward responsible cannabis regulation, said rules such as one that requires child-resistant bags were a good thing. Like other advocates, Cvetko fears that the legal market is not given an opportunity to succeed.

“If the majority of the bans stay in place there will be no access for residents to find clean and safe products,” Cvetko said. “It’s not that the black market will come back, it’s that it hasn’t gone away. The goal was to allow existing operators to transition, so without any pathways for operators they have no choice but to stay in the illicit market.”

In Redondo Beach, the council was unified against the state’s rulemaking allowing delivery services even in cities with laws prohibiting them. The council directed staff to draft a letter to that effect. Similar letters were recently addressed to the state agency by the League of California Cities

While it opposed one important aspect of the rules, the Redondo Beach City Council also instructed the city manager to form a Cannabis Steering Committee. Mayor Bill Brand said that doesn’t mean the city is giving the green light to dispensaries.

“This is brand new legislative territory, so I’m looking forward to the recommendations from the city manager’s task force and more importantly, what the residents feel is appropriate for Redondo Beach,” Brand wrote in a statement. “No decisions will be made before a full vetting of all the issues.”

For more information on the cannabis industry in California and to comment on the proposed rules visit Cannabis.ca.gov.