CONTROL, REGULATE, TAX, TAX, TAX

BY FELISA ROGERS

The passage of Proposition 64 has California growers and users in an uproar. While stoners and backyard gardeners rejoice and entrepreneurs scheme ways to make money on legal marijuana, medical and black market growers worry that this could signal the end to a way of life. Part of the fear stems from the loose language of the proposition, which leaves much to be determined by local authorities and the Bureau of Marijuana Control.

HOW WILL THIS AFFECT RECREATIONAL USERS AND GARDENERS?

Californians have had it pretty good since 2011, when the state decriminalized the possession of less than an ounce of marijuana. Proposition 64 will improve their situation by making it completely legal for any adult to possess and transport 28.5 grams of non-concentrated product or 8 grams of concentrated product. By noting that flour, sugar, and other ingredients used in making edibles will not count toward the total weight of the “marijuana,” it ends the bad old days of people being charged with a felony for a pan of shake brownies. The best news is that adults will be allowed to grow six plants per household and legally possess any weed produced by these plants, provided it is kept in a locked storage compartment.

Adults will eventually be able to purchase and ingest recreational marijuana at licensed establishments, provided they live in cities or counties that haven’t banned recreational marijuana at a local level. However, licenses for recreational retailers won’t be issued until 2018, so for the time being it’s still illegal for recreational users to purchase weed. The usual rules apply regarding providing weed to minors, smoking in public places, or driving while high.

Recreational users could benefit from the law’s proposed regulation of pesticide use, as well as additional safety regulations and quality standards designed to protect customers from unsafe or shoddy products.

HOW WILL THIS AFFECT GROWERS?

The New York Times and The Washington Post recently ran articles on “Growers Who Are Opposed to Legalization,” as though this were a new or puzzling phenomena, but of course industry insiders credit grower opposition as the primary reason California lagged behind in the movement to legalize recreational marijuana. A glance at the formal title of Proposition 64 should illustrate why. The Control, Regulate and Tax Adult Use of Marijuana Act definitely puts emphasis on “control, regulate, and tax,” giving regulatory rein to a Bureau of Marijuana Control and putting the Department of Food and Agriculture in charge of licensing and overseeing marijuana production. The state’s entrenched black market and medical growers worry that their existing farms will not be eligible for licensing under the new regulations. In addition to zoning concerns, growers will face stringent environmental restrictions designed to protect wildlife, habitat, and general water quality. The Department of Pesticide Regulation will set rules for the maximum application of pesticides, while the Department of Food and Agriculture will establish a certified organic designation and organic certification program.

In addition to worries about regulation, many growers have long feared that legalization will open the doors for corporate takeover of the industry. Existing mom-and-pop operations should be somewhat comforted by the language of California’s law, which stipulates a five-year ban on issuing licenses to large-scale growers, and also states that prospective controllers of a recreational marijuana “entity” must be able to prove continuous California residency since 2015. However, this residency requirement will expire in 2019 unless the California legislature decides to renew it, and it’s also an example of the proposition’s vagueness: the requirements for being the controller of an “entity,” are not defined, so it’s possible that out-of-state or international entrepreneurs might still be able to participate in the industry.

The law is also vague on the status of existing medical growers. If said growers want to get in on the recreational business, it’s not clear whether they will be able to change their nonprofit status to for-profit, or whether they will need to start from scratch and form a new entity.

Perhaps the most crucial mystery is the number of licenses that will be issued. As of yet, Proposition 64 doesn’t set a number of licenses to be issued or specify license costs, although it does go into pages of detail about the criteria that officials will use to determine whether to issue or renew a license in a given area.

It’s important to note that the law is also subject to local and federal regulation. Many cities, including Santa Barbara and Davis, have already passed ordinances banning all recreational cannabis activities. Meanwhile, federal law will continue to create hassles for businesses seeking to engage in prosaic activities like banking and marketing. It’s as yet unclear whether the new presidential administration will challenge the autonomy of California and other states.

OTHER POINTS OF INTEREST

The law defines marijuana as all parts of the plant Cannabis sativa L., including seeds, resin, and every compound, manufacture, salt, derivative, or preparation.

Prop 64 authorizes courts to consider resentencing (or possibly liberating) individuals who were arrested for marijuana-related offenses under the old laws, provided that the law no longer applies.

If you had daydreams of buying a pint and a joint at your local pub, you’re out of luck. The law prohibits the sale of marijuana at establishments that sell alcohol or tobacco.

Californians can now grow industrial hemp as an agricultural product, which will be regulated separately from the strains of cannabis with higher delta-9 tetrahydrocannabinol concentrations.

The law will establish regional appellations and prohibit false advertising of county of origin.

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