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California – Ready to Legalize Recreational Use and Regulate Commercial Activities (Part V)

Posted by Ken Tapman on Oct 24, 2016 3:26:00 PM
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What roles will local governments play in rec use rollout?

Part V: With upcoming elections and the expansion of Canopy's cannabis startup accelerator into Berkeley and San Diego, we've followed California's regulatory environment closely. The following blog post is part of a series dissecting California’s November 8th ballot initiative commonly referred to as the “Adult Use of Marijuana Act (AUMA)", or Proposition 64. Parts I and II discussed the AUMA's major objectives and next steps for regulated cannabis businesses; as well as highlighted several of the Act's provisions, such as the allowance of hemp as an agricultural product, and the Act's intensive licensing schedule; Part III reviewed where revenue will be allocated. In Part IV, we looked at the agencies involved in recreational legalization. The final part in the series, the roles of local government is discussed.

At this stage in the process, roles for local governments can only be addressed in generalities because AUMA is directed at state agencies;however, The Act preserves the right of a local government to control commercial marijuana activities within its jurisdiction (as long as it is consistent with AUMA). There are also 2 other significant changes affecting local governments:

  • They will be able to exercise their normal authorities for regulating legitimate businesses once commercial marijuana businesses are “legalized”, and
  • Local government can request to assume responsibility for enforcing a state agency’s regulations

Additional key concepts related to the role of local governments under AUMA include:

  • Local governments can enact stronger licensing ordinances for regulated facilities and activities but not enact more permissive ordinances
  • Consistent with the intent of AUMA, local governments would need to be consistent with state and local prohibitions regarding combustible tobacco products and e-cigarettes but could enact exemptions for indoor marijuana use inside retail stores and marijuana clubs

Finally, the AUMA's limitations on local governments:

  • A local jurisdiction shall not prevent transportation of marijuana or marijuana products on public roads by a licensee acting in accordance with AUMA
  • A local jurisdiction could ban marijuana businesses by a local vote of its residents. While AUMA makes this possible, though unlikely because of costs to local governments or citizens to hold an election and mount this kind of campaign

 If approved, the AUMA holds supremacy over other proposed MJ ballot initiatives

AUMA was only one of many marijuana related initiatives being proposed for the November 8th ballot. To avoid any potential conflicts if AUMA is approved, Section 13 of the Act was drafted, stating that the provisions of the Adult Use of Marijuana Act would prevail over any conflicting legal authority approved by the voters on the same November 8, 2016 ballot.

To Summarize: The times are changing for recreational marijuana users and for commercial marijuana businesses in California.

Watch out for push-back!

But a word of caution, there will be push-back, whether from isolated local governments, state legislators or opponents of legalization. These same opponents are also likely attempt to repeal or at least severely limit licensing and regulation of marijuana related businesses. Even lawsuits in State and Federal courts can be expected. AUMA supporters need to make sure that they don’t do anything to undermine the advances of 2016. The goal is not to give opponents, the press or politicians high profile stories that can be used against legalization.

The community level is most susceptible to anecdotal examples and exciting news stories. There are far fewer public officials who will be involved. Recreational and commercial marijuana interests should start at the local level to make sure that they have the support of their neighbors and the surrounding community. In most cases, the goal is to let state agencies do the regulating.

The key to success?  Actively work with state agencies.

Businesses need to work collaboratively with the state regulators to make them as effective as possible. An immediate goal for California’s marijuana business interests is to become involved in the process of appointing members to the Advisory Committee by the Director of the proposed Bureau of Marijuana Control. The Advisory Committee has the potential to exert significant influence on how AUMA is implemented. Because the law and implementing regulations are new to both regulators and those being regulated, input from experienced individuals will be most effective when state agencies and local governments begin promulgating and adapting to the new rules in 2017. Get involved early!

And for any Californian readers, help make sure that the times do, in fact, sure to vote on November 8, 2016!

This article is by Ken Tapman, a Canopy Mentor. If you would like to talk with Ken, he can be reached at 561.350.7401 or you can email him at ktapman at gmail.


Topics: Legal