California Cannabis Business Licenses
WHAT IS CALIFORNIA'S CURRENT CANNABIS MARKET STATUS?
The California cannabis industry has been likened to the days of the ‘gold rush,’ when there were talks of huge profits and hoards of entrepreneurs flocked to the state to strike it rich, leading to a modern day ‘green rush.’ The primary difference being a confusing gauntlet of government red tape and changing regulations requiring a California cannabis business license. California cannabis regulations seem to have stabilized for now, with some new bills amending the original Act to become more inclusive and focus more on the medical patients’ needs.
In 2016, California became the 6th state to legalize recreational cannabis when voters passed Proposition 64, making California a dual cannabis license state with opportunities in both the medical and recreational markets. Currently, California is the world's largest cannabis market with nearly USD 3 billion in sales in 2019. There are eight license types that you can apply for to become operational in the state including opportunities for retail, delivery, cultivation, distribution, manufacturers, micro businesses and testing laboratories. As a new and growing industry, California lawmakers continuously update and refine the regulatory policies. Some areas of particular interest include: the environmental impact of producing cannabis; how to eliminate the elicit underground market; the tax burden imposed on the sale and operations of cannabis and; safe, compliant banking solutions for cannabis businesses. Although cannabis is legal throughout the state, ultimately the decision on lifting prohibition goes to the local municipality.
WHAT ARE CALIFORNIA'S CANNABIS LAWS?
California has had more relaxed cannabis laws since 1996 with the legalization of medical cannabis and decriminalization of possession under 28.5 grams. In 2016, voters approved Proposition 64, the adult-use of Marijuana Act allowing adults 21 and older to purchase, possess, and consume up to 28.5 grams of cannabis. Licensing to sell and produce recreational cannabis began in January 2018. Consumption must be kept to the privacy of residential homes or licensed marijuana consumption lounges. With regulation changes, California immediately lifted most criminal sanctions pertaining to the plant after the general election.
The framework for regulation of commercial activity throughout the state is derived from The Medicinal and Adult-Use Cannabis Regulation and Safety Act. The law requires all commercial cannabis facilities to be licensed by the state, and gives local authorities the power to decide what activities are permitted in their jurisdiction. The state developed the Bureau of Cannabis Control (BCC) to lead development of the regulations for both medical and recreational cannabis within California. Additionally, the BCC is the deciding department for license awards through its online licensing portal. Once licensed, operators must stay in full compliance with the regulations implemented by the Bureau of Cannabis Control, Department of Food and Agriculture and the Department of Public Health.
WHAT IS CALIFORNIA'S CANNABIS LICENSING TIMELINE & CANNABIS APPLICATION PROCESS?
Prior to applying for a state license an applicant must obtain support from the local jurisdiction where the cannabis facility will be located. Although each license type requires different application forms and plans, repeated requirements among the various license types include completing the Financial Information Form, a Premises Diagram, Inventory Procedures and Security Procedures. Once submitted, application processing times can vary and have no promised time stamp for approval or denial. Factors such as the ability to provide documentation from the applicable local jurisdiction authorizing operations, type license application, and thorough completion of the application all contribute to the processing time.
WHAT IS THE HISTORY OF CANNABIS IN CALIFORNIA?
Cannabis for medical use became legal in 1996. In 1972, California had the first U.S. ballot initiative for cannabis although it was unsuccessful. Medical cannabis advocates were frustrated with failed attempts and in the November 5, 1996 general election brought the issue to the ballot. Proposition 215 was approved with 56% of the vote to legalize the use, possession, and cultivation of cannabis by patients with a physician recommendation for specific, qualified conditions. The vague wording of Proposition 215 left many frustrated, which led to the introduction of Senate Bill 240 in 2003. This bill allowed non-profit collectives to provide cannabis to patients, and created an identification card system for medical cannabis patients. Additionally, all possession limits were lifted in 2010 after the California Supreme Court ruled SB 240 did not limit the quantity of cannabis a patient can possess.
On November 8, 2016, voters passed Proposition 64, the adult-use of Marijuana Act, legalizing the sale and distribution of recreational cannabis to adults 21 and older. The Act allows adults to possess up to one ounce of cannabis, grow up to six plants at home, and provides licensing opportunities for interested parties in California. In 2018, licenses were granted to operators with the first legal recreational sales beginning January 1, 2018.
ARE YOU PREPARING FOR THE CALIFORNIA CANNABIS MARKET?
California continuously accepts state applications for cannabis businesses on a rolling basis. If you are wondering how to apply for a California cannabis application for dispensary, cultivation, manufacturing, distribution, or delivery, Point7 is here to help you on your entrepreneurial journey. The most important detail to ensure is solidified before applying is the local authorization from the jurisdiction where the facility will be located. We can help with both local and state licensing, especially in highly competitive local markets with limited licenses available. Are you debating applying for a cannabis license of your own? Point7 is delighted to offer service packages and products developed utilizing our combined decades of experience to aid in all stages of the cannabis business cycle.