CVIndependent

Fri09222017

Last updateFri, 16 Sep 2016 12pm

The National Conference of State Legislatures, citing the wave of legalization and the explosion of a new industry in its wake, on Aug. 7 passed a resolution urging the federal government to remove cannabis from Controlled Substances Act scheduling completely.

Marijuana’s Schedule I status prohibits marijuana-based businesses from having access to the standard banking practices afforded all other businesses, because FDIC-insured banks can face federal penalties for dealing with businesses related to Schedule I substances. This has resulted in a multi-billion dollar industry that operates almost completely in cash. Aside from the obvious security concerns caused by keeping a ton of cash around, it also means shops can’t take credit debit or credit cards; they can’t have normal real estate mortgages; and they have no access to small business loans. Oh, and state tax collectors are continually faced with cartoonish bags of cash.

The NCSL resolution recognizes this problem with the fifth “whereas.” The important part:

“Now, therefore, be it resolved, that the National Conference of State Legislatures believes that the Controlled Substances Act should be amended to remove cannabis from scheduling, thus enabling financial institutions the ability to provide banking services to cannabis related businesses; and be it further resolved, that the National Conference of State Legislatures acknowledges that each of its members will have differing and sometimes conflicting views of cannabis and how to regulate it, but in allowing each state to craft its own regulations, we may increase transparency, public safety, and economic development where it is wanted.”

To nobody’s surprise, the Marijuana Policy Project applauded the move.

“State legislators and the vast majority of voters agree that marijuana policy should be left to the states,” said Karen O’Keefe, director of state policies for the Marijuana Policy Project, in a press release. “Legitimate, taxpaying marijuana businesses should not have to face the difficulties of operating on a cash-only basis. Allowing banks to offer them financial services will be good for the industry and benefit public safety. Even more so, states should not have to worry about the federal government interfering with their marijuana policy choices.”

Upon hearing news of the resolution, Attorney General Jeff Sessions reportedly dropped to the ground, pounded his fists, kicked his feet and wailed: “NO! NO! NO! Marijuana BAD BAD BAD!” (OK, not really, but it would not surprise us if that really happened.)


California Growers Prove It’s Possible to Have Too Much Weed

Flying in the face of centuries of pothead orthodoxy, California growers are proving there is indeed such a thing as having too much weed.

With medical marijuana sales on the rise, and the sale of cannabis for recreational use coming to fruition in January, California growers have increased production in preparation for a huge increase in demand. After all, Nevada was completely unprepared for recreational sales, and the whole state ran out of weed. But now it’s coming to light that California growers may have overcompensated just a bit.

Depending on whom you ask, California growers are growing an estimated three to 12 times more bud than California needs, based on current demand and projections. Even the conservative end of the spectrum equates to a ton of extra bud. Add to that further restrictions (and enforcement) on interstate marijuana commerce going into effect Jan. 1, and people in the industry are starting to wonder what to do with all that weed. 

"We are producing too much," said Hezekiah Allen, executive director of the California Growers' Association, according to the Los Angeles Times. “(Growers) are going to have to scale back. We are on a painful downsizing curve.”

Allen delivered his assessment to the Sacramento Press Club as part of a panel discussion. The panel also included Lori Ajax, chief of the state’s shiny new Bureau of Medical Cannabis Regulation, and Joseph Devlin, chief of Cannabis Policy and Enforcement for city of Sacramento.

This will surely lead to prices dropping across the Golden State. While this is great for the retail customer, it does not bode well for the massive mega-grows popping up around the Coachella Valley and elsewhere. With operations like Sunniva’s Cathedral City campus hoping to produce 90 tons of product in 2018, and Desert Hot Springs licensing millions of square feet for cultivation, let’s hope interstate cannabis commerce can become a reality sooner than later.

Otherwise we’re all going to need to start doing our part to get rid of all that weed, somehow. … Got a light?


Palm Springs Sends Cannabis Tax Measure to Voters

Palm Springs has a pension crisis looming, and the City Council is scrambling to make sure the city’s debts are covered.

In November, not only is the city asking voters for a half-cent sales-tax increase; the City Council voted unanimously to send a marijuana tax measure to ballot.

The measure sets the annual tax for cultivation facilities at $10 per square foot. In preparation for recreational sales going live in January, it would also put a tax structure in place for recreation retail businesses.

Dispensaries and other marijuana businesses would be taxed at a rate of 15 cents per $1 (or 15 percent). This rate would apply to recreational and medical retail sales alike. The City Council could vote to lower this rate, but would require approval of four-fifths of the council to increase the rate.

Drug-prevention programs and public safety are mentioned in the ballot measure, but it doesn’t take a huge stretch of the imagination to see the city channeling these funds to help out with the pension crisis on the horizon.

Published in Cannabis in the CV

Legalizing marijuana, California voters were told last year, would create a “safe, legal and comprehensive system” allowing adults to consume the drug while keeping it out of the hands of children.

Marijuana would be sold in highly regulated stores, the Proposition 64 campaign promised, and California would gain new tax revenue by bringing the cannabis marketplace “out into the open.”

Voters overwhelmingly bought the message, with 57 percent approving Proposition 64. But as state regulators prepare to begin offering licenses to marijuana businesses on Jan. 1, it turns out that a huge portion of the state’s weed is likely to remain on the black market.

That’s because California grows a lot more pot than its residents consume, and Prop 64 only makes marijuana legal within the state’s borders. It also didn’t give an automatic seal of approval to every cannabis grower: Those who want to sell legally must be licensed by the state and comply with detailed rules that require testing plants, labeling packages and tracking marijuana as it moves from farm to bong.

Exactly how much cannabis circulates in California is unknown, because most marijuana grows—and purchases—have been illegal for so long. But economists hired by the state government estimate that California farms produce about 13.5 million pounds of cannabis each year, while state residents annually consume about 2.5 million pounds. That leaves 11 million pounds of pot that likely flows out of California illegally, according to the economic report commissioned by the California Department of Food and Agriculture, which regulates cannabis farmers. Other analyses have similarly found that roughly 80 percent of California-grown marijuana leaves the state.

Even the 2.5 million pounds of marijuana consumed within California won’t all be purchased through state-sanctioned shops when they open; the economists predict about half of it will probably be sold illegally.

“Those sales opportunities will still be there,” said Hezekiah Allen, executive director of the California Growers Association, which represents more than 1,000 marijuana businesses in the state.

Allen surveyed his members recently and found that 85 percent hope to get a license to sell marijuana legally under Prop 64. But many fear they won’t be able to, because some local governments limit or ban pot businesses, and because prices could drop too low in the regulated market. If they can’t sell weed legally, 40 percent of the respondents to Allen’s survey said they would continue operating the way they always have: on the black market.

Some long-time cannabis growers will likely go out of business, Allen said. But, “at the end of the day, a lot of businesses in general may stay outside of the regulated market.”

That means that despite the passage of Prop 64, California cops will still have plenty of work going after illicit cannabis operations.

“You’re going to see robust enforcement efforts to prevent California from becoming the staging area for drug trafficking nationwide,” said John Lovell, a lobbyist for the California Narcotics Officers Association, which opposed the ballot measure.

A spokesman for the Prop 64 campaign said the measure wasn’t intended to abolish all criminalization of marijuana, but instead to allow opportunities for “operators who want to be responsible and compliant.”

“No one ever promised to completely eliminate the black market—that’s like promising security cameras will completely eliminate shoplifting—but it will be significantly reduced,” spokesman Jason Kinney said by email.

He added that the state’s estimates of marijuana supply and demand are unreliable, because the legal marketplace created by Prop 64 won’t begin to roll out until next year. And he pointed out that some of the tax dollars generated by legal marijuana sales will go toward cracking down on illicit operations.

State officials said they are encouraging marijuana businesses to follow the rules and become part of the regulated system, while also planning how to go after those that remain in the black market.

“We are developing a formal complaint system that will allow anyone to report illegal grows or other concerns, and then we will forward those potential issues to the appropriate (law enforcement) agencies,” said Rebecca Forée, a spokeswoman for the state’s cannabis cultivation licensing office within the Department of Food and Agriculture.

Lori Ajax, chief of the state’s Bureau of Cannabis Control, said her agency is trying to entice marijuana businesses to go legit by crafting rules that aren’t too difficult for them to live by.

“It’s making sure that for those people who want to be in the regulated market … we have made a path for them; we’re not making our regulations so difficult and hard to comply with that you’re discouraging people,” Ajax said.

“First, we’ve got to get those folks in there and … then see what comes after that with enforcement.”

CALmatters.org is a nonprofit, nonpartisan media venture explaining California policies and politics. For more analysis by Laurel Rosenhall, go to calmatters.org/articles/category/california/politics.

Published in Cannabis in the CV

The public-opinion news just keeps getting better for the legalization movement.

A recent Pew Research Center poll revealed that 57 percent of Americans favor the legalization of the use of marijuana, while only 37 percent still think it should be illegal. This is fairly amazing, considering that a mere 10 years ago, those numbers were pretty much reversed, with 32 percent in favor of legalization, and 60 percent opposed.

Weed, you’ve come a long way, baby!

Not surprisingly, the youth vote is where the strongest support for legalization is. A whopping 76 percent of millennials (ages 18-35 in 2016) are in favor. That’s up from 34 percent just a decade ago. Baby Boomers and GenXers are showing increasing support as well: Boomers are 56 percent in favor of legalization, up from just 17 percent in 1990, while Generation X sits at 57 percent in favor, up from 21 percent in 1990.

How does this break down across party lines? Predictably: 66 percent of Democrats are in favor of legalization, with just 30 percent opposed, while most Republicans (55 percent) oppose legalization.

Here in California, the numbers tell a similar tale. A recent poll showed that 58 percent of Golden State voters favor Proposition 64, which, if approved in November, would legalize marijuana for some recreational use. The poll (conducted by USC Dornsife and the Los Angeles Times) also showed that support for legalization was strong across “most lines of age, race, income and gender,” the Los Angeles Times reported.

This shift in public opinion all but guarantees passage of Prop 64, which is backed by former Facebook president Sean Parker and Lt. Gov. Gavin Newsom, despite blowback from pro-marijuana skeptics who think the law doesn’t do enough to protect smaller growers and the rights of medical patients.

Cannabis-industry trade groups like the California Growers Association are deeply divided on the issue. Only 31 percent of the 750 member growers of the CGA are in favor of the bill, while 31 percent are opposed, and 38 percent are undecided. The resistance stems from potentially costly environmental regulations (said to cost around $20,000 to $100,000 per farm), and a lack of long-term protections from an industry takeover by out-of-state interests.

Allowing Big Agriculture into the game is the biggest concern of growers. Some of these growers have been waiting decades for legalization, and now they fear being cut out of the industry they helped create. Prop 64 gives growers five years to establish market dominance in the state before corporate mega-grows can be approved, but many in the industry say this is not enough time, will take industry accessibility away from smaller operations, and will result in a lower-quality product.

The possibility of a lower-quality product is one of the many arguments coming from the medical-marijuana camp. One such voice of dissent is Dennis Peron, a co-author of Proposition 215, which opened the door for medical marijuana in the state back in 1996. He believes cannabis patients will be victimized by law enforcement and the tax code as they are lumped in with recreational users.

“I want the voters to be aware of the situation at hand,” Peron told The Cannabist. “Prop 64 is not legalization. If it were legalizing, that would imply that marijuana is illegal, and it’s not. This law would mean the displacement of cannabis farms in Humboldt. It essentially empowers profit instead of people.”

While these concerns are indeed valid, Prop 64 will most likely become law in our fair state. Even if Prop 64 fails, not much would change; most of the regulations it puts into effect were passed in last year’s Medical Marijuana Regulation and Safety Act, which is now law.

Only time will determine how things shake out. In a strange little twist, the Drug Enforcement Administration may actually help smaller California growers stay in business by refusing to reclassify marijuana from Schedule 1: Until the federal prohibition is lifted, large investors will want to place their money where it can be federally insured, like Canada.


‘High Times’ Launches Marijuana-Themed Clothing Line

Back in 1974, a group of pothead pranksters headed by a publisher named Thomas King Forcade thought a one-off spoof of Playboy Magazine that featured buds instead of babes would be a pretty funny thing to do. That first issue sold more than anyone expected, and the public demanded more.

High Times magazine was born. Since then, the magazine has become the voice of the industry, movement and subculture that is marijuana.

The roller-coaster ride to legalization is finally coming to fruition, and weed subculture has been thrust into the limelight. Stoners across the land are more and more open about their love of cannabis, and cannabis culture is booming. Therefore, High Times has introduced a line of clothing that pays tribute to these connoisseurs, patients, activists and advocates—as well as to their maverick founder.

"The fashion trend in general is about retro and vintage. … You can see it at any show you go to. At the same time, what you’re seeing is this recognition of the legalization of cannabis," says Larry Linietsky, chief operating officer of High Times. "It's a way to support the movement by wearing the clothing. We think it's well-timed. (It’s) vintage, counterculture and authentic."

With the line’s launch, “High Times recognizes the need to celebrate these street soldiers worldwide by giving them banners to fly.” This would be pretty haughty talk for anyone other than High Times … but would you question Rolling Stone magazine’s place in rock ’n’ roll history? Playboy’s place in pinup culture? No, you would not.

The line is available now at shop.hightimes.com.

Published in Cannabis in the CV