Cannabis had been federally prohibited for several decades before public attitudes towards marijuana started changing in the late nighties. As drug reform advocates championed for marijuana legalization, more and more states legalized marijuana with the aim of earning tax revenue from cannabis sales, edging out the illicit market and repairing the damage done by the decades’ long war on drugs.
However, a few years after a number of state-legal cannabis programs were launched, it has emerged that they aren’t as effective as projected. Despite bringing in millions of dollars in tax revenue, states like Colorado and California have had a hard time pulling clientele from the illicit market. Similarly, Los Angeles has had such a troubling legal marijuana program that a City Council Committee has approved a series of changes to it.
The city was once seen as a potential showcase for the budding cannabis industry, but the reality does not measure up to the vision. The illicit market still thrives and licensed shops have repeatedly stated that everything costs too much and it takes too long to deal with City Hall. To make matters worse, the programs designed to help communities that had been unfairly targeted by the decades’ long war on drugs have been slow to take shape.
The proposed changes include tweaking a definition to match language on state law, limiting delivery licenses until 2025 only to businesses that meet “social-equity benchmarks, permitting businesses to relocate while being licensed, clarifying what employees are supposed to be subjected to background checks and streamlining the application process.” Such programs were initially designed to help individuals who were convicted of a marijuana related offense and lower income residents who live or have lived in neighborhoods marked by high marijuana arrests.
According to the city’s top cannabis regulator Cat Packer, the changes are urgent. She noted that the industry and City have been affected by the coronavirus pandemic, an economic crisis and nationwide protests over systemic racial injustice. And with these circumstances, marijuana remains illegal at the federal level, and banking and insurance institutions shy away from cannabis businesses due to fear of federal retaliation.
“The intersection between cannabis policy and racial injustice is clear to me. Black and brown communities have been disproportionately impacted, disproportionately policed, and we made a commitment to actively acknowledge those harms and address the harms of the drug war,” said Packer.
However, according to Adam Spikier, an executive director of the industry group Southern California Coalition, the proposals are a ‘mixed bag.’ They may be well intended, he says, but placing an inflexible limit on who could qualify for a delivery license is “open to a lot of problems” as it could leave out long-standing operators who are already enmeshed in the industry. “I think that creates more problems than solutions,” he said.
Licensing has also been a major issue, with the city being sued this April by license applicants claiming the city’s licensing process is flawed. What remains to be seen is whether these changes will be adopted into the state’s cannabis industry, and industry watchers think entities like SinglePoint, Inc. (OTCQB: SING) will be happier to see any changes implemented rather than remaining on paper without being felt on the ground.
Published: June 29, 2020
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