Local Politics Matters for Cannabis Businesses
California is home to many “cannabis deserts,” vast areas where citizens must drive 30-60 miles for access to legal cannabis (barring delivery as of Jan 2019), despite Prop 64 passing in November 2016. This is because businesses need local approval to operate. While voters said yes to legal cannabis, city councils and county supervisors are saying no.
Who is in office matters
Local governments have a lot of power in the California cannabis landscape. Banning or allowing commercial cannabis in any jurisdiction often times comes down to 5-7 elected officials. Their opinions matter. Getting them on your side as a cannabis business is paramount.
Take Oroville (Butte County) for example: Voters passed a cannabis tax in November. Two ordinances (1830 and 1831) were subsequently passed 4-3 allowing commercial cannabis activity. The city, headed to financial trouble, wanted to capitalize on the estimated $300,000 to $600,000 in annual revenue the cannabis business tax would generate. However, the November vote replaced two pro-cannabis city council members with one for and one against cannabis regulations. In January of this year the new council voted 4-3 to ban all commercial activity, effectively reversing the ordinance passed merely a month earlier.
And it’s not just Oroville.
Calaveras County has been flip flopping for some time. Despite some 200 permitted grows and another 177 in the process, the county banned all commercial cannabis uses in March of last year after the 2017 November election brought in a new Board of Supervisors. The vote was 3-2 in favor of the ban. Hundreds of growers that had paid millions in taxes to the county were understandably upset. Fast forward to November 2018, two anti-cannabis officials were ousted and as of this February the county is going forward with drafting cannabis cultivation regulations with hopes for permits in 2020.
Benicia in Solano County and Mountain View in Santa Clara County are also facing challenges post the 2018 November elections. Mountain View’s new council is currently in the process of brutally amending the regulations passed last fall that allowed two storefronts and two deliveries. Benicia, whose previous cannabis ordinance passed only 3-2, has already taken thousands of dollars in application fees from hopeful businesses; however, there has been a stall in awarding the permits since a new council was sworn in. At a recent meeting, when asked why it was taking city staff so long to evaluate the applications and if a time estimate could be provided, the planning department dodged any direct answer. Furthermore, earlier this month the council voted to revisit the municipal code regarding limitations on location for cannabis business (item 14.C). They may pass new zoning regulations that would prohibit commercial cannabis activity at locations where current storefront applicants are located, effectively prohibiting storefront retailers.
A city that allows cannabis one day may reverse course seemingly overnight. Elections are important and making sure your city council or county board is sympathetic to cannabis issues is essential for survival. Make sure your local government has all the information. Scot Candell & Associates is experienced in understanding local politics and putting together presentations and packets of information for local officials. Give us a call if you need assistance navigating the local permit field.