Angelenos, we know how excited you are about legal weed in California post-Proposition 64. But while you’re still lighting those victory joints, remember that we have more than a year to go until the state’s adult use and medical marijuana regulations are in full swing. In many ways, California’s cannabis economy in 2017 will look a lot like how it’s always looked — while on the other hand, various sectors of the industry will start to plant seeds (yes, figuratively and literally) in preparation for full implementation of AUMA (Adult Use of Marijuana Act) and MCRSA (Medical Cannabis Regulation and Safety Act).
“Let’s just understand that 2017 is sort of a transitional year between an unregulated system and moving toward licensure on the state level, which will happen in 2018 at some time,” says Aaron Herzberg, partner and general counsel at CalCann Holdings, LLC, a holding company focused on municipally licensed marijuana real estate opportunities in California. In the meantime, he says, California will begin to see a greater influx of large-scale players, like traditional investors and funds that had been in other industries, now entering the cannabis market.
In the state’s move toward regulation, with licenses soon-to-be necessary for everything from cultivation to manufacture to sale, says Herzberg, competition will get tougher for those who try to remain in the grey market. “At some point in the future, the illegal unlicensed black market dispensaries are going to be put out of business and the black market growers will be put out of businesses, unless they ship their marijuana illegally to other states.”
With that said, anyone who tries to operate outside state regulations should fear backlash from the federal government. The greatest protection against federal interference, if Jeff Sessions were to become attorney general, is to have a robust regulatory system in place at the state level, according to Amanda Reiman, marijuana law and policy manager at the Drug Policy Alliance. The best way for cannabis businesses to prove state-level compliance begins with having regulations with which to comply — something California has lacked for the past 20 years.
In the coming months, the state legislature will work to harmonize both AUMA and MCRSA to smooth out any discrepancies in the two laws. The idea is to have two parallel systems for both medical and adult use marijuana. However, reconciling state and federal marijuana will take more work, especially with Trump’s nomination of Jeff Sessions. With medical marijuana legal in more than half the states in the country, federal denial of that fact is becoming an increasingly untenable policy.
You can read the other half of this great article on the L.A. Times here: http://bit.ly/2ir65E8