During the summer, California made the biggest change in regulating cannabis since voters agreed to legalize it six months ago. Governor Gavin Newsom has integrated the three agencies overseeing the industry segments into a new cannabis division.
A month later, new strategies and challenges for the industry materialize.
According to people working in or advocating for the cannabis industry, the cannabis business has been slow licensing since its integration.
Lindsay Robinson, general secretary of the California Cannabis Industry Association, a trade association that represents more than 400 trade associations, said: She said most business owners are willing to “give a little extra” to the new state regulators because they believe it will streamline being oversight is best for the industry in the long run.
Nicole Elliott, director of the state’s new cannabis division, admits that the work of integrating three complex regulatory and licensing processes into one is actually just beginning.
Regulators also need to work to find new ways to address California’s large illegal market and other issues that plagued the licensing industry from the start. And new challenges need to be addressed, such as how falling wholesale cannabis prices could affect the industry.
Elliott said he is currently laying the groundwork for some reforms with clear goals.
“We want people in our government markets to get licenses and make it easier to manage licenses, and we want to support a wide variety of industries.”
A new department was established
Most states that have legalized cannabis have set up a branch to oversee the industry, but after voters created the world’s largest legal market in November 2016, California split responsibility among three agencies. Did. The Cannabis Administration of Manufacturers and Consumer Affairs was responsible for retailers, distributors, tests, and events.
Since the idea was first proposed, Robinson said the CCIA was in favor of integrating surveillance into a new department.
“We have heard over the years that it is really difficult to find your way around different institutions,” she said.
Brian Dewey, director of business development at Les Nabis, a California cannabis distributor, said clear regulation, approval processes and latency create specific problems for vertically integrated business owners. It says.
“There were three different contacts trying to play their part in cannabis,” said Dewey. “There was no parental authority overseeing everything.”
According to Dale Gillinger, director of the California branch of the nonprofit cannabis rights group NORML, the farmers who have waited long for approval from the Department of Food and Agriculture are the most dissatisfied with the old system. I complained.
“You had a lot of application backlogs,” said Gieringer. “There are not enough staff and they have to watch out for bigger harvests.”
Shortly after Newsum took office and named Elliott as its chief cannabis policy advisor in February 2019, she said they met with stakeholders and started talking about how the industry can be strengthened. Strengthening surveillance is a top priority and should take place in 2020. Then there was a pandemic.
Behind the scenes, Elliott migrates hundreds of thousands of files between different institutions, establishes inter-institutional agreements, establishes key leadership roles, and is ready when the time comes. He said he spent extra time. ..
That day was July 12th when Newsum established the cannabis division with the passage of Parliament Act 141, a trailer law for the 2021-22 budget. This was the most important integration and reorganization of California government agencies since the establishment of the California Tax Department and Tax Appeals Department in 2017.
Changes in progress
The cannabis department oversees a budget of $ 194.4 million this year. (Related to this, licensed cannabis companies paid taxes of 817 million in fiscal 2020-21.)
This year’s cannabis sector also manages a $ 100 million special grant granted to 17 counties and cities. This is one of the strategies Elliott identified for curbing illegal markets.
For many entrepreneurs, bans, strict regulations and long-term delays at the local level are the biggest hurdles in obtaining a license. So if the state can use subsidies to help local governments regulate cannabis within its borders and help companies move from temporary to permanent licenses, Elliott will do more. Companies looking to encourage more jurisdictions to welcome the industry while attracting and retaining licenses.
Cities and counties can also use these local grants to help small cannabis farmers float as wholesalers. Marijuana prices are starting to fall, Elliott said.
Price declines are a foreseeable result of legal market growth and stabilization, said Gieringer.
“Upscaling makes production more economical,” he said. “It’s always been inevitable, but it puts pressure on really small producers.”
The cannabis sector plans to provide local grants by the end of the year.
They also plan staff and Elliott says waiting should be helped.
The cannabis department will have up to 624 employees this year. A spokeswoman said they were at 394. That gap is why Elliott said some business owners may have noticed a slowdown in application processing coupled with an increase in cultivation applications. She hopes they will be able to process their applications faster as the department will continue to hire staff over the coming weeks and months.
That problem aside, people in the industry generally say only good things about Elliott, who prior to joining Newsom was the director of the San Francisco cannabis office. Communication is solid, according to Robinson. Dewey also said the learning curve is small, given that Elliott has previous work experience in the industry.
The decisions of several other organizations and the top executives in the cannabis sector have also received industry praise. Robinson, for example, praised the creation of a new equity and inclusion department. It is one of the 10 new departments, with others devoted to topics such as enforcement, technology, and auditing. Robinson said he was glad the assistant director of the stocks division went to Eugene Hillsman, who was at Princeton University with a paper on marijuana policy before moving to the San Francisco cannabis office.
This fall, the department will work to enact new emergency regulations, which Elliott says will consolidate hundreds of pages of regulations from the previous three regulators into a single rule. She said there were some important regulatory inconsistencies that needed to be resolved, such as different definitions of “property” of the company and “monetary interests” by the institutions.
According to Elliott, the department has just begun discussions about creating a unified licensing system and it has not yet been predicted when the changes will take place.
Newsom’s potential recall has raised some concerns in the industry, and while both CCIA and NORML California are opposed to the move, Elliott said their department’s work would take place on September 14th. He said it shouldn’t be affected.
“We are focused on getting this done and getting it right.”
One month after California created a cannabis division, reforms and challenges are taking shape – San Bernardino Sun Source link A month after California created a cannabis division, reforms and challenges are taking shape – San Bernardino Sun.