LA Cannabis Licensing & Social Equity

Posted by Margolin & Lawrence on June 29, 2017

As explained in our previous blog post, “compliance” will be a major factor in the distribution of marijuana licenses in Los Angeles – and cannabis lawyers around the city are fielding a number of questions about what, exactly, LA’s priority licensing process will entail.

The draft regulations the City has released extend a certain amount of privilege to existing marijuana sellers when it comes to licensing. Businesses and dispensaries that have operated “in substantial compliance” with prior iterations of marijuana law will be given priority, allowing them to continue operating while their license approvals are pending. Clearly, this confers a major business advantage, which has raised concerns about whether a compliance-based approach to awarding priority is equitable.

Disqualifying potential cannabis business owners for past violations, but opening the door to “compliant” newcomers, threatens to reinforce inequality. As Drug Policy Alliance policy director Cat Packer, slated to head the City of LA’s Cannabis Commission, explained in an interview with Merry Jane, “The impact of marijuana prohibition and the drug wars was heaviest in black and brown latino communities. If you say people with prior arrests and convictions can’t participate, it automatically has a disproportionate effect on communities that were punished by the War on Drugs.” In other words, privileging “compliance” could compound the negative effects of marijuana prohibition, blocking communities which have historically been more likely to be punished for cannabis use from gaining access to the benefits of the new, legal marijuana industry. As attorneys who have practiced in cannabis law for many years, we have seen the damage prohibition has done to these communities, and are fully supportive of a restorative approach to justice through the licensing process.

The LA City Council recently moved to create a Social Equity Program for marijuana licensing, intending to serve “those individuals and communities that were disproportionately harmed by cannabis prohibition.” This follows in the path of a similar program in Oakland, which reserved half of new dispensary permits for residents who lived in certain neighborhoods, had below-average annual incomes, or had previously faced cannabis convictions. Given how much larger Los Angeles' marijuana industry is than Oakland's, however, the mechanics of the LA program may need to be worked out, and it may not be able to mirror the Oakland model in every way.

Whatever the exact parameters of LA's Social Equity Program end up being, (and however they'll be affected by recent changes to state and city licensing regulations,) the priority-based system will continue to play a major role in deciding which marijuana businesses are allowed to operate. At present, the city plans to reserve a special round of applications for organizations that fit a profile similar to the requirements Oakland used. For more on priority and marijuana laws to the new state law (MAUCRSA), check our previous blog posts or guide to Prop 64, or email us at info@margolinlawrence.com.

 

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This blog is not intended as legal advice and should not be taken as such. The possession, use, and/or sale of marijuana is illegal under federal law.