LA Phase II Update

Posted by Margolin & Lawrence on June 20, 2018

Today the Los Angeles City Council held a special meeting, where a passionate and energized public audience made it clear that they want to see the tax revenue collected from the commercial cannabis industry to be reinvested into social equity programs. The specific tax revenues being discussed were the proposed “Cannabis Reinvestment Act,” as well as a provision that would increase tax rates once the cannabis industry within LA reaches an aggregate of $1.5 Billion in total gross receipts.


There was also a great deal of discussion as to the importance of properly funding the Department of Cannabis Regulation so that the DCR can accurately and efficiently oversee the commercial cannabis businesses within the City of Los Angeles. Cat Packer, the Executive Director of the Department of Cannabis Regulation, spoke at the special meeting about the DCR’s need for robust funding in order to manage a streamlined business application process, while also building solid relationships with current and future cannabis business operators.


We will publish a more detailed post on the signage ordinances and further details on social equity next week.


For now, here are the key takeaways from the meeting for L.A. cannabis businesses:


  • As of June, 153 Cannabis Dispensaries have been approved under Phase 1. Another 17-23 more properties need to be visited before Phase One of Los Angeles cannabis licensing is complete.
  • Phase 2 update: Phase 2 is still rumored to begin on July 1 but the City did not confirm any specific date at this meeting.
  • The LA Dept of Cannabis Regulation will hold a meeting on July 2 in room 340 of City Hall. DCR continues to struggle without enough resources to process the license applications they will receive from L.A. cannabis operators.
  • For the Cannabis Social Equity Program under Phase 2, there is a proposal to expand the definition of conviction to include cannabis arrests, which would broaden the number of people who qualify as Tier 1 social equity candidates.
  • There is a proposal to allow Tier 3 social equity candidates to donate incubator funds rather than 10% of their retail space to qualify.
  • As for the timeline moving forward, Phase two of licensing has been rumored to begin on July 1, but nothing has been made official by the City. Additionally, nothing regarding a proposed or tentative start date for Phase Two licensing was mentioned at the recent council meeting. Cat Packer also stated that on July 2 the Department of Cannabis Regulation would be announcing its first public meeting and will post information regarding the meeting inside room 340 of Los Angeles City Hall.


For more information on how to prepare your business for Phase 2 licensing, contact us at

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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.