Cali's Cannabis Crackdown Collapses

Lately headlines have been circulating about how cannabis businesses in California who have gone through the extreme burden (financial and otherwise) of getting licensed by the state to do business legally under the recently implemented Prop64 are complaining about – and sometimes even ratting out – their grey and black market competitors.

This “unfair” competition is being blamed for the state’s significant shortfall between what they thought they’d rake in from cannabis tax revenues and the much lower number that they are likely to see.

So you have enough deep-pocketed investors complaining to easily-influenced bureaucrats about money, action is usually taken.

Action, in this case, took the form of California’s governor, Jerry Brown, announcing the creation of five teams in the state attorney general’s office that would be tasked with cracking down on California’s illegal cannabis sales and cultivation centers.

The price tag for this west coast war on weed?


Even Weedmaps, the popular dispensary-searching website, got a cease & desist letter from the state telling them to stop allowing unlicensed outlets to advertise on their platform.

Weedmaps promptly and completely ignored that demand and continues to cater to all cannabis businesses with a valid credit card and some herb to sell.

Now we might know why they were so confident in their decision.

It turns out, the $14M the state needed to conduct their little crackdown never made it into this week’s state budget plan which was negotiated and finalized between state lawmakers and Gov. Brown.

It came down to an internal dispute between state agencies about where exactly the money should come from. Some felt that it should be funded via the Cannabis Tax Fund, but others felt this was an inappropriate use of that coffer and instead argued that the enforcement of the crackdown could be financed through the state’s General Fund.

Amy Jenkins, a spokesperson for the California Cannabis Industry Association (CCIA), expressed her displeasure for the lack of action in the state capitol, vowing to continue to work with lawmakers to combat unlicensed growers and retailers.

After news of the crackdown’s collapse went public, Jenkins was quoted saying, “Since the rollout of the state licensing framework earlier this year, CCIA has consistently maintained that additional resources are critically needed to ensure that lawful cannabis businesses can successfully compete in the California marketplace.”

As it so often does, political red tape ground the program to a halt, and for now at least the west is still a bit wild.

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