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California

CANNABIS DISPENSARY REGULATIONS FOR CALIFORNIA

To set yourself up for long-term success in this growing but competitive industry, you’ll need to know exactly what’s required in order to stay compliant with state law. Being found in violation of any regulations – even for a seemingly small infraction – can result in losing the license you worked so hard to get.

California Dispensaries are cross-regulated by three separate entities. The Bureau of Cannabis Control is the primary regulatory agency for California’s dispensaries, overseeing commercial licenses for medical and recreational cannabis retailers, labs, distributors, and events. The California Department of Public Health’s Manufactured Cannabis Safety Branch regulates and licenses commercial cannabis manufacturers, while CalCannabis Cultivation Licensing oversees cultivators’ certification and tracking.

To operate legally, dispensaries in California must obtain a retailer’s license from the Bureau, which offers both Type 9 and Type 10 licenses. Type 9 licenses are required for eCommerce, and Type 10 licenses are necessary for traditional storefront dispensaries.

As part of the application process, a $5,000 bond must be paid to the state, and dispensaries must be at least 600 feet away from any school and have limited hours of operation (6:00 a.m. to 10:00 p.m. PST). Each city has additional regulations and fees that must be followed, and the total cost can exceed $100,000 depending on income and other factors. Additionally, the state levies a 15% excise tax on all recreational cannabis sales.

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CANNABIS LEGALIZATION HISTORY IN CALIFORNIA

California has a long and complex history with cannabis legalization. In 1996, California became the first state in the U.S. to legalize medical cannabis with the passage of Proposition 215. This allowed patients with certain medical conditions to obtain and use cannabis with a doctor’s recommendation.

The California State Legislature passed the Medical Marijuana Program Act in 2003 to establish California’s medical cannabis program. The MMPA enabled the Department of Health to issue patient identification cards and allowed for the creation of patient “collectives.” These collectives are authorized to grow and distribute marijuana to approved patients who are members of the collective.

In 2016, California voters approved Proposition 64, which legalized the possession, use, and cultivation of cannabis for adults 21 and over. The law also created a regulatory framework for the commercial cultivation, production, and sale of cannabis products. Since the passage of Proposition 64, California has faced challenges in implementing the law and regulating the cannabis industry. The state has struggled to issue licenses to cannabis businesses, leading to a thriving black market. Additionally, high taxes and regulations have made it difficult for licensed businesses to compete with the black market.

In recent years, California has also taken steps to address the harms caused by the war on drugs and the disproportionate impact of cannabis prohibition on communities of color. This includes measures such as expungement of past cannabis convictions and social equity programs to promote diversity and inclusion in the legal cannabis industry.

LAST UPDATED 5/10/2023 – It’s important to remember that laws can be revised and updated frequently, so please keep this in mind.