L.A.'s New Pot Era Begins With Debate Over the Number of Shops
Nanette Gonzales

L.A.'s New Pot Era Begins With Debate Over the Number of Shops

Los Angeles voters this week finally said yes to fully legalizing marijuana dispensaries in town. Measure M passed with a whopping 79 percent in favor.

The law, spearheaded by City Council president Herb Wesson, empowers the council to issue licenses to collectives, with priority given to the 135 or so medical marijuana dispensaries that are compliant under current law. It also allows the council to expand the number of weed retailers (paving the way for recreational shops, which state law will begin allowing next year), open the door to delivery, permit cultivators and edibles makers, tax pot enterprises and shut down scofflaws with the help of increased penalties.

Supporters of Measure M say the hardest work lies ahead. That includes figuring out how many dispensaries beyond the 135 should be legalized, whether to allow delivery apps like Speed Weed to operate within city limits and how to regulate growers.

Members of the Southern California Coalition, a collective of marijuana businesses and advocates that was the main backer of Measure M outside City Hall, want the free market to decide how many pot shops should be allowed in L.A. "You should have zoning and land use and the free market dictate what the numbers are," says Adam Spiker, the group’s executive director.

Spiker estimates that there are as many as 1,700 pot shops in the city today (the vast majority of them illegal). Some of those illegal ones should not be granted permits, he says, but others have tried to abide by the law and should be allowed to exist under the new regulations.

Members of the United Cannabis Business Alliance (UCBA), a group that represents a good slice of the 135 quasi-legal dispensaries, have favored more limited expansion of weed retailers. UCBA president Jerred Kiloh says permitting a total of 300 — more than double the number of dispensaries currently tolerated by City Hall — is more like it. “Based on the demographics, we feel the market is larger and more densely populated” than the current 135 legit shops are prepared to handle, he says.

The Southern California Coalition also has been more supportive of permitting weed delivery services, though both groups acknowledge that such services could be limited by state law. According to his reading of the Medical Cannabis Regulation and Safety Act, Kiloh says a delivery service licensed by City Hall would have to operate a permitted brick-and-mortar facility. However, that facility wouldn’t necessarily have to be a retail dispensary, he says.

"Wherever they're warehousing the product, that's where they’ll have to have a permit," he says. "There shouldn’t be a monopoly on dispensing just because you’re a retail shop."

Discussing these details, however, is like choosing the color of a car that hasn’t been designed yet. Measure M has a twisty road ahead that will include public input (including that of traditionally hostile neighborhood councils) and the creation of a bureaucratic agency to oversee permits and regulation.

Wednesday night, the City Council's Rules, Elections, Intergovernmental Relations and Neighborhoods Committee recommended that the city set up a Cannabis Licensing Commission that would be composed of three mayoral appointees and two council appointees, all of whom would serve staggered, four-year terms. The committee recommended that one of the mayor's people be a member of a neighborhood council. And it wants a full-time executive director to be sought, starting July 1. The cannabis commission would "administer the cannabis license and public hearing process," according to a city memo.

Kiloh says there are probably a few thousand cultivators in town as we speak, with most of them likely to vie for a license. Each permit could require an alcohol-style licensing process that includes a public hearing. On top of that, Building and Safety officials would have to figure out what a proper cultivation setup looks like. "All that needs to be decided," Kiloh says.

While draft regulations already have been circulating among marijuana business groups, under Measure M the city must have its rules and regulations up and running by Sept. 30. The Rules, Elections, Intergovernmental Relations and Neighborhoods Committee recommended that applications for pot business licenses be made available by Sept. 1.

"We take that vote Tuesday night very, very seriously," Spiker says. "The folks who did vote gave us a mandate to get cannabis right in the city of L.A."

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