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Cannabis' Regulatory Home Stretch



It looks like Fortuna residents might be able to get weed delivered to their homes after all.

The California Bureau of Cannabis Control, Department of Food and Agriculture and Department of Public Health released proposed updates to their cannabis regulations on Oct. 19, kicking off a 15-day public comment period that will be open through Nov. 5. The updates themselves come as a result of state regulators getting more than 6,000 comments on their last draft of state regulations.

If permanently adopted, the proposed changes would have some sizeable impacts on everything from the way cannabis is packaged and delivered to how much information is publicly disclosed about those invested in cannabis businesses.

Here's a list of the more notable changes at a glance:

Delivery: The new rules continue to maintain that cannabis can be delivered anywhere within the state, rebuffing the objections of state law enforcement agencies and a variety of cities and counties. This is notable, as just 25 percent of California's cities and counties currently have ordinances allowing legal recreational cannabis sales, according to an analysis by the cannabis website Leafly. But the proposed regulations do tip their hats to the public safety concerns raised by law enforcement by reducing the amount of inventory a delivery vehicle can carry from $10,000 to $5,000. If this provision holds, it means residents of cities that have banned commercial cannabis activity — like Fortuna, for example — would be able to get marijuana products delivered to their doorsteps. The regulations would also outlaw "weed brokers," or unlicensed third-party businesses that profit from acting as middle men and facilitating delivery transactions.

Packaging: The new regulations would shift child-resistant packaging requirements from manufacturers to retailers until January of 2020. This spares manufacturers the added expense of child-resistant packaging but means retailers will have to once again use the zippered "exit bags" that were prevalent in the wake of Jan. 1.

Events: Licensed cannabis events would no longer be confined to the state's 80 county fairgrounds or district agricultural association properties. Humboldt County has been without a cannabis event this year due to the prior regulations, which limited potential venues to the Humboldt County Fairgrounds and Redwood Acres, both of which can't host the events for various reasons. But this new provision — if it becomes part of the final regulations — could open up the possibility of cannabis events in a wide variety of local venues.

Transparency: The new regulations would require cannabis businesses to make public far more information about who they are profiting. More specifically, they would require businesses to disclose anyone who is in line to receive a share of their profits — whether through a landlord-tenant lease, an employee profit sharing plan or contracts with accountants, attorneys or other agents.

Fees: In what will surely be welcome news for many Humboldt County cannabis businesses, the proposed regulations would also lower annual license fees for small operators. For example, retailers with annual revenues up to $750,000 would previously have seen a $4,000 fee for a 12-month license but the new proposal would carve out a $2,500 license fee for retailers with sales less than $500,000. The proposal — which comes as a response to industry concerns that high fees were encouraging some to stay in the black market — left the fee structure for larger operations unchanged.

Advertising: The latest proposed regulations also have some changes for the way cannabis can be advertised. Most notably, retailers won't be able to promote giveaways of anything — even non-cannabis products — in an effort to bring folks into their storefronts. Further, ads won't be able to depict anyone under the age of 21, up from the current rules, which prohibit depictions of anyone under the age of 18. Finally, the new regulations outlaw cannabis billboards on highways within 15 miles of the California state line.

The Bureau of Cannabis Control will be accepting comments on the proposed regulations — which can be found at www.bcc.ca.gov — until Nov. 5. The state's final regulations must be sent to the Office of Administrative Law for review by Dec. 3.

Thadeus Greenson is the Journal's news editor. Reach him at 442-1400, extension 321, or [email protected]. Follow him on Twitter @thadeusgreenson.

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