The Law is Moving Too Slow for America’s Fastest Growing Industry
Imagine that you applied for a driver’s license with your state but in order to do so, you had to employ lawyers or consultants to help you through the application and then submit a fee of thousands (or tens of thousands) of dollars to your state along with that application.
Now imagine that your temporary license has been expired for two years and even though you have provided everything that the state has asked for, including that hefty application fee, they continue to insist that they are just too busy to issue you, or anyone else, a permanent driver’s license.
Would you walk to work?
Or would you weigh and take the risk of driving anyway, knowing you’ve done all you can to satisfy the law?
That is the morally conflicting position that thousands of California’s cannabis growers find themselves in now well over two years after California voters approved Proposition 64 to establish a legal, regulated market for the cultivation, processing, manufacturing, testing, distributing, and selling of weed in the Golden State.
The California Department of Food and Agriculture (CDFA) is the regulatory agency overseeing the licensure and compliance of the root of the state’s new multibillion dollar industry – the growers themselves. But, so far, the agency has failed miserably at providing reasonable turn-times to process the applications for growers looking to transition from temporary or provisional licenses into more permanent annual licenses.
Since the state has declared that the thousands of pending temp licenses will not receive any further extensions, all eyes have been on the CDFA to see if they would then hold up their end of the bargain and clear their massive backlog of applications.
THE ROOT OF THE PROBLEM
In our last article, we reported on California Senate Bill 67, a legislative effort aimed at helping the state’s cannabis farmers stay legal long enough to realize the annual license they are seeking.
If a farm’s temporary license expires anytime between now and Croptober, they can’t just put the harvest on hold… there is no pause button on pot. So then they will have a difficult decision to make, not unlike the driver’s license scenario we spelled out above. We called SB 67 a “Band-Aid on a Bullet Wound”, and it appears that we were correct.
The bill itself made it through the state senate last week with awesome bi-partisan support and now heads to the State Assembly where it is expected to receive a similar welcome. The skids are greased to have SB 67 make it to the Governor’s desk for a final signature in near-record time, but it’s still not happening nearly fast enough.
4,000 temporary cultivation licenses are set to expire this month alone.
On the same day that SB 67 made it through the senate, the CDFA issued a record-breaking 70 annual licenses. If they could keep that pace every day, they could conceivably get through their backlog in just over three months.
Of course, the very next day, they processed just 16 temps into annual licenses, so the law of averages is not in the favor of Cali’s conflicted cannabis growers.
In the meantime, thousands will expire each month until SB 67 is written into law – if it ever is.
What this convoluted process has revealed is that those who did their due diligence early and submitted all of their paperwork ahead of the rush are the ones being punished the most severely by these delays by the state agencies.
Those who applied earlier are seeing their extended temporary licenses expire sooner than those who waited until the last minute to submit their applications and will now have later expiration dates and be able to bridge the gap to SB 67 more easily.
There are many reports of annual licenses being granted on applications filed later than some that are still pending a decision from the CDFA indicating that there is no “line”, no rhyme nor reason, and cultivators on the cusp are growing restless.
WE SAW THIS COMING
When Prop 64 was being sold to the California voter, there were basically two blocs on the pro-cannabis side that needed to be convinced – the producers and the consumers, supply and demand.
For the average cannabis consumer, it was an easy sell. They were duped into thinking that pot shops would crop up in every town and very, very few of them ever read ten words of the proposed legislation before voting on it.
For the folks on the supply side of the curve, particularly the growers, there was a bit more skepticism. Nobody who laid their freedom on the line for the past decade or two to pave the way for legal weed wanted to see big business swoop in and take it all away from them.
But Prop 64 specifically placed a 1-acre cap on all outdoor cannabis farms for the first five years that the law would be in place in an attempt to allow small to mid-size “mom and pop” grows and legacy operators the chance to get established before the inevitable wave of corporate cash flooded the market… and the government agencies.
That one stipulation was enough for many grassroots cannabis advocates to hang their hats on and support 64, but, of course, that entire clause went up in smoke as soon as legal weed became a reality in California.
Some of the most successful business leaders in California’s crippled cannabis market today were instrumental in abolishing that essential 1-acre cap protection and they have reaped untold profits in the wake of that bait and switch.
By allowing these corporate entities to “stack” multiple licenses onto one property not only has the state greenlit a sea of boof weed farms, but they have created the overflow that they now slog through.
This lag is punishing the same small to mid-size farmers that Prop 64 promised to protect.
Meanwhile, Gov. Gavin Newsom has vowed to spend $200 million in taxpayer dollars combatting unregulated cannabis production and sales in 2019. He has assigned over 100 National Guard troops to deploy to NorCal to start some sort of Wolverines remake as they kick down doors and uproot farms and families over a plant that the state itself can’t even properly babysit.
Maybe the gov should have those troops set up camp in Sacramento to start processing paid and delayed cultivation applications.