California lawmakers are looking to Amsterdam to help save the state’s struggling cannabis consumption lounges.
A new bill introduced in the state legislature by San Francisco Assemblymember Matt Haney would allow cannabis lounges and retailers to offer food, drink, and live entertainment like the cafes made popular in the Dutch city.
Plus, California’s cannabis industry could see another commerce boost under the state’s latest step towards making interstate trade in marijuana a reality.
Leafly Senior Editor David Downs breaks down the latest efforts to revitalize California’s cannabis business.
What kind of impact could Assembly Bill 374 have on cannabis lounges and retailers?
it would just make [the experience] more civil. It sounds like such a nice experience — let stoners get together, smoke, eat, and listen to music. We're doing it anyway.
Assembly Bill 374 would add the ability to prepare and serve food at cannabis lounges, as well as potentially host live music. Activists and the industry are saying [that] it’s weird that you can go to a bar and get a burger and listen to a band, but the laws right now preclude making a grilled cheese sandwich and serving it to someone in a cannabis lounge.
Just for context, there are [roughly] two dozen lounges licensed in California. You need to have a local license, not a state license, for that consumption lounge, and that requires some regulatory innovation. So there's very few cities — seven years after voters approved [Prop 64] — that have taken that step to allow consumption lounges, most of them are in San Francisco. Down in SoCal, West Hollywood is really leading the charge with regard to the ability to get together and smoke a little bit and eat.
To me, it's just infuriating that we're at this dynamic where the industry is begging for state and local officials to just lift the boot off their necks a little bit and let them be normal. The industry and its fans are saying that over taxation and regulation is really stunting any further growth, so this bill chips away at the onerous rules on cannabis.
What are you hearing from cannabis retailers and lounges about the bill?
I was kicking it at Moe Greens Lounge on Market Street in San Francisco, and they are really hoping for the rules to lighten up a little bit. They're dying to get people back in the door as the city tries to restart the downtown core post-COVID.
They have a really nice facility and you can smoke all the wonderful pot there, but if you want anything more than a drink of water, you're going to have to go to another spot.
Most retailers with lounges or aspiring to have lounges are looking at this bill as a potential bright spot in an otherwise turbulent volatile year for cannabis in general.
The bill would not impose new regulations on cities and counties. What does that mean?
This is just the state saying it's possible [to offer food, drink, and live music at cannabis lounges and retailers]. You're still going to need a bunch of local action and arm twisting to make it happen.
How likely is it to pass?
It’s going to get a hefty debate. It’s like there is a spirit of progress that's in the air about optimizing legalization [in California,] but the headwinds are out there, too.
I see conflicting forces. I see some people trying to take the boot off the neck of the legal industry and give them a chance to survive. But then I see others that are ready to pile on new regulations on them.
What is the latest action in the effort to launch interstate cannabis commerce?
We've got a turn of the screw for people who are bird-dogging interstate commerce and the ability for California to sell its excess cannabis crop into other markets.
On January 27, the Department of Cannabis Control (DCC), the regulators for the biggest legal weed market on the planet, asked the state attorney general to give them a written opinion that the state would bear little to no legal risk for negotiating authorizing agreements between states to do legal interstate cannabis commerce.
This is something that the DCC needs to get from the [attorney general] in order for Senate Bill 1326 to allow the creation of a controlled way to ship cannabis across borders. This puts California at the front of the pack in terms of the interstate commerce discussion.
How big of a deal is this?
Think about how far we've come. We have 21 legal cannabis states now, and Guam and D.C. In California, [cannabis] is a $6 billion a year legal business … and California has been the No. 1 supplier of pot since the 80s. And here we have the number one regulator saying, “We want the attorney general to tell us that it's going to be fine. The feds aren't going to sue or prosecute the state of California for authorizing weed shipments. Give us the green light to go out and work on this a little bit more.”
I think that is a pretty big move. It's going to be a shot across the bow of federal lawmakers who are watching all this happening, as well as a green flag to other state lawmakers who might want to buy some of California's cannabis.
Who would California partner with for interstate trade?
It's going to be tricky. A lot of the states have their own silos which might be labeled unconstitutional, because the U.S. Constitution has the Commerce Clause, which specifically bars states from discriminating against interstate commerce. Interstate commerce is going to upset a lot of interests and other states where they're trying to control their market and benefit their farmers.
Why would interstate commerce be good for the industry here?
It is a huge boon to consumers in terms of more choice and lower prices, which is naturally what happens with free trade.
It also might be a lifeline to growers here in California, where outdoor pounds [of cannabis] are at $500 or $600. They might be able to sell those pounds wholesale, or double that, or triple that in other markets.