On Jan. 1, 2018, you will no longer need a doctor’s note to buy the good stuff.
2017 was a year dominated by debates within the state’s cannabis industry on every aspect of how regulations for selling adult-use cannabis on the state and local level should look. Now, just days remain before Prop. 64 takes full effect and permits the sale of recreational marijuana in California.
Two weeks ago, Berkeley Patients Group became the fifth dispensary in the state — and the first in the Bay Area — to officially receive its retail license. COO Sean Luse is glad the wait is finally over.
“This has been a long time coming,” he says. “We opened Berkeley Patients Group in 1999, so we were there as pioneers at the beginning of medical marijuana in California, and we’re going to do it again and be some of the first to open the doors to full, adult-use sales.”
Recounting the path the company has traversed to get to this point, Luse notes they’ve endured more than a few “bumps in the road.” Looking over the timeline, it might be more accurate to call the issues that have plagued dispensaries like Berkeley Patients Group a 10-car pile-up, from battles with the Bush administration to the unexpected state crackdown in 2011 that left Luse without a storefront.
“We had to rebuild from nothing,” he recalls.
However, with the 2015 passage of the Medical Marijuana Regulation and Safety Act (MMRSA), the future of cannabis in California began to take shape. After voters approved Prop. 64 the following year, Jan. 1, 2018 became the date to be ready for.
Yet for Luse, being able to sell adult use is not the end game, but the beginning.
“We look at Jan. 1 as the starting line, not the finish line,” he says. “There’s still going to be a lot of work to do to really fine-tune this.”
One area Luse is especially concerned about is the amount of taxes being levied on adult-use sales. While California’s tax — 7.25 percent — is in line with what other states that sell recreational marijuana are charging, there is currently no cap on the amount of local taxes that can be piled on. This means that a gross receipts tax can be charged all along the supply chain, from cultivation to manufacturing to distribution to retail.
For Luse, it all boils down to a question of whether consumers choose the regulated market if black market alternatives are substantially cheaper.
“It definitely concerns me when you have an effective tax rate north of 50 percent,” he says. “I think everybody who has their ear to the ground knows that there’s plenty of unregulated marijuana in California and it can be pretty cheap these days. With that in mind, will we really be able to stay competitive?”
While the weeks and months to come will surely bring intense scrutiny over where to draw the line on taxes, the immediate focus is one of celebration. Berkeley Patients Group plans to open at 6 a.m. on Jan. 1 — the earliest it can legally sell adult-use cannabis — and Berkeley Mayor Jesse Arreguin is expected to mark the occasion with a ribbon-cutting ceremony.
As for who exactly will be queuing up to be one of the first to buy recreational cannabis, Luse points to the customers he saw enter his Nevada dispensaries when the Silver State went legal in November 2016.
“I was there on the first day of sales in Las Vegas,” he recalls, “and the amount of people who were there who still wanted to ask about what’s going to work for their back pain or what’s going to help them with insomnia was tremendous. They were still really using it for medical purposes, but under the label of a ‘recreational’ consumer, just because that was the first system that really felt legal and safe for them.”
Whoever ultimately attends Berkeley Patients Group’s inaugural day of recreational sales in California can expect a party.
“We’re still putting all of the pieces together,” Luse says, “but it’s definitely going to be a big celebration. We’re going to really try to make it a nice event. Mayor Arreguin will say a few words, and I’ll probably say a few words, just to mark the historic moment and kick it off. Then we’ll get down to business.”
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