Chain Dispensaries Limited to Four S.F. Locations

Franchises can only open four pot shops in San Francisco, as the Board of Supervisors hashes out another new set of cannabis laws.

San Francisco’s distaste for formula retail now extends to cannabis stores too. In unanimous votes both Tuesday and last week, the S.F. Board of Supervisors approved a large package of new legal marijuana regulations. The most notable change, at least for everyday marijuana buyers, is that each cannabis business will be limited to four permits in the city.

Right now, the only San Francisco dispensaries with more than one storefront are Harvest (on Geary and off Mission) and the Apothecarium (Marina, Castro, and South of Market). But a look at all of the businesses applying for new dispensary permits shows that some larger companies are applying for as many as five permits.

“We all want to prevent chain stores from gobbling the industry up,” Supervisor Aaron Peskin said before last week’s vote. Peskin himself added the four-permit limit as an amendment to the larger set of regulations sponsored by Supervisors Malia Cohen and Rafael Mandelman.

Equity applicants — those War on Drugs victims given priority in permit applications — argue that the four-permit cap is unfair to them. Some supervisors had concerns that the limit wouldn’t apply to existing dispensaries, creating a loophole since the law classifies them differently than new applicants.   

“That limit of four will apply to our new retail storefronts,” Mandelman said. “The existing dispensaries are operating under ‘grandfathering’ where they continue to operate under these new rules. But going forward, they will be subject to the limit of four.”

The package’s other new regulations are business matters that will not affect retail shoppers much. Temporary permits are now extended for another year, there are slight changes to the Equity and incubator programs, and some new protections were added for Medical Cannabis Dispensaries who lose their storefront leases. The Board will continue to tinker with some of these regulations into the new year.  

“This is not quite done yet,” Board President Malia Cohen said. “We hope to have it done in the next couple weeks.”  

In a separate measure, the Board passed a rule that 35 percent of any cannabis business’ new hires be enrolled in a state-approved apprenticeship program.

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