It all comes down to local control of licensing. To even operate a 100% mobile business, you have to be licensed out of a specific city. This involves all the associated cronyism, NIMBYism, and the like which goes along with local politics, and grinds the whole system to a halt. We need to adopt a statewide system like Oregon or there will be no room for smaller distributors left and we will be stuck with monopolized pricing.
I'm personally fine with local control, and despite the negative tone of this article, it all sounds pretty normal to me.
I live in SF, where there are a variety of shops. The ones I walk by all seem clean, orderly, and well run. Certainly more so than some liquor stores I can think of. So I'm happy to have them as neighbors. That said, I understand why other cities would have been more reluctant to license. Not everybody needs or wants to be a pioneer.
If we're still having the same problems 5 years out, I'll be more concerned. But personally, I'm a big fan of subsidiarity, the principle that decisions should be made as low down in the power structure as possible. [1] That different people are deciding differently right now is how we'll learn the best ways to do it. There's no urgent problem here that requires a centralized solution.
I feel like the problem with that idea is right there in the first sentence of the wikipedia article - should be dealt with at the most immediate (or local) level that is consistent with their resolution. Who decides what level that is? It never seems to be very straightforward, and a lot of important things end up having consequences that go way beyond what the folks arguing for the most granular level of local control will admit (see - housing, transit, climate change).
Recreational pot sales is probably a pretty small issue in the scheme of things and will likely sort itself out eventually since there's money to be made. But the idea that local control is fundamentally a good thing seems pretty suspect to me based on how many examples there are of it going so badly.
No principle is universally applicable or produces perfect results. So I think, "If applied naively it sometimes has problems," is not a useful criticism of a principle.
The examples you raise seem to be ones where you're saying that local control is not consistent with resolution of the issue. So it seems like you're agreeing with the principle, not contradicting it.
Climate change and transit offer pretty clear examples where people have decided local control isn't sufficient, so they're resolving it at higher levels. See, e.g., the Paris accords, BART, and the various state and federal highway systems.
Housing is clearly more complicated, but it seems like the principle is often being applied there too. Most control is local, but where that doesn't work, we see attempts to resolve it at higher levels. E.g., California's recent battle over the Costa-Hawkins Rental Housing Act and Prop 10.
Do you have an alternative principle in mind? If we don't start with the assumption that local control should be preferred, then what do you suggest instead? Historically it was the divine right of kings, which I'm not a fan of. And giving all power to the UN or the national government unless they decide otherwise also doesn't seem great.
Another way to have the same principle is to have the state lay some very basic ground rules or none at all (just a normal store), and allow localities to create restrictions as they see fit. This is how almost everything else is done.
This is an algorithmic issue up to a point. Local optimization is often 'easier' than global optimization but does not necessarily find a global optimum.
On the other hand, some systems do just fine navigating a complex problem space by just solving large number of local optimization problems. See for example slime molds, which are colonies without centralized nervous system, yet manage to move and forage for sustenance successfully as long as the environment is solvable.
It's more efficient if everyone get's their own breakfast but the central bank should take care of the interest rate affecting the money that's used to buy the breakfast. Etc
[IANAL] if my city and all the others around prohibit such stores it is de-facto equivalent to Prohibition in that area while the state level amendment granted that right to all the people in the state, and no local government has the power to exclude it own particular local area from the amendment.
The same principle as with for example right to vote with no voting place in N (for sufficiently large N) miles radius.
Yeah ultimately you're being stripped of your state given rights by a locality run by cronies where it takes millions jus to win a seat on the local board of supervisors. Even though we do have ballot initiatives, a non-democratic, corrupt local process can ultimately strip you basically of all your rights. This also impacts criminalizing poverty by local governments where basically being low income and being there is a crime.
The City of San Diego is the second largest city in California and the eight largest in the United States. For the latest election cycle the City Council fundraising was in the low $100,000 — hardly “millions.”
I think the total across all races in the entire county (school boards, ballot measures, multiple city councils, water districts, everything) was about $33 million for all candidates. SD County is so big that if it were a state it would be about 20th.
So at less than an programmer salary, what you're saying is that there's ample opportunity for enterprising software artists to take over and automate the whole thing.
I went to college in a dry county. You could not purchase take home alcohol in the county, but you could still possess it and drink it there. You just had to drive a little further to get it. It was a limit on convenience only.
Some may see high monopolized prices and having to jump through hoops as "fair": that is, cannabis use is not "good" and thus should not be made easy or cheap. See alcohol and tobacco.
IDK if this mindset is widespread enough in California. But coincidentally such an approach does improve the bottom line of large / established sellers.
Then those people are actively seeking to maintain the supremacy of the black market, despite decades of evidence as to the inability of such measures to reduce consumption. Maybe people who have such ignorant and baseless beliefs shouldn’t be heeded.
Yeah, but they don't and won't see it that way. The people with these types of reactions seem to think things go away when you make them illegal (probably aided by them having never actually seen the problem firsthand anyway).
You can choose to heed their views or not, but they still get to vote the same as you.
I think the grandparent comment just switched some words around. I think it's meant to be read as "To operate even a 100% mobile business...". I.e., these restrictions apply even if your business is 100% mobile.
The town I live in in the bay area (south) pre-emptively passed an ordinance re-banning pot before it was even made legal. They didn't take a vote, they just did it.
Maybe this article overstated things and someone will clear it up in the comments but that was painful to read.
I live in Vancouver and weed's been officially legal throughout the Canada for several weeks now. It's still relatively new but nothing noticeable has changed aside from fewer people discussing such a frivilous and previously mishandled issue. It's not perfect but far, far, far better than strict prohibition with draconian sentencing laws.
What bothers me the most about this story is how marijuana is supposedly 'legal' yet some locals seem Hell-bent on treating it like an illegal and necessarily dangerous. Instead of vocferiously refusing shops to open in a municipality you'd think the free market would be enough to determine where there's not enough demand for a product.
I guess if some people prefer being judgemental and pious to actually getting a handle on social issues that's their prerogative. It's a frustrating position to reason against, in fact that almost never enters the equation, but it sure seems to resonate with a lot of people.
> What bothers me the most about this story is how marijuana is supposedly 'legal' yet some locals seem Hell-bent on treating it like an illegal and necessarily dangerous.
It is still illegal at the federal level. There is nothing that stops the federal US government from throwing someone in jail for growing / transporting / using / processing payment for marijuana.
I cannot think of anything else that is illegal at the federal but legal at the state level, and has weird hand wavy aspects in front of it.
"There is nothing that stops the federal US government from throwing someone in jail for growing / transporting / using / processing payment for marijuana."
I always wondered about that. Has there been any chatter about someone trying to get a federal court to nullify the law? I have no idea how that can work.
> Has there been any chatter about someone trying to get a federal court to nullify the law? I have no idea how that can work.
The US has signed up to a treaty that requires us to treat marijuana as an illegal controlled substance. That requires an explicit act of Congress to abrogate, and no court is going to find otherwise.
> The US has signed up to a treaty that requires us to treat marijuana as an illegal controlled substance. That requires an explicit act of Congress to abrogate, and no court is going to find otherwise.
In any case, the relevant treaty is not self-executing, and there is no mechanism to force Congress to criminalize drugs if it chooses not to even without explicitly abrogating (or even the President unilaterally disavowing) the treaty. Foreign countries could try to bring a case against the US before the ICJ, but even if successful, that wouldn't actually force changes to domestic law.
Although the treaty does seem to be pretty clearly prohibitionist, there is some debate (covered under "Possession for personal use", https://en.wikipedia.org/wiki/Single_Convention_on_Narcotic_...) as to whether or not the treaty requires member states to prohibit possession for personal use.
2/3rds of the membership of the Supreme Court has changed since Gonzales vs. Raich. There might be more skepticism about applying Wickard here given that the majority of Americans now support legalization. It shouldn't matter in theory, but it it probably does to some extent. I could see RBG changing her vote from last time and possibly Souter as well, especially if the case could be distinguished from Wickard in such a way that doesn't call into question large swaths of the modern federal government.
Federal laws can't be arbitrary, though - they need to fall under one of the enumerated federal powers.
Problem is, ever since Wickard v. Filburn decision, all that the federal government needs to do is to add "... in interstate commerce" in the text of the law, and it is magically constitutional. The words themselves have practically no meaning - in Wickard, the Supreme Court ruled that a person growing food for personal consumption is still "participating in interstate commerce", on the basis that they'd have to buy that food otherwise, and therefore affect market prices on it.
Technically the federal government can only impose penalties for recreational cannabis. Medicinal cannabis is also federally illegal, but congress has prohibited any resources from being allocated to enforcing prohibition against medical marijuana businesses or users who are in compliance with state law.
But the commenter is right about it being illegal at the federal level... and as a Schedule I drug on par with Heroine no less but more dangerous than Hydromorphone (HA!).
You are right it is an outlier and some would say not ideal. It is transparently a breakdown of rule of law into realpolitik given constraints and the redundant levels of powers - from what is fundamentally bad law and consistent failure to respond to facts on the ground. It brings to mind the old bit of legal philosophy about unenforceable laws breeding contempt for the law in general.
The Federal government can technically roll up and enforce the laws federally at any location they please but they don't have the budget or manpower for it. Unfunded mandates can't be enforced upon the lower levels of enforcement and they depend upon them for cooperation. They could technically have thrown the bulk of their enforcement budget into an early adopter but that would be playing whack-a-mole as others could crop up and openly defy them while they are busy there - all while 49 other states are complaining about there being way better uses of their resources than replacing every vice squad in California.
The federal government caused the problem in the first place in their adamant refusal to acknowledge reality with Schedule 1 classification - not just in assigning it to marijuana which trivially has medical uses but in that the very category is a tautology. We don't know if something has medicinal use until we try it in every application. For all we know even something horrific like krododil may be very good chemotherapy for treating specific kinds of tumors. Weaning off of heroin may well be the best approach to beating addiction - it is already accepted for nicotine in general practice! The specifics don't matter so much as the general point that Schedule 1's very existence is an outright tautology and illogical dogma.
They could have avoided the massive backlash and much of legalization movement's momentum being a serious thing by making Marijuana schedule 2. This isn't even something radical, not even decades ago - you have been able to find cocaine in ENT applications throughout the country perfectly legally given that there really is no better substance despite the known downsides.
The whole thing is fundamentally a failure state on the law. It is technically a solution in that it prevents enforcement of bad laws but it really highlights the systemic dysfunction and creates greater inconsistency. It is a matter of debate if being able to have this is a good thing or not.
I can think of one similar issue as well however that is even lower. The Sanctuary City "issue" (an emergent solution that some don't like) is a similar disconnect of high-level dogma colliding with and failing to respond to low-level reality - any significant urban police force knows they would have to be extremely stupid to have a zero-tolerance deportation policy when they depend upon the population for witnesses and crime reporting. It is beyond a matter of even demagogic politics locally while many above consider its state unacceptable.
TL;DR version - the law refused to bend so it broke instead.
While I don't disagree with much of what you said, your characterization of schedule 1 generally is factually incorrect. There is still testing of schedule 1 substances; as of 2017 there were more than 590 researchers registered to study schedule 1 substances. Both THC and CBD have been approved for medicinal uses (Marinol and Epidiolex respectively).
Yet the whole reason medical marijuana 'broke out' of doctor control in California was the DEA threatening to arrest any doctor who wrote a prescription for it. So it went off of something other than the prescription of a registered doctor undermining their point with their zeal.
Schedule 1 substance research has long had far more 'propaganda machine' orientation than science orientation however with the agenda transparently reflected in studies.
All of the giving spiders drugs studies to look at their webs while it may have some slight neurological value ignored the bleeding obvious with some examples like the 'caffeine' webs.
Of course those webs looked sparse, caffeine is a known neurotoxin to insects! That is why plants produce it in the first place and spiders wouldn't even have much reason to develop a resistance given most species have a carnivorous diet, their prey would have more of a reason to and prey that is dying of neurotoxin would be far less likely to survive to land in their web. Perhaps caffeine's inclusion among the study was a snide point on someone's part about the applicability of spider models to vertebrates.
Meanwhile they knew about MDMA use therapeutically yet it took to the 10's to start using it for PTSD again in clinical trials. Sorry lost generations of veterans - there was another war for you to be a casualty of.
It is still having politicians try to practice science - and I'm not sure how applicable those two are when they were dragged from them kicking and screaming essentially. It is still a political process instead of a scientific one.
A lot of the concern is essentially about the precedent it sets. If you start questioning the logic of criminalizing cannabis, what's next on the list? That's the fear driving a lot of the reactionary opposition to a lot of things these days, and I think especially in the tech industry we have to remember that a lot of people don't have our appetite for risk.
Personally I think we as a society have demonstrated a considerable capacity for adaptation, so there's little to worry about, but my extended family certainly disagrees. There are a lot of other linked issues that operate similarly and it's a bit of a tragedy.
"A lot of the concern is essentially about the precedent it sets. If you start questioning the logic of criminalizing cannabis, what's next on the list?"
Plus ça change, plus c'est la même chose.
It's ironic that for so many Americans the idea that people should be allowed to make their own choices would be such a tough sell...
"It's ironic that for so many Americans the idea that people should be allowed to make their own choices would be such a tough sell..." Good point, if you are not allowed to put something into your own body do you really have freedom?
> What bothers me the most about this story is how marijuana is supposedly 'legal' yet some locals seem Hell-bent on treating it like an illegal and necessarily dangerous.
Marijuana is illegal in the United States. There may not be state-level prohibition in some states, but that doesn't make it legal in those states, any more than the fact that individual states may not prohibit fraud against the US government makes such fraud legal in those states.
The federal policy against enforcing the existing federal criminal prohibition of marijuana against medical use that complies with state law is an unusual complication, but the criminal prohibition still applies even in those cases (particularly, should that policy be lifted by Congress tomorrow, all the crimes that occurred while it was in place could be prosecuted—and criminal and/or civil forfeiture associated with them pursued—because neither the crime nor it's punishments were removed, so no ex post facto issues would exist.) And it's not clear what the boundaries of that policy are, and, more importantly, it's not clear that anyone but Congress itself would have standing or an available remedy should the executive branch act in a manner that is arguably outside of the bounds of the policy.
Its because they were unlicensed and could be fined up to millions of dollars for unlicensed operations (although not arrested). Licenses are being handed out now though.
The shops don't create horrid stenches. The grow ops and processing facilities do create noxious odors, but the stores hardly produce an odor that can be smelled from the street, or even in the stores.
What kind of people do you suppose loiter at these shops? From my experiences here in CO, no one loiters at these shops. The stores often have pretty tight security and attentive guards. You go in, do your business, and leave with product in hand. I would be willing to bet that the kind of people who visit these establishments is far more varied than you are able to comprehend.
Agree - I live in SF. A few months ago, after leaving my local dispensary, I was standing out front looking up directions. The dispensary security guard politely asked me to move along. I don't know where the OP is from, but around SF you actually can't loiter around the stores.
What if I don't want any kind of smoke in public places?
I know I'm well into the minority on this one, but I think it's antisocial behavior to smoke anything where the general public will catch so much as a whiff of it and the people who knowingly do it are jerks, but for some reason this is very normalized behavior. I'm not anti-drug though; smoke whatever you want cloistered away from the public.
I personally hate the stench of weed. Prohibition is good because people think twice before making an entire street reek just because they want to get high.
Burning leaves is no more harmful than deodorants.
Burning known and non debatable evidence of toxic chemicals in tobacco leaves harvest curing.
Marijuana comes out ahead.
So much misinformation about drugs. Heroin is safer than alcohol if moderately consumed. Addiction wise, not so great. but Tobacco is said to be harder to quit than heroin.
you get tar but when you light up a tobacco it has all sorts of chemicals. you are not just burning tobacco leaf, you are burning dozens of chemicals they add to it.
You can't even get high from second hand marijuana smoke outside.
Hotboxing your car however, will get you high. Certainly better than being in a car with a tobacco enthusiast.
Probably because it's been "legal" in CA for years. The "medical" cannabis was a joke. There were people on the beaches holding signs "$50 medical cannabis card". Being legal recreationally didn't really make it any more accessible. Anyone that wanted a medical card could get one in a few minutes.
For perspective Colorado has 549 retail establishments and 574 medical establishments (although many overlap) while having ~3/20 the population of California. While obviously Colorado has had retail cannabis since 2012/13, both states have areas strongly for and strongly against legalization.
Considering that the cities that do allow rec cannabis include Los Angeles, Oakland, San Francisco and San Diego, the number of retail establishments seems very low even if they were limited to only these cities. Whats interesting is that California's licensing is done through their Food and Agriculture Department while Colorado's is done through the Department of Revenue.
Reporter from CO here. I think this is the crux of the matter. If the points about a strong underground market in the article are true, it's (IMO) due to a weakened attempt at decriminalization. Very much like bittorrents before netflix/prime were widely available with large catalogs.
Here in Sunny CO, the prop was a Constitutional Amendment, guaranteeing the right of each state citizen to grow and possess their own Marijuana, which lead to sales. -Only two cities (Colorado Springs and a mountain town IDK)- created local exemptions against retail sales. They are now suffering with badly damaged roads and limited tax revenues to fix them, compared to cities right next door that capture all the sales.
Hampered decriminalization does not rid us of the black market. The [THC] black market is _gone_ in CO because who needs it? Questionable products, limited availability, difficult logistics...no, you go to the local store and five minutes later can be higher than 5280'.
Both Colorado and California had significant commercial medical cannabis industries for years and years before going recreational. Why is that not often brought up in reporting? It’s already been close enough to recreational in California for years - anyone who wanted to smoke could get a card for 100 bucks and start shopping at dispensaries, or grow their own. I wouldn’t expect any major changes from recreational in a state has had loose medical for years, but for some reason the media does.
California's neighbors to the north both have 1500+ establishments. Oregon isn't exactly big, but due to massive overproduction and no sales tax prices in Oregon are approaching sister crops like hop.
Forreal. As someone in Canada watching the weed thing play out, my prediction is that Cali would legalize and then utterly dominate.
Like the medical and recreational stuff is there, the weather is great for growing stuff, including weed, and with 40 million people -- more than all of Canada -- there is a huge base of investment capital and consumers to pull from.
Why isn't California DOMINATING the global weed trade?
I believe the current limit in California is a 1 acre parcel - that's in effect until 2023. Many counties in California still don't allow cultivation at all. If you look at the licenses that are being granted (public database), you'll see that none of the Southern California counties are even granting those 1 acre outdoor permits.
There's probably other reasons as well, but this might be part of it.
The other factor not talked about is that in general the prices seem to be going down due to a lot of supply (both on the retail/licensed market, and the grey/black market). About ten years ago, a really good pound (in bulk) could go for $3k-$4k to a dispensary. Now the high end seems to have fallen out and you're maybe lucky to get half of that. I think a lot of people ran their business plan numbers where they were, but now that there's a lot more supply, just the raw numbers are going down. There's also a lot more low quality product on the market, which pushes down prices on higher quality things slowly. And yes, the licensing, taxes, and testing are just insult to injury on top of that.
Overall I think it's a good thing though. Since real medical patients never get their pot on medical insurance, the reduction in cost really helps consumers.
Source: anecdotal data from friends that were in the industry, and prices at Harborside back in "the day."
>could go for $3k-$4k to a dispensary. Now the high end seems to have fallen out and you're maybe lucky to get half of that.
For comparison, bulk price of tobacco is a few bucks a pound. Admittedly I am not an expert in marijuana vs tobacco cultivation, but I doubt it's 1,000 times more expensive. Ultimately, the problem with profiting in a legal marijuana industry is that people simply don't smoke that much pot.
Say that there's 260 million adults in the US and they all smoke 1 joint per day. Assuming:
1 joint = 1 g of marijuana
1 lb = 454g
1 acre can yield 600 lbs of marijuana
1 farm is 1000 acres
If you do the math, that means we need roughly 350 farms worth of marijuana. Or in terms of acreage, roughly 0.04% of all the acreage in the U.S. under cultivation. In other words, even if we assume a ridiculous level of smoking there's simply not a huge demand for pot. Using more realistic amounts, a handful of large farms could produce all the marijuana consumed in the country.
Consider that a lot of mass-produced flower is used for production of concentrates. The yield weight of cannabis extracts might be 10-20% of plant matter input.
> Now the high end seems to have fallen out and you're maybe lucky to get half of that.
Barely. I do lots of work with growers.. the sweet spot for a pound these days is $600 to $850, depending on quality. On top of that, transaction volumes are increasing too.. before you could make a deal on a handfull of pounds, now purchasers are interested in buying a "box" or a hundred pounds at a time.
> Retailers and growers say they’ve been stunted by complex regulations, high taxes
I can't say I'm surprised. As someone who grew up on the Oregon border of California on i5, locals here complain about California's influence on the local economy and politics. (E.g. buying expensive land, driving taxes up)
However in Oregon, I believe our problem is with oversaturation of the market. From what I understand (not rehearsed in the subject), we literally have to give the stuff away because there's so much. For anyone who knows/cares, it's not unheard of for places to sell quality marijuana for as low as $48/ounce, which is very cheap.
Washington state took a careful evaluation before putting rules in place. They decided to target a certain percentage of the black market, both in price and distribution. Two years in, the supply is ample for the legal market, businesses are profiting and the state is making money.
The fear was was that nobody would pay for a more expensive product if you could get it cheaper, but customers like the idea of buying a product with a consistent price and quality.
Dear my. Have you considered smoking saffron, truffles, beluga caviar, or Hewlett-Packard color inkjet cartridges? You're paying 2 to 10 times as much.
> it's not unheard of for places to sell quality marijuana for as low as $48/ounce, which is very cheap
When I look at other dried herbs on amazon, they're much cheaper. E.g. thyme is about $10 for 12 ounces, oregano is $13 for 5 ounces.
Weed obviously has higher taxes, more regulation and I presume a smaller market (most people consume culinary herbs as part of their diet, not everybody consumes weed). But I'd expect the price to come down once the regulations disappear.
> and I presume a smaller market (most people consume culinary herbs as part of their diet, not everybody consumes weed)
On the contrary, I know plenty of people who consume large amounts of concentrates and don't use much herbs and seasonings with their food. I suppose unless we're counting third party foods, in which case you might be right.
> But I'd expect the price to come down once the regulations disappear
Prohibition might disappear, but I doubt when marijuana is treated as a legal psychoactive drug it will be unregulated, or even merely regulated the way culinary herbs are.
To clarify a few hort points : flowers are part of the herb and are treated / sold as herbs in the herb trade. A few common examples : Chamomile, Calendula, rose [R. gallica]
Generally, all herbs require curing [e.g., fan-driven air drying at a specific temperature] if not sold fresh; in addition, the work of developing a cultivar or strain is similar for a great many trade herbs that are farmed as opposed to gathered in the wild [e.g., the numerous types of basil, F1 hybrids of parsley, valerian cultivars of varying potency, etc etc]
The farming side is even funnier. The old-line potheads who are used to hiding, high margins, and inefficient farming are being pushed out by Central Valley farmers who look at it as just another cash crop.
Fact. What used to be junkyards and chop shops in South Phoenix [AZ] is now filled with state-of-the-art indoor horticultural installations producing this stuff at an industrial scale.
Your question really made me curious so I looked it up, the NIH keeps extensive records about this sort of thing. This is America only of course, which looks to be in the top third or so worldwide based on the WHO lists ("Western" countries or those with colonization history there and Russia seem to be higher then southern Asian and African countries in general). But in America while a majority use it, it's still lower then I actually expected digging into the definitions. In the surveys apparently 56% of Americans reported consuming alcohol, any whatsoever, in the previous month, 70% in the previous year, and 86% tried it at some point in their lifetimes.
But it's hard to see "tried once in their life" or even "a few times a year" as really falling in an equivalent "junkie" category, so I looked for "heavy drinking" which they defined as "4-5 or more drinks in 2 hours" a few days in a month, where a "drink" is a standardized measurement of ~14 grams of pure alcohol, equivalent to a single 12 oz 5% beer = 5 oz of 12% wine = 1.5 oz of 40% spirits (etc, whatever the percentage is). Just 7% of Americans reported heavy drinking in the previous month.
Alcohol is regulated and taxed, but even so beer & wine at least is pretty trivial for adults to legally acquire in most of the country and relatively cheap spirits (like very low quality vodka) as well. I don't at all want to understate the harm of alcohol abuse, it's very real (and of course can extend beyond drinkers themselves due to their actions). Even so it seems like "make everyone into a junkie" would not be borne out by legalized alcohol. Based on popular culture it's easy to assume drinking is more prevalent to a higher degree then it is, at least personally I would not have guessed that heavy drinking was only single digit percentages here.
It looks like, as in other areas, there is a strongly non-linear curve function in the population where relatively small percentages form an inordinate part of consumption. If that's the case for marijuana as well then it'd suggest we could get far more efficient harm reduction by general legalization focusing limited resources on that smaller slice?
I was curious about the details of this, so I looked it up.
There's a 15% excise tax statewide in CA. It used to be a straight 15% on top of the sale price, but now it's calculated based on the average market price for an arm's length transaction.[1][2] This is usually calculated based on the wholesale price plus a markup of 60%.[3]
On top of that, there's (normal) sales tax applied to the whole purchase, including the excise tax amount.[2] In California, that means a statewide sales tax of 7.25%, plus county and sometimes city sales taxes that can add on an extra 0-3.25%.[4]
In places with very little additional county and city sales taxes, e.g. Newport Beach[5], that means paying 15% excise plus 7.75% sales tax, for an effective total retail tax rate of 23.9125%.
In places with higher county and city sales taxes, e.g. Santa Monica [6] that means paying 15% excise plus 10.25% sales tax, for an effective total retail tax rate of 26.7875%.
San Francisco is on the lower end of the middle of the pack with a sales tax of 8.5% [7], so that means the effective total retail tax rate is 24.775%.
Of course, there are other cultivation taxes, use taxes, special local marijuana excise taxes and other permitting costs that apply to cultivators and distributors and retailers that may get passed along to customers[8][9][10], so you could say that "total taxes" are closer to 40%. But most retail buyers are paying about 24-28% on top of retail list price in sales + excise taxes.
Note: Prop 64 made it so most medical cannabis sales aren't subject to sales tax, so medical users only have to pay the 15% excise tax. [8]
> Montes, who received his city and state licenses in January, says his business faces a 15% state excise tax, a 10% recreational marijuana tax by the city of Los Angeles and 9.5% in sales tax by the county and state — a markup of more than 34%.
And of course that black market is on average actually cheaper, often by 2x than the “legal” sources. Nobody gets taxed for growing a little on the side, or buying on the black market. As usual local greed is strangling an emerging market with the potential to net billions. As usual small operators are kept behind until the big boys (Altria et al) can dominate the market and slash prices and quality.
IMO that’s what this is about; a delaying game until federal laws change and the multi nations can take over.
Another big issue might be the financial industry. Marijuana is still illegal at the Federal level so banks might be reticent to get involved with providing loans or services to these businesses. Without access to credit and banking services, a lot of people who might otherwise go into business, won't.
A former coworker's brother-in-law ran into this. He was a finance officer and got laid-off back during the Great Recession. He found a position as the CFO of a dispensary, and one of the first problems he had to address was employees doing cash pickups from the stores using their personal cars. So there were people moving $20k+ daily in their Toyotas (not especially safe!)
So he called some of the armored car firms to inquire about hiring them, and they all turned him down flat because they didn't want the chance of his cash getting intermingled with that of Wells Fargo, etc. What he did was set up a wholly-owned subsidiary to do the transport, buying a couple of armored cars to move both the money and the product.
Yeah, well that's what happens when you let local cities/counties shit all over it, and have the laws/regulations written by the alcohol and tobacco lobbies.
The market was already functioning - now with taxes, regulations, overhead ... who wants to have to find a new supplier and pay for all of that?
There may be real competition between the black market and over the counter market that will play out, particularly if the former networks are already well established.
The regulations and controls on advertising are fairly strong here, for 'vaping' in Quebec for example, windows have to be covered, and there can hardly be any wording on the signage. No advertising, no way to get the word out.
Now - for a very heavily established industry, with a very addictive product like smoking ... they can still thrive.
But for a relatively new and established industry, we'll be able to see just how powerful advertising, branding, sponsorships really are in terms of influencing behaviour.
It ain’t taking off because is still quite tabu to smoke that stuff. You won’t really see that at a family party unlike alcohol. The main reason is because that shit affects children when you puff it out and stink it up for people that doesn’t want it.
Yet another thing the local, baby-boomer, middle aged home owning people bring us. Voting down all development. Banning cannabis shops. Prop 13. They vote in large percentages and have shaped the Bay area in a big way.
Marijuana policy is the epitome of broken American politics. Obsession with money and morality, racism and ignorance driving policy, a tiny minority out-of-touch with what they’re regulating writing the legislation, business regulations that are designed for business not people, and on and on.
My personal issue with how legal pot has played out is I have no interest in becoming a patron of these lifestyle shops for a variety of reasons.
I also don't want my ID to be scanned for buying something still federally illegal.
If I could occasionally buy marijuana products at the grocery store as part of my normal shopping, no different than my occasional purchase of whiskey or wine, then I would have at least bought legal weed a few times since it was legalized here in CA. Even if it were relatively expensive.
Instead, today I'm far more likely to either not acquire any marijuana products at all (it's been years already) or buy some from the guy on the street who might also have shrooms.
You could just have a friend get it for you from the store. Who the hell knows what's in the stuff off the street corner or who's blood had to be spilled to get it to you.
I'm guessing investors are leery of funding expansion in an industry that is still illegal under federal law. The businesses themselves also have all sorts of trouble because banks don't want to deal with them.
The government of California is extremely inefficient, no surprises. Glad I left CA
I'm in Colorado now (I'm from NY originally)
CO did it right, but like someone said above - CO Springs was against it (pretty conservative, military area)and are now suffering the consequences of not doing so, worse roads, worse everything...
And hey, I'm pretty conservative myself and I live in Boulder. Boulder is wrong about other things though, like thinking they can ban AR-15's
I hate to break it to you, but Colorado Springs has been worse in most ways, roads and otherwise, long before recreational/medical weed was legalized. They've had issues with crime and meth, for a very long time as well.
From what I understand, Colorado Springs has tried to make an industry out of churches. Unfortunately for the town, churches don't pay taxes for things like roads.
You mean the local dealer who doesn’t have any at the moment, doesn’t answer his phone, can’t get the good shit like he had last time and this batch costs more but weighs less?
Like 7-11, you’re paying for convenience and being able to get the exact same potent batch for the same price every time.
Isn't that the issue, though? In places where legalization has gone smoothly (I have personal experience in Oregon), cannabis shops are a dime a dozen, weed is cheap, easy to find, and certainly better quality. There are over 10 shops within a 10 minute drive of me, I can go buy an ounce for $50.
Honest question: Why do newspapers, NPR, etc. often refer to pot possession / sales as being legal in California and some other states, when they're clearly illegal under federal law?
There are numerous other behaviors that IIUC are illegal under U.S. federal law but are not proscribed by California law, including: aircraft hijacking, carjacking, credit card fraud, and possession of destructive devices such as missiles and poison-gas weapons.
And yet I don't hear those same news sources referring to carjacking, etc. as being legal in California.
The cynic in my suspects that those news organizations are intentionally choosing language to push their own agendas, but maybe I'm totally missing something here.
It's not illegal to possess destructive devices on the federal level. There's a $200 NFA transfer tax to pay, but that aside, you can own a perfectly legal grenade launcher, or even a tank with an operational main gun. Some people do.
In CA, on the other hand, these things are explicitly prohibited (18710 PC).
It is explicitly legal in WA, CO, CA and others. Those states have successfully passed laws to this effect. Because the feds don’t/can’t enforce the federal laws prohibiting cannabis on residents of those states, it is for all intents and purposes legal, no scare-quotes required.
Because California passed bills clearly delineating how, where, and in what quantities pot growing and selling can be done. The state issues licenses.
In America, this is federalism at work. States can choose to do things that the federal government explicitly does not allow, and states can choose to not do things that the federal government explicitly tells it to do. When there is enough of a conflict, it gets resolved by the courts. In this case, the federal government has just chosen not to dedicate resources to cracking down on California's pot industry. California still welcomes the DEA's efforts in CA to crack down on other things, such as pot coming in from Mexico and harder drugs being trafficked.
Parent post is correct.
GP is incorrect.
Constitutional Federal law trumps State law. See the Supremacy Clause.
It's why actions at the Federal level normatively should be thought through and constructed extremely well. It obliges everyone to play by those rules once passed. In reality however, realpolitik tends to limit Federal reach.
Yeah, I meant Constitutional law trumps state law but states can also decide to keep doing it, betting that the federal government won't bother to enforce.
