There will be a meeting to discuss Oakland’s permitting proposals on Tuesday September 27th at 6pm in City Hall, Hearing Room One.
Oakland is facing a tough decision on how to move forward with business permits for the local cannabis industry. If you missed the front page of the SF Chronicle last week, it is a good thing you are reading this article.
One of the foundational goals of cannabis legalization in California is to eliminate the black market by making cannabis business permits obtainable for everyone currently operating in the cannabis industry. Members of Oakland’s city council seem to have lost sight of that goal due to a lust for revenue.
A letter went out to cannabis businesses last week from Councilmember Desley Brooks (with the support of Larry Reid and Noel Gallo) which proposed a plan to restrict business permits on a number of levels.
The most concerning is that Oakland’s city council feels that the city deserves to be part owners in every business that it provides a license, demanding 25% of profits as well as a minimum of one seat on the board of each company.
The cannabis industry is livid at the thought of this stifling proposal,which would guarantee reduced profitability on already meager income forecasts. Many people are wondering if such a proposal is even legal. Oakland’s Democratic Assemblyman Rob Bonta, who lead the efforts on the cannabis regulations signed into law last year, says the council’s move would run afoul of both the spirit and the letter of the recent state laws.
If Oakland is going to responsibly assign business permits, it cannot remain unbiased if it functions as both part-owner and industry regulator. Brooks and the other council members in favor of this proposal claim that the income generated could fund many municipal programs, at least one of which is run by a personal friend of a council member.
Red flags are flying up on all sides, but the primary reason for concern is how far this proposal would re-direct legalization efforts at the state level. The Blue Ribbon Commission on Marijuana Policy, fronted by Lieutenant Governor Gavin Newsom, found that previous legalization efforts made mistakes when earmarking funds for outside programs because this actually incentivizes regulators to promote more cannabis sales (which in turn could increase youth exposure to the plant).
Additionally, Oakland regulators have announced a policy to distribute an equal number of business licenses to two pools of applicants. The first pool of applicants consists of people who have been disproportionally affected by the War on Drugs. The second pool is made up of everyone else. While this certainly seems like a fair and equitable policy, the implementation threatens to marginalize the very people it seeks to protect.
The definition of an individual who has been disproportionally affected by the War on Drugs is an incredible gray area in the proposed amendment, and has drawn criticism from many operators in the cannabis industry. Limitations include arrest records, residency requirements from specific sections of the city, or having family members imprisoned on cannabis charges.
The core concept of assisting marginalized individuals with obtaining business licenses is admirable and would set a great standard for national cannabis legalization. Unfortunately, the proposed guidelines would limit business permits on a one-to-one basis for both those disproportionately affected and those who do not fall under the murky definition. The threat to limit business permits fundamentally opposes Gavin Newsom’s findings that successful legalization means opportunity for anyone currently operating in the cannabis industry.
Oakland has the potential to be California’s cannabis hub due to the large number of locations that meet zoning requirements for cannabis operations. However, if Oakland city council members remain steadfast on the city’s pay-to-play permitting program, many businesses will move their operations, or simply shift their focus to the illicit market.
Every Oakland cannabis company is holding their breath to see what comes next. The majority of business owners are thrilled to see protections in place for people hurt by the War on Drugs, but the limitations heavily threaten an open cannabis industry here in Oakland.
The Yerba Team as well as many other cannabis businesses will be in attendance at the next City Hall discussion on cannabis permitting. The meeting will be held at City Hall in Hearing Room One on Tuesday, September 27th. We will publish a follow-up to this article after that meeting has concluded.
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And of course, you can explore the cannabis available at Yerba.org!