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California cannabis ‘in peril’



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Leaders of California’s cannabis industry painted a bleak picture of their business at Monday’s Senate Business, Professions and Economic Development Committee.

“The industry is in peril,” said Ron Gershoni of Jetty Extracts.

“We are at grave risk. We need your help,” said Genine Coleman of the Origins Council.

Wesley Hein, of the California Distribution Association, called for a “Manhattan Project”-like effort to address the state’s marijuana regulatory structure.

“Bring the people in and say you don’t come out until we’ve gone through every single regulation,” he said. “All we’re saying is, we need to do a reset.”

Along those lines, Coleman said that the state must remove its site-specific California Environmental Quality Act requirement that presents a major hurdle to the industry.

As Tiffany Devitt of CannaCraft explained, when applying for a CEQA permit, cannabis businesses are required to provide a specific address.

That means leasing property, paying rent and going through the local application process, even though they are not assured of getting a permit, as for some local jurisdictions, “it’s literally flip a coin,” Devitt said.

Devitt said that that cannabis is one of California’s great legacy industries, akin to the wine industry, Hollywood and Silicon Valley.

But without taking concrete steps to allow more retail sales (by over-riding the control of local governments that have blocked them), cutting taxes (like the excise tax) and stepping up enforcement of the illicit market, including going after the makers of dangerous synthetic hemp products, the cannabis industry in California will continue to fail, she said.

Lawmakers largely used their time to ask panelists questions and seek clarification. One lawmaker, Sen. Steven Bradford, D-Gardena, used his time to critique the Legislature for making the issue more complicated than it needs to be.

“We’ve put regulations on an industry that no other industry faces,”’ he said.

By creating too many barriers, including high regulations and even higher taxes, lawmakers are promoting the illegal market, Bradford said.

“This is the only industry that you have to pay taxes on your product before it’s sold,” he said.


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