California Could Soon Allow Cannabis Dispensaries to Serve Food

Assembly Bill 374 is designed to help struggling dispensaries and cannabis consumption lounges by Mona Holmes Feb 8, 2023, 2:18pm PST

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Last week, a California lawmaker introduced a bill that would allow eating food at cannabis dispensaries and enjoying live events at consumption lounges. Currently, California’s cannabis dispensaries are not allowed to sell any non-cannabis food, while consumption lounges (restaurants where cannabis can be consumed) are restricted from selling tickets for live events.

Assembly Bill 374 aims to ease these regulations by allowing local governments to manage their own rules. If passed, AB 374 could alter operations throughout the state and make it entirely possible to order a side of french fries with a pre-rolled joint at a dispensary, or enjoy a meal while watching stand-up comedy or live music at a consumption lounge.

Assemblyman Matt Haney introduced AB 374 on February 1. The San Francisco legislator says that the move is meant to support struggling legalized cannabis businesses, particularly because of the robust black market for cannabis in California. As it currently stands, many legal cannabis dispensaries are reporting underwhelming revenues, high taxes (resulting in higher-than-street prices), and even market oversaturation, which is happening in Palm Springs.

In an interview with KQED, Haney says the bill would help to inject economic life into cannabis businesses. “If an authorized cannabis retail store wants to sell someone cannabis, a cup of tea, and a sandwich, we should allow cities to make that possible and stop holding back our economy and a service that people want,” says Haney. “Those things are all illegal under state law now.”

AB 374 would permit dispensaries to sell non-infused food and beverages while cannabis consumption lounges can opt for “non-cannabis-infused food, selling nonalcoholic beverages, and allowing, and selling tickets for, live musical or other performances.”

In West Hollywood, one of the two consumption lounges/dispensaries — the Artist Tree Studio Cannabis Lounge — already sells food from an outside vendor and hosts live events like stand-up comedy and drag brunches. For decades, West Hollywood officials leaned towards cannabis-friendly policies and will likely welcome the loosened restrictions. Palm Springs also holds a similar stance with 10 consumption lounges that vastly outnumber West Hollywood’s. Eater LA reached out to West Hollywood for information on how the standalone city would work with the potential new law, but has not heard back.

California cannabis laws can be incredibly complicated. Some might recall that the Original Cannabis Cafe was forced to split into two separate businesses: a restaurant and a cannabis retail establishment. This was a costly solution that led SoCal’s first consumption lounge to maintain a mostly empty non-cannabis section to comply with state and local laws. In 2019, West Hollywood’s City Council updated regulations to allow patrons to take leftovers home from the Original Cannabis Cafe, which remains temporarily closed. If passed, AB 374 should help, at least in some small way, to streamline the still-growing California cannabis sector.