Thousands of California Marijuana Growers Could Lose Their License
10,000 temporary business licenses are scheduled to expire in 2019
Most of these licenses that are set to expire are held by cultivators. If these licenses expire, it could bring calamity upon California’s booming cannabis industry. The question of the day is; how did California get itself into this mess and how are they going to fix it?
The Bureau of Cannabis Control is the agency responsible for regulating adult-use and medical commercial cannabis licenses. The Bureau oversees regulating testing labs, retailers, microbusinesses, distributors and temporary cannabis events.
According to the California Cannabis Portal, a temporary license allows businesses to operate in the commercial cannabis industry for 120 days. 90-day extensions may be issued if the business has put in an application with the correct licensing authority for an annual license. Businesses who currently have a temporary license must adhere to the same regulations and rules as businesses who have annual licenses.
In 2018, legal growers were given temporary licenses that would allow them to operate. It’s now 2019 and the temporary permits are beginning to expire. A disproportionate number of these businesses are still waiting for their annual permits.
Related Article: New California Law Gives Previous Marijuana Offenders a Break
10,000 Waiting for Annual Licenses
Allowing growers to operate is the reason temporary permits were issued to begin with. All this while they were in the process of getting their annual license. Out of the 6,900 applications that were submitted to the California Department of Food an Agriculture, only four were issued. Only 52 annual licenses have been issued by all California agencies.
The slow pace of licenses being issued has created a huge problem since extensions are no longer being given out. Growers who continue to operate with an expired temporary license, will now operate under the black market versus a legal one. With all these growers banned from participating in California’s Commercial Cannabis industry, supply will not be able to meet demand. This could cause the following ramifications:
- Million of dollars in tax revenue will be lost in California
- Citizens purchase from the black market
- Businesses sell in the illegal cannabis market
- Lack of lab testing poses health risk to customers
- Retail Cannabis Businesses will run out of inventory to sell
- Thousands of Californians will suffer job loss
Senate Bill 67
Mike McGuire, D Healdsburg is sponsoring SB67. The goal of this bill is to grant cannabis growers an extension. McGuire stated in a hearing that farmers should not be punished, when they did what they were supposed to do (applied for a state annual license.) Prop 64 would allow California regulatory agencies to issue a one-year provisional license to those who apply for it. This would apply to businesses who’ve applied and are working under an extension but have not received their annual license because of unanticipated delays beyond their control.
Currently there is no voiced opposition to this bill. Many groups in the industry and organizations have stood up in support of SB67. Terra Carver is the executive director of Humboldt County Growers Alliance. She stated that some farmers have already gone out of business when their temporary license expired because California didn’t issue a provisional one on time. She also stated that hundreds of businesses will go under all throughout California if nothing is done about this pressing situation.
SB67 would also put some fire under the feet of licensing agencies. These agencies responsible for issuing licenses would be required to report the following:
- The amount of temporary licenses that have expired
- Info that could result in delays in processing applications
- The amount of businesses with a temporary license who have not applied for an annual license
Related Article: California Cannabis Festivals Face Obstacles Under New State Regulations
Many law makers agree that SB67 should pass. Farmers should not be punished for doing everything right when it’s the regulatory agencies inability to process their applications on time that is causing this dilemma. The problem that many farmers face now is the fact that SB67 will most likely pass but it might take until the end of May 2019 before it becomes official law.
MJBizDaily did an analysis of California license data and found that between January and February, 249 cultivation licenses expired and in March and April the number that are scheduled to expire is 5,500. In March and April, 800 manufacture licenses are scheduled to expire. This puts California in a sticky situation as some cultivators stated that they would grow without permits and one grower stated that he would possibly file a lawsuit against California.
This fiasco is most likely to hit small farmers harder than ones who have a bigger share of the market. Bigger farms and cultivating companies may have enough capital set aside to get them through the month of May or whenever California finds a way out of this problem. Small farms may have to consider enlisting the help of investors to get them through this rough patch. Many growers remain optimistic and state that California will have to keep issuing extended licenses until a permanent fix is found.
Pick the best Option for You
Thankfully, cannabis is a wonderful plant that is versatile and can be consumed in many ways. If you live around people with strict workplace rules or small children, you can still enjoy smoking and vaping in places that they’re not present. If you are a regular partaker of cannabis, edibles are a great option.
Whether your favorite method of consuming cannabis is smoking, vaping, edibles or tinctures, Harbor Collective has a great selection of products for you to choose from. You can order online and skip the line at the shop by going to www.harbormmcc.com/shop/. Don’t forget about our happy hours specials, from 7 a.m. – 10 a.m. 7, days a week to save 10% on all your purchases.