The legalization of recreational cannabis in the state of California has reportedly neither led to a downturn in illegal business nor has it relieved stress on law enforcement.
As it turns out, illegal cannabis growers have only thrived since California legalized the recreational use of the drug in 2016, stealing business from legal sellers at half the price due to the lack of regulation or taxation.
“The illegal industry is competing with the legal industry and essentially putting them out of business,” Sgt. James Roy of the Riverside County Sheriff’s Department told Fox News.
Roy, who heads the department’s cannabis eradication team, had recently raided an illegal farm in Riverside County that had four massive white tents, colloquially known as “hoop houses,” containing $1.5 million in illegal cannabis.
“This place is no different than thousands of others we hit this year confiscating about a half-million plants in Riverside County alone,” Roy told the outlet.
“It’s definitely profitable for the illegal market,” Roy later said. “They’re selling greenhouse marijuana by the pound of anywhere from $500 to $2,000 here on the West Coast. But if they take that same exact product and ship that back east, it’s going for two and three times that amount.”
Democratic Oregon Gov. Kate Brown issued a pardon Monday for those in her state who have been charged with simple possession of marijuana.
“No one deserves to be forever saddled with the impacts of a conviction for simple possession of marijuana — a crime that is no longer on the books in Oregon,” Brown announced in a press release. “Oregonians should never face housing insecurity, employment barriers, and educational obstacles as a result of doing something that is now completely legal, and has been for years. My pardon will remove these hardships.” The move will eliminate over 47,000 convictions from criminal records impacting about 45,000 people.
Calling the criminal justice system in Oregon “flawed, inequitable, and outdated,” Brown further added that “Black and Latina/o/x people have been arrested, prosecuted, and convicted at disproportionate rates.”
Hundreds of thousands of pounds of marijuana are currently sitting idly on New York cannabis farms without a single legal recreational dispensary in the state open and ready to sell the product.
An estimated 300,000 pounds of weed are becoming a growing concern for farmers who planted the crop in spring 2021 in hopes of cashing in on the drug’s legalization in New York state. The lot is valued at about $750 million based on the average wholesale value of $2,500 per pound, according to Bloomberg.
Today, the legal recreational cannabis market is stalled as applicants for the first 150 individual retail licenses and 25 nonprofit licenses are still waiting to hear back from the Office of Cannabis Management, per Bloomberg.
Although players in the industry are waiting for the green light from the state, Melany Dobson — CEO of New York-based Hudson Cannabis — told Bloomberg it’s not the only thing holding her and others back.
“It’s an unclear path to market,” Dobson said. “We’ve been told again and again that dispensaries will open before the end of the year. I’ve acted as though that’s our single source of proof, so we’re prepared for that.”
The clock is ticking for the freshly harvested pounds of pot as farmers work to extend its shelf life in preparation for the still-to-come legal dispensaries.
“Old cannabis starts to have a brownish glow,” Dobson said.
She continued: “We’re trying to retain as much quality as possible. And rushing it into the finished product bags is not the way to do that.”
A new report indicates that Washington, which legalized recreational marijuana in 2012, has been much more successful at displacing the black market than California, where voters approved legalization in 2016. In a 2021 survey by the International Cannabis Policy Study (ICPS), 77 percent of Washington cannabis consumers reported buying “any type of marijuana” from a “store, co-operative, or dispensary” in the previous year, while 17 percent said they had obtained pot from a “dealer.”
The share of Washington consumers who report buying marijuana from a “store, co-operative, or dispensary” is higher than the average for states that have legalized recreational use, which was 57 percent in 2021, according to a nationwide ICPS survey. Washington’s Liquor and Cannabis Board (LCB) paid for the ICPS report on cannabis consumption in that state, and the ICPS has not published California-specific survey data. But calculations based on estimated total consumption and legal sales suggest that the black market accounts for somewhere between two-thirds and three-quarters of marijuana purchased in California.
California’s striking failure to shift consumers from illegal to legal dealers is largely due to a combination of high taxes, onerous regulations, and local retailing bans. While Washington has a relatively high retail marijuana tax (37 percent, plus standard sales taxes), in other respects the state has made it easier for licensed suppliers to compete with illegal sources.
A 2022 study from Reason Foundation (which publishes Reason) notes that local restrictions in California have created “massive cannabis deserts” where “consumers have no access to a legal retailer within a reasonable distance of their home.” Washington has more than three times as many legal dispensaries per capita as California.
Voters in two more states approved ballot measures legalizing marijuana on Tuesday despite the ongoing federal prohibition of cannabis, continuing a 50-year history of efforts by the state to nullify the feds, cities to nullify the state – and individuals to nullify them all.
Maryland and Missouri both passed ballot measures legalizing marijuana for individuals 21 and over. That brings the total number of states that have legalized recreational marijuana to 21.
The movement to take down marijuana prohibition started in the 1970s accelerated after California legalized cannabis for medical use in 1996. Since then, states have advanced the issue every year. This happened in spite of a 2005 Supreme Court opinion supporting federal prohibition, at least 12 years of relentless year-to-year increase in spending and enforcement efforts by the federal government through three presidential administrations, and ongoing, complete prohibition at the federal level.
In California, individual and local action started long before the passage of Prop. 215 legalizing medical marijuana in 1996. Other states followed their lead. Many states started with modest medical programs and then expanded them over the years.
We’ve seen the same progression when it comes to adult-use marijuana.
Each year, new state laws and the loosening of old laws help expand the market, and each expansion further nullifies the unconstitutional federal ban in practice and effect. With state and local actions accounting for as much as 99 percent of all enforcement efforts according to the FBI, the feds rely heavily on state and local help to fight the “drug war.” That help has rapidly evaporated in the last few years with marijuana legalization and decriminalization.
As marijuana becomes more accepted and more states, localities, and individuals simply ignore the federal prohibition, the feds become less able to enforce their unconstitutional laws. After more than two decades of state, local and individual resistance and nullification, the federal government’s unconstitutional prohibition of cannabis is beginning to come apart at the seams.
Having utterly failed to end the marijuana black market in California, lawmakers have decided to backslide into the drug war by increasing fines on those who operate outside of the state’s very costly and tightly regulated legal cannabis system.
California will begin 2022 not just by increasing taxes on legal marijuana cultivation but also by introducing new fines against anybody “aiding and abetting” any unlicensed dealers in the state.
Lawmakers passed A.B. 1138 in September, and it was signed into law by Gov. Gavin Newsom in October to take effect at the start of 2022. California law establishing recreational marijuana already permits civil penalties against unlicensed marijuana dealers. A.B.1138 threatens civil fines of up to $30,000 per violation against anybody providing assistance to an unlicensed dealer. And each day of doing so counts as a new violation.
California’s implementation of recreational cannabis regulations, authorized by the passage of Proposition 64 in 2016, has been a massive mess. The ballot initiative allowed for municipalities to decide whether to allow cultivation and dispensaries, and two-thirds of them still refuse to do so despite the public vote. The state levies high cultivation and excise taxes that are escalated further by local sales taxes in any municipality that does allow for dispensaries to open up shop.
The result has been price and availability issues so severe that experts estimate that between two-thirds and three-quarters of all marijuana purchases take place through unlicensed dealers, which means that the state isn’t getting its share of the revenue. The problem is so severe that the editorial board at the Los Angeles Times recently acknowledged that high taxes for goods fuel black markets.
But instead of eliminating or reducing these taxes, the state is instead taking a more punitive approach. And it’s not just lawmakers looking to make sure the state is getting its cut of the money. The bill was introduced by Assemblywoman Blanca E. Rubio (D–Baldwin Park), but the Assembly analysis of her proposal explains that it was co-sponsored by the United Cannabis Business Association and The United Food and Commercial Western (UFCW) States Council, the union that represents some licensed cannabis industry workers. Several licensed cannabis industries and trade groups have also signed on in support.
The California Legislature on Monday approved a $100-million plan to bolster California’s legal marijuana industry, which continues to struggle to compete with the large illicit pot market nearly five years after voters approved sales for recreational use.
Los Angeles will be the biggest beneficiary of the money, which was proposed by Gov. Gavin Newsom to be provided as grants to cities and counties to help cannabis businesses transition from provisional to regular licenses.
“California voters approved Proposition 64 five years ago and entrusted the Legislature with creating a legal, well-regulated cannabis market,” said Assemblyman Phil Ting (D-San Francisco), the chairman of the Assembly Budget Committee. “We have yet to reach that goal.”
Many cannabis growers, retailers and manufacturers have struggled to make the transition from a provisional, temporary license to a permanent one renewed on an annual basis — a process that requires a costly, complicated and time-consuming review of the negative environmental effects involved in a business and a plan for reducing those harms.
In the historic election cycle that took place in November, multiple states made their voices heard in regard to the prohibition of cannabis and they voted to legalize it. As we reported, in many of these states, the ballot measures to legalize cannabis received more votes than both Biden and Trump. South Dakota was one of these states. Now, despite the overwhelming support for legalization by the people, drug war-addicted cops challenged the popular vote — and overturned it.
Immediately after the vote, Pennington County Sheriff Kevin Thom and South Dakota Highway Patrol Col. Rick Miller came out fighting, letting the state know that they are not okay with the citizens of South Dakota having access to the devil’s lettuce, so they filed a lawsuit challenging the voter referendum that legalized cannabis.
Thom and Miller nitpicked the vote to legalize by challenging what is little less than a strawman they created. They said the vote to legalize cannabis which required a constitutional amendment to do so — was done so illegally — because semantics.
As legal marijuana becomes a reality in every corner of the U.S., Idaho is putting up a fight.
State lawmakers on Friday moved forward with a proposed constitutional amendment that would bar the legalization of marijuana in Idaho in an attempt to keep the growing nationwide acceptance of the drug from seeping across its borders.
Idaho is one of only three states without some sort of policy allowing residents to possess products with even low amounts of THC, the psychoactive chemical in marijuana. Residents can cross the state border in nearly every direction and find themselves in a place where marijuana can be bought for recreational or medicinal purposes. Support for medicinal marijuana use is growing among some residents — with legalization activists trying to get an initiative on the state ballot in 2022.
It’s made some lawmakers in the deep-red state nervous, particularly after voters in the neighboring state of Oregon decriminalized the personal possession of drugs like heroin, cocaine and methamphetamine last November.
The joint resolution to ban all psychoactive drugs not already legal in Idaho won approval along a 6-2 party-line vote in the Senate State Affairs Committee. The list of substances would change for drugs approved by the Food and Drug Administration.
But the primary target over the two days of testimony on Monday and Friday was marijuana as Idaho finds itself surrounded by states that have legalized cannabis.