Confusion Reigns in Los Angeles on California’s First Day of Legal Sales

Pedestrians walk past MedMen, a medical marijuana dispensary in Los Angeles, in this Thursday, Dec. 21, 2017 photo. California kicked off adult-use cannabis sales on New Year's Day, but Los Angeles officials say dispensaries in the city won't be part of the celebration. The city announced Friday, Dec. 22, 2017, that it won't begin accepting necessary license applications until Jan. 3. It could take a month or more before those businesses are properly licensed with the city and state. (Richard Vogel/AP)

LOS ANGELES — While much of California is aflutter with legal adult-use cannabis today, businesses in the city of Los Angeles are once again holding their collective breath.

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Although the city released final commercial cannabis regulations in December, businesses won’t be able to apply for licenses until Wednesday. Even then, processing will only be open to Proposition D dispensaries; these are the approximately 135, long-standing medical marijuana shops that have been designated as responsible operators and protected with “limited immunity” from law enforcement.

“Right now there’s a risk in every move we make. No one's giving us clarity.”

Jerred Kiloh, president of the UCBA Trade Association that represents about 70 medical dispensaries in Los Angeles, said what happens between Jan. 1 and when these shops receive provisional licenses—which could be weeks—is anybody’s guess.

While state and local officials have indicated that prosecuting medical shops that have otherwise operated in accordance with state law will not be a priority during the interim period, Kiloh said there’s been no definitive statement on the matter and an overall lack of intelligibility.

“Tell us what we’re supposed to do and we’ll do it,” Kiloh said. “They have made this so complicated that no one knows the answer.”

There’s also the added wildcard of the Los Angeles Police Department, which has been known for sporadic crackdowns and raids on local medical marijuana dispensaries. It is unclear how they will handle this legal limbo period.

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So close to legalization, existing medical dispensaries that want to participate in the state-regulated market are desperately seeking direction in order to avoid jeopardizing their long-awaited shot at licenses.

“Right now there’s a risk in every move we make,” said Kiloh. “We’re in a Catch-22 and no one’s giving us clarity.”

Attorneys and industry experts say a Health and Safety Code statute gives some medical shops a “little bit of cover.”

While some shops considered acting out of an abundance of caution and shutting down completely until they received a provisional license, many reconsidered after hearing from concerned employees who said they would be out of a job—and patients who would be cut off from product, said Kiloh.

Kiloh said he’s done his due diligence. He and other attorneys and industry experts say that a Health and Safety Code statute within a governor’s trailer bill gives some medical shops a “little bit of cover” to continue to operate until they secure the necessary permits. The clause, he said, essentially allows dispensaries to remain open until December 2018 under the nonprofit collective model made legal by California’s Compassionate Use Act of 1996.

“Of course, no one on Jan. 1 can sell adult-use marijuana unless and until they have a local permit in hand and a state license,” said Clark Neubert attorney Ariel Clark, who’s also chair of the Los Angeles Cannabis Task Force, a local industry group.

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In all likelihood, the first adult-use shops won’t open in LA for at least another few weeks, said Clark, but even that is just an estimate.

Los Angeles launched the website for its Department of Cannabis Regulation over the weekend. On it, the city minces no words as to whether or not residents will be able to buy commercial cannabis on Jan. 1.

“You can’t,” says the website, which goes on to state that it is illegal to “engage in commercial cannabis activity without a local temporary approval or license.”