With a population of almost 40 million, California is set to be the largest US state to legalize recreational marijuana on Jan. 1, 2018
The Head of California’s Bureau of Cannabis Control is not “expecting everyone” to obtain their licenses to operate their marijuana businesses on time. The western state now braces itself to officially legalize recreational Marijuana on Monday, making it the largest US state to do so.
“We don’t expect everyone to have a state license on January 1,” Lori Ajax told the Financial Times in an interview published Tuesday.
Operators will be given a fair chance to transition fully to legalization, Ajax said.
“If we want to minimize the black market, I think we have to give time for people to transition,” she said amid simmering fears that legal operators will be paying a combination of state and municipal sales and excise taxes. These taxes could exceed 45 percent, making some operators unable to compete with those, who are still in the dark shadows of the black market.
Licensing fees not uniform
Ajax also tried to dispel these fears that the new regime will fuel a black market as growers try to avoid the new taxes.
“People are looking to be able to go to a legal store, buy it, ask questions, know that it’s tested and safe,” she said, adding the licensing fees are also scaled according to business size.
The Bureau of Cannabis Control is responsible for licensing retailers, distributors, testing labs and microbusinesses in California.
Licensing cannabis operators so far is not expected to be an easy task in California, where it utilizes a system called track and trace. The system requires the bureau to trace the whereabouts of every product from seed to full growth to the sale of cannabis products to US adults.
On top of that, California’s regulations were not submitted until November. This gives businesses a short time-frame to go through applications before the new year. Especially lengthy ones.
So far, Ajax’s agency already has 1,300 applicants.
The good news: the bureau is not alone in regulating marijuana in California. The agency is one of three dealing with cannabis. The public health department is regulating manufacturers, while the food and agriculture department is dealing with cultivators.
California is a heavyweight state with a population of approximately 39.25 million, more than the whole entire 36.29 million population in Canada.
In the US, seven states – Washington, Nevada, Alaska, Oregon, Colorado, Maine – and the District of Columbia have laws legalizing recreational marijuana in addition to its medical use, with California, Massachusetts, Maine and Nevada being the recent joiners.