The landscape is shifting. In 1913, California became the first state in the US to prohibit the use of marijuana. In 1996, voters in the state approved a measure allowing the use of marijuana as a treatment for a small number of medical conditions. Twenty years pass, nearly half the country had adopted medical marijuana laws and California joins the seven other states that regulate marijuana in a similar way as alcohol.
California marijuana legalization had been a long time coming. Over the past decade, I had been expecting marijuana legalization to pass first in California. When I began doing the research, it seems like the state has had a much longer run at recreational marijuana California laws for nearly 50 years. Voters in 1972 defeated the state’s first attempt at full-blown legalization by a two-thirds majority.
While California marijuana laws have gone through various iterations, and people have been jailed or otherwise been sent to the judiciary for just for medicating, out-right California marijuana legalization sends pressures to the federal government that all states hitherto just cannot compete with.
Recreational marijuana California begins with Prop 64. Passed in late 2016, the legalization measure is a prettier version of the 2014 attempt to regulate marijuana like alcohol. While reading over 60 pages in length, the ballot measure includes a host of how the products will be taxed, sold, and regulated as well as how it can be bought, grown, and transported. Let’s take a look at some the key elements of the newest of California marijuana laws.
Taxes: Collection and Use
While nearly every state boasting a recreational marijuana industry has included additional taxes levied upon sales, cultivation, and distribution, the scope of how the state tax revenues will be dispersed in California is surely the most, say, comprehensive.
On the sales of retail marijuana, the California marijuana laws dictate the following tax structure:
- 15% sales tax on retail sales to consumers
- $9.25/ oz. of flower from the supplier to retailer
- $2.75/ oz. for leaves from supplier to retailer
Concerning the use of tax revenues collected by the state, recreational marijuana California anticipates the following uses:
- $10 million per year for the next 11 years to public universities within the state for monitoring the impact of California marijuana laws on the public, making recommendations for future regulatory legislation.
- Starting at $10 million, and increasing annually by $10 million until the $50 million dollar annual cap, the state intends to give mental health services, substance abuse treatment, job placement programs, and even aid in discrimination.
- $3 million per year for the next five years to California’s highway patrol to assist in the development, implementation, and study of protocols related to marijuana and driving.
- $2 million per year to the University of California at San Diego Center for Cannabis Research
Additionally, any remaining tax revenues are to be dispersed in the following ways:
- 60% will go to youth programs, including (but not limited to) drug awareness and prevention
- 20% to aid in prevention of environmental disturbances from illicit marijuana production as part of California marijuana legalization efforts
- 20% to the development of programs that communicate the risks of driving while intoxicated, as well as a grant program to allay the social and health impacts associated with driving while intoxicated.
Implementation and Timeline
California marijuana legalization has left more than a few people wondering what to expect. While the details are still being worked out, the state does maintain a deadline of January 1st, 2018 to begin issuing retail licenses for new and existing (if only medical) dispensaries. If you are wondering what sort of immediate effect recreational marijuana California will have, you can do the following things (provided you are of age 21 or over):
- Consume cannabis
- Grow up to 6 plants in a “fully enclosed and secure” place
- Possess up to one ounce (28 grams) of flower or 8 grams of concentrates
- Share with friends (provided they are of age)
Unfortunately, until the state begins issuing retail sales licenses, you’ll still need a medical card if you want to purchase from a store. While some of the support for legalization aimed to limit criminal activity, the “limbo” time between the issuance of licenses and the beginning of the mandate’s effect can’t be prevented. The newest of California marijuana laws certainly may be seen as counter-productive to this end, allowing the population to use it but not providing anywhere to buy it.
If as an accidental incentive to join the state’s medical registry, the writing of Prop 64 actually removes sales taxes from medical sales. Though this exemption was meant to start at roughly the same time the state begins issuance of retail licenses, it began once the legislation had been voted in.
It is also important to note that under prop 64, California marijuana legalization isn’t limited by a number of licenses. The state will issue as many as we request, it is the local municipalities where recreational marijuana California that maintain the power to limit or ban business licensing.
The Economic Environment
The most drastic difference in what California marijuana legalization means for the marijuana industry as compared to the other states that have legalized the plant is the population and economic output.
Here is what California represents:
- Over 37 million people (roughly 11% of the US population)
- More economic activity than the lower half of the country COMBINED
- More economic activity than all but five other countries (yes, the US is one of those 5)
Alaska, Colorado, Oregon, and Washington combined maintains less than half of what California has in population or GDP, making California marijuana legalization take center stage.
It has been projected that Prop 64 will inject an additional eight billion in sales revenues into the already multi-billion dollar cannabis industry. California marijuana legalization represents the most viable economic conditions to nudge congress to act regarding California marijuana laws.
California marijuana legalization, once licenses have been issued, is expected to grow to a $1.5 billion dollar industry. By 2020, it is estimated to be at $4 billion. In every case thus far, however, the projections and estimates have been woefully under-calibrated, often being much lower than the actual sales. If you include the medical market that currently exists, by 2020, California marijuana laws supporting private use will have bolstered the state cannabis industry to $6.5 billion!
Wipe your record of cannabis
A part of the projected economic impact of recreational marijuana California involves the state not having to prosecute for marijuana offenses, requiring less jailing, which reduces the burden on the state to come up with ways to pay for the prisons.
The state of California is granting the opportunity for early release for the currently incarcerated, removing jail for minors caught with marijuana, and allowing citizens to petition to have their conviction expunged.
While this is not a comprehensive sweeping reform, people that have a felony for growing a small number of plants, for instance, in providing the state with the current California marijuana laws would be able to justify having the record dismissed.
As it has been a long-standing point of organizations such as the ACLU that the criminalization of cannabis allowed for discrimination in minority communities. With California marijuana legalization a reality, the ability of the legal system to propagate discrimination though its agents has been forever disrupted when it comes to cannabis.
In hopes that California marijuana laws and the legalization efforts around the country open the proverbial floodgates of revenue, the marijuana industry staked its largest claim yet in declaring California marijuana legalization.
By Joey Wells