As California enters its third year of legal recreational cannabis sales, many expect upcoming new laws, high-profile court cases and major criminal justice reforms to shake up the industry.
Marijuana advocates are wary after a challenging second year, but most also are hopeful that changes in 2020 will put them in a better position a year from now.
“We always knew it would be an uphill battle,” said Robert Flannery of Dr. Robb Farms, a cannabis cultivation company based in Desert Hot Springs. “But there are very few people who are not generally optimistic about the cannabis industry.”
Here are six things for Californians to watch for when it comes to cannabis in 2020:
1) Deliveries go to court: In April of 2019, one county and 24 cities sued the California Bureau of Cannabis Control over a rule that permits marijuana deliveries throughout the state, even in communities that don’t allow cannabis businesses. That case, pitting advocates for access to legal cannabis against local governments fighting for control over the industry, is finally due to go to trial in Fresno County Superior Court starting — no joke — April 20.
Another lawsuit on the docket in 2020 tackles the same issue at a local level. Atty. Gen. Xavier Becerra in November joined a suit filed by East of Eden Cannabis Co. after Santa Cruz County banned marijuana deliveries by companies it hasn’t licensed. The next hearing in that case is scheduled for Thursday, Jan. 2.
2) Legislative changes: Three new marijuana laws take effect Wednesday, Jan. 1. Senate Bill 34 will let licensed businesses donate products for medical marijuana patients in need. Assembly Bill 37 will let cannabis operators deduct expenses, a standard business practice that’s been blocked due to federal law. And Assembly Bill 1810 makes it illegal for passengers in limos, taxis and other commercial vehicles to consume cannabis (though they can still drink alcohol), effectively ending any hopes of cannabis party buses. Also on Wednesday, mandated industry tax hikes will hit an already struggling industry.
Businesses say more legislative changes are needed if they stand a chance of competing against the thriving illicit market, with wholesale cannabis prices expected to fall in the coming year. There are calls for a potential overhaul to the tax structure. And, with shops allowed in just 20% of California cities, there’s talk of trying to force cities with residents that supported Prop. 64 to allow marijuana businesses in their borders. Also, in the wake of a vaping-related health crisis that in 2019 killed at least 54 people and left another 2,506 with serious lung injuries, new state or federal laws governing the vaping sector are expected.
3) Clearing the record: Prop. 64 retroactively reduced penalties for just about every crime involving cannabis, downgrading marijuana sales without a license, for example, from a felony to a misdemeanor. But data shows only a fraction of the people eligible to petition the courts to have those crimes reduced or cleared from their records since the law passed in November 2016 have done so — presumably due to the time, cost and expertise involved.
The legislature in September 2018 approved Assembly Bill 1793, which requires the state to proactively track down and process all marijuana cases eligible for expungement. The bill gave local prosecutors until July 1, 2020 to process eligible cases, and it’s expected that several hundred thousand people could have marijuana cases downgraded or dropped from their records. That could make them newly eligible for jobs, housing and other benefits often denied to convicted felons.
4) Weedmaps cleanup: The Irvine-based online marijuana shop directory Weedmaps has continued to promote illicit retailers even after California’s Bureau of Cannabis Control sent Weedmaps a cease-and-desist letter in February 2018. And it’s still going even though Gov. Gavin Newsom signed a bill, effective July 1, that lets regulators fine unlicensed parties up to $30,000 each day that they’re in violation of state cannabis laws.
Weedmaps said in September that it would stop advertising illicit businesses by the end of the year. As of Friday, Dec. 27, ads for cannabis shops in cities that have banned retail were still easy to find on the website. If the illicit ads don’t come down in the next week, licensed businesses expect to see major fines handed down by the state, with calls for tougher enforcement across the industry in the year to come. And if the ads do come down, the industry will have a real-time test in 2020 of just how important Weedmaps was in bolstering the illicit market.
5) More states eye legalization: Licensed cannabis shops will open for the first time in Illinois starting Wednesday, Jan. 1, making it the 11th state to legalize recreational marijuana and the first to do so through the legislature. But in the coming year as many as six more states are expected to consider legalizing cannabis through the legislature, led by Vermont (which legalized cannabis possession in 2018), New Mexico and New York. And another 12 states could vote in November on legal cannabis, including Arizona, New Jersey, Ohio and Florida.
That could give California’s legal industry more clout as it pushes for federal reforms in 2020.
6) Federal changes afoot: September saw the first ever federal vote on a stand-alone cannabis bill, when the House of Representatives voted to let federally-insured banks work with cannabis businesses in states that have legalized marijuana. While that SAFE Banking Act still faces the Republican-controlled Senate, observers are predicting some version of the bill will pass in 2020.
A bill that would end federal marijuana prohibition entirely — which would open up interstate cannabis commerce and public markets — also passed a congressional panel for the first time in November, when the House Judiciary Committee approved the MORE Act. That bill still has to pass the full House and the Senate, with success in 2020 looking less likely than the banking bill. But federal cannabis legalization could come through another route.
Most Democratic presidential candidates are promising to legalize cannabis nationwide if elected in November, a platform spearheaded by New Jersey Sen. Cory Booker and Vermont Sen. Bernie Sanders. However, the current front-runner — former Vice President Joe Biden — isn’t among them, though he’s recently come out in support of decriminalizing marijuana.
By Brooke Staggs, The Orange County Register