Pleasant Hill Bans All Commercial Cannabis Business

Last night, the Pleasant Hill City Council voted unanimously to reject the Planning Commission’s recommendation for 2 medical dispensaries and to implement a moratorium on all commercial cannabis business, except to allow medical cannabis deliveries from companies outside of Pleasant Hill. However, the city indicated that they would require delivery companies to obtain a Pleasant Hill business license to deliver to Pleasant Hill residents.

Requiring delivery companies to obtain licenses for all of the cities to which they deliver is unprecedented, unfair, and unacceptable. Cannabis companies should be required to obtain a license from the city out of which they operate—just as is required from companies in other industries. Obtaining a license from cities of destination would prove too financially and logistically burdensome for The Agathist Collective. And, frankly, we object simply on principle.

Unfortunately, we are forced to add Pleasant Hill to a long and growing list of cities to which we cannot deliver starting January 1, 2018.

Many representatives of the cannabis industry attended the meeting last night. We spoke about the need that our members’ have for delivery services. Largely absent, sadly, were Pleasant Hill and Contra Costa County residents who use cannabis and rely on delivery services.

We cannot fight this battle alone. Often, city council members (and city residents) simply see us as greedy entrepreneurs rubbing our fists together in anticipation of a financial windfall. Our pleas often fall on deaf ears, or are lost in the drumbeat of misleading facts, racist subtext, and the propagation of prevailing negative stereotypes. If cannabis delivery services are important to you, it’s critical that you attend these meetings and voice your support. Otherwise, local delivery services will not be available to you in 2018.

The Concord City Council meeting is on October 24. If the Concord City Council follows the path that every other city in central Contra Costa County has tread, there will be no legal cannabis companies east of the Caldecott tunnel starting January 1.  We will go out of business along with all other local, state-compliant cannabis delivery services.

This morning, it’s feeling very likely that a complete ban across all cities east of the Caldecott is the likely outcome. If you want access to legal cannabis next year, then it’s time to show up and speak:

Concord City Council Meeting
Tuesday, October 24, 2017
6:30p.m. in the Council Chamber
1950 Parkside Drive, Concord

Commercial Retail vs. Home-Based Delivery Services

An article published in Forbes Magazine in February of this year projects that by 2020 the legal cannabis market will create more than a quarter of a million jobs nationwide. According the Bureau of Labor Statistics, this is more than the expected jobs from manufacturing, utilities, and government jobs.[1]

The legal cannabis market in California generated an estimated $2 billion in 2016 and is projected to grow at an annual rate of 17%.

Cannabis is a major economic driver and job-creation engine for the California economy and has the potential to be a positive economic force in California at a time of potential economic decline.

We have an opportunity right now to ensure that members our communities—and not just large corporations and venture capitalist-backed businesses—can benefit from this job growth. Let’s open up opportunities for small businesses and residents of Concord and surrounding communities.

Home-based businesses make up roughly half of all U.S. businesses—they are the predominant form of small business.[2] Over two-thirds of all sole proprietorships, partnerships, and S corporations are home-based. Home-based businesses are incubators that encourage participation at a local level and that provide entry points into the business world.

Yet government regulations typically have a disproportionately large impact on these businesses. Studies have found that the costs of complying with regulations are consistently higher for businesses with fewer than 20 employees than for businesses with over 500 employees. [3]

I'm confident that many of our elected representatives understand the importance of delivery services—they serve our most vulnerable populations. In order for us to ensure that delivery companies can operate, we need to regulate them differently than commercial retail stores. Delivery services and retail stores are two different business models that serve different demographics. They should be regulated differently, as well.

For over 2 years, the Agathist Collective has operated as a small, home-based delivery service for about 500 seniors and chronically ill patients. We operate on very small margins (despite perceptions about the industry, neither of us have yet to take a salary or have received any type of compensation).  We intentionally keep costs low because most of our members are on fixed incomes. Keeping costs low will be even more important next year when the state and cities begin gouging patients with excessive taxes.

Currently, it’s difficult for us to imagine how we stay in business next year if we have to compete for a limited number of retail licenses, comply with regulations intended for store front spaces, or rent a space in a commercially zoned building.

Combining small, home-based delivery services in the same commercial use classification as commercial retail stores will effectively limit participation to only corporate and vc-funded operations, it will create barriers of access that will disproportionately impact small, local business owners.

Home-based delivery services are discreet and can be reasonably regulated to ensure professionalism and safety but in a manner that ensures that local residents can continue to benefit from their services.

Contact your city council members and State representatives. Urge them to let the market naturally limit these services. Urge them to create a distinct classification in the municipal codes for home-based delivery companies, to recognize these companies as distinct from commercial retail stores, and to create reasonable regulations that encourages participation of local, small business owners.   

[1] https://www.forbes.com/sites/debraborchardt/2017/02/22/marijuana-industry-projected-to-create-more-jobs-than-manufacturing-by-2020/#274e6bc53fa92020/#b3e16123fa92

[2] https://www.sba.gov/sites/default/files/FAQ_Sept_2012.pdf

[3]https://www.sba.gov/sites/default/files/articles/Home%20Based%20Business%20and%20Government%20Regulation.pdf

Cannabis in 2018: Expect Increased Costs and Reduced Access in Contra Costa County

Prop 64 legalized adult-use cannabis (also called recreational use). In 2018, one might reasonably expect access to an increased number of cannabis products, retail stores, and delivery services.

In fact, here in Contra Costa County, we expect just the opposite.

Most local cities—in fact, all cities in Contra Costa save for Richmond—have imposed bans, extended moratoriums, and have expressed concerns about the permitting of local cannabis businesses, despite that California voters overwhelmingly supported legal access to medicinal cannabis in 2015 and legal access to adult-use cannabis last November.

Because of these bans, cannabis patients in Contra Costa County (starting 1 January 2018) will likely be forced to drive to or order delivery from companies in Oakland, Berkeley, Vallejo, or Richmond. Many companies in these cities do not deliver to Contra Costa County. Those that do deliver charge a premium for the service ($10-$15 delivery fees) and require minimum order amounts. Add on the 15% excise tax that will be imposed on all retail sales (you can avoid the 15% tax if you pay $100 annually for a State ID card), and you can expect a delivery of a $16 tin of 5mg chocolate blueberries to cost about $34.

How did we get here?

In 2015, the California State Legislature passed a series of bills collectively called the Medical Cannabis Regulations and Safety Act (MCRSA). And last November, California voters passed Prop 64, the Adult Use of Marijuana Act (AUMA). In June, the California State Legislature approved a bill to merge these initiatives into a single set of regulations called the Medicinal and Adult Use Cannabis Regulations and Safety Act (MAUCRSA).

After 20 years of an unregulated system, California will finally implement a state-governed regulatory system that oversees all aspects of the industry, including: cultivation, extraction, manufacturing, testing, distribution and delivery, and taxation. These new laws address important regulatory and safety issues that the industry has needed for a long time.

However, this first iteration of these regulations is seriously flawed and presents barriers of access for the very people the regulations should protect. Some of these regulations cause undue burdens on the companies who are currently compliant with state law. For example, there exists a requirement that, effective January 1, all cannabis companies must have express permission from their city of origin to legally operate a cannabis business.

At first blush, this seems a reasonable requirement—all businesses require a local business permit. In the cannabis industry, however, it is a death knell to most cannabis businesses east of the Caldecott tunnel.

Here’s why:

Before the end of the 2017 calendar year, cities currently have three options for regulating cannabis:

  • Option 1: Allow local cannabis companies to exist by issuing city-designed business licenses and by establishing local regulations.
  • Option 2: Establish no local regulations and allow the State regulations to govern local cannabis laws.
  • Option 3: Enact a city-wide ban and prohibit cannabis companies from operating in the city.

Option 1 represents a considerable amount of work for a municipality. To enact local cannabis regulations, a city must create a local regulatory system to determine:

  • The types of businesses allowed (for example, store front dispensaries, lab testing, or commercial cultivation)
  • The number of licenses to issue for each type of business
  • The locations available to these businesses
  • The requirements, fees, and qualifications necessary for obtaining a license

Most city councils argue that they simply do not have enough time to implement this type of regulatory structure, especially when the State has not issued its final draft of regulations yet.

Option 2 is undesirable because cities and counties do not want to abdicate power to the State, lose the ability to enforce more restrictive regulations, and lose the opportunity to collect taxes.

That leaves Option 3, which is the least threatening and easiest way to respond to the state-imposed deadline and is why cities across California are enacting bans and moratoriums.

Unfortunately, many city councils have very little first hand knowledge about using cannabis to treat age-related and chronic illness. This lack of education fuels a reluctance and enforces misperceptions despite data that demonstrates the positive impact of a local cannabis industry, including lower incidents of DUIs, violent crimes, suicides in young men, and opioid-related overdoses and deaths (1, 2).

We know that cannabis prohibition doesn’t work. It fuels the black market and prevents access to the responsible people who need these products. It’s critical that Contra Costa County residents continue to have access to locally-based cannabis services.

There is still time to affect change. Call and write to your civic representatives and tell them you want to receive products and services from companies that are licensed locally. If they tell you that you’re allowed to have your products delivered to your home, let them know that is not good enough. We voted for access to legal cannabis. Driving to Oakland or paying exorbitant prices to delivery companies located in different counties effectively limits our access.

Consider this: cannabis is far safer to ingest than NSAIDs (conservative estimates have reported 3,200 deaths annually as a result of NSAID-induced GI bleeding; 0 deaths annually are attributed to cannabis) (3). What if similar restrictions and requirements were placed on ibuprofen? What if you had to drive to Richmond every time you needed to buy Advil? Or spend an additional $15 per bottle to have it delivered? Does that seem reasonable? We don’t think so.

1 Trilling, David. “Marijuana Legalization: Research Review on Crime and Impaired Driving.” Journalists Resource, 23 Sept. 2016, https://journalistsresource.org/stu...

2 Armentano, Paul. “The Five Biggest Marijuana Myths and how to Debunk Them.” Freedom Leaf, 12 July 2017, https://www.freedomleaf.com/five-bi....

3 Krueger, Courtney, PharmD, BCPS, “Do NSAIDs Cause More Deaths Than Opioids?”

https://www.practicalpainmanagement.com/...