In preparation for the legalization of recreational marijuana in California next year, the city of Oakland is currently reviewing over 250 applications for permits to grow and sell cannabis. None of the applications have been approved thus far but they do expect to have some permits approved prior to the January 1st deadline. Do you expect that a large percentage of these applications will be denied?
Oakland officials are reviewing 255 applications from individuals seeking special business permits to cultivate, sell, distribute and transport marijuana legally under the state cannabis laws that take effect Jan. 1.
The largest number of the applications, 78, are from individuals who want permits for indoor cannabis-growing businesses. The second-largest number, 55, want permits for cannabis delivery businesses.
The city is also looking at permit applications for transporters, lab testers, distributors, manufacturers and outdoor growers.
None of the applications has been approved so far.
“This industry is not used to compliance, so a large number have not moved forward in the process,” said Greg Minor, the assistant to the city administrator in Oakland.
The city expects to approve a handful of applicants to be fully permitted in time for Jan. 1. Dozens more will be able to obtain a temporary state license as long as they operate in the right zone, pay taxes and satisfy the equity program’s requirements, Minor added.
Claudia Mercado, 33, a former Mexican restaurant owner, is trying out the cannabis industry as a business owner for the first time.
She is one of the many general applicants waiting to be approved for a local permit. Her distribution business, Calibueno, is set to get a city permit as long as she passes the building inspection, she said.
“For Oakland, it’s going to be unique because they’re bringing everyone to the table, so I’m hoping we can build a really healthy business ecosystem,” she said.
Mercado started searching for a site in May and signed a lease in June. As part of Oakland’s application, the building had to be in the proper zone and Mercado had to submit a copy of her lease for proof that the landlord allows her to engage with cannabis.
Additionally, she has to work with an engineer to design a filtration system that uses charcoal filters to eliminate the odor of cannabis from outside the building, as required by the city, Mercado said.
“I think the city of Oakland is really trying to make sure everyone is protected and safe,” she said.
The city already has authorized eight dispensaries to operate as brick-and-mortar marijuana businesses. These businesses were grandfathered in and not required to go through the application process for a special cannabis business permit from the city.
But like other cannabis businesses in the state, they will need a state license to operate as of Jan. 1, and Oakland’s eight dispensaries are expected to be among the first to apply for those licenses when the state begins the application process next month.
The eight grandfathered dispensaries are Harborside Oakland, Oakland Community Partners, Purple Heart Patient Care, Oakland Organics, Blum, Magnolia Wellness, Phytologie and Telegraph Health Center.
Proposition 64, passed last November, requires a person or business to get a state license to conduct commercial cannabis business. To acquire a state license, applicants must have authorization from their local jurisdictions, said Alex Traverso, a spokesman for the Bureau of Cannabis Control.
The state released its long-awaited regulations — a precursor to its application process — last week. The idea is that the state will issue its first licenses in time for Jan. 1 sales.
“My biggest thing is getting the building ready and us being in line with the state for the 1st. That’s what I’m aiming for,” Mercado said of her plans to be up and running. “This is like a marathon.”
Other jurisdictions — including Berkeley and Santa Cruz County — have also passed local ordinances to allow for cannabis sales come Jan. 1, though with some holdup. Berkeley and Santa Cruz County are still determining what regulations will be implemented for dispensaries to obtain a local permit.
Oakland officials said they expect to permit another eight brick-and-mortar marijuana dispensaries to operate this spring, bringing the city’s total to 16. But there’s no limit on the number of the non-brick-and-mortar dispensary permits, Minor said.
Oakland’s cannabis permitting system was passed under an ordinance that has been amended and discussed for more than a year. Half of all permits the city will issue will go to people who qualify under the Equity Permit Program.
Those who qualify for equity permits are people convicted of a marijuana-related offense in Oakland, who earn an income less than 80 percent of the city average, or who have lived for 10 of the past 20 years in an Oakland neighborhood that saw a high number of cannabis arrests.
The city has received 255 completed applications since May, 129 of which are equity applications, for cannabis permits from cultivators, delivery services, distributors and lab testers.
“Just the fact that I can get a shot in having a cannabis business is huge,” Mercado said. “It’s scary but also really exciting.”