After years of frustration from myriad business complications, the California marijuana industry may soon have a way to “fix” “legal cannabis” in the state.
A statewide election is under way that could potentially reduce the high taxes, regulatory burdens, and illegal market competition that California industry has been grappling with since 2016, when Proposition 64 – the initiative to legalize adult cannabis – was passed .
To reverse the complications caused by Prop 64, marijuana advocacy group Weed for Warriors has been tacitly circulating a draft election initiative over the past few weeks seeking support from cannabis companies, unions, politicians, medical marijuana patients, and others can bring to the table.
According to a summary by Weed for Warriors, the 65-page draft measures would:
- Remove local control over cannabis licensing, opening up business opportunities in far more jurisdictions.
- Eliminate state marijuana growing taxes.
- Lower the state excise tax rate on cannabis from 15% to 5%.
- Ban local marijuana taxes, but use 20% of the state taxes levied on municipalities.
According to Sean Kiernan, executive director of Weed for Warriors, the bigger systemic problem is that the current system has proven to be inoperable as it has raised prices for consumers, thereby empowering and encouraging illegal actors.
In addition, most cities and counties in the state are closed to legal MJ companies as Prop 64 gave local governments the right to opt out of the industry.
This has resulted in an ongoing cannabis ban in around 70% of California’s cities and counties, Kiernan said.
In a letter accompanying the draft measures, Kiernan stated that an estimated 80% of the California marijuana market is still illegal and referred to a warning to Governor Gavin Newsom from his own cannabis advisory committee.
Prop 64 “Balkanized access, causing over-taxation, over-regulation and giving elected locals, not local voters, the opportunity to say,” Not in my back yard, “” Kiernan wrote.
“That has to change so that every consumer, business owner and community has access to legal, safe cannabis and the positive jobs and taxes that come with it.”
Support, funding are key
It’s not clear whether Weed for Warriors will be able to round up the political support – or funding – it would take to launch a viable nationwide campaign in 2022, Kiernan said.
An encouraging sign is that a Prop 64 funder has funded the drafting process for the Weed for Warriors campaign. Kiernan declined to identify this supporter.
“We don’t call this a campaign yet,” said Kiernan. “We are currently forming a team. We’ll see who we can get on board. “
Kiernan said it will likely take tens of millions of dollars to collect the signatures needed to get the action on the 2022 California ballot – at least 623,212 signatures from registered voters – and fund a successful political campaign.
In contrast, eight separate political committees supported Prop 64 in 2016, and those groups spent a total of $ 41.7 million in that calendar year alone.
Weigh in 2022 versus 2024
Kiernan is realistic about the chances of the measure – it’s a “long shot,” he said – in part because 2022 will be a mid-term election. Due to the generally lower voter turnout, it is usually more difficult for election measures to be successful in the medium term than in a presidential election year.
“We assume that we need to raise $ 8 million for collecting signatures,” said Kiernan. “Then talk about at least $ 20 to 30 million to run a campaign that has a real chance of winning an out-of-year election.”
He said the campaign could wait until 2024 to seek a voting spot to give the initiative a better chance and give the organization more time to pool political support and funding.
For example, Kiernan admitted the group doesn’t have an angel sponsor like Prop 64 when billionaire Sean Parker funded much of that campaign.
Weed for Warriors has partnered with some state lawmakers, Kiernan said, and there might be a “third option” to address the California marijuana industry problem: state lawmakers could also take their own action to make Prop 64 to put on the ballot.
Regardless, Kiernan is optimistic about the Weed for Warriors draft initiative, knowing that there is great industry interest in the types of reforms that the electoral measure could bring about.
“Just today I had 15 calls with 15 different CEOs,” he said. “Each and every one of them (said), ‘We’ll do this. I’ll be there.'”
John Schroyer can be reached at [email protected].