Historic Day – Pot Is Legal on Monday, January 1 in California – Here Are Some Answers to Basic Questions

An historic day in California is rushing upon us – Monday, January 1st – the day it’s legal to smoke marijuana in the Golden State.

So, what does it all mean? Can you smoke a joint legally on the way home from your New Year’s Eve party? Can you stop by your local dispensary on January 1 and buy cannabis legally?

There’s a lot of smoke enveloping the ganja – lots of confusion out there.

Here are some answers to basic questions – plus updates on a whole range of issues surrounding California’s recreational pot industry and situation.

It was November 2016 when California voters legalized adult-use cannabis sales in the state by passing Proposition 64. Yet buying legal recreational weed doesn’t go into effect until January 1, as state lawmakers took nearly a year to hammer out a regulatory framework for the new legal cannabis market –  which is expected to top $7 billion.

Of course, medical marijuana in California has been legal  for two decades. And today it accounts for about $2 billion in sales every year.

Lori Ajax, the state’s top pot regulator, the director of the state Bureau of Cannabis Control, has these answers:

Can I buy legal weed on January 1?

Ajax says, it depends on what part of the state you’re in. Pot businesses must have a local permit and a state license before they can open their doors for recreational sales. The pattern of state licensing, she says, has been very uneven across the state.

For instance, San Diego, Oakland, Santa Cruz and Shasta Lake are among the cities that have licensed operators ready to sell legally on January 1st.

In contrast, the old hippie capital of California, San Francisco, is running behind in issuing licenses and legal sales are not expected until later in the week.  Los Angeles – the largest legal weed capital in the world – is not even accepting license applications until January 3rd and legit shokp sales won’t happen for weeks.

Plus, you must be at least 21-years old to buy legal cannabis.

If I have legal weed on January 1st, where can I smoke it?

You can’t just smoke it anywhere; basically any public space where you can’t smoke a cigarette will also be off limits for sparking a joint, while it will also be illegal to consume marijuana while in an automobile.

Back to Lori Ajax; she says “not in public” and as a general rule, not where you can’t smoke tobacco. The state has guidelines that prohibit smoking 1000 feet from schools and day care centers where kids are, and not while driving.  Also, state rules dictate that legal weed can not be sold until 6 a.m. or after 10 p.m.

Other than that, the state has left it up to local jurisdictions to determine their own rules, including allowing smoking on-site at retail pot outlets.

Unfortunately, most of the cities in California have still not approved recreational marijuana sales. The San Diego Union-Tribune estimates the number of California cities and counties that have banned either the sale or cultivation of cannabis at higher than 70%.

Leafly, a website for the legal cannabis industry, has a list of California cities where legal recreational pot will be going on sale.

What are some of the other regulations?

For marijuana dispensaries and other similar businesses in California – they will continue to not be allowed to operate within 600 feet of any school, and they still need to maintain 24-hour surveillance for security reasons.

State lawmakers have also been working on other measures, including crafting a banking plan for the legal marijuana industry. Los Angeles Times:

Officials in Gov. Jerry Brown’s administration have quietly met with representatives of 65 banks and credit unions over the past few weeks about creating a network of financial institutions that would accept funds from pot businesses in a way that would guarantee federal banking regulators that the cannabis industry money is subjected to special tracking, oversight and transparency. 

The green banking proposal: To designate one bank as a central correspondent bank that would hold accounts from other banks that are doing business with marijuana firms.

They also voted down a measure that would allow weed delivery by drone.

Ajax, the cannabis director for the state says, the more than 1,300 dispensaries that now legally sell marijuana for medical use will be able to quickly get state licenses to continue medicinal sales starting Jan. 1. The Los Angeles Times reports:

Annual licenses will require a background check, training and a $1,000 application fee. The state will also monitor all marijuana products from farm to counter through a track-and-trace system.

To prevent those costs from putting legal marijuana sales out of reach to new retailers, the new state agency has decided to initially issue temporary permits that are good for four months and do not require application fees or background checks. Ajax’s office began accepting applications for temporary licenses on Dec. 8, and is issuing licenses this month that will be effective on Jan. 1.

But businesses can only get a license — temporary or otherwise — if they have a permit or approval to operate from the city or county where they are located.

What about the taxes?

On January 1, California begins a 15% state excise tax on every purchase of a cannabis product. And there will be local taxes as well.  Here’s the state’s tax guide for pot businesses.

Why so much?

In order to collect $1 billion a year in taxes, the state will need to reach a projected $7 billion in annual legal recreational cannabis sales. … At that rate, California would easily be the country’s largest legal marijuana market, as the entire legal cannabis industry in the U.S. is expected to pull in roughly $10 billion in total sales for 2017.

Of course, if the tax-laden legal weed costs too much, the black market will continue to prosper – so that’s the dilemma for state regulators as they want to bring the underground industry out into the open.

What about the feds?

Says Fortune:

One potential major obstacle for California’s legal marijuana boom could be the federal government.

Cannabis sales are still illegal on the federal level, and the Trump administration has played coy about its plans for the burgeoning marijuana industry, even as the man the president hand-picked to be the country’s law enforcement officer has made it no secret that he despises the drug.

Last year, Attorney General Jeff Sessions refused to rule out prosecuting people who sell cannabis, even when they do so in accordance with state laws. But, for now states like California have little choice but to move forward with their long-gestating plans (and, perhaps, gear up for a fight down the road).