California was one of the legal cannabis pioneers. Yet, despite being already well-established in this respect, there’s still plenty of news coming out of the state. Here we look at some recent developments from the last month, including tax breaks for cannabis companies in the state, efforts to standardize lab testing methods for THC, and even an AirBnb rental on a cannabis farm.
As one of the pioneering jurisdictions in cannabis legalization, it’s easy to forget that cannabis developments are still coming thick and fast in California. So to catch up on what’s happening, let’s take a look at a handful of news items from the last month or so.
But, before we do, don’t forget to download our free companion app to keep up with the latest in domestic and international cannabis news.
California Is Working to Standardize Cannabis Testing Methods
California cannabis regulators are seeking comments on proposed rules to standardize cannabis testing methods in the state. Officials hope it will prevent cannabis companies from “shopping cannabis labs” to find facilities more likely to return more favorable THC level results.
Although statewide rules require that producers test cannabis products for cannabinoid content and possible contaminants, licensed testing labs do not have a uniform methodology. This lack of standardization means that analysis results of the same sample of cannabis can vary from one establishment to another.
Driven by Consumer Demand for High THC
Due to consumer demand for high-THC products, the state is aware of instances where some cannabis companies are scouring labs to find those whose testing methodology tends to produce a higher amount of THC.
To address the issue, the California Department of Cannabis Control (DCC) announced on Friday that it was initiating a regulatory process to develop standardized testing methods. Every licensed laboratory should then follow these methods.
“One of the challenges we face in regulating an industry that is not federally recognized is the lack of standardized and validated test methods,” Nicole Elliott, director of the DCC, said in a press release.
“Accredited laboratories use different methods that can produce inconsistent results and inaccurate data on the cannabinoid content of cannabis. The CDC is working to change that so that there is greater integrity in the marketplace, accurate information for consumers, and trust among stakeholders.”
The CDC will accept public comments on the proposed cannabis testing methods rule until August 2.
“These standards build on existing standards for testing laboratories by requiring that they use only CDC-designated cannabinoid testing methods,” Elliott said. “The ultimate goal is to protect public health and safety by providing consumers with accurate and consistent information about the cannabis they purchase.”
Airbnb Offered a Night at a Californian Cannabis Farm
A sign that mentalities are irrevocably changing in favor of cannabis, the AirBnb accommodation rental platform entered into a partnership with the Sonoma Hills farm in California to allow visitors to taste the “high life.” The temporary listing was in celebration of 420 and was available throughout spring.
Host and cannabis grower Aaron Keefer invited visitors to “test their green thumbs in one of California’s most beautiful agricultural valleys.”
“Embrace nature’s rhythms and cultivate mindfulness with a cannabis-infused stay at the farmhouse that overlooks Sonoma Hills Farm,” reads the Airbnb listing. The company collaborated with Michelin-starred chefs “to cultivate the highest expression of cannabis, hemp, and sun-grown vegetables.”
What Was on Offer?
Three bedrooms were available in the house next to the farm, one with a king-size bed and two with a queen-size bed. Rates were $60 per night, plus taxes and fees, “in honor of the farm’s 60-acre culinary garden.” Guests were required to be 21 or older.
The only catch: due to regulations, customers could not “interact” directly with the cannabis produced on the farm. However, they were allowed to go to one of the nearby dispensaries where California tourism regulations authorized the distribution of cannabis directly on the farm.
Goals of the Initiative
“Our goal is to normalize the cultivation of hemp and cannabis by demonstrating that it is a plant like any other, with benefits for humans and the earth. In addition, by providing an insider’s look at how we carefully grow our produce – whether it’s vegetables or cannabis strains – we hope to provide a relaxing and rewarding stay,” Keefer said.
In keeping with the principles of regenerative and sustainable cannabis cultivation, Airbnb donated to Regeneration International, an international movement for the transition to regenerative cultivation, to support its “mission to reverse global warming and end hunger in the world.”
The AirBnb listing can still be seen here: https://www.airbnb.com/rooms/584764524113745490
California Governor Signs Tax Break for Cannabis Companies
California’s governor signed a sweeping bill to overhaul the state’s adult-use cannabis program, including eliminating the cannabis cultivation tax, to relieve the industry and further reduce the illicit market.
Key provisions of AB 195 coming into effect eliminate the Cannabis Cultivation Tax and shift the point of collection and remittance of the 15% excise tax on cannabis sales from the distribution level to the of retail. Additionally, there will be no excise tax increase for at least three years under the proposal.
The legislation also aims to strengthen law enforcement against unlicensed operators. For example, property managers who knowingly rent premises to a business that illegally manufactures, stores, or sells cannabis will be subject to civil penalties of up to $10,000 per day per violation. County governments can also take civil action against unlicensed growers for pollution or water diversion.
Cannabis businesses linked to the social equity program will be eligible for a $10,000 tax credit under the bill. In addition, they can keep 20% of excise tax revenue from their cannabis sales to reinvest them in their business.
The legislation also earmarks approximately $670 million in cannabis taxes for education, youth drug treatment, school retention, environmental cleanup, remediation related to illicit cannabis manufacture, and law enforcement.
California has taken in nearly $4 billion in cannabis-related tax revenue since the adult-use market launched in the state in 2018.
Study: Californian Cannabis Sellers Comply “100%” with Ban on Access by Minors
According to a new study, Californian cannabis retailers are doing an excellent job of preventing minors from entering their stores and buying cannabis.
The researchers wanted to test the cannabis industry’s compliance with identification requirements. So they sent people who appeared to be underage to 50 randomly selected cannabis stores across the state to see if they could enter without showing ID.
All Californian Retailers Requested ID
The study’s authors wrote: “Somewhat surprisingly, the ID policy aimed at preventing minors from purchasing cannabis directly at outlets authorized sales representatives were 100% respected. However, this is consistent with what has been observed in two other states, Washington and Colorado.”
If the consistency of compliance surprised the authors, the reason is probably unsurprising. Retailers face harsh penalties if they break the law. There’s usually an entry area inside dispensaries where identification is required upfront before a person can enter the main part of the store.
“It appears that legal adult cannabis outlets in California avoid selling cannabis to minors. One reason could be a strong incentive for owners and managers of recreational cannabis outlets to avoid being shut down for illegal activity.”
Retailers Have Strong Motivations to Comply
In California, where cannabis was legalized in 2016, anyone who supplies cannabis to a minor faces up to six months in jail and a maximum fine of $500 for a first offense. Police officers are allowed to use minors as decoys to verify compliance, and failure to comply with identification requirements can result in losing a license and additional penalties.
“It appears that licensed recreational cannabis outlets in California verify the age of young customers. Therefore, young people are unlikely to purchase cannabis directly from these outlets,” the new study states. “They are more likely to use other sources, such as having an adult buy it for them, getting it from older friends or siblings, and consuming it at parties where drinking cannabis can be shared.”
The authors also said that while these findings represent an important part of a growing body of literature on cannabis policy compliance. They added that future studies and law enforcement agencies “should consider if underage customers attempt to use fake IDs at licensed cannabis outlets and if young people obtain cannabis from illicit dispensaries or social sources.”
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