The California Senate is scheduled to vote on Thursday on a bill that would extend temporary licenses for thousands of cannabis cultivators waiting for their permanent license applications to be approved. The measure, Senate Bill 67, was introduced by Democratic Sen. Mike McGuire in January and approved unanimously by a Senate committee the following month.
Nearly 2,000 temporary cannabis cultivation licenses have already expired, with thousands more set to suffer the same fate in the coming months, according to Jacqueline McGowan, the Director of Local Licensing and Business Development at K Street Consulting in Sacramento.
“SB 67 would extend temporary licenses for anyone that is regulated by the Department of Food and Agriculture,” McGowan said in a telephone interview with High Times. “The agency was inundated with a large amount of temporary license applications at the end of last year and they have been overwhelmed and unable to process those applications in a timely fashion.”
McGowan said that is a dire situation for California’s legal cannabis industry and has described the potential calamity as an impending “extinction event.”
“We have 3,996 licenses that are set to expire this month,” she said. “That’s almost half of the licenses that are currently active.”
Joe Devlin, the Chief of Cannabis Policy and Enforcement for the City of Sacramento, told High Times that growers who choose to eschew the black market and accept the burdens of licensure deserve the protection that SB 67 will provide.
“We want folks to operate within the legal framework and the transition of this existing industry, the industry that predates legalization, is a process,” Devlin said. “Legalization wasn’t an event that occurred on January 1, 2018, it was really the beginning of a process. When you do things that you’ve never done before like legalizing cannabis and setting up new permitting and licensing departments, there are always going to be unforeseen challenges.”
“There are no winners if all these temporary licenses simply expire. It doesn’t do anybody any good,” he added.
McGowan says that regulators at the CDFA faced a daunting task to approve thousands of cultivation licenses and doesn’t blame the agency for the delays.
“The reasons are fair,” she said. “The regulations were in flux. We had five different sets of draft regulations that we went through in 2018. I can understand that the agencies were hesitant to process these applications in the midst of the regulations being in flux.”
McGowan urged medical marijuana patients and recreational cannabis users who support a regulated industry to call their state senators and ask them to support the bill, saying a loss of licensed growers will lead to higher prices for consumers.
“If manufacturers are unable to source licensed product, it will affect everyone throughout the supply chain and every type of product,” said McGowan.
At a hearing for the bill, McGuire asked his colleagues in the Senate for their support.
“The bottom line is this: This bill is going to protect thousands of cannabis farmers, in particular, who did the right thing and applied for a state license after the passage of Prop. 64 but their temporary license is about to expire,” McGuire said.
The senator warned that failure to pass the bill would enable unlicensed cannabis businesses to thrive.
“In a time where the Golden State is working overtime to bring the cannabis industry out of the black market and into the light of a legal regulatory environment, we can’t afford to let good actors who want to comply with state law fall out of our regulated market just because timelines are too short and departments have been unable to process applications in time due to the sheer number of applications,” McGuire said.
If SB 67 succeeds Thursday’s vote in the Senate, it will also have to be passed in the California Assembly and approved by Gov. Gavin Newsom to become law. Citing the urgency of the situation, the bill would take effect immediately, if passed.