California Laws Regarding Owning a Cannabis Dispensary

Thinking of opening a cannabis dispensary in California?

Experts project the recreational cannabis market in California will exceed $6 billion by 2020.
Since Prop. 64 passed, starting a marijuana dispensary has begun to look appealing.
However, with all the excitement surrounding legalization, many misconceptions have arisen. The truth is that California’s new marijuana laws are more complex than they seem.
Here’s a look at a few things you need to keep in mind before attempting to sell marijuana in California. Keep reading to find out what you need to do to run a successful dispensary while staying within the law.
laws for cannabis dispensary

You Cannot Sell Recreational Pot Yet

Proposition 64 legalized marijuana use for all adults 21 and older in California. This means that if you’re over the age of 21, you can buy and share up to 28.5 grams of marijuana. You can also grow up to six plants on your own property.
As it stands, you cannot sell recreational pot in the state—at least not yet. Anyone interested in purchasing pot from a dispensary must still possess a medical card to do so.
The state has until January 1, 2018, to begin issuing commercial licenses. Until then, there are still many local and state regulations to iron out.

Penalties Exist for Selling Without a License

Proposition 64 reduced the penalty for selling marijuana illegally to a misdemeanor. As alluded to before, however, if you want to sell marijuana, you’re still going to need to obtain a license.
If you’re caught selling pot without a license, you’ll face a penalty of up to 6 months in jail and/or a $500 fine. Just keep in mind that some counties in California have a hold on issuing licenses to medical dispensaries for the time being.

There Are Rules for Advertising Your Cannabis Dispensary

Federal law still classifies marijuana as a controlled substance. Therefore, broadcasters may avoid airing pot ads to maintain a good standing with the FCC.
If you want to advertise your marijuana business, you’ll have to remain cautious. For example, you cannot place a pot-related billboard within 1,000 feet of schools or daycares. Also, you cannot use marijuana symbols to advertise products to minors.
But there’s always a chance that federal law changes in the future. If it does, state law requires that at least 71.6% of the audience for a recreational marijuana ad must be 21 or older.

New Taxes Are Coming

Proposition 64 also laid out how the state plans to tax marijuana.
California will levy a 15% excise tax on all marijuana products. But only recreational buyers will be subject to state sales tax.
Marijuana growers will also be subject to new taxes. The cultivation tax is set to be $9.25 for every ounce of flowers and $2.75 for every ounce of leaves.
However, none of these rates include local taxes. Proposition 64 will also allow each city and county to levy its own taxes on top of the state’s.

Final Thoughts

As long as you’re aware of the laws in place, running a dispensary is like running any other business.
Don’t forget that recreational licenses won’t be available until early 2018. But make sure you get one if you plan to sell recreationally. Otherwise, you’ll likely face legal ramifications.
Furthermore, be careful when advertising your business on billboards around town. Also, keep in mind that getting your ads featured may prove to be difficult.
If you need legal help starting your business, feel free to contact us today!

For more information about how to navigate California corporate laws, contact Lisa Wills Law today for a consultation!

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