AGENDA 21 RADIO

BY CHRISS STREET

NEWPORT BEACH, CA

California New Year’s Day partiers can only buy legal recreational marijuana at 44 locations as cities like Los Angeles suffer problems setting up taxes and dealing with union infighting.

After voters passed the California Control, Regulate and Tax Adult Use of Marijuana Initiative (Prop 64) in November 2016, recreational marijuana dispensaries were required to have local authorization before applying to the state permission to conduct public sales

Yelp already has Best Recreational Marijuana Dispensaries in Los Angeles, CA” ratings for at least 8 top locations, including 256 reviews for a prestigious 5 stars awarded to the Nirvana Clinic in East Hollywood. But there is a slight problem with Yelp’s credibility, the City of Los Angeles has not even applied for any recreational marijuana licenses.

But the State of California Bureau of Cannabis Control (BCC) began issuing licenses on Dec 1. But as of Dec. 29, it had only issued 44 for adult recreational marijuana use and 69 cannabis licenses for medical retailers, despite at least 2,174 supposedly licensed medical dispensaries in California with online phone numbers listed in FindTheBest site.

The BCC had projected that a legal cannabis industry would growing at about the same 28 percent compounded rate for the roll-out of Internet broadband access. California’s Prop 64 was expected to generate $6.6 billion in legal cannabis sales and support 100,000 private sector jobs in 2018.

The State of California made under Prop 64 made legalized marijuana and hemp subject to an excise tax rate of 15 percent on sales, plus a cultivation tax of $9.25 per ounce for flowers and $2.75 per ounce for leaves. At the $6.6 billion sales level, the state expected to collect over $1 billion in taxes politicians could use for discretionary spending in 2018.

Marijuana investment bank New Frontier Financials projected local governments would also layer another up to 25 percent in sin taxes to collect $800 millionannually.

But Los Angeles’ big problem in cashing in on Prop 64 is that of the 1,700 locations claiming that they were legally selling medical marijuana in 2017, only 139 complied with the current local regulatory and tax structure, according to Controller Ron Galperin.

Another headache for union dominated cities, like Los Angeles and San Francisco, is infighting about which union(s) will organize “weed workers,” after the United Farm Workers union, founded in 1962 by Cesar Chavez, claimed marijuana is a Mexican-American agricultural product that would benefit from branding with its iconic WFC logo.

The United Food and Commercial Workers’ union that had expected to organize retail sales, because they represent grocery clerks, and the Teamsters’ union, because they represent transportation drivers, both declared they too now intended to battle to organize all 100,000 workers in the industry.

It looks like the real winners from Prop 64 will be the black market. The marijuana user-friendly Hightimes blog reported that an eighth of an ounce of weed at a California medical marijuana dispensary currently costs about $50, whereas an illegal street dealer only charges $20. Hightimes believes that 2 new layers of taxes and unionization will make black market dealers even more competitive.