California’s failing cannabis industry is anxiously awaiting Governor Gavin Newsom’s bailout decision on two bills that could significantly reshape the state’s marijuana market while increasing public cannabis abuse. If signed, these bills would allow pot growers to sell directly to consumers at farmers markets and permit pot cafes to serve food, a change that advocates say could provide a much-needed financial boost to struggling recreational marijuana businesses in hopes of reversing pot fortunes.
Not surprising, the California Legislature recently passed both measures, which now sit on Newsom’s desk awaiting his signature. One bill would establish legal cannabis farmers markets, offering pot growers the opportunity to bypass middlemen and sell directly to customers. The second bill would expand the state’s existing cannabis lounge model by allowing these establishments to serve prepared food and host events.
Proponents of the bills argue that these changes are crucial for revitalizing an industry that has been hit hard by economic challenges. Many cannabis companies are struggling with declining profits, and competition from the illegal market, prompting calls for innovative ways to help businesses survive. Opponents see the measures as yet another threat to community safety by encouraging impaired driving and public intoxication.
It remains unclear whether Newsom will sign the bills into law. While he has supported the growth of California’s cannabis industry in the past, he vetoed a similar pot cafe bill last year, citing concerns about workers’ exposure to secondhand smoke.
The proposed cannabis farmers markets would be limited to jurisdictions where local governments permit cannabis events. It remains unclear as to whether Union City will join cities like San Francisco in this endeavor. Under the current system, marijuana farmers must sell their products through licensed distributors and retailers, which take a cut of the profits. Ironically, this is how normal retail businesses function, but the pot industry apparently sees itself as ‘special’. Legalizing direct-to-consumer sales at farmers markets would eliminate intermediaries and allow pot farmers to retain more earnings. It seems pot is not quite the ‘big business’ that some have touted it to be.
The separate bill that would legalize food sales in cannabis lounges is also being hailed as a “potential lifeline” for retailers. Matt Haney, an Assemblymember from San Francisco who sponsored the bill, believes that allowing lounges to serve food could increase revenue for marijuana businesses, many of which are barely staying afloat.
In response to Newsom’s previous veto, Haney has added provisions to the bill that claim to address concerns about secondhand smoke exposure. These include allowing workers to wear face masks and designating smoke-free areas within lounges. Hopefully the pot smoke knows where not to float.
As the cannabis industry anxiously waits for Newsom’s decision, many see the outcome of these bills as a pivotal moment. With California’s cannabis market facing ongoing economic challenges, industry leaders are calling on the governor to back these legislative efforts to ensure the survival and growth of pot businesses across the state.
Undoubtedly the next proposal will be to provide taxpayer subsidies to assist failing pot businesses. After all, if banks can be “too big to fail”, why can’t the pot industry be “too high to fall?”
