As of today, January 9th, 2019, California’s cannabis industry will start to see some big changes that will have a positive impact on licensed cannabis businesses in the state. Almost a year ago, the Bureau of Cannabis Control (BCC) stated that unlicensed Medical Marijuana collective/cooperatives will have to cease operations if they do not acquire a California cannabis business license by January 9th, 2018. While the number of unlicensed cannabis businesses is unknown, it is thought that there are still hundreds of collectives operating throughout California.
There are several reasons why gray market operators will choose to pursue the black market rather than legitimize their cannabis venture. The necessary corporatization that accompanies a legal marketplace turns off many of these could-be businesses, but not in the way you might think. The hippie counter culture has little or nothing to do with it. The most prevalent reason is bottom line: such entrepreneurs have historically benefited from the lack of oversight – risking consumer safety by not having any purity or standards testing. Much of the unlicensed product in California has unsafe levels of residual solvents, pesticides, trace amounts of metals, and other disturbing foreign materials not natural to cannabis. Selling these unregulated products is not an “f-you” to the man, it is shortsighted profiteering at the risk of public health and safety. The unfortunate reality is that if these could-be operators had approached the industry with long term goals and obtained the proper licensing, they could have reaped benefits of perpetual returns and the option to eventually cash out with an enormous return on investment.
On January 10th, 2019 there will still be hundreds of collectives continuing to operate illegally despite the potential of civil and even criminal consequences. In the coming months local law enforcement will likely ramp up their operations to deal with the illicit cannabis collectives operating within their jurisdictions – possibly joined by an increased presence of BCC agents. While this seems to make it more difficult for some medical marijuana patients to obtain their medicine, California has declared by law that counties and cities cannot ban cannabis deliveries from entering their jurisdictions to serve patients. Moving forward the effort to ban illicit cannabis collective/cooperatives will give legal operators an upper hand in the competition against illegal operators. In the meantime, customers are advised to verify that their dispensary is licensed under the BCC to ensure that the products they order are safe to consume.