When California’s recreational marijuana law took effect in January, Los Angeles became one of the country’s largest cannabis markets. Cat Packer, head of the city’s department of cannabis regulation, is guiding a booming business—which includes hundreds of eager entrepreneurs as well as still-thriving unlicensed operators—through an unprecedented transition. Here’s how Packer, a former advocate with the Drug Policy Alliance, a nonprofit aimed at ending the war on drugs, is addressing the issues facing the industry.
Curtailing the gray market
The city is granting licenses in phases, beginning with existing medical dispensaries, then commercial vendors who were operating before the law was passed, and, finally, new entrants. Although the delay in approvals has bolstered the illicit market, Packer isn’t in a hurry. She’s focused on helping consumers discern legal merchants from illegal ones. “We’re bringing on good operators,” she says. “We’re still talking about cannabis—we’re not selling bikes.”
Establishing banking services
Cannabis companies can’t use federally funded banks, which means it’s an all-cash industry, and particularly vulnerable to theft. Packer says she supports a bill in the California legislature that would grant local banks and credit unions charters to work with cannabis companies.
Packer, other L.A. officials, and representatives from Oakland, Sacramento, and San Francisco introduced a program to give people of color—who were disproportionately penalized for possession—easier access to the opportunities created by cannabis. “We can’t move on as if this harm never occurred,” says Packer. In L.A., applicants who have previous marijuana convictions, are low income, or who live in neighborhoods affected by the war on drugs could get help applying for licenses, training employees, and finding retail space, and will also have access to low-cost startup loans.
$3.7 billion: Size of California cannabis market by the end of 2018.
$7 billion: Predicted size of California’s market by 2020.
3,130: Total cannabis cultivation licenses issued in the state of California (as of early July).
500%: Increase in foot traffic to the West Hollywood location of MedMen, a premium cannabis dispensary, between January 2017 and January 2018.