Report Foresees $5B Legal Cannabis Industry for California
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As early as January 2018, California will become the latest – and by far the biggest – state to allow the sale of legal adult-use marijuana.
At 39 million people, one-in-eight Americans lives in California. If separated from the United States, the Golden State has the sixth largest economy in the world.
According to a report from the state, that economy is about to get a whole lot bigger. The legal marijuana market will create a $5 billion industry in California, according to a state-sponsored study conducted by the University of California Agriculture Issues Center.
The state already has a $2 billion market for medical marijuana, which voters in California approved all the way back in 1995, the first state to do so.
The study also found that California will benefit from rapid growth in tourism thanks to the legalization of recreational marijuana.
Because adult-use cannabis remains illegal in most states, California “may attract some new visitors whose primary reason for visiting the state is cannabis tourism, as has been observed in Colorado,” the study stated, as quoted in The Los Angeles Times.
California already draws 260 million visitors a year who spend more than $122 billion in the state.
Visitors will need to read up on cannabis law across the state, however. Some cities, including Pasadena and Laguna Beach in the Greater Los Angeles area, have already banned recreational marijuana sales.
Against this backdrop, state lawmakers and Gov. Jerry Brown have been working quickly to craft new marijuana regulations that eliminate contradictions in existing laws and set up a recreational marijuana regulatory framework that can be in place by January 2018.
In June, lawmakers proposed compromise legislation in a mammoth, 215-page bill. The bill’s proposals include:
- Allowing both medical and adult-use marijuana to be sold at the same location. The legal marijuana industry sought this change to reduce the costs of running multiple locations. The change will also cut enforcement costs, with fewer locations to inspect and monitor.
- Establishing penalties for having an open container of marijuana in the car, much like the law for open containers of alcohol.
- Offering detailed rules on how testing labs are operated, including the transportation and storage of marijuana.
- Allowing those who are not residents of California to apply for licenses to sell adult-use marijuana.
Lawmakers still hope to have a regulatory process in place in order to begin issuing recreational marijuana licenses by January 2018.