Wed, Dec

Unfair Delays in Approving Social Equity Cannabis Licenses

420 FILE-The notion of “being the change you want to see in the world” is powerful when adopted. It stirs us into action, using the only thing over which we have any real control: ourselves. 

Whatever may have been the catalyst for the Los Angeles Department of Cannabis Regulation’s (LA DCR) decision to suddenly call for a “special” public teleconference meeting of the Cannabis Regulation Commission on October 8 at 2 p.m. -- it’s a step forward.   

Each one of us can leave a stamp on our City by participating in this important conversation. In both previous LA Cannabis Regulation Commission teleconference “special” meetings, participants were unable to call in due to “technological snafus.” It’s inexcusable for that to happen one time, let alone twice. A working phone system is a prerequisite for facilitating a large-scale teleconference, and it's frustrating to participate in a discussion hamstrung by such rudimentary issues. 

Truly, the most contentious elephant in the room issue is how the LA DCR plans to compensate its invoiced applicants for a flawed process. The central licensing process flaw -- requiring social equity applicants to have a lease (or purchase & sale agreement) in place at the time of application -- has devastated many. Although landlords and tenants entered into agreements at premium rents in 2019 -- with hopes of getting licensed relatively quickly -- due to a protracted licensing process, subsequent internal audit, the pandemic, the City’s “safer at home” directive, riots, ordinance revision, and the change in market conditions, the cash burn rate associated with licensing has become untenable. 

Invoiced applicants, most having lost “site control” due to the aforementioned extenuating circumstances, are now subject to a litany of new relocation rules, leaving one only to assume further delays in the process will come. 2021 is right around the corner, and not one social equity license has been issued.  

Despite Los Angeles Department of Cannabis Regulation receiving more than $6 million in grant funding from the California Cannabis Equity Grant Program for Local Jurisdictions (under the state's Cannabis Equity Act of 2018 to aid local equity programs), Executive Director Cat Packer has offered none of this money to any of the LA’s Phase 3/Round One invoiced applicants to help offset expenses incurred during the ill-begotten licensing misadventure. 

Unelected bureaucrats MUST be held accountable for their actions, or lack thereof. It’s been over three years now, and despite the LA DCR’s machinations, it’s claims that licensing is “right around the corner,” nothing materializes. Meanwhile, the Department is collecting interest on taxpayer money earmarked to help social equity applicants -- and social equity applicants continue to wait.  

What’s the holdup? This is a mystery wrapped in a riddle inside an enigma!


(Gary Mittin is a commercial real estate broker, specializing in cannabis real estate.) Edited for CityWatch by Linda Abrams.