Decades from now, anyone looking back at California history will note 2018 for one major change: the year recreational cannabis became legal. The sky clearly didnt fall.
Some hospitals reported upticks in marijuana-related visits, but reliable data on that issue is a couple years out. And other early reports suggest teen use is down, arrests are plummeting and accidental pet consumption is leveling off.
For the marijuana industry, however, the year was a rocky one, as California struggled in the early steps of legitimizing the worlds largest cannabis market. “Ive worked in this industry for a decade, and things are now the most financially tight as theyve ever been,” said Luke Maroney, cofounder of Lucky Box Club, a subscription service for cannabis products.
The growing pains arent going away overnight, though everyone in the industry is hopeful that 2019 will bring stability.
“I am optimistic about the coming year,” said Lori Ajax, chief of Californias Bureau of Cannabis Control. “Our focus will be primarily on getting more businesses licensed and increasing enforcement efforts on the illegal market.
To see how industry leaders felt about the past year, read this.
Rocky rollout[hhmc]
Just a few dozen California cities permitted shops when the state launched recreational cannabis sales on Jan. 1. Over the next few weeks, more jurisdictions opened their markets, including Los Angeles and San Francisco. But the pace overall has been slow. A database compiled by Southern California News Group showing only 14 percent of Californias cities and counties currently permit recreational marijuana sales.
In the first legal test of how far California cities can go in limiting residents rights under Proposition 64, a judge in November ruled against Fontanas strict rules for people growing marijuana at home.
But local bans mean some Californians still have to drive 100 miles or more to buy legal cannabis, with medical patients in particular feeling left behind. The bans also have had the unintended effect of boosting the illicit side of the market, with unlicensed shops growing stronger, in part because of high taxes on regulated products.
Other problems have slowed the legal weed industry. Most legal businesses are still operating with stop-gap licenses issued under emergency regulations that have been phased in throughout the year. A ew batch of rules that took effect July 1, leading to temporary shortages at some shops. Also, the planned roll-out of a statewide tracking system has been delayed. Meanwhile, strict new testing standards have led to recalls of millions of dollars in cannabis products.
“I dont know anybody right now who is really thriving,” said Casey ONeill, a longtime Mendocino County cannabis farmer.
Social equity programs, aimed at leveling the playing field for people of color by easing the licensing process for people who have been harmed by former marijuana enforcement policies, also have floundered in 2018, though Oakland did open its first social equity shop in November.
Many in the industry also find themselves at odds with neighbors over odors from marijuana farms, with some non-weed businesses threatening to leave if marijuana operations move in.
Combined, the challenges limited marijuana tax revenue in 2018, with yields $100 million below what Gov. Jerry Brown budgeted for the first six months of the year.
Still, the industry is growing. Ajax points out the state issued more than 8,400 licenses to cannabis-related businesses in 2018. Tax revenues also rose in each quarter.
Regulators also incorporated feedback from the industry into final regulations, which are pending. And state officials are partnering with law enforcement to begin cracking down on illicit cannabis businesses.
Federal changes at play[hhmc]
As Californias legal market launched in 2018, the state also was touched by changes in federal marijuana policies.
In June, the Food and Drug Administration sanctioned the first drug made from cannabis. Epidiolex is already controlling severe seizures for California patients, including a teenage girl from Yorba Linda.
California cannabis operations businesses saw opportunity for growth in October, when Canada became the second country to open a commercial marijuana market. And, in the Nov. 6 midterm elections, Michigan voted to legalize recreational cannabis while Utah and Missouri approved medical marijuana.
The industry also celebrated news that Attorney General Jeff Sessions, who was an outspoken opponent of legal marijuana, resigned the day after the election.
Then in December, President Donald Trump signed a Farm Bill that legalizes hemp. That bolstered an already-booming industry for CBD, a compound in cannabis that doesnt make consumers high but is said to provide an array of medical benefits.
Whats coming in 2019?[hhmc]
Advocates hope 2019 will bring more shifts in federal policy, with Sessions out, Democrats in control of the House, and support for marijuana regulation crossing party lines.
“I believe that cannabis will become federally legal and regulated in 2019,” said Carly Bodmer with GrowFlow, which makes compliance software for the industry. “Its a big statement, but I think this is the year.”
Either way, upheaval will continue in California.
Theres positive change coming for cannabis festivals, which struggled to find legal venues in 2018. Starting Jan. 1, cities can sanction events that permit marijuana sales and consumption just about anywhere they want.
Final state regulations will let licensed services deliver cannabis even if a given city has blocked commercial businesses. Some jurisdictions and law enforcement groups are opposing that rule, with talk of a lawsuit looming.
Cannabis collectives, long permitted under medical marijuana laws, must shut down or get licensed by Jan. 9.
New testing requirements will also kick in soon, which some fear could trigger more product shortages.
“Id like to say Im hopeful for 2019,” said cannabis farmer ONeill. “But its pretty tough.”
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