California regulators release final draft of cannabis rules

The first draft of permanent regulations on recreational and medical cannabis was released by California regulators on July 13, opening up a 45-day window for public comment and hearings on regulations for the state’s multibillion-dollar marijuana industry by the end of the year.

Emergency regulations, in place since legalization of recreational pot took hold Jan. 1, will remain in effect until the nonemergency rulemaking process is complete, according to the announcement by the Bureau of Cannabis Control.

"The emergency rulemaking process provided an opportunity to evaluate how the rules were working for businesses throughout the supply chain," bureau Chief Lori Ajax said in a statement. "The regulations we now propose include changes that make it easier for businesses to operate and strengthen public health and safety policies."

Industry advocates and opponents will now have a chance to voice opinions during 10 public meetings held around the state through August. Public comments can also be expressed through email or mail.

The regulations — a collaborative effort by the bureau and the state departments of Food and Agriculture and Public Health — aren’t perfect, according to cannabis lawyer Joe Rogoway, but they do help stabilize the pot industry by solidifying rules that until now have been in a state of flux.

"Largely these will be the rules, and they will be what the industry lives with in the near- to medium-term future. So I think it’s important that people working in this space have fluency in these rules and use that to better their companies," Rogoway said in a phone interview.

The 315 pages of documents contained noticeable changes compared to earlier emergency rules.

One change prohibits the use of advertising techniques that may be attractive to minors, including the use of toys or cartoon characters. Free cannabis goods or giveaways would also be prohibited under the changes.

For distributors and production companies, a significant change will allow delivery of cannabis products to any jurisdiction in California. The rule is expected to expand markets and reach a broader base of customers, particularly in counties and municipalities that have banned or restricted the sale and distribution of cannabis.

The changes also mandate that cannabis event holders must submit more details than previously required on the set up of licensed distributors at events and where attendees can smoke.

While many in the industry largely accept regulations at the state level, frustration with local authorities and regulations is widespread, said Rogoway.

"Local regulations do not exactly track what is happening at the state level, and so things that seem basic, like having the same definitions, don’t apply across the board," he said.

Rogoway also described "Byzantine and Kafkaesque" local licensing requirements that have frustrated growers, as well as high taxes that are making pot much less attractive in some counties compared to what is available in the black market.

"Everyone has something to be unhappy with, but we are trying to wrangle the biggest cannabis marketplace in the world into a system of regulated transparency and of course, there are going to be a lot of corrections along the way," said Rogoway.