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Cannabis Cafes under AB 374 Vetoed by Newsom

Posted by Sara Cooper | Oct 10, 2023 | 0 Comments

Legislative season has been in the works for the past couple of months, with more engagement with the state's constituents more than ever. With Newsom having the power to pass bills in law, it has been a Pandora's box on what he could do. For a bill that would legalize cannabis cafes for example, he vetoed it recently that would've changed the marijuana industry in California. Dispensaries would've interlocked with government relations to make their businesses into cafes where it wasn't just a transactional station – food and cannabis products can be sold more broadly and events such as concerts and game nights could be held.

Under state law, even though it is legal to consume cannabis in areas that permit consumption, it is illegal to for dispensaries to sell non-marijuana products such as food or drinks. Assembly Bill 374 did have support on both ends of the state legislature, with the passing of the Assembly with a 66-9 vote and in the Senate with a 33-3 vote.

Assemblymember Matt Haney introduced AB 374, where his argument contain how the cannabis market in California struggles deeply. According to news sources, “In 2020, California's legal cannabis sales reached $4 billion, while illegal sales are believed to have surpassed $8 billion that same year.”

“It's really about fairness and supporting businesses that follow the rules,” said Haney in a press release. “If we keep allowing unnecessary regulations to strangle California's legal cannabis businesses, we're just encouraging illegal drug sales and all of the problems that come with that.”

Addressing his veto for the bill, Newsom responded that the bill would possibly have infiltrate issues with smoke-free protections in California, however he “appreciates the author's intent to provide cannabis retailers with increased business opportunities.”

On-site smoking of cannabis for permitted dispensaries was legalized under Prop. 64 in 2016. However, it's illegal to smoke cannabis outdoors as well as in all public places, apartment buildings, and automobiles. If on-site smoking areas were illegal still, only homeowners and their guests would be allowed to smoke cannabis in their private homes.

During the 70s in the Netherlands, they had legalized cafes for cannabis consumption to help revive the market that was significantly declining. This turned out successful, and it is still remains as a top tourist industry today. According to Haney, while the country is ten times smaller than California, the Netherlands has more than 700 cannabis cafes where tourists spend over $1 billion every year.

Haney has not commented if he will reintroduce the legislative shift for the cannabis industry in a new bill in the future.

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