A cannabis testing lab? A mini-plant for making cannabis products? Retail shops on Santa Monica Boulevard? A hotel shop with cannabis candies and skin creams? A lounge where people can smoke a joint and chill without a venté latte?
West Hollywood could see any or all of those next year, depending on how the city decides to regulate the manufacture, sale and use of recreational marijuana.
Such regulation was the subject of a study session by the City Council tonight that included a panel of five people who advocate for or execute policies for the use of recreational marijuana, including one who is in the business of making and selling it.
As models, the panelists cited recreational marijuana policies enacted in Colorado and Nevada and how cities elsewhere in California are responding to the passage in November 2016 of Proposition 64, which legalizes recreational marijuana use beginning Jan. 1, 2018.
Certain minimum standards are set by the state. For example, the California Department of Public Health is proposing to restrict that amount of THC, (tetrahydrocannabinol), the physiologically active component, in any individual cannabis product to no more than 10 milligrams. Individual cities, however, can make their own decisions on issues such as licensing retail marijuana stores, allowing on-site consumption, allowing home delivery of marijuana and allowing warehousing of marijuana.
California cities have until Jan. 1 to enact local ordinances, otherwise, the state laws governing those matters will prevail.
Currently, West Hollywood law allows a maximum of four medical marijuana dispensaries to operate in the city, all of which are on Santa Monica Boulevard. Under city law medical dispensaries must be at least 1,000 feet apart from each other and none can be within 500 feet of a church/temple, school, day-care center or playground.
One key issue is how the city should decide who can receive a license to sell recreational marijuana. One option is to have a lottery system in which the city randomly selects an applicant from a pool of them. Another is to establish a merit-based system in which applicants have to meet certain qualifications that could include whether they are adequately financed and are run by an experienced business person. Local applicants could be given a preference in such a system.
Council members supported the merit-based approach, noting remarks from panelists such as Trent Woloveck, president of TGS National, which manages the national Green Solution and Nectar Bee cannabis businesses. “Everywhere we see a lottery, we see law suits,” said Woloveck, saying lawsuits by unsuccessful applicants could delay the city’s ability to grant licenses to marijuana retailers.
Council members also supported the idea of permitting on-site consumption of cannabis products.
The council asked city staffers to return with suggestions as to how to address other issues. They include:
— How many recreational use licenses the city should grant.
— How many types of businesses related to recreational use the city should permit. Those businesses could include growing cannabis, manufacturing cannabis products, selling those products and delivering those products.
— What specific restrictions should be imposed on particular types of business. For example, Councilmember John D’Amico voiced his support for businesses involved in cannabis infusion (adding cannabis oil to a food or skin product) but not for cannabis extraction businesses, which sometimes use volatile solvents to extract THC from the marijuana plant. D’Amico recommended that the county fire department be asked to look at the safety of extraction methods.
Cindy Capobianco was one of several West Hollywood residents in the cannabis business who spoke at the study session. She and her husband, Robert Rosenheck, operate Lord Jones, which manufactures and distributes cannabis products including confections and topical creams. Its products have been profiled in publications such as Elle, Vogue and Rolling Stone magazines. They are available for delivery in Los Angeles and Orange counties and other areas of California. Capobianco said they hope to open a cannabis shop in the Standard Hotel on Sunset Boulevard. Rosenheck said he would like to create a commercial kitchen to create edible cannabis products.
Jackie Subeck, who is CEO and founder of Hey Jackpot!, a Los Angeles cannabis business consulting, events and advocacy firm, said she is working with others to get the state to create a license for on-site cannabis sales at events. “On-site consumption is going to be a very big part of events and tourism,” she said, noting its importance to West Hollywood’s economy.
Sherri Franklin told the council that she and Dani Shaker, who is CEO of Cannabis of Los Angeles, a cannabis cultivation, manufacturing and retail company, are working to establish a credit union to handle financial transactions for cannabis companies. Because the sale of cannabis remains illegal under federal law, it is difficult for cannabis businesses to open bank accounts, leaving them to conduct most of their business in cash.
Adam Gillman, founder and chair of Cycle House, the exercise studio with locations in West Hollywood and Santa Monica, and the co-founder of a medical marijuana business, argued that there is a huge opportunity for cannabis product manufacturing in WeHo.
City Manager Paul Arevalo said city staffers would address the questions raised by council members and return with policy recommendations at its Aug. 15 meeting. Council members asked that the city’s Planning, Public Safety and Business Licensing commissions review the final draft proposal before it comes back to the council for a final decision.