Posts tagged cannabis compliance
Requirements for California Cannabis Packaging | 2020
Requirements for California Cannabis Packaging | 2020

The California cannabis regulations require that all product packaging be

• child resistant

• tamper evident

• resealable (if the product has multiple uses).

Packaging for edibles must not only be opaque, but industry manufacturers are forbidden from showing the image of what the edible looks like in order to avoid appealing to children.

In addition, the labeling on the cannabis package may not:

• be attractive to children.

• make health claims.

• use the word “organic,” in violation of federal and state laws.

• use a California county name unless 100% of the cannabis was grown in that county.

It must carry the aforementioned California government warnings — the California Cannabis warning and, if the product contains one of the 900 chemicals currently on the Prop. 65 list, a Prop. 65 warning. Finally, every layer of the packaging must carry what is known, in properly cosmic lingo, as the Universal Symbol — a triangle with the silhouette of a cannabis leaf and an exclamation point.

For Cannabis Business Licensing help, call at . We help cannabis business owners navigate the complex world of State and Local Cannabis Regulations while helping to develop and grow your business in the right direction. CAP can assist with projects large or small. Whether you’re looking for full-service state and local cannabis licensing or other services such as Cannabis Pro Forma, Cannabis Business Plan, Cannabis Business SOP, and Cannabis Investor Presentation development, we have you covered.

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San Luis Obispo Accepting Cannabis Business Applications
San Luis Obispo Accepting Cannabis Business Applications
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The City of San Luis Obispo, CA is accepting cannabis business applications for Cannabis Delivery, Cannabis Microbusiness, and Cannabis Cultivation business. The application is merit based with no caps, but property is required. Applications due between January 15th - February 15th 2020.

For help with all of your upcoming cannabis licensing needs, contact Cannabis Advising Partners at (800) 819-0149 or click the button below.

Information Regarding Posting of QR Codes by Commercial Cannabis Retail Licensees
Information Regarding Posting of QR Codes by Commercial Cannabis Retail Licensees
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The Bureau of Cannabis Control (Bureau) is encouraging retailers open to the public to post a QR Code certificate that consumers may scan with their smartphone camera when visiting a commercial cannabis storefront retailer to confirm licensure. Participation in this effort by retail licensees will assist consumers in purchasing legal cannabis goods. Licensees are also encouraged to educate their customers on how to use the QR Code and the importance of shopping at a licensed retailer. The Bureau is providing licensees with an enlarged version of their individual QR Code (QR Code certificate). Storefront cannabis retailers are encouraged to assist the public by prominently displaying their QR Code certificate on the licensed premises in the following manner:

• The QR Code certificate should be visible and scannable from outside the premises.

• The QR Code certificate should be printed on paper not less than 8 ½” by 11”.

• The QR Code itself should not be less than 3.75” by 3.75”.

• The QR Code should be posted in the front window of the licensed premises or in a locked display case mounted on the outside wall of the licensed premises within three (3) feet of any public entrance to the licensed facility.

• The QR Code should be posted in a manner that is clearly visible from outside of the licensed premises by all persons entering the premises and shall be of sufficient clarity that the code can be read by a smartphone or device capable of reading QR Codes from a distance of at least three (3) feet.

Consumers can confirm that the retail location is properly licensed by using a phone camera or QR Code app to scan the QR Code certificate. Once scanned, the consumer will automatically link to a URL that confirms the cannabis retailer’s license status. The website will display the address and business license of the location to ensure that the retailer at that location is licensed. By providing commercial cannabis consumers with an easy method for verifying licensure status, the Bureau and its licensees can work together to reduce the potential risks that may come from the purchase of non-compliant cannabis goods from unlicensed retailers.

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City of Davis, California Proposed Ordinance
City of Davis, California Proposed Ordinance

CITY OF DAVIS- Depending on the decision made by the Yolo County Board of Supervisors next spring, the new addition could either increase or decrease cannabis activities in unincorporated parts of Yolo County. 

The draft has five proposed options that vary in the authorized types of cannabis activities, the zoning location and buffer requirements and the total number of operations. The first option has the smallest number of licenses and only allows cultivation activities of the current 78 existing operations. 

The second and third alternatives allow all types of cannabis use and have higher numbers of allowed operations (132 and 264, respectively). The fourth alternative only allows operations indoors or in greenhouses. And the fifth would limit the operations to agricultural zone districts besides retail. 

Comments for the DEIR can be submitted by the public until Dec. 23 at 4 p.m. and written comments can be sent to the Yolo County Department of Community Services. Oral comments can also be made at the Yolo County Planning Commission Meeting on Dec. 3. The Davis meetings will occur on Dec. 2 at the South Davis Citizens Advisory Committee Meeting and on Dec. 3 at Unitarian Church in West Davis. 

Long Beach to Lower Cannabis Taxes for Non-Storefront Businesses
Long Beach to Lower Cannabis Taxes for Non-Storefront Businesses

The Long Beach City Council has voted to lower the tax rate for cannabis cultivators, manufacturers, distributors and testing labs from 6% to 1%.

 Although this new rate won’t come into effect until an ordinance is created, many cannabis business owners are starting to feel more at ease after months of lobbying for lower taxes.

The City Council purposely left retail taxes out of the picture. By lowering the taxes of other cannabis business sectors, cannabis dispensaries will pass on less product costs to their customers. This will give the Long Beach legal cannabis market time to establish itself and outgrow the black-market shops.

As of August 2019, the city had received 618 cannabis business applications, in which only 106 of those had been issued a business license. Hundreds of facilities remain under construction, under building plan review or pending building plants or initial zoning review.

At 6%, Long Beach currently holds one of the highest taxes for any non-storefront cannabis business. Even Los Angeles holds a 2% tax on cultivation on manufacturing and cultivation and 1% on distribution and lab testing.

The city’s cannabis revenue will drop a few hundred thousand dollars, but this will depend on how many cannabis businesses the city allows to open its doors.

The ordinance will be drafted in the next coming months and will not go into effect until the city council approves it twice and at least 30 days have passed after the mayor signs it into law.

DCR Compliance Training Workshop
DCR Compliance Training Workshop

The Department of Cannabis Regulations will be holding a phase 2 cannabis compliance training workshop on Saturday, November 23rd, 2019 from 2 PM - 4 PM. Follow the link below to register!

10 ProTips Before You Start Your Legal CannaBiz Venture
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Author: Joseph Chicas | Cannabis Expert | Cannabis Advising Partners

After several years consulting in the cannabis industry and now as the Executive Director of Cannabis Advising Partners, below are some gold nuggets, some ProTips, I offer for those of you looking to start your own CannaBiz venture.

1.   Start with Your Why– Yes, I know its sounds cliché, but this point cant be understated. Do some intense soul searching, mediate on your goals, speak with your close friends and family, and dig deep to arrive at your WHY. Getting into the cannabis industry is no joke. Its highly competitive and capital intensive. It will require you to dig deep to be successful in the long-term. Being clear about your reason to be in the industry and having that reason (AKA Your Why) be sincere and authentic, is a great foundation for early success. Find your why and use it as your daily motivation. 

2.    Realize that Fortune Favors the Bold After drilling down on your WHY, realize there are inherent risks in launching your venture. Constantly changing regulations, high tax rates, inflated costs of business (i.e. real estate price hikes) all make cannabis a risky investment.

For this reason, many entrepreneurs and investors are on the sidelines. But this shouldn’t stop you. Early adopters who carve out a niche in the industry are seeing solid early returns. For instance, our clients are obtaining licenses to operate and choosing to put them on the market to be sold. We are consistently seeing 10 x returns within one year.

Obtaining your cannabis license is a low risk high reward proposition. But with cannabis prohibition slowing losing its grip, more and more licensing opportunities will occur and the space will get more saturated and competitive. Avoid the rush to the floodgates by being an early adopter, capture early market share and get ahead of the “green rush”

3.   Avoid the Red Ocean– red oceans exist where sharks are feeding on their prey. This analogous to whats happening in the cannabis industry. Despite being at the early stages, cannabis is still a highly competitive industry. Some spaces are already extremely competitive and saturated. Evaluate the cannabis landscape and see what gaps, or blue ocean, exists out there. Catch up on cannabis news, sign up for cannabis blogs, and consult with experts as soon as possible.

4.    Clarify Your Roadmap & Go – when you commit to starting your venture, go through a series of exercises to drill down on your vision and plan. Vision board, use design thinking, plan a strategic planning retreat, whatever it takes. Consulting with an industry expert is also highly suggested to get insider perspective and informed advice. Discuss your ideas with trusted and selected friends and colleagues that can give you their honest take. Narrow down your ideas and weigh the costs and benefits of each. Speak with prospective partners and co-founders. After you’ve exhausted these efforts, make a decision and GO!

5.    Have Your End Goal In Mind – failing to plan is planning to miss the green rush. Is this a short or long-term investment? How do you define success? Are you interested in vertical integration? What is your exit strategy? Once you can answer these and answer other related questions, reverse engineer and map out all critical strategies and tasks needed to achieve your end goal.

6.     Licensing is Key – Whatever avenue you choose, you will most likely need a commercial cannabis license to operate. Like any industry, cannabis licensing stretches across many verticals: retail, manufacturing, cultivation, distribution, testing, and delivery. Licensing in California is a two-fold process: obtain local authorization and then apply for a state license. Sounds straightforward, but the application itself is quite complex. Consult experts on this and don’t take short-cuts or take it all on your own.Cities are looking for applicants that know what they’re doing and the application is how you will get measured. Failed applications can result from incomplete documents, inaccurate materials, cookie cutter documents, technical oversights, language not aligned with local and state law etc. Missteps will lead to serious delays in getting your application approved. Avoid being penny wise and pound foolish.

7. Get Your Finances In Order - make no mistake, it takes a sizeable investment to get into the cannabis industry. Application and consulting fees will cost you around $100,000 and startup operational costs will cost a few hundred thousand, minimum.You will also need reserves while you strive toward positive cash flow. Additionally, city’s issue licenses for applicants that are fiscally strong and sustainable. They want to see roughly $500,000 + in your bank or in assets. If you don’t have that, find an investor or partner who does, and share your piece of the pie. There is plenty opportunity to go around.

8. Real Estate is an X Factor - to obtain a commercial cannabis license, you will need to secure properly zoned property. You can buy or lease real estate. The city and state will need to know you have permission to conduct cannabis activity at your site. Cannabis property rates are sky rocketing by the day while cannabis zoning laws can be unclear. Look out for deals that may drain your cash flow and hurt your bottom line. Contingency deals are advisable. Consult with experts to help you negotiate your terms and ensure your property fits the city’s zoning requirements.

9. Build Your Dream Team - anticipate your growth and prepare to build your dream team. Bootstrap as much as possible until growing your team is necessary.Attend trade shows, local cannabis meetups, and network on LinkedIn to find like-minded and like-spirited individuals in the space. Find technically sound people with values and mission alignment. And if you need more advanced help, seek out a cannabis hiring firm and pay them to do the heavy lifting of screening potential candidates that fit your dream team goals.

10. Course Correct, Pivot, Stay Agile and Stay Hungry - the road ahead is exciting, yet filled with highs and lows. Your plan will sometimes be met with resistance, doubt, may not be feasible or may be the wrong move. Be brave and course correct. Pivot when needed. Speed matters here so be agile. Celebrate small wins and stay humble, yet ferociously hungry.

Summary of Major Changes of the Recently Amended Article 4 of Chapter X City of Los Angeles Ordinance
Summary of Major Changes of the Recently Amended Article 4 of Chapter X City of Los Angeles Ordinance

The most significant updates to Article 4 include a revised definition of “Undue Concentration” to increase the number of the number of cannabis businesses and define ownership concentration.  In addition, a tiered system of “Social Equity Applicants” was permitted to allow for economically disadvantaged persons to apply for cannabis licenses.

  • The definition of undue concentration was updated to allow for additional business licenses according to population density and applicable zoning laws.  This includes:

    • One Store Front Retail (Type 10 license) for every 10,000 residents.

    • One Microbusiness (Type 12 license) for every 7,500 residents.  A Microbusiness is an entity that engages in cultivation on less than 10,000 square feet.

    • One square foot (1 sq. ft.) of cultivation space for every 350 square feet of zoned land.

    • One license to manufacturer (Type7) for every 7,500 residents.

    • Existing dispensaries (EMMD) and processors (as defined under Section 104.08) are not subject to this new rule.

    • Additional rules, including calendar days, for how applications are submitted, accepted, processed, approved and denied was also clarified. Some limits pertaining to zoning (i.e. M1-M3, MR1, MR2), as well as limits on the number of licenses (i.e. 1 cultivation license per every 2,500 square feet of cultivation space) were also delineated.

    • The Undue Concentration provisions may be waived if the City Council believes doing so would serve “public convenience or necessity.”

  • Ownership & Percentages was also updated to clarify and limit the number of individuals that may own cannabis businesses

    • A person may own or have a maximum 20% profit share in up to three Storefront retail (Type 10) or Delivery (Type 9) businesses. 

  • Three types of Social Equity Applications (Tier 1, Tier 2 and Tier 3, each which must be approved by DCR), were introduced:

    • Tier 1 applicants are reserved for those with low income AND a prior California Cannabis Arrest or Conviction; OR Low income and a minimum of 5 years California residency. 

      • Restrictions, including a minimum ownership requirement (51%), as well as benefits including expedited renewal processing, fee deferrals are also detailed.

    • A “Tier 2 Social Equity Applicant” was also defined to include anyone with a Low Income & 5 years' residency or 10 years residency and no less than a 33.3% ownership.

    • A “Tier 3 Social Equity Applicant” was also defined to essentially include those entities that support Tier 1 & Tier 2 applicants and regulates the price per square foot of property, in certain instances.

  • Finally, this ordinance also requires a completed financial statement for the “most recently completed fiscal year” for any cannabis businesses applying for a renewal license.

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