Grower selling marijuana
Grower Anthony Nguyen sells marijuana at the medical marijuana farmers market at the California Heritage Market in Los Angeles. REUTERS/David McNew

The city of Los Angeles’ new Department of Cannabis Regulation, which has taken in far more revenue than was anticipated since marijuana became legal for recreational purposes at the beginning of the year, got the green light Wednesday from the City Council to add 21 positions to its current authorization of five.

“That is a huge jump from our current capacity,” Cat Packer, head of the city’s Department of Cannabis Regulation, told City News Service. “We always anticipated that this part of the conversation would be a natural development. As a new department, we are participating in the city’s normal budget process, but this is going to allow us to allocate resources a little bit quicker and make sure that we have the capacity we need to move forward with the next steps.”

From the beginning of January, when marijuana became legal for recreation use and sales, through mid-February, the city issued 101 temporary authorizations to cannabis businesses, according to Packer.

The department was formed in 2017 and given a budget of $1.3 million for the fiscal year, and as of mid-February had collected more than $2.2 million in licensing fees, with around $800,000 in outstanding invoices, making it likely the department’s revenue projections through June will be $3.5 million, according to Packer.

Although the licensing fees the department collects go to the city’s general fund, with the department taking in more revenue than expected, the City Council and mayor are more easily able to give additional resources to the DCR, Packer told CNS.

“Because we’ve been issuing so many temporary approvals, we’ve been able to collect that additional revenue and we’re hoping to use that additional revenue that’s been collected to appropriate to new positions,” Packer said.

Although Packer’s department was allocated five positions, it currently only has three employees, including herself, and she said she is working to fill the other two positions.

The staff expansion of the DCR was approved on a 14-0 vote and still needs to be approved by Mayor Eric Garcetti.

California voters approved the legalization of recreational marijuana in 2016, effective Jan. 1 of this year. Last March, Los Angeles voters approved Measure M, which set up regulatory measures for the cannabis industry, projecting more than $100 million could be generated annually in revenue through licensing fees, sales taxes and other sources for a city with a budget that topped $9 billion last fiscal year.

The council also took several steps aimed at improving the city’s regulation of marijuana, including passing an ordinance to prohibit marijuana advertising within 800 feet of sensitive locations such as schools, limit a cannabis business to one on-site sign that has a maximum size of 75 square feet, and prohibit portable signs or sandwich signs located in the public right- of-way.

The council also approved a motion that explores expanding the city’s social equity program into parts of the San Fernando Valley, Boyle Heights and downtown. The program aims to help people convicted of some low-level marijuana- related crimes and residents in some low-income communities impacted by the war on drugs to open a cannabis-related business.

The council voted to ask the City Planning Commission to devise provisions to the city’s municipal code for location and sensitive use restrictions for private clubs and lounges that may engage in providing social consumption to the public.

Currently, California law allows for on-site consumption of cannabis at businesses, but only if the local jurisdiction specifically allows it. The city council did not allow for on-site consumption in the ordinances it approved last year for marijuana sales, but is exploring the option and recently received a city staff report that detailed the rules in place for jurisdictions that do allow on-site consumption or are in the process of allowing it, including San Francisco, Oakland, West Hollywood.

–City News Service

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