New California gov earmarks more funds for cannabis regulations, enforcement

In his first state budget, California Gov. Gavin Newsom recommended a sharp increase in spending for marijuana regulatory programs.

But it’s an open question whether additional funding will be enough to help steady the state’s cannabis economy.

The governor’s budget proposes setting aside more than $200 million for marijuana-related activities in the fiscal year that starts July 1.

That total would be more than a 50% boost from the current budget.

California’s top marijuana regulator, Lori Ajax, has said the state intends to get more businesses licensed and operating in 2019, while cracking down on rogue operators who continue to proliferate statewide.

Up to 80% of California’s cannabis sales remained under the table at the end of 2018, according to some estimates.

Newsom, an advocate for legalized marijuana, said it has long been expected the new market would take five to seven years to settle in.

The issues he intends to look at include the distribution pipeline and claims that local governments are gouging marijuana businesses.

The state will “move expeditiously at licensing more and more dispensaries, making sure we go after the bad actors,” Newsom said.

The budget also projects the state will bank $355 million in marijuana excise taxes by the end of June. That’s roughly half of what was once expected after broad legal sales kicked off last year.

Industry experts say the tax income is proof that most consumers are continuing to purchase marijuana from the black market, where they avoid taxes that are nearly 50% in some communities.

– Associated Press

13 comments on “New California gov earmarks more funds for cannabis regulations, enforcement
  1. Keith Shepherd on

    BS. There are more rogues in California now than there were last year. Newsom is lenient on crime. Alex, I will take a misdemeanor for another cool $300k this year. Black market all the way.

    Reply
    • Darren Nelson on

      Just like the black market, these ‘rogue’ operations are a product of the government for two reasons:

      1. The taxation on recreational marijuana is ridiculous. Depending on where you are, it’s over double the state sales tax of 7.25% at 15%.

      2. California was not and is still not ready, infrastructure wise, to handle the business recreational legalization brought about. Most people trying to operate within the law cannot do so because the infrastructure for them to do so is not ready yet.

      I realize that once the infrastructure issues are resolved, there will still be those that choose to operate outside the lines. However, once the state gets it’s act together and there are enough legitimate businesses open and the taxation becomes reasonable, the ‘rogue’ operations won’t be an issue.

      How many illegal liquor stores do you know of?

      https://www.latimes.com/politics/la-pol-ca-pot-tax-reduction-california-legislature-20180315-story.html

      Reply
  2. Rick Kauger on

    HELP US OUT IN WISCONSIN. IT’S STILL THE OLD SAYING, COME TO WISCONSIN AND GO BACK IN TIME TWO HUNDRED YEARS. ALL WE HAVE IS THE BLACK MARKET. WE HAVE A FEW CBD DISTRIBUTORS. I REMEMBER THE DAYS OF COLOMBIA GOLD , AFRICA BLACK. ALSO OTHERS. TELL THE DOCTORS AND HEAD SHRINKERS TO HELP US VETERANS OUT INSTEAD OF THE DOCTOR COMING IN AND TRYING TO TELL US HOW WE NEED DRUG REHABILITATION BECAUSE THEY FOUND THC IN OUR SAMPLE. I’M ALL FOR MEDICAL RESEARCH BUT I’M NOT A PERSON WHO IS GOING TO BELIEVE THAT USING CANNABIS IS THE REASON WHY I HAVE MENTAL HEALTH ISSUES. DOCTORS!! READ THIS AND LISTEN. IF I DIDN’T USE A LITTLE CANNABIS I’D BE IN PRISON OR A MENTAL HOSPITAL. BECAUSE I WOULD LOSE IT. SOMETIMES! BUT I HAVE TO PLAY A GAME WITH SNEAKING AROUND TO GET SOME CANNABIS FROM MY FRIENDS AND I HAVE TO HIDE THAT I SMOKE WEED. LET’S GET WISCONSIN LEGAL AND LET’S GET THE V. A TO ALLOW US TO HAVE LEGAL CANNABIS IN ALL V.A.S HELP US VETERANS AND HELP US OUT IN WISCONSIN. MAKE CANNABIS LEGAL IN THE UNITED STATES AND NOT ONLY MEDICAL. LET’S SMOKE OR VAPE OR YOUR CHOICE. I THOUGHT THAT I WAS IN A COUNTRY WHERE PEOPLE WERE SUPPOSED TO HAVE FREEDOM?.

    Reply
  3. George Bianchini on

    ”California’s top marijuana regulator, Lori Ajax, has said the state intends to get more businesses licensed and operating in 2019, while cracking down on rogue operators who continue to proliferate statewide”.

    Everybody in the cannabis industry were rogue operators before Lori Ajax’s renewed war on drugs, started with the molesting of prop 64. The voters thought cannabis was going to be legal. What a joke! The only change has been in the price of cannabis, it’s new 100% or more in taxes/ fee’s/tiers and regulatory compliance costs, has grown the black market/rogue operators like nothing else has ever done before.
    The State of California has evolved the safe and efficient cannabis industry under prop 215 into a pure, by design, chaotic mess.
    The unheralded success of the “rogue operators” define the intent and will of the consumer. Apparently both are happy with the arrangement.

    Reply
    • john ward on

      One reason for the unheralded success of the “rogue operators” is that a lot of us don’t like and will not do business with these new big monied companies that are displacing the mom and pop operators that took the risks to evolve this industry.
      All the news these days seems to be, who bought who for mega millions and who is suing who over why their criminal partners ripping them off.
      What happened to creating medicine for patients? Why do poor sick people have to pay $50 for a tiny bag of cannabis? Why did former Governor Brown construct a Cannabis Board that had zero knowledge of what they were regulating?
      And why the F**k can’t I buy CBD dog treats at my health food store anymore?
      Shame on you California, shame on you.
      Thank goodness for our rouge operators. As it’s the consumer that will ultimately decide the market place, not the new State Cartel system.

      Reply
  4. lee rigby on

    I too live in Wisconsin and am a decorated combat Veteran from the Viet Nam conflict. It was 1967 when we all thought it was the right thing to do. I was a staunch opponent to cannabis as returning home to a group of people that were foreign to me was an eye opener. I have heard all the arguments about how the Hippie movement was a good thing as it changed the world for the better. My personal opinion was after using cannabis with a high thc and then coming home to a bunch of morons acting stupid on 5% thc just turned me off. Now at 70 years old I can look back and much of my feelings have not changed regarding this lifestyle. I realize now that the regulation of the industry is a given fact. The right to grow and use is a given fact, the medical benefits are beyond question and the fear of big pharma running rampant is overblown. I do see this as a sector whose time has come and the benefits are to important to by pass with bureaucracy. People really don’t realize the fact that people like myself and many seniors are all in. It is however a real image problem. Lookat the documentary “Murder Mountain”, really doesn’t help the middle America mentality understand this is no longer “black market” and under ground only territory. When you get into medical grade cannabis, it is something that along with edibles needs very well monitored health concerns. If people understood that only 16% of cannabis is actually smoked, they would forget the images of “POT HEADS” and “Stoners” and see this for what it is. I invest in the Cannabis sector and have so for two years and have learned a lot. I may convert part of my vineyard to industrial hemp as cbd has been proven effective for a number of issues. I even ordered some for my friend, King James, my dog. Now this is a long post but I think people have to really start looking at the benefits and not be drawn to the old images . Wake up folks!!!!. Wisconsin I am afraid will never legalize in my time frame as the gentlemen stated, once you enter Wisconsin you enter a time wrap. It is amazing how we cannot see the light but allow or County to have a Meth problem that is way out of control…..

    Reply
  5. mike on

    well, well increase enforcement, where have heard this before. voted legal but beauracratic dysfunction and unreasonable licensing requirements ensured that 80% would stay black market. the design was always to crowd out the legit medical to keep big pharma in business and to make rec licensing so complicated and expensive that only big business could actually get licensed cauz they can pay the vig to the pols.

    Reply
  6. https://Zack-cuckoo.blogspot.com on

    Thanks for finally writing about >California
    gov earmarks more funds for cannabis industry in 2019 budget <Loved it!

    Reply
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