Regulating marijuana in California will be turbulent, state official says

By David Garrick   Contact Reporter


MARCH 24, 2017
Crafting comprehensive state marijuana regulations this year will likely be a turbulent process of trial and error, California’s top marijuana official told a few dozen San Diego industry leaders during a forum this week.

Lori Ajax, chief of California’s Bureau of Medical Cannabis Regulation, also said that once new regulations are in place in January the state may crack down on illegal marijuana operations that local jurisdictions have struggled to close.

Ajax also expressed some optimism the state could help marijuana businesses get access to banks despite the drug still being illegal under federal law, but said any changes to local tax rates would need to start at the grass roots level.

On some issues unique to San Diego, such as U.S. Border Patrol agents possibly blocking transportation of marijuana that is allowed under state law, Ajax said she didn’t have any answers yet.

Ajax assured the audience, however, that her staff is moving full speed ahead despite recent comments from the Trump administration that enforcement of the federal marijuana ban could resume.

"We have so little time to wring our hands about that," she said. "We have to get this done so I'm focusing on what's in my control, and that's not in my control."
The main theme of her hour-long question-and-answer session at San Diego Regional Chamber of Commerce headquarters on Thursday was that crafting regulations will be a work in progress followed by a period of awkward transition once they’re in place.

She’s facing time pressure because Proposition 64, which was approved by 57 percent of state voters on Nov. 8, requires the new regulations be in place by Jan. 1.

Her agency plans to unveil proposed regulations for medical marijuana in late April and then, after the state Legislature sorts out which of nearly four dozen proposed bills under consideration will become law, propose recreational regulations in late summer or early fall.

Ajax urged the group of local industry leaders, which included attorneys, dispensary owners, cultivators and operators of delivery services, to take an active role in commenting on the proposals during a 45-day period after they are unveiled.

"They are proposed regulations — not final," she said. "The whole reason we have a 45-day comment period is for you to comment, and we expect we may be changing stuff."

And even after the regulations become law, Ajax predicted there would be changes based on how the rules perform in real-world situations.
"This industry evolves very, very quickly so we have to be ready if some of our regulations aren't working the way we thought they would — we need to be ready to make changes,” she said. "Not everything is going to be OK on Day 1 — there's going to be a transition."

Her chief concerns, she said, are whether there will be enough licensed labs to test all of the marijuana — which will be a requirement under state law — and whether cities and counties will approve enough distributors to get the drugs to dispensaries.

Testing labs need expensive equipment and rigorous certifications, creating significant barriers to entry, she said.

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