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Business of Cannabis

Why It’s Time to Repeal Local Bans on Licensed Cannabis Sales

The majority of Californians in 2016 cast votes to displace the illicit cannabis market with a taxed and regulated marketplace; one that would be controlled by licensed businesses, not by criminal entrepreneurs. 

Five years later, the voters’ desire has yet to become a reality. In many cases, local elected officials are largely to blame. 

More than half of the state’s cities and counties prohibit the operation of licensed cannabis businesses. In absence of above-ground legal cannabis outlets in these jurisdictions, illicit market providers are more than willing to meet consumers’ demands.

That’s because local moratoriums banning the establishment of licensed cannabis retailers do nothing to limit local residents’ access to cannabis; they only limit their access to legal cannabis. 


Marijuana production and sales exist in every neighborhood in California. However, in those localities that have chosen to regulate this marketplace, these transactions take place in a safe environment. Consumers have access to lab-tested products, and revenues from these transactions are redirected back into the local community. 

By contrast, in localities without a regulated marketplace, these transactions take place in the shadows — initiated by unlicensed (and sometimes underage) sellers who don’t check ID, who lack the means (or desire) to test their products for quality or purity, and who most certainly don’t pay sales taxes. 

Local voters and their locally elected officials must choose which sort of cannabis marketplace they want operating in their neighborhoods. Acting as if no local marijuana marketplace currently exists — or that banning licensed cannabis retailers will somehow keep cannabis and cannabis dealing “out of their community” — simply denies reality.

Crime rates

Furthermore, concerns expressed by some politicians that establishing brick-and-mortar marijuana businesses will negatively impact community safety and prosperity have long been proven to be meritless. Rather than being magnets for criminal activity, studies have repeatedly found that licensed operators are associated with reductions in neighborhood crime. 

This is because these operators take guardianship over the neighborhoods in which they operate. They employ security personnel and install security cameras. They displace illicit local operators. They are associated with an increase in local property values because they create jobs and stimulate economic growth. 

Unlike street-corner sellers, licensed retailers do not provide marijuana to minors. According to data published this year in the journal JAMA Pediatrics, 97 percent of adult-use retailers in California checked customers’ identification prior to making a transaction. A separate study conducted by the Insurance Institute for Highway Safety and local law enforcement found 100 percent compliance among licensed cannabis retailers.

Underage use

Finally, it must be acknowledged that youth who reside in localities with licensed retailers are no more likely to use cannabis than are young people in other jurisdictions. 

According to research published this year by a team of investigators with the RAND Corporation, “Young adults who live in an area with a greater density of any type of [retail cannabis] outlet are not significantly more likely to report stronger intentions to use cannabis, e-cigarettes, or cannabis mixed with tobacco/nicotine in the future.”

It’s time for local officials to put an end to the NIMBYism and unwarranted fears surrounding the establishment of marijuana retailers. Cannabis is here and here to stay. Municipalities need to embrace this reality and provide the necessary oversight in order to hold these businesses accountable, and to make this marketplace safe, transparent, and profitable for the community. 

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