California Cannabis Community Urges Government to Save Industry from Collapse

Nearly 30 California cannabis companies have raised the alarm to warn Gov. Gavin Newsome and legislative leaders that the state’s legal cannabis industry “is collapsing” due to excessive taxes and regulations.

Full story after the jump.

Nearly 30 California cannabis companies have sent a letter to Gov. Gavin Newsom (D) and legislative leaders warning the state’s “unwillingness to effectively legislate, implement, and oversee a functional regulated” industry has brought cannabusinesses to their knees. The signatories warn that the state’s legal cannabis industry “is collapsing.”

“The California cannabis system is a nation-wide mockery; a public policy lesson in what not to do. Despite decades of persecution by the government, we have been willing and adaptable partners in the struggle to regulate cannabis. We have asked tirelessly for change, with countless appeals to lawmakers that have gone unheard. We have collectively reached a point of intolerable tension, and we will no longer support a system that perpetuates a failed and regressive War on Drugs.” – Letter to Newsom, Senate President pro Tempore Toni Atkins, and House Speaker Anthony Rendon

The companies argue that California’s regulatory environment “threatens the viability” of the state’s “legacy cannabis operators” and that the craft cannabis farmers “are literally killing themselves, trying to find ways to survive on a chessboard” that lawmakers “mandated them to join but is rigged for all to fail.”

The signatories further argue that social equity licensees in the state “are being assaulted, burglarized, and left without recourse or protection from law enforcement.” The companies further claim that such applicants and operators “are forced to incur expenses and costs associated with a licensing regime that has no timelines and no respect.”

The operators contend that the state’s “excessive taxation” of legal cannabis products has made them 50% more expensive than unregulated cannabis, which they say still represents 75% of all cannabis consumed in the Golden State and is “untested and unsafe.”

“Illegal grows often use banned pesticides that poison our streams, rivers and lakes,” the letter states, “and illicit products put consumers at risk as they often include fentanyl, synthetic cannabinoids, and other potentially deadly chemicals.”

The letter points out that just 32% of the state has access to adult-use cannabis as 68% of the state has opted out, effectively recriminalizing cannabis through local control.

The companies are asking lawmakers to eliminate the cultivation tax, enact a three-year holiday of the excise tax, and enact legislation requiring that municipalities in which the majority of voters approved the reforms allow adult-use cannabis operations.

“We need you to understand that we have been pushed to a breaking point and we will not remain on our knees. We will not stand for political interests to the detriment of our own livelihoods, the health of our citizens, the prosperity of our families, and the state of California’s economy,” the authors said in the letter. “For some of us, this has been our craft since back when the world thought it was a crime. This industry is California’s to lead globally. Listen to us. Hear us. Respect us. Represent us. Work with us. We are behind you. Act.”

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