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Will Los Angeles Catch Up to San Francisco and Santa Rosa?

San Francisco has regulations for medical cannabis businesses – we know how much it costs to apply for a dispensary permit ($8,459) and how many medical cannabis dispensaries are allowed to be open 24-hours per day (two, see subsection (e)). Santa Rosa is another city with developed regulations; it’s paved a path for both commercial cultivation and commercial dispensaries.

Los Angeles is at the opposite end of the spectrum. Los Angeles voters passed Proposition D in 2013, putting a cap on the number of dispensaries (135). We’re just talking about the City of Los Angeles for this post, which is larger than 23 of the United States . LA’s 4m people make it larger than Nevada, Mississippi, Connecticut – and 135 dispensaries meant about 1 dispensary for every 30,000 people. LA County, for the record, has over 12m people and its regulations aren’t on the ballot today.

The other thing about Proposition D – while San Francisco and Santa Rosa hammered out legislation and worked with stakeholders to create regulatory system, LA did none of those things. Combining all this: Northern California is miles ahead of LA, but LA is far larger than Northern California.

If Measure M passes today, a few things will happen in Los Angeles:
1. Proposition D will be repealed, meaning no more 135-dispensary cap
2. The City Council begin working on LA’s own regulatory system, and they aim to be complete by September; this means LA City will start a process to become like SF and SR
3. Measure M puts a gross receipts tax of 5% on medical cannabis and 10% on recreational cannabis. Transporters, testers, cultivators and manufacturers would pay a 1%-2% tax, too

If M passes, a huge market is opening: LA City is bigger than 23 states and as cities go, only Tokyo and New York City have bigger economies. This is as significant, if not more significant, than some of the state elections we saw in the fall.

Update – 845pm on Tuesday, March 7 – first results in..Measure M is way-up…more results soon

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