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Will Prop 64 Make 2023 the Year Corporate America Takes Over California Cannabis?

Debate rages between growers and users in the Golden State.

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The Adult Use of Marijuana Act, or Prop 64, is a contentious topic among the growers that Northern California farmer Tom Liberty is in contact with. They are “by-and-large nine-to-one against AUMA,” he says. Why?

For one: In 2023, a new category of Type 5 “Large” cultivation licenses will be created for farms over the MMRSA limit of half-acre indoors or one-acre outdoors. Type 5 gardens have no limit to their size, leading some skeptics to refer to them as potential “super farms” perfect for a corporate takeover of the California cannabis industry. The state won’t issue Type 5 licenses until Jan. 1, 2023.

“The reason we and other growers have a problem with that is there is currently no true open market,” said Liberty, who resides in Calaveras County. “We can’t deal interstate and we can’t deal internationally. With a truly open market people can grow as large as they want [and not have a monopoly]. If you give someone ability to grow as much weed as they want, when there is no interstate commerce, then you kill the little guy.” He doesn’t see Prop 64 so much as California cannabis legalization. He calls it a regulation bill.

“And just one out of many,” Liberty says. “It’s not a good one from a farming perspective. They’ve thrown things in there to make it attractive to patients, and there’s always been a group of people in this movement who felt anything that moves the ball a bit further down the field is a good thing. I personally prefer [Proposition] 215 [Medical Marijuana Initiative] to AUMA. Even MMRSA [Medical Marijuana Regulation & Safety Act], with all its problems, is better than AUMA.”

Small farmers fear that 2023 could mean the end of their businesses, as they struggle to afford licensing and regulatory compliance measures, while other, more monied competitors benefit from an entirely different licensing structure—Type 5. The Calaveras County farmer doesn’t see that as fair.

“A garden of unlimited size is in some ways an unregulated garden,” he says. “If you have a severely regulated market, then let fat cats come in and grow as much as they want. That’s nowhere close to an even playing field.”

Sure, there are going to be a few highly skilled people able to manage small farms like small craft breweries are able to compete with Budweiser and Coors, the farmer says.

That is “until Heineken comes in and buys them up, like happened here with Lagunitas,” he quips, referencing the Sept. 2015 partnership between Heineken and Lagunitas.

California-based corporations are the ones best positioned to dominate the cannabis marijuana market. Federal prohibition means corporations can’t take marijuana money across state lines. So, a big out-of-state corporation—like, say, Marlboro—would have to jump through regulatory hoops to become a cannabis business in California. Some question the anti-64 crowd’s motives.

“The anti-AUMA growers prefer to profiteer off their mediocre black market product instead of stepping up their game to compete in an open commercial market which is regulated for consumer safety as other human consumables are regulated,” states George Kepnir, an Internet commenter in a Facebook group dedicated to California marijuana user rights.

Northern California lawyer Omar Figueroa echoes Liberty: “The people that are reticent about about it are the ones afraid everything they worked for so many years is going to be swallowed by corporate America. A lot of people don’t want to become corporate. They desire unconventional, non-corporate lives. Now, the threat of corporate America taking over the cannabis industry—a once semi-outlaw profession—and turning it into boring corporate culture dedicated to profit maximization, short-term and goal-oriented profit-chasing does not appeal to them.”