When a cannabis growers, cultivators, or retailers are looking to set up shop in one of the 482 municipalities within the state of California, the overall process is much more grueling than most commercial endeavors. Before they have to pay their $500,000 licensing fee and begin operating under strict regulations, these companies must first obtain the approval of the local government. That’s where Dr. Chris Brown, former mayor of Hawthorne, Calif., comes in.
Dr. Brown is currently the chief political officer for The Foxx Firm, a legal group founded by attorney Freddy Sayegh, who introduced Brown to the idea of cannabis when two originally while he was still mayor. With his city in the midst of a major deficit, Brown quickly realized that cannabis companies were the key to saving struggling local municipalities like Hawthorne.
Since leaving office this past January, Brown’s new occupation is making the connection between cannabis companies and local governments, helping to ease the process for both sides. Instead of charging a flat fee for his services, he becomes an investor in prospective cannabis businesses that he thinks will succeed, taking a small stake for getting them past the endless political obstacles. Thanks to the former mayor, companies like the Los Angeles-based delivery service SpeedWeed have been able to thrive throughout California, and more are sure to follow.
MERRY JANE talked to Dr. Brown about his beginnings in the industry, what cannabis companies need in order to obtain the approval of local cities, and how cannabis is poised to become the bastion of California’s economy.
MERRY JANE: What is the role you play between local government and cannabis companies?
Dr. Chris Brown: I deal with people who want dispensaries, cultivation, manufacturing, and distribution. I’m sympathetic to the cities that don’t want dispensaries, and there are a lot of illegal ones throughout California, which the state is going to clean up. We want everything done right, so we have to start backwards. What do these cities want? Revenue. What are they comfortable with?
How are these local governments learning to cope with the cannabis boom?
More people are comfortable with medical marijuana cultivation and manufacturing than anything else. The distributions and dispensaries are a little tougher to get in local cities. They’re starting to become a little more open to it, but manufacturing and cultivation are what local municipalities are really comfortable with. If everything is set up right for these cultivations and manufacturers, the city is going receive anywhere from $300,000 to $500,000 per license, and that’s significant.
Why should these smaller cities welcome the cannabis industry?
Sometimes these cities are in a four- or five-million-dollar annual deficit, and they need that deficit plugged up. Why not have cannabis companies come in to fill your budget woes? The money doesn’t just go to a general fund, it also goes to public safety. You can improve the police department, you improve the parks, you improve the community.
There are certain cities that are not open to it, and they will look back down the road and wish they had at least looked at it, maybe at least have opened one or two distributions. You never know which one of these companies could become the next Anheuser-Busch. You see this company created 400 new jobs in my city, and they’re also paying us $500,000 a year—who wouldn’t want that in their city?
Why are these companies unable to approach the city on their own?
The problem is the introduction between a business owner and the city. There’s a big language block there, and I’m one of the people to call and fix that. I understand what the issues might be for a city, and what would get a city to say yes. So, we have to come with that median, and sometimes that takes time. But, being a former elected official, I can help reduce that time drastically.
What aspects are you looking for when investing in these cannabis companies?
Experience, finance, and a feasible deck. There’s a lot of people coming into the industry that know nothing about it. I like those companies that have put their toe in the water and understand the temperature of what they’re getting into. Not the ones that are doing illegal grows all over the place, but someone that sits with legislators and policymakers to see what it will bring to a city, how they can make this happen.
What role did cannabis play in your political career?
Cannabis was never a part of my personal campaign, but increasing tax revenue for my local city was always a part of it. The cannabis aspect wasn’t on the forefront originally. [My focus] was to keep my local city and now all cities out of the red and keep them in the positive—it’s extremely important. If our state government can pass legislation to create billions of dollars in revenue for the state of California, why not create millions of dollars for your city?
When do you think politicians will start adopting cannabis into their platform?
Two years from now, cannabis will become a platform to push for politicians. You have John Woodard, from the city of Adelanto, who ran on it and won. Before that, the city was facing bankruptcy. Now they’re going to get an additional ten million dollars in tax revenue. Now, the city is going to forever be in the positive. The commercial property went 1,200 percent over the last year, residential properties went up 30 percent.
The same thing is going to happen to localities in Southern California, but some elected officials need to open up their eyes. It’s going to be here no matter what. The question is, are you going to have one of those cities that are going to ignore it, or are you going be involved and collect tax revenue? It’s smart to at least create that bridge where you’re collecting a tax on everything sold in your local city.
What do you see for the future of the cannabis industry in California?
California is the sixth largest economy in the world. Wherever California goes, the whole country goes. We’ll be the leader. We always have been, whether it's with Apple or now with cannabis. Everyone is going to sit back and watch as we pass our legislation, and then everyone will base their legislation off of what California is doing. California is going to be the most aggressive and also highly-regulated [state] as well.
What is your long-term goal in the industry?
I’m here to help individuals and companies get licensing. That is my objective, to get as many licenses in California that localities and states will allow. Come 2018, doing this the wrong way will not just be illegal—you’re not just growing marijuana and you get a slap on the wrist like today—it’ll be a felony, because now it’s tax evasion. It’s going to be in a whole other ballpark, so I want to focus in on this and get it done the right way.