Although Los Angeles authorities are actively cracking down on illegal cannabis storefronts, their efforts have done little to curb the city’s black market weed sales.
According to a new Los Angeles Times report, police have opted to shut off power and water to illicit pot shops rather than issue search warrants or deploy full-on raids. The reason for the soft approach: LA has so many unlicensed weed retailers that the cops can’t bust them all.
The Los Angeles Department of Cannabis Regulation lists 182 businesses with legit cannabis licenses. However, the online cannabis directory Weedmaps lists 365 active dispensaries within city limits, indicating there are just as many unlicensed pot shops in LA as there are licensed ones.
Unlicensed retailers pose a major challenge to the state’s legal marijuana program. Black marketeers don’t pay excise taxes or licensing fees, allowing them to undercut licensed retailers by 50 percent. Licensed retailers can’t flourish given those figures.
“The frustration for us is twofold,” Carlos de la Torre, founder of the Cornerstone Research Collective, told the LA Times. “Our businesses are suffering tremendously now because we’re having to compete in an unfair playing field, and we’ve spent all this time and energy and resources crafting something that should be really cut and dry, and it feels like [the city is] not really holding their end of the bargain up.”
Earlier this year, the owners of the nation’s largest dispensary chain, MedMen, claimed that their business was tanking because of California’s black market weed. Gov. Newsom responded by sending the state’s National Guard troops to raid some of the largest illegal cannabis farms, but smaller storefront operators continue to do business in Los Angeles.
Compared to the rest of California, Los Angeles’ regulations (or lack thereof) created a unique situation where unlicensed stores have operated in legal gray areas — and with limited immunity — after the state first approved of medical marijuana in 1997.
“This is really a Los Angeles phenomenon… I can’t tell you where there would be an unlicensed dispensary operating in Oakland or San Francisco,” Dale Gieringer, director of California NORML, told the LA Times.
Over the last two months, the LAPD shut off power to 90 businesses allegedly selling unlicensed weed. However, the LAPD’s resourceful strategy hasn’t done much to stop illicit sales. Some shops switched to their own electrical generators to keep the lights on. Others simply changed the names of their businesses to fool the cops.
According to Det. Vito Ceccia, who works on the LAPD’s Gang and Narcotics Division, the money alone is enough to motivate unlicensed retailers to stay in business, even after they’re threatened with heavy fines or even arrest.
Although police could order search warrants, selling or growing unlicensed weed products are only misdemeanors in Los Angeles, meaning the penalties would be minimal and likely wouldn’t result in any prison time for offenders.
To help resolve the problems stemming from illicit weed sales, Los Angeles officials plan to issue an additional 250 pot shop licenses sometime in or after September. Statewide, legislators have advanced a bill to extend 7,000 temporary cultivation permits for cannabis farmers, which are currently set to expire this summer.
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