California Working To Keep Pot Off Black Market Before Feds Step In

By Paul Gaita 10/05/17

Of the more than 13 million pounds of marijuana produced by California last year, only 2.5 million was consumed by state buyers.

Person examining marijuana buds in a field.

The California legislature is hoping to exert some control over where the state's overabundance of marijuana—more than 13 million pounds in 2016 alone, by conservative estimates—ends up before the federal government steps in.

A report from the Los Angeles Times reveals that the California Assembly and the state's newly formed California Bureau of Cannabis Control are working overtime to implement regulations to prohibit marijuana from being exported out of California to other states.

The measures come at a crucial time for California growers, whose own concerns about runaway production are being exacerbated by an aggressive campaign by the Drug Enforcement Administration (DEA) to rein in production through seizures, which have so far netted more than 3.7 million plants in 2016.

Of the more than 13 million pounds of marijuana produced by California last year, the Times cited a study by the state's Department of Food and Agriculture that only 2.5 million was consumed by state buyers, leaving the majority in the hands of black market distributors who sold the product to other states. That has California lawmakers and growers concerned, especially in light of federal attention to exports from states where recreational marijuana is legal, such as Oregon and Washington.

With the passage of Proposition 64, California is slated to join that group at the beginning of 2018. Officials are worried that DEA seizures of California product, which are already at the highest level in the nation, will only continue to increase if proper regulations are not in place by that time.

The California Bureau of Cannabis Control hopes to address concerns through regulations that went into effect in late 2016 after the passage of Prop. 64, including the prohibition of marijuana exports to other states, and seed monitoring that will ensure that plants grown in California are sold there.

Assemblyman Tom Lackey (R-Palmdale) has put forth legislation that would put enforcement of marijuana regulations into the hands of the California Highway Patrol (of which Lackey is a retired officer). As the Times noted, there is no single entity that oversees drug laws for the state—rather, it's left up to city and county law enforcement in cooperation with the California Bureau of Narcotic Enforcement.

Lackey's proposal, AB 1733, will be considered early next year, but that may not be soon enough for growers, which are already under pressure to exact their own regulations on runaway production that is putting some farmers in danger of losing their businesses.

"We are producing too much," said Hezekiah Allen, executive director of the California Growers Association, who also noted that farmers are facing the possibility of reducing their crops in order to meet requirements for the upcoming state legislation. That scenario also highlights a concern among officials that some growers may simply sidestep the whole state regulation issue and sell directly to black market dealers, which will only feed federal interest in California exports.

"For right now, our goal is to get folks into the regulated market—as many as possible," said Lori Ajax, executive director of the Bureau of Cannabis Control. Marijuana industry observers say that the state has its work cut out for itself. "I don't think California lawmakers realize how difficult it is to put proper safeguards in place," said Kevin Sabet, president of the Smart Approaches to Marijuana, which opposes legalization efforts.

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Paul Gaita lives in Los Angeles. He has contributed to the Los Angeles Times, Variety, LA Weekly, and The Los Angeles Beat, among many other publications and websites.