The bill would permit new provisional licenses
The marijuana industry in California has a problem. Currently, business licenses are issued as temporary licenses that are only valid for 90 days. Additionally, by law, no extensions can be requested after December 31 of this year. This means that no business would have a license after March 31, 2019. Lawmakers are hoping to change this, however, and have introduced a bill that would allow for year-long provisional licenses, if it is approved.
Senate Bill 1459 has already cleared the state legislature and is waiting for the governor’s signature, which is more than likely to happen soon. This is a good thing, as the state is reeling from a backlog of requests for the 90-day licenses. If for any reason it doesn’t receive approval, though, it could create a major disruption in the cannabis marketplace in the state.
The provisional licenses are not the same as permanent business licenses. Put simply, they are temporary licenses, but ones that would allow for a 12-month extension of the business.
According to Los Angeles attorney Nicole Neubert, “Someone who’s applying for an annual license, they have to have full local authorization before the state can issue an annual license to them, and the local jurisdictions are not ready to do that. It’s taking way longer than anyone anticipated. It’s crucial for all of our clients, pretty much. Some people have some local entitlement, but it’s a really small percentage that’s ready to go.”
A regular state business license can be delayed by as much as a year as the business cuts through all the local red tape. The provisional licenses can help ease the backlog, but it will depend on how quickly the local governments can process the growing mountain of paperwork.
The bill is more of a band-aid fix to a growing problem, and not a permanent resolution. Many questions still need to be addressed, but it’s at least a step in the right direction. Neubert asserts, “It’s going to be very bumpy for at least a few more years. This time next year, we’ll be talking about things that people didn’t anticipate or weren’t in the statute that need to be fixed.”