Long Beach dispensaries may soon be allowed to sell recreational marijuana, pending City Council approval.

On Tuesday, June 19, the council will weigh whether to approve a series of code changes that would pave the way for dispensaries to sell both medical and recreational marijuana, and also set regulations for the cultivation and distribution of weed in the city.

If approved, city staff estimates the tax on such businesses could bring in an additional 750,000 to Long Beach’s coffers in fiscal year 2019, on top of the projected $2 million in taxes medical marijuana businesses will raise, a staff report said.

“This is not a decision to allow marijuana,” said Ajay Kolluri, the city;s cannabis program manager. “We’ve had a thriving black market for a very long time. This is about whether we want to regulate it and how we do that.”

Even though California voters approved recreational marijuana in November 2016, cities have the right to implement zoning regulations that determine if and where dispensaries can open. The city, which currently allows medical marijuana dispensaries, has been working on regulations for recreational pot shops for months.

Under the proposed regulations, medical marijuana dispensaries would be required to obtain business licenses to sell what the city has termed adult-use marijuana, more commonly known as recreational pot. The amendments to the city’s municipal and zoning codes would also allow the cultivation and distribution on recreational marijuana, according to a staff report.

The city’s voters approved medical marijuana dispensaries during the same election voters statewide approved recreational weed. But the local ordinance capped the number of dispensaries that can open at 32.

Currently, Kolluri said, there are only about 10 operating in Long Beach. But the applications for the rest of the spots have been accepted and those businesses are working to open.

The proposed regulations would not allow any other dispensaries to open, Kolluri said. Recreational-only dispensaries would not be allowed.

“The regulations,” Kolluri said, “would open up the recreational market while maintaining the medical cannabis regulations approved by voters.”

Many of the rules that exist under the medical marijuana law would remain the same. For example, while dispensaries can open up citywide, they aren’t allowed in residential neighborhoods; they must also be a 1,000-foot radius from schools and beaches, and a 600-foot radius from a park, library or daycare center, the staff report said.

The rules for non-dispensary marijuana businesses, meanwhile, would be more relaxed. While they would only be allowed in industrial areas, there is no cap on how many can open. And, the staff report said, current cultivation and distribution companies don’t have to apply for recreational-use licenses. Not doing so, however, would limit what type of marijuana they could produce.

For example, if a cultivator has a license to grow medical marijuana, they could only sell their product to a distributor who deals with medical marijuana exclusively.

The supply-side marijuana businesses could also choose to be recreational-only or get dual licenses, Kolliuri said.

The districts that would feel the greatest impact from the industrial-use regulations are one, two, seven and nine, said City Councilman Rex Richardson, who represents District 9, in north Long Beach. Under the city’s current zoning map, those districts have the most industrial spaces, although many of those areas were changed to the more environmentally friendly neo-industrial designation during the controversial land-use element process.

Richardson said those businesses could be a boon to the city, if officials get the regulations right – creating jobs, and leading to reinvestment in communities that were often targeted by harsh anti-weed laws the state once had and the federal government still has.

“The important aspects are how can people get jobs,” Richardson said, “how can people own businesses and how can those businesses reinvest in the community.”

The proposed ordinance, which likely would not go into effect until the end of July at the earliest, also calls for the creation of a social equity program.

Those who benefit from the program would get fee waivers, an expedited application review, tax deferrals and “access to workshops to help navigate the city’s licensing process,” the staff report said.

To qualify, an individual must have:

  • an annual family income below 80 percent of the area’s median income and a net worth below $250,000;
  • and at least one of the following: an arrest or conviction for a citation or misdemeanor marijuana offense before the state passed its legalization of marijuana in 2016; or residency in a Long Beach census tract for at least three years where 51 percent or more of residents have a household income below 80 percent of the median income.

The proposed law also requires employers to allocate 25 percent of annual work hours to those who are eligible for the program.

Richardson said on Wednesday he would like to see that percentage raised to 40 percent.

“The equity aspect is key,” said Richardson, who first proposed the idea when the City Council directed staff to draft regulations in November. “We’re going to do this with our community first.”

Before the new rules can be enacted, the council most vote in favor of them twice. Then there is a 30 day waiting period before it goes into effect, Kolluri said.