Since 1996, when California became the first state to legalize medical cannabis, farmers have only been able to grow a limited number of plants and businesses were restricted in the amount of profit they could make off the product. Under a new state law, both of those policies have been reversed. The California marijuana industry is now allowed to make a profit and limits on the number of plants that can be grown have been eliminated.
The California Marijuana Industry is expanding rapidly, thanks to a change in laws and an increase in the number of investors. 7raysmarketing / Pixabay
Legalized, Large-Scale Marijuana Farming Attracts Corporate Investors
Now that a greater profit motive has been incorporated into the California marijuana industry, new investors (including some from out-of-state), as well as taxing authorities are rushing to get a piece of the pie.
Investors are purchasing farmland and opening new marijuana dispensaries. They are also working to make even more changes to the marijuana laws in the state, frequently with the support of mainstream politicians.
California Voters May Legalize Recreational Marijuana This Fall
In November, voters will have another opportunity to legalize the recreational use of marijuana and this time the ballot measure is expected to pass. Since California already comprises the biggest legal marijuana market in the world, based solely on medical marijuana sales, investors believe the trend towards general legalization will create profits which are far larger than what has been seen in the states of Washington and Colorado.
One of the factors that has changed in the past few years in California has been more “normalization” and greater acceptance of marijuana use. While many people assume that casual marijuana use is common in California, the truth is that several ballot measures that would have legalized the recreational use of marijuana have been turned down by voters in the past. This year, supporters believe the tide has turned and the measure will pass. However, there are currently so many different petitions being considered for the November ballot that they risk cancelling each other out … which has happened in the past. This time, supporters hope to put together a consensus ballot initiative that will be acceptable to voters.
One symptom of this change in attitude towards marijuana is that even the Drug Enforcement Agency has approved the first-ever trial of medical marijuana for PTSD in veterans.
Celebrities are Investing in the California Marijuana Industry
A number of celebrities have shown interest in investing in the marijuana business. Snoop Dogg and one of Bob Marley’s sons, Ky-Mani Marley, have met with officials to learn about getting the necessary licenses to get into the business.
Tommy Chong (of Cheech and Chong) has been involved in the California marijuana industry for years. He is now in negotiations with a company to grow and produce larger quantities of his trademark “Chong’s Choice.”
Actress Roseanne Barr is opening a marijuana dispensary in Santa Ana, CA in late April, 2016.
Rapper B-Real and actor Woody Harrelson are two other celebrities who have expressed interest in investing in the California marijuana industry. With the new laws allowing greater profits, more celebrities are certain to join those who have already publicly announced their interest.
Troy Dayton, the chief executive of the ArcView Group, said, “People are definitely salivating over the California market. It’s huge, and Californians love cannabis so much.” The ArcView Group is a research firm in the San Francisco Bay Area that specializes in studying marijuana.
Both of the Democratic candidates for U.S. president have indicated that they plan to make major changes to federal cannabis laws, if they are elected. In the past, this attitude would have seemed too radical for mainstream politicians.
The leading California candidate for the Senate, Kamala Harris, is also the state’s current Attorney General. If elected to replace the state’s retiring Senator Barbara Boxer, she is another politician who supports taking action to soften the federal government’s marijuana laws.
Local Tax Authorities are Seeing Benefits
The boon in the marijuana industry could also help state and local tax authorities. Property values have tripled in some parts of the Southern California desert, especially the areas around Adelanto and Desert Hot Springs. These are communities where investors have been buying up large tracts of land where cannabis can be legally grown. In fact, some business analysts believe that the largest profits to be made may be in the real estate business.
Opposition to Increased Profits in the Marijuana Industry
Some early investors in the marijuana industry are disappointed by the increase in outside investors and the new profit incentives. They are afraid that large conglomerates will come into the state and push out the small farmers that have grown cannabis for the past two decades.
Share with your friendsFollow Us