California lawmaker pushes ‘Cannabis Cafes’ in new Bill
You order a sandwich, a coffee, and a marijuana cigarette, then settle in for a musical performance. This could become the future under a bill aimed at changing the landscape of cannabis use in California.
Legislation introduced this month by Rep. Matt Haney (D-San Francisco) would legalize the sale of edibles and soft drinks at cannabis retailers and lounges.
“It’s no different than a neighborhood bar or cafe where people congregate and have great social value [out] of it,” Haney said. “We allow cannabis consumption on-site in a lot of places, but right now they’re pretty sad places because you can’t eat or drink.”
Alcohol is not allowed in “cannabis cafes” under Assembly Bill 374, Haney noted.
If passed, the bill and its Senate counterpart would allow municipalities and cities to allow consumption of food and beverages at cannabis retailers. The state will not impose the new regulations on municipalities, Haney said.
Haney’s bill would also allow cannabis cafes to host live performances and sell tickets to the events.
Haney said he’s spoken to marijuana dealers from Los Angeles to the Coachella Valley, who all say their businesses need to expand to survive.
“If we want this legal industry to survive in California, we have to change these laws. They’re losing to the illegal cannabis industry, and one thing the legal cannabis small business can offer is an experience,” Haney said. “Cannabis companies have told us that unless the laws change, they may have to close their doors. The regulations that forbid them from offering other products like groceries are a huge liability.”
In West Hollywood, cannabis cafes use workarounds to serve food and drinks. At the Artist Tree Dispensary & Weed Delivery on Santa Monica Boulevard, weed smokers can hang out in the second-floor lounge like they’re dining at a restaurant. People can order food from Fresh Corn Grill, a restaurant that has an agreement with Artist Tree.
“So we have plated meals available. We mimic the experience of being in a restaurant even though we’re not actually selling the food,” said Lauren Fontein, a co-owner of Artist Tree. “We just have to mess up the process in some way to get there.”
Although the experience is great for customers, Fontein said proceeds go to the restaurant, not their business.
“That is the big problem, which is why this bill is very important. The food and drinks are a big part of the revenue plan and we can’t capitalize on that now,” she said.
Fontein said Artist Tree has struggled to maintain profitability at its lounge, which has high overheads including staffing and build-out.
“The whole lounge model hasn’t been proven successful by any company in general,” she said.
In the city of Los Angeles, where lounges aren’t licensed, retailers are even less fortunate.
“I’ve had a location next to my pharmacy for four years waiting for consumption lounges to be legal in Los Angeles,” said Jerrod Kiloh, who has owned a pharmacy called Higher Path in Sherman Oaks for 10 years.
Kiloh said the ability to sell drinks, food, and an experience for customers would help draw people away from the illegal marijuana market.
“They want coffee, food, snacks… Those other services or experiential sides of things are super important for this business to grow beyond a commodity,” Kiloh said. “There’s a reason people go to a bar and not because they want to spend four times more on alcohol than they would at a grocery store.”
Even if the state allows lounges to operate more like restaurants or cafes, that’s just a small piece of the puzzle for the legal cannabis industry.
Robert Solomon, co-chair of the UC Irvine Center for the Study of Cannabis, said that high taxation remains the biggest challenge for people running legal cannabis stores. The state levy on retail marijuana sales is 15%.
Lounges’ ability to sell food and soft drinks is a “minor” change, Solomon said.
But the change could help normalize and destigmatize marijuana use, said Chelsea Byers, a West Hollywood councilwoman who supports the bill.
“Offering food and entertainment like this could create an opening for people otherwise closed to cannabis use,” she said.
Byers, a cannabis user, said the bill could transform retailers from antiseptic, dispensary-like places into community spaces.
“It helps fulfill the vision of creating those third spaces for people to go to between home and work,” she said.
Haney compared the possibilities to Amsterdam, the Dutch city where marijuana is decriminalized and available in coffee shops, which has been a huge boon to tourism. Haney noted that his bill would not allow existing coffee shops to sell marijuana, but would license marijuana retailers to sell coffee.
A spokeswoman for the Los Angeles Department of Cannabis Regulation said it was “monitoring” the law, but didn’t comment on whether the city would opt in if it were passed.
