The California Cannabis Countdown: The City of Berkeley

California cannabis lawyersUntil recently, the “Wild West” of U.S. cannabis lacked robust statewide regulations which left California cannabis companies subject to unclear rules and risk of federal shutdowns. The Medical Marijuana Regulation and Safety Act (MMRSA) created these regulations, but ultimately left control in the hands of local cities and counties. At last count, California has 58 counties and 482 incorporated cities across the state, each with the option to create its own rules or ban marijuana altogether. In this California Cannabis Countdown series, we plan to cover who is banning, who is waiting, and who is embracing the change to legalize marijuana — permits, regulations, taxes and all. For each city and county, we’ll discuss its location, history with cannabis, current law, and proposed law to give you a clearer picture of where to locate your cannabis business, how to keep it legal, and what you will and won’t be allowed to do. Our last California Cannabis Countdown post was on Calaveras County, and before that, Monterey County and the City of Emeryville.

Welcome to the California Cannabis Countdown.

Berkeley is known for being a very liberal city, so it’s not surprising that it had laws addressing marijuana enforcement long before California legalized the use of medical marijuana throughout the state. It currently has four legal dispensaries operating within the city and it allows an unlimited number of cannabis collectives through a unique provision for locations incidental to residential use. The city is now considering increasing the number of its permitted dispensaries as well as passing regulations specifically for medical cannabis businesses focused primarily on cultivation.

Location. Berkeley is an incorporated city in Alameda County located in the region of the Bay Area commonly referred to as the East Bay, and borders the fellow East Bay cities of Oakland and Emeryville. It is home to the University of California, Berkeley and it is considered one of the most politically liberal cities in the United States.

Berkeley’s History with Cannabis. In 1979, Berkeley voters passed the Berkeley Marijuana Initiative II which ordered the city’s police department to make the possession, cultivation, sale and transportation of marijuana the lowest law enforcement priority.

The 1979 initiative remained the law in Berkeley until November 4, 2008, when Berkeley voters passed the Patients Access to Medical Cannabis Act of 2008 (Measure JJ) in order to implement California’s Compassionate Use Act of 1996. Under Measure JJ, the Berkeley Medical Cannabis Commission was established and Chapter 12.26 was added to the Berkeley city code to regulate medical cannabis collectives.  Chapter 12.26 initially allowed for three medical cannabis dispensaries within Berkeley city limits. Further amendments to Berkeley’s medical cannabis regulations were passed through Measure T on November 2, 2010.

On July 8, 2014, the Berkeley City Council passed new ordinances to regulate medical cannabis dispensaries and collectives operating in the city through Chapter 12.27. The new regulations also approved the selection of a fourth dispensary in Berkeley which was officially announced on May 10, 2016. At the same time, the City Council recommended that local law be changed to allow two additional dispensaries within the city, which would increase the total number of permitted dispensaries in Berkeley to six.

Berkeley’s Current Cannabis Laws. Cannabis collectives in Berkeley consist of a group of patients and primary caregivers whose purpose is to provide for the cultivation and distribution of medical cannabis to their members. The city allows cannabis collectives to be organized as any statutory business entity in California as long as they are operated in a not-for-profit manner. Though collectives are allowed only in residential districts, dispensaries are authorized to operate at a non-residential location and may cultivate, acquire, bake, store, process, test, and transport medical cannabis as well as provide other incidental services to their members.

Medical cannabis dispensaries in Berkeley must be located in commercial zoning districts. The sections of the medical cannabis regulations regarding dispensaries include:

  1. Eligibility requirements – requires a dispensary be operated as a not-for-profit cooperative or collective, lists criminal convictions that disallow a person from having a position with a dispensary other than as a member, and disallows a principal of a dispensary to be a principal in any other Berkeley dispensary
  2. Information requirements – details the information every dispensary must provide to Berkeley and update annually
  3. Operating Standards – includes standards for: membership; non-diversion; dispensing; members and employees; security; neighborhood compatibility; consumption of medical cannabis, tobacco and alcohol; accessibility; and termination of membership
  4. Signage – requires that signs with specific text be posted at the entrance and conspicuously inside the dispensary
  5. Product Safety, Quality Assurance and Labeling – provides information on testing of medical cannabis, medical cannabis products and edibles for specific compounds and contaminants, as well as rules on packaging and labeling
  6. Medical cannabis for low income Members – requires that at least 2% (by weight) of the annual amount of medical cannabis provided by a dispensary to all members be provided at no cost to very low-income members who are Berkeley residents
  7. Records – requires dispensaries to maintain contemporaneous financial and operational records to show compliance with local and applicable state laws regarding the dispensary’s finances, membership, and operations
  8. Ranking and allocation procedure and criteria – allows the City Council to establish procedures and criteria for accepting and approving applications for dispensaries, which were eventually established by the City Council on July 1, 2014 in anticipation of its approval of the fourth Berkeley dispensary
  9. Confidentiality of information – protects the confidentiality of information submitted by dispensaries to the city, including information regarding principals and members of dispensaries, recordings from security cameras, and states that dispensaries shall not collect or maintain protected health information

Medical cannabis collectives in Berkeley must be located in residential zoning districts and must be incidental to the residential use of the property. In addition to complying with many of the operating standards applicable to dispensaries, a collective operating in Berkeley is subject to the following operating limitations:

  1. A collective may not generate more than 5 member trips per day per location, excluding trips by residents of the collective location.
  2. Cash on hand shall be minimized, and no more than $1000 may be retained overnight per location.
  3. Collectives may not operate at more than four (4) locations in Berkeley, and may not store or maintain at any site at any time more than a combined total of 10 pounds of dried medical cannabis and concentrates, of which no more than 1 pound may be concentrates.
  4. Collectives may not have member visits to obtain medical cannabis except for social purposes before 8:00 a.m. or after 9:00 p.m.
  5. No alcohol may be served for consideration.
  6. No consideration may be charged for entry into the collective or any part of the residence in which the collective is located, no live entertainment may be provided, and no entertainment of any sort may be provided for consideration.
  7. Smoking of medical cannabis by non-residents is prohibited in all exterior areas of collectives and within 50 feet of collectives on the public right of way.
  8. Collectives may not have any exterior display identifying them as such.
  9. Establishment and maintenance of a collective may not involve any changes in utility service or exterior modifications beyond those that would be customary for a residence.
  10. Collectives may not have any impacts on adjoining properties, such as, but not limited to, excessive noise, glare, smells, smoke, etc., beyond those that are normal for residential use.

Berkeley’s Proposed Cannabis Law. The Commission is currently in the process of drafting ordinances to regulate medical cannabis cultivation in Berkeley by adding Chapter 12.28 to the current city code. The new chapter will outline regulations specific to “Medical Cannabis Cultivation Businesses” operating within the city, which are defined as collectives whose primary activity is cultivation. The regulations generally mirror those applicable to medical cannabis dispensaries in Berkeley except that the section for Medical cannabis for low income Members is replaced by a section for Energy Use which requires cost-effective water and energy efficiency measures, mitigation of carbon dioxide emissions of electrical energy, and offset of carbon content of electrical energy for businesses that use natural gas.

For those considering opening a cannabis business in the popular East Bay area, Berkeley is a good option if you are able to comply with its operating limitations on locations that are incidental to residential use. If instead you are more interested in operating a dispensary in a commercial area, then you may be in luck, as the city could be selecting two additional dispensaries very soon. Either way, Berkeley is a politically liberal, marijuana-friendly city well worth watching as we here in California continue down the path to a regulated statewide marijuana market.