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Legally Opening a Marijuana Dispensary in California

How Does One Legally Open a Marijuana Dispensary in California?

Business and Professions Code 26051.5 (section a2) requires that one seeking a license to sell or grow marijuana must provide documentation of compliance with local ordinances, and proof of the legal right to operate on the proposed premises.

The process of opening a cannabis dispensary can vary by municipality. Some still completely ban the sale of cannabis, and many others limit the number of dispensaries that can operate in a given area. Generally speaking, any local licensing will typically charge a fee and require one to submit the following:

  • A comprehensive business plan regarding finances, security, safety, and other various operations.
  • A community assessment plan that describes how one’s business will affect the community in a positive way.
  • Proof of compliance with local zoning laws, which can be obtained from the city’s community development department or similar organization.
  • Criminal history and background check.

Business and Professions Code 26051.5 (section a6) requires that anyone who seeks to license a dispensary must have a seller’s permit. This is required for all businesses that take part in the sale of any goods. A cannabis tax permit is only required in operations that participate in the distribution of cannabis. For dispensaries that solely retail cannabis, this permit is not required.

Once the preparation for applying is done, an applicant must decide to get an A or C license. A licenses permit the sale of cannabis for adult use, while M licenses permit the sale for medical use. These have the same application requirements. Business and Professions Code 26051.5 lists all of the required documentation to licensing a cannabis dispensary. The requirements are:

  • Pass a background check and provide fingerprints for criminal history.
  • Documentation of the right to legally occupy and operate on the premises, which includes a statement of consent from the landowner.
  • All local licenses required by the municipality that the dispensary will operate in.
  • Valid seller’s permit ID number, and a cannabis tax permit if required.
  • A detailed description of all business, financial, security, and safety operations.
  • A diagram of the premises, with a description of where all operations will take place.
  • Proof of compliance with the California environmental quality act.
  • Proof of compliance with Business and Professions Code 26054, which prohibits cannabis-related businesses from operating near schools and child care centers.
  • Applicants with 20 or more employees must provide documentation of a labor peace agreement. Any dispensary must enter into a labor peace agreement within 60 days of hiring its 20th employee.
  • All licensing fees. These can vary with different levels of expected profit. They range from a few thousand dollars to over one hundred thousand.

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