politics

Bill legalizing cannabis lounges passes state legislature, awaits governor's signature

Gov. Gavin Newsom vetoed similar bill in 2023, arguing for more worker protections, which the sponsor of the new bill said had been modified to accommodate

The state of California legalized medical marijuana in 1996 and recreational marijuana sales and consumption 20 years later. Later this month, the Golden State might just legalize cannabis lounges where customers could ingest the drug, then stick around for a meal or a live show.

Marijuana is still a Schedule 1 controlled substance at a federal level, but cannabis is legal for recreational use in 24 states and the nation’s capital, while medical marijuana has been approved in 37 states.

A few locations around California, including National City in 2021, passed ordinances permitting the creation of consumption cafes, but, on a state level, legal approval has lagged.

That all almost changed last year, when the state senate and assembly passed AB 374, which would have legalized the lounges, but California Gov. Gavin Newsom vetoed the bill, citing concerns over worker protections at the sites.

"I appreciate the author's intent to provide cannabis retailers with increased business opportunities and an avenue to attract new customers," Newsom said, in part, in his veto message, which was signed in October 2023. "However, I am concerned this bill could undermine California's long-standing smoke-free workplace protections. Protecting the health and safety of workers is paramount. I encourage the author to address this concern in subsequent legislation."

Which is exactly what Matt Haney, the San Francisco-based Assemblymember who sponsored AB 374, said he did this year when he drafted AB 1775.

"… Haney reintroduced the bill with the support of the United Commercial and Food Workers to ensure cannabis lounge workers are protected from secondhand smoke impacts at work," said a news release issued last week by Haney's office.

According to Haney's office, the state has made strides with cannabis culture but has failed to keep up with, say, Amsterdam.

"In the Netherlands ... cannabis cafes thrive as a part of the city’s unique social structure and capitalize on the social nature of cannabis through coffee, food and live music – all of these opportunities which are currently illegal under California law," the news release pointed out.

Under AB 1775, cannabis cafes could sell non-cannabis-infused food and non-alcoholic drinks, and also host live music.

National City cannabis lounge operator's reaction

The potential passage of AB 1775 is supported by Alex Ayon, whose Sessions by the Bay cannabis lounge in National City — which will be operated in partnership with the Sycuan Tribal Development Corporation — is now slated for a December opening.

"We're very pleased with it," Ayon told NBC 7 on Monday. "It's a much-needed developmont for the cannabis industry. We're very pleased with it," adding, "cannabis has been legalized for some time now but there haven't been any regulations around where people could consume, so it's important that there's some guidelines so that people can understand where they can consume responsibly."

The nearly 16,000-square-foot, two-story will be located in the city's tourist commercial zone at 700 Bay Marina Drive, the former location of California College San Diego.

Ayon said he isn't worried about the possible addition of other cafes in the San Diego cannabis space.

"This isn't really creating competition immediately for us," Ayon said. "It still allows cities to decide where lounges can exist. The big reason that cities have been reluctant to allow them is because the state hadn't provided any sort of framework or oversight for that type of business."

Not having the lounges legalized poses risks, too, Ayon argued.

"We expect cities to be more open to it, which will be a good thing for the industry in general — not just the industry but the community in general," Ayon said. "There's lots of consequences of not having safe spaces to consume."

But will Newsom sign AB 1775 into law? California may not know till the end of the month.

"This measure will be evaluated on its merits," Newsom's deputy director of communications Tara Gallegos told NBC 7 on Monday. "The deadline to sign or veto legislation on the governor's desk is Sept. 30."

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