Photos courtesy of The Artist Tree

Wider Attempts at Cannabis Lounges Struggle

October 19, 2023

Nearly six years since the implementation of Prop 64, the fact that the social cannabis use scene in California still operates in mostly a gray area is garbage.

Essentially, we’ve gotten to the point now that the farther you get from West Hollywood, the worse off you are. We can’t emphasize enough how much places like The Woods and The Artist Tree are our standard bearers at the moment, along with a few shops in San Francisco. But the SF lounges kind of feel like bars that are too bright or too dark with weed. The varying formats we see in WeHo make it the winner for sure.

So while lounges are technically legal under prop 64, you have to find a winning municipality. Then you need to find a way to be commercially viable besides, “hey, you can smoke pot here.” Which may not be enough in this saturated market. Assemblymember Matt Haney (D-San Francisco) was trying to help with the latter when he filed Assembly Bill 374 earlier this year. width=

“Lots of people want to enjoy legal cannabis in the company of others,” said Haney after the bill passed its final hurdle on the way to Newsom’s desk last month. “And many people want to do that while sipping coffee, eating a scone, or listening to music. There’s absolutely no good reason from an economic, health or safety standpoint that the state should make that illegal. If an authorized cannabis retail store wants to also sell a cup of coffee and a sandwich, we should allow cities to make that possible and stop holding back these small businesses.”

Haney went on to note that while California is certainly the birthplace of cannabis culture as we know it today, Amsterdam competes with California for cannabis dollars and for the title of the world capital of cannabis. Haney emphasized the over 700 cannabis cafes operating across the Netherlands are seeing $1 billion dollars spent in them annually. He went on to note that here in CA we have replaced the social aspect of the Amsterdam cannabis scene with pharmacy-like business models that only allow customers to order cannabis at a counter, purchase nothing else, and then leave.

“California’s small cannabis businesses are struggling,” said Haney. “Issues like over-saturation, high taxes, and the thriving black market are hurting cannabis businesses who follow the rules and pay taxes.”

Haney called AB 374 simple because it allows cannabis retailers to diversify their business by selling non-cannabis-infused foods and selling tickets to live performances.

“To be clear, we’re not saying that coffee shops should be allowed to sell cannabis,” said Haney. “We’re saying that cannabis shops should be allowed to sell coffee. It shouldn’t be illegal for an existing cannabis business to move away from only selling marijuana and instead have the opportunity to grow and create jobs by offering coffee or live jazz..

On Oct. 8, Gavin Newsom responded to the bill making it to his desk after crushing in the Senate with a 33 to 3 vote and then in the Assembly in a 66 to 9 vote. Seemingly bipartisan, but not not enough to get the pen to the paper.

“To the Members of the California State Assembly:

I am returning Assembly Bill 374 without my signature.

This bill would allow local jurisdictions to permit certain cannabis retailers to prepare and sell food or drinks that do not contain cannabis, as well as host and sell tickets to live events at their licensed premises.

I appreciate the author's intent to provide cannabis retailers with increased business opportunities and an avenue to attract new customers. 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.

For this reason, I cannot sign this bill,” the governor said in his veto message.

Some have trouble with that language of Newsom’s response. Since there already are lounges operating in the state with staff that need to enter the consumption spaces to provide basic services from changing out water jugs to cleaning ashtrays, what’s the big deal if they drop off a coffee, too.

One of the things the effort may have had going against it was how much cannabis stuff hit the governor's desk at once. Specifically, a lot of the wagons were circled around the fight to get AB 1207 banned that would have devastated branding in the industry. So even with the big wins in both Sacramento chambers, it was hard to rally the troops with everything going on.

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