Lee proposes city cannabis office
Department would develop rules for regulating recreational pot use
San Francisco Mayor Ed Lee wants to create a city department that would develop rules regulating the cultivation, manufacture, distribution and sale of recreational cannabis in San Francisco.
Speaking at his monthly appearance before the San Francisco Board of Supervisors Tuesday, Lee said his proposed Office of Cannabis would act as a “navigator for the public, businesses and city agencies” when it comes to legalized recreational pot.
Introduced as part of his two-year budget plan, the Office of Cannabis would have to be approved by the city’s supervisors. The mayor’s bill will be reconciled with similar legislation to create a standalone city cannabis department introduced in March by District Eight Supervisor Jeff Sheehy.
Under Lee’s proposal, the staff and operating costs for the new department would be supported by fees paid by cannabis businesses seeking operating licenses. The cannabis office would have a staff of three and would be supported at first by $700,000 in city funds, then by the fees.
In addition to overseeing the permitting process for marijuana businesses, Lee said Tuesday the Office of Cannabis would create regulations for when and where cannabis may be consumed in San Francisco and how to prevent exposure and access to cannabis by the city’s youth.
Lee also urged the supervisors to craft a 2018 ballot measure that would shift some of the proceeds from taxes on marijuana to disadvantaged communities. Proposition 64, the 2016 ballot mea-
sure that legalized recreational pot use in California, includes provisions that allow local jurisdictions to tax cannabis sales independently.
“While many of the details of this tax are yet to be developed, chief among the goals must be to ensure that marginalized communities benefit from the revenue,” Lee said, adding that such a strategy could mean using marijuana tax revenue to create jobs in the cannabis industry or for a variety of health and social welfare programs.
“Proposition 64 presents a unique opportunity for atonement of years of misguided drug policies,” Lee said.
Lee said Tuesday that his office would convene a cannabis tax task force to help ensure that city tax revenue from pot sales is used efficiently and in a “socially responsible manner.”
The task force will be composed of City Administrator Naomi Kelly, Treasurer José Cisneros, Sheehy and District 10 Supervisor Malia Cohen, whom Lee said would be a “a leader and champion on this issue.”
How the task force decides to classify the ballot proposal would have a crucial impact on how difficult it could be to gain voter approval. Ballot measures that direct tax revenue at the city’s general fund need only a simple majority to pass. Proposals that collect money for a specific fund or purpose require a two-thirds majority to be approved.
Under Lee’s proposal, the Office of Cannabis would be housed within the city administrator’s office. Kelly would appoint the cannabis office’s director.
Stephen Rechif, who operates the Bloom Room Cannabis Collective in San Francisco, said that in an industry constantly beset by legal murkiness, he welcomed the city’s efforts to create more regulatory certainty.
“I think that people are less likely to invest when it’s less regulated, and that just leads to a market that doesn’t develop,” Rechif said.
“I want clear guidelines and someone to tell us what we can and can’t do, so we can obey the rules and operate freely within those rules.”
But Rechif added that others in his industry are leery about overregulation and overtaxation, which some fear could “end up driving up the costs for the consumer,” he said.