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From Illegal to Essential: Cannabis Regulations and Operations in the Time of COVID-19

Posted by Alexa Steinberg, Esq. | Apr 01, 2020 | 0 Comments

Co-Author Shannon Heatley

After Governor Gavin Newsom issued a Safer-At-Home order to protect the health and well-being of all Californians in the face of COVID-19, cannabis businesses were deemed an essential business in California and Los Angeles and were allowed to remain operational. The COVID-19 pandemic is drastically altering our lives, but these difficult times expose many truths, including the understanding that legalization and safe access to cannabis is critical, especially during a crisis. While cannabis businesses work to weather the storm of COVID-19, state and local agencies are working to provide aid, guidance and relief to their continued essential operations. Below is a summary of the resources available.

State Agencies Issue Guidance and Resources for Cannabis Businesses During COVID-19   

Amongst the determination that cannabis businesses are essential, regulators have made clear that the ability to remain open also hinges on compliance with local rules and regulations, as stated in the Bureau of Cannabis Control (BCC) COVID-19 Press Release

It's no surprise that the biggest impact of COVID-19 is felt by the retailers who are still open and operating as essential businesses in Los Angeles and across CA. With social distancing as the new norm in attempts to flatten the curve, businesses are working to modify operations to keep customers and staff healthy and safe. For example, previously the sale or delivery of cannabis outside the licensed premise was prohibited, but the BCC has amended its regulations for retailers to allow for curbside pickup and contactless delivery.

In fact, all state licensing agencies have issued press releases and posted notices instructing cannabis businesses on how to continue to operate in compliance under new COVID-19 conditions. The Department of Public Health (DPH) COVID-19 response page is a great resource for best practices, cannabis product safety, and CDC Interim Guidance for Businesses and Employers. Meanwhile, the California Department of Food and Agriculture (CDFA) made clear that they are still operating (even arranging for cash payments to be made at their northern CA branches).  The CDFA press release further stated that cannabis businesses can continue to operate so long as they adopt anti-congregating measures and follow the CDC's Interim Guidance for Businesses and Employers to Plan and Respond to Coronavirus Disease at all times. 

The California Department of Tax and Fee Administration's (CDTFA) Field Offices across the state have also closed their public counters, and unlike the Feds, have not extended tax filing or payment deadlines. However, taxpayers in need of assistance can request an extension on filing a return or requests for relief of interest and penalties through CDTFA online services. 

Seemingly, all state agencies are continuing to operate as usual with little exception. As of the date of this article, none of the State agencies have deferred licensing, renewal or application payments. Although, State licensing agencies are responding to requests for fee waiver based on hardship. 

State licensing agencies have also significantly pulled back, and at this point, put a halt to all operations inspections and site visits. 

City of Los Angeles

Some of the Department of Cannabis Regulation (DCR) services have been modified in line with the Mayor's directives. It goes without surprise that the DCR has canceled all its scheduled workshops as has the Cannabis Regulation Commission canceled all its upcoming hearings. The DCR has also closed its office to the public, its Public Service Counters and most staff are working from home. The DCR has also put a halt to the submission of application amendment forms and documentation, all pre-licensing inspections, and the issuance of Temporary Approvals for Phase 2 applicants.

The Office of Finance's Public Counters are also closed. This means applicants and licensees are currently unable to make cash payments despite the looming license renewal fees that are due May 15 - a deadline for which no indication of extension has been made. 

That said, the DCR and Office of Finance are still responding to emails and answering the phones - from home that is.  

Manzuri Law is here to help

Manzuri Law has transitioned to remote work but we are still available and here to help. With all of the global uncertainty, it is more important than ever to remember we are all in this together. If you or someone you know needs assistance in navigating new operational requirements we encourage you to reach out to our office. 

Disclaimer: This article has been prepared and published for informational purposes only and is not offered, nor should be construed, as legal advice.   

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