RCRC's legislative proposal related to interstate cannabis commerce has been introduced in the Legislature. Senate Bill 1326, authored by Senator Anna Caballero (D-Merced), seeks to allow the cross-jurisdictional import and export of cannabis and cannabis products, by authorizing the Governor to enter into agreements with other states with legalized cannabis in order to provide for lawful interstate commerce. SB 1326 requires agreements to include public health, safety, and labeling standards; a system to regulate and track cannabis items; and collection of applicable taxes. The measure also requires that out-of-state cannabis items delivered to California are tested, packaged, and labeled in compliance with California state law.
California legalized cannabis for both medicinal and adult use through the passage of Proposition 64 (2016). However, state law currently limits commercial cannabis activities within California's borders and prohibits California's cannabis licensees from engaging in interstate commerce. This prohibition has consequently left many California cannabis growers with no viable pathway into the legal, regulated market. Historically, most of the cannabis grown in California was exported, up to 80% by some estimates.
Five years after the passage of Proposition 64, the cannabis industry is experiencing overproduction and a steep drop in prices, oversaturation of products, and cannabis businesses struggling to survive. Without considerable market expansion as part of the solution to stabilize the legal industry and to incentivize participation in the regulated market, California risks the collapse of portions of the legal industry, particularly impacting rural producing regions, which could lead to considerable expansion of the illicit market.
SB 1326 provides a relief valve for the oversupply of cannabis, supports rural economies in producing regions, provides a tool to stabilize the cannabis industry, and gives the state a competitive advantage as federal policy develops. In addition, coordinated action by states that have legalized cannabis, and the development of a sensible and secure multi-state legal cannabis market, provides support for a policy shift and help guide the federal conversation in future years.
For more details, read the SB 1326 fact sheet here. For additional information or questions, contact RCRC Policy Advocate Sarah Dukett.