Governor Newson’s budget proposal for cannabis industry regulation and taxation was announced on January 10, 2020. See below for more details or go to: https://cannabis.ca.gov/.

Regulatory Simplification

In an effort to improve access to licensing and simplify regulatory oversight of commercial cannabis activity, the Administration plans to consolidate the three licensing entities that are currently housed at — the Bureau of Cannabis Control, the Department of Food and Agriculture, and the Department of Public Health — into a single Department of Cannabis Control by July 2021. Establishment of a standalone department with an enforcement arm will centralize and align critical areas to build a successful legal cannabis market, by creating a single point of contact for cannabis licensees and local governments. The Administration will provide more details on this proposal in spring 2020.

Allocation of the Cannabis Tax Fund

Pursuant to Proposition 64, expenditures are prioritized for regulatory and administrative workload necessary to implement, administer, and enforce the Cannabis Act, followed by research and activities related to the legalization of cannabis and the past effects of its criminalization. Once these priorities have been met, the remaining funds are allocated to youth education, prevention, early intervention, and treatment; environmental protection; and public safety-related activities. The Budget estimates $332.8 million will be available for these purposes in 2020-21, and the structure of these allocations is unchanged from 2019-20:

  • Education, prevention, and treatment of youth substance use disorders and school retention—60% ($199.7 million).
  • Clean-up, remediation, and enforcement of environmental impacts created by illegal cannabis cultivation—20% ($66.6 million).
  • Public safety-related activities—20% ($66.6 million).

Thank you,

Lori Ajax
Chief, Bureau of Cannabis Control

Richard Parrott, Director
CalCannabis Cultivation Licensing Division
California Department of Food and Agriculture

Miren Klein
Assistant Deputy Director
Center for Environmental Health
California Department of Public Health