Marijuana industry continues to face growing pains one year after CA legalization

January 1, 2019, will mark one year since recreational marijuana use was legalized in California. A year ago, cannabis advocates had high expectations for the industry.

“After my injury, it is a godsend. This businesses, this cannabis industry has really changed peoples lives,”

Business owners were also hoping for big profits.

“Most people who don’t know the industry assumed overnight, we’re gonna be making billions of dollars.” said Dina Browner, owner of the cannabis dispensary “OG Collective” in Cathedral City.

Browner opened her first dispensary 17 years ago, she says she has seen the industry and perspectives change in that time.

“It was people that had an ailment that didn’t feel comfortable talking to their doctor about using it because it was an illegal substance, but now that it’s legal they were the first ones in the door,” Browner said.

But the reality is the weed craze hasn’t lit up like many thought. Just 20 percent of California cities sell recreational cannabis, and profits aren’t expected to be nearly as high. The original estimated $1 billion in profits is looking more like just $471 million this fiscal year.

Browner says she believes the reason for the lower than expected profits is tight regulations and constantly changing rules and restrictions.

“I feel like we’re building a house of cards on quicksand some days because you do all this work, and then you find out the regulations and its like wipe the board clean let’s start over,” Browner said.

There is also the issue of high taxes.

“So, there’s the distribution tax, the manufacturing tax, the cultivation, then there’s the 15 percent on the retail item so the customer has to pay 15 percent,” Browner said.

The cannabis industry has experienced some legislative victories in its first year, including the expansion of delivery to anywhere in the state and plans to reduce petty convictions for pot prisoners.

Browner said come 2019 and beyond there are bigger problems to address, like getting more cities on board, expanding cannabis lounges to buy and smoke on the spot. Most importantly, figuring out where to put the profits.

Read: State leaders looking into public bank for cannabis industry

“Our biggest challenge to date, where are we supposed to put our money that’s safe how are we supposed to pay our bills, now that we’re becoming legitimate, and the federal government is backing off a little bit, money is starting to flow in investors but the scary part is where does it go,” Browner said.