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California Law Allows Cannabis Cafes Now

by Omar Figueroa & Lauren Mendelsohn

January 4, 2025

 

Last fall, Assembly Bill 1775, known colloquially as the “Cannabis Cafes Bill”, was signed into law.  For more background, please read our previous blog post here.

This Cannabis Cafe legislation took effect on January 1, 2025, and allows storefront retailers and microbusinesses (with local approval) to sell freshly-prepared food and beverages and sell tickets to live events at licensed premises where cannabis and cannabis products can be bought and consumed, similar to the cannabis coffeeshops in the Netherlands.

You can read the text of AB 1775 below and download it here:.

AB 1775

 

AB 1775 requires express approval by local jurisdictions in order to unlock its potential.  Additionally, the legislation imposes numerous requirements for cannabis cafes.  The key provisions are found at subdivision (g) of Section 26200 of the Business and Professions Code now that the law has taken effect.

Subsection (g)(1) describes three different types of allowable activities: (1) onsite smoking, vaporization, and ingestion of cannabis and cannabis products; (2) preparation and sale of noncannabis food and beverage products, and; (3) the sale of tickets for live musical or other performances where the consumption of cannabis is allowed.

Notwithstanding paragraph (1) of subdivision (a) of Section 11362.3 of the Health and Safety Code, if all of the conditions in paragraph (2) are met, a local jurisdiction may allow for any of the following:

(A) Smoking, vaporizing, and ingesting of cannabis or cannabis products on the premises of a retailer or microbusiness licensed under this division that has been granted authority by a local jurisdiction to engage in onsite cannabis consumption.

      (B) (i) Preparation or sale of noncannabis food or beverage products in compliance with all applicable provisions of the California Retail Food Code (Chapter 1 (commencing with Section 113700) of Part 7 of Division 104 of the Health and Safety Code) by a retailer or microbusiness licensed under this division in the area where the consumption of cannabis is allowed.
            (ii) For purposes of this subparagraph, “noncannabis food or beverage products” shall not include industrial hemp products or hemp products, as defined in Section 111920 of the Health and Safety Code.
     (C) Live musical or other performances on the premises of a retailer or microbusiness licensed under this division in the area where the consumption of cannabis is allowed, and the sale of tickets for those performances.

The first type of allowable activities (namely onsite smoking, vaporization, and ingestion of cannabis and cannabis products) already existed in some local jurisdictions prior to the passage of AB 1775.  The second type of allowable activities permits the preparation of fresh food and beverages similar to Dutch coffeeshops.  Think smoothies, coffee drinks, and sandwiches, which are logical harm reduction measures that pair well with onsite consumption while increasing revenue, including local and state tax revenue.  The third type of allowable activities (ticket sales to live performances where cannabis consumption is allowed) is another aspect of Dutch culture, similar to the Melkweg in Amsterdam.

Subsection (g)(2) imposes numerous requirements on local jurisdictions that wish to permit any of the three types of allowable activities:

A local jurisdiction may allow any of the activities provided in paragraph (1) if all of the following conditions are met:
     (A) Access to the area where cannabis consumption is allowed is restricted to persons 21 years of age or older and each entrance to the area prominently posts a warning that cannabis consumption, including smoking of cannabis, is permitted inside.
     (B) Cannabis consumption is not visible from any public place or nonage-restricted area.
     (C) Sale or consumption of alcohol or tobacco is not allowed on the premises.
     (D) Noncannabis food or beverage products are not contaminated by or commingled with any cannabis products sold or served on the premises where the consumption of cannabis is allowed.
     (E) (i) Smoking or vaporizing of any cannabis product by an employee or customer is not allowed in the food preparation, food storage, or warewashing area of a food facility located on the premises.
          (ii) For purposes of this subparagraph, the following definitions apply:
             (I) “Food facility” has the same meaning as that term is defined in Section 113789 of the Health and Safety Code.
             (II) “Warewashing” has the same meaning as that term is defined in Section 113940 of the Health and Safety Code.
     (F) The local jurisdiction considers whether to require adequate ventilation and filtration systems.
         (i) Ventilation and filtration systems are considered adequate for the purpose of this subparagraph if they prevent smoke and odors from migrating to any other part of the building hosting the consumption lounge or any neighboring building or grounds.
         (ii) Nothing in this subparagraph prohibits a local jurisdiction from allowing one or more forms of cannabis consumption on the premises of a retailer or microbusiness licensed under this division, including smoking, vaporizing, and ingesting of cannabis or cannabis products, while prohibiting other forms of cannabis consumption on the premises of a retailer or microbusiness licensed under this division.
     (G) (i) Employees are permitted at their discretion and without penalty or sanction to wear a mask for respiration, including N95 and NIOSH N95 rated masks in any area where cannabis is smoked.
         (ii) Employers are required to pay for the mask.
     (H) When hired, employees who will be working where cannabis is smoked shall be provided in writing the Department of Public Health or its successor’s guidance regarding secondhand cannabis smoke.
     (I) A cannabis consumption lounge that offers on-site consumption of cannabis products shall include secondhand smoke in their analysis of potential work hazards for purposes of their injury and illness prevention programs required by Section 3203 of Title 8 of the California Code of Regulations.
     (J) Loitering in or around the business is prohibited, and the retailer or microbusiness shall ensure the absence of loitering.

Notably, these additional requirements apply to local jurisdictions that previously allowed onsite smoking, vaporization, or ingestion.  This means that jurisdictions that previously allowed onsite consumption need to update their local cannabis ordinances in order to comply with the updated requirements imposed by Assembly Bill 1775.

Since many local ordinances that allow for some type of cannabis consumption (whether smoking, vaporization, or oral or topical ingestion) are due for an update, this would be a convenient opportunity to also update the local ordinances to permit freshly-prepared food and beverages as well as permit ticket sales to live events at licensed premises, adding revenue streams to struggling cannabis retailers while increasing local and state tax revenue and enhancing protections for employees.

Now that AB 1775 is in effect, cities and counties across California should update their local ordinance to unlock the potential of cannabis cafes, which benefit the community in many ways from stimulating the local economy, enhancing local tax revenue, and providing safe spaces for residents of multi-unit housing to consume cannabis.

Key Takeaways

  1. Local Jurisdiction Approval Required
    • Even though AB 1775 is now state law, licensed onsite retailers and microbusinesses can only offer these new onsite consumption activities if they receive explicit approval from their city or county.
    • Jurisdictions that already allowed onsite consumption need to update their ordinances to align with AB 1775’s expanded requirements.
  2. Three Key Activities Allowed
    • Onsite Consumption of Cannabis (smoking, vaporizing, ingesting).  (This was already allowed by state law with local approval, so it’s not really new.)
    • Preparation and Sale of Noncannabis Food and Beverages (e.g., coffee, sandwiches, smoothies), in compliance with health codes.
    • Sale of Tickets for Live Performances where cannabis consumption is allowed (akin to entertainment venues in the Netherlands).
  3. Strict Operational and Safety Requirements
    • Age Restriction: All onsite consumption areas must be 21+ only.
    • Visibility and Odors: Cannabis consumption cannot be visible from any public or non–age-restricted area, and localities should consider requiring ventilation/filtration systems to prevent smoke/odors from spreading.
    • No Alcohol or Tobacco: Concurrent sale or consumption of alcohol or tobacco at cannabis cafes is prohibited.
    • Food Safety: Noncannabis foods or beverages must remain separate (no commingling); employees and food preparation areas must be protected from cannabis smoke/vapor.
    • Employee Protections: Staff must be allowed to wear N95 masks at no personal cost and must be informed of secondhand cannabis smoke risks.
  4. Impact on Existing Onsite Consumption Businesses
    • Even localities that already permitted some form of onsite cannabis consumption must update their regulations to  incorporate additional health and safety measures.
  5. Opportunities for Expansion and Revenue
    • By adding onsite food service and entertainment, cannabis retailers and microbusinesses can diversify their offerings, attracting more customers and increasing revenue.
    • Local governments can benefit from increased tax revenues and see a reduction in unregulated cannabis consumption in public spaces.
  6. Community and Public Health Considerations
    • Cannabis cafes can provide safe, regulated spaces for adults—particularly those in multi-unit housing where smoking may be prohibited.
    • AB 1775 mandates employee and consumer health protections, emphasizing ventilation systems, clear signage, and education on secondhand smoke.
  7. Next Steps for Municipalities
    • Cities and counties should proactively update their cannabis ordinances to include provisions for food/beverage service and entertainment ticketing under AB 1775.
    • Local regulations should outline age restrictions, ventilation requirements, operational rules, and employee protections.

Overall, AB 1775 paves the way for fully realized “cannabis cafes” in California, similar to the Netherlands model, but hinges on local jurisdictions opting in and enforcing the newly mandated safety and operational standards.

 

This information is provided as a public educational service and is not intended, nor should be construed, as legal advice. For specific questions regarding Assembly Bill 1775, cannabis consumption lounges, and updating local ordinances in order to unlock the potential of cannabis cafes in California, please contact the Law Offices of Omar Figueroa at 707-829-0215 or info@omarfigueroa.com to schedule a confidential legal consultation.

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