“Cannabis Cafes” Bill Approved by State Assembly
By Lauren Mendelsohn
June 4, 2023
Last week, the California State Assembly approved Assembly Bill 374 (“AB 374”), which would allow cafe-style cannabis consumption lounges to offer live music and other ticketed entertainment events. The bill, sponsored by Assembly Member Haney, now heads to the State Senate. The current text of the bill can be found here.
Consumption lounges serve numerous purposes and provide various community benefits. For example, they can help to boost tourism in a particular jurisdiction, and can aid with existing tourism by providing places for visitors to consume the cannabis purchased during their trip. They can increase tax revenue and create high-quality employment opportunities, thus bolstering the local economy. They can also help combat the illicit market by encouraging customers to purchase and consume cannabis in a fun and comfortable setting. Furthermore, they are critical from an equity perspective as they offer residents of multi-tenant housing or other rental housing where smoking is prohibited with a safe, legal place to consume their medical or adult-use cannabis.
Cannabis consumption lounges are allowed in California under MAUCRSA, the state’s primary law governing commercial cannabis, and the Department of Cannabis Control’s regulations, namely 4 C.C.R. §15407, provided that such is permitted by the relevant local jurisdiction. However, very few cities and counties actually allow such facilities to exist, largely due to uncertainty around state-level legal requirements as well as concern regarding potential risks. Additionally, AB 374 goes beyond what is currently addressed in MAUCRSA and the DCC regulations in terms of consumption lounge activities by explicitly allowing ticketed entertainment events and preparation of non-cannabis foods and beverages. If this bill were to become law, this would provide jurisdictions with some reassurance to move forward with embracing cannabis consumption lounges.
Stay tuned for our next blog post on this topic, which will discuss some of the risks related to cannabis consumption lounges and related risk mitigation strategies.
This information is provided as a public educational service and is not intended, nor should be construed, as legal advice. For specific questions regarding cannabis lounges in California, please contact the Law Offices of Omar Figueroa at 707-829-0215 or info@omarfigueroa.com to schedule a confidential consultation.