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August 1, 2017

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A California Plan To Save Millions On Cannabis Regulation Is Getting Props Worldwide

Southern California Coalition co-founders Virgil Grant (L) and Donnie Anderson (R) pose for a snapshot with U.S. Congresswoman Maxine Waters (D-CA) at the 2017 California Democrats State Convention in Sacramento.


In his new gig heading the U.S. Department of Justice, Attorney General Jeff Sessions has kicked up plenty of dust over cannabis, from erroneously aligning the plant with heroin to threatening to reignite our deadly drug war, which Sir Richard Branson called "a trillion-dollar failure."


But while Sessions was making headlines with ill-considered claims for the past few months, entrepreneurs and lawmakers in Los Angeles were putting the finishing touches on a plan they've developed over decades to finally bring order and stability to the legal cannabis industry's biggest market--and cities around the world, if not the A.G., are paying close attention.


In March, Los Angeles voters resoundingly chose to approve Proposition M, a measure designed to give operators in the city's legal cannabis industry both the room and regulation they need to grow. Since then, Prop M's master cultivators in City Hall and the cannabis business community have been working nonstop to pin down the licensing system and processes that will define the largest market of the highest-selling state in this booming industry for years to come.


They've also been fielding calls from interested parties in cities around the country and globe.

By phone, Southern California Coalition (SCC) co-founder and cannapreneur Virgil Grant and SCC executive director Adam Spiker noted that their cannabis industry collective, which has joined others in the area to help bring about Prop M, has received inquiries about the measure from legislators across the country, and even from other nations in North America and Europe.


"When you realize Los Angeles is the biggest cannabis market in the world, you understand how many eyeballs are on this city right now, and we truly believe we're creating a model that other cities and states would want to use," Spiker said. 


According to Grant and Spiker, who joined forces in the quest for Prop M several years ago along with their SCC co-founders and members, their model for creating a stable, enforceable legal cannabis industry relies on a four-pronged approach designed to take Los Angelenos' priorities into account, both inside and outside of the cannabis community.


"Firstly, it creates smart and sensible regulation, which is something we've not had in L.A. for over 20 years, since medicinal marijuana was first allowed in California," Grant explained. "Prop D was a disaster--it passed the buck, didn't want to deal with the realities of the industry, and was toxic for it overall."


"Secondly, Prop M creates a licensing mechanism for the first time, allowing operators to obtain a physical license to own and operate in the city of Los Angeles, which is also something we haven't had before," Grant said. "We had something known as a BTRC, a business tax registration certificate, for operating under Prop B's limited immunity ban, but never a physical license, which will soon be required under California law."


"The third component is taxation," he said. "We have the lowest taxes in the nation right now: 2% for cultivation, manufacturing, distribution, and transportation, and 1% for lab testing. And because Prop M raises those taxes toward a more feasible level, it also lowers the tax for the collective [operating] model from 6% to 5%."


"And the last component is enforcement--it has to be the last component," Grant said. "Because you have to have the first three in place, or else you end up enforcing on legitimate and good operators, which we've seen in L.A. throughout our history, under Prop B, and in the course of 21 years of operation." 


Enforcement and harassment of good operators is something that Spiker, with a background in finance and government affairs, has often witnessed since joining the cannabis industry, and which Grant, a native of Compton who's been working in the legal cannabis industry for two decades, has experienced first-hand. Not too long ago, Grant returned to his active and leadership-heavy role in the cannabis community after serving 72 months in federal prison for being the kind of good operator that L.A. regulators have promoted over the years.


After a marijuana edible from Grant's company was found to have been used by a driver who admitted to driving under the influence at the time of a fatal crash, authorities conducted a seven-location raid of Grant's properties, including his home, o