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The cannabis industry has much to celebrate with the 2020 election results.

Commercial cannabis initiatives and candidates who support regulated, licensed access to cannabis won on the national, state, and local level in unprecedented numbers.

The analysis below will take you first through the results for San Diego County, the City of San Diego and other cities in San Diego County with cannabis decisions pending; then California State; National; and Federal results. Each jurisdiction will be given a Win, Neutral, or Loss grade depending on the voting results and how we think those results will impact the industry in the coming year. A win means we believe licensed cannabis will either be rolled out, licensing expanded or the industry boosted in some way by the election results, and a loss means either higher industry taxes, continued zoning or licensing restrictions, or some other setback, which can vary greatly from jurisdiction to jurisdiction.

Jump to individual jurisdictions: County of San Diego, City of San Diego, Chula Vista, Encinitas, Escondido, Lemon Grove, National City, Oceanside, Solana Beach, California State, National, Federal

San Diego’s 2020 Election Results for Cannabis

Cannabis access and taxation was on the ballot in multiple local elections in San Diego County. The most critical races in San Diego County for the future of licensed cannabis were the San Diego County Board of Supervisors races in Districts 1, 2 and 3, where industry and advocates have been lobbying to overturn the March 2017 cannabis ban in the unincorporated County.

Cannabis regulations were on the ballot in the North County coastal cities of Encinitas and Solana Beach, and there cannabis business tax (CBT) initiatives in Lemon Grove and Oceanside. Key races in our region included Mayor and City Council in the City of San Diego and City Council seats in Carlsbad, Chula Vista, Escondido, Lemon Grove, National City and Vista. With cannabis licensed in the City of San Diego, Chula Vista, Lemon Grove, National City and Vista, issues regarding either licensing, taxation, zoning or social equity and cannabis were important in each of these jurisdictions.

In Escondido, the City Council has been considering commercial cannabis but without significant progress, so advocates were hoping for a strong pro-cannabis turnout. Please see below for a detailed analysis of each of these jurisdictions and their election results.

 

County of San Diego: WIN! WIN! WIN!

Cannabis was first legalized in San Diego County’s unincorporated areas on June 23, 2010, and the first licensed medical marijuana collective opened in August 2014. By March of 2017, there were five licensed medical cannabis collectives in the unincorporated County, an area that covers more than 3,500 square miles and has a population of over 500,000 residents.

In early 2017, shortly after Proposition 64 passed in San Diego County with overwhelming support, the Board of Supervisors voted to ban all commercial cannabis in the unincorporated County. The five existing cannabis license holders were allowed to continue operations until April 2022 in order to recoup the investments they had made in their businesses.

Not only did the Supervisors’ decision go directly against the recently stated will of the voters, it also denied the Board’s constituents the access to safe, regulated medicine that residents of other parts of the County rely on. In August 2020, Supervisor Nathan Fletcher, the first democrat elected to the Board in decades, proposed overturning the ban and bringing licensed cannabis back to the County. Fletcher’s proposal failed to receive a second and was never even discussed by the entire Board.

So how did this situation come about? The Board of Supervisors has been one of the more conservative jurisdictions in San Diego County and was run by largely the same Republican officials for the better part of the last 30 years. The Board consists of five Supervisor districts and three of them, Districts 1, 2 and 3 were all up for grabs this November.

Fortunately for the cannabis industry and advocates, term limits and a growing number of democratic and independent voters have begun to change the make-up of the Board. There were two democrats running for the District 1 seat, and, in District 3, Kristin Gaspar, the Supervisor who originally proposed the cannabis ban in 2017 was challenged by Terra Lawson-Remer, an economist and former senior advisor in the Obama administration.

Healthcare and education advocate Nora Vargas beat fellow democrat Ben Hueso in District 1, and Lawson-Remer won a commanding victory over incumbent Kristin Gaspar in District 3, giving Democrats a majority on the Board for the first time in decades.

The complete surprise of this election was the unexpected victory of Joel Anderson over Steve Vaus, the Mayor of Poway. As of publication, the results of this race had not yet been certified, but Anderson leads Vaus, a lead that has been widening every day as the remaining votes are counted. While Anderson is a Republican who has voted against cannabis in the past, he now supports some cannabis legalization and should provide additional cannabis support on the Board.

What To Watch For

Once the three newly elected Supervisors take office in January, expect to see Supervisor Fletcher renew his bid to overturn the County’s ban on commercial cannabis, expand licensing and pursue adopting the region’s first cannabis social equity program for the County. By 2022, instead of facing all dispensaries being shut down and a full ban on cannabis, San Diego County should be home to a thriving, robust cannabis industry.

 

City of San Diego: WIN

Democrats already held a majority on the San Diego City Council, and cannabis support within the City has generally been favorable. But, with ongoing competition from the illicit market and last year’s raise in San Diego’s cannabis business tax (CBT) from 5 to 8%, cannabis remains an important political issue in San Diego.

In 2004, voters in the City of San Diego adopted the Strong Mayor form of governance, in which the Mayor is the City’s Chief Executive Office and the City Council is responsible for legislation, acting as a check to the Mayor’s authority. San Diego’s current (and termed-out) Mayor, Kevin Faulconer, has been lauded for preparing the City to be the only local government in San Diego County to be prepared for recreational cannabis sales on Jan. 1, 2018, but has been criticised for not doing enough to address the disparities in cannabis crime enforcement against people of color especially in San Diego’s central and southern neighborhoods.

The biggest wins for cannabis in the City of San Diego were the election of Todd Gloria as Mayor and Stephen Whitburn as the Councilmember for District 3. Asesmblyman Gloria was President of the San Diego City Council when it passed the first cannabis retail license. Stephen Whitburn served as Vice Chair of the Medical Marijuana Task Force, the body that advised the City on the original for medical marijuana collectives in San Diego, and we are confident that he will prove to be an extremely informed elected official when it comes to cannabis.

In District 1, pro-cannabis candidate Joe LaCava easily won election as did Sean Elo-Rivera in District 9. First-time candidate and deputy city attorney Raul Campillo in District 7 was a surprise win as was Marni Von Wilpert in District 5, both helping to secure a democratic supermajority on the City Council.

What To Watch For

Cannabis advocates and industry representatives have been lobbying for San Diego’s Mayor to appoint a cannabis development committee similar to programs in San Francisco, Sacramento and Los Angeles. Many advocates see this position as key to the creation of a robust cannabis social equity program.

Look for progress on the development of a cannabis social equity program; a majority of the standing and newly elected officials have publicly stated that they would like cannabis social equity to become part of the City’s equity and cannabis initiatives.

 

Chula Vista: WIN

Chula Vista voters approved Measure Q on November 6, 2018, with a 64% approval rate, and the measure was certified by the City Council on November 27, 2018. Measure Q allowed for 12 retail licenses, three in each council district, of which only two could be storefront operations. Chula Vista began accepting cannabis business applications in January 2019 and has received 136 applications, including 84 for dispensaries. As of November 23, 2020, only one legal cannabis operation has been licensed and opened in Chula Vista, and there are at least two lawsuits pending against the City citing bias and flaws in its beleaguered licensing process.

The good news for our industry and social equity advocates comes from the Chula Vista City Council race for District 3, where life-long resident Andrea Cardenas was elected. Councilmember-elect Cardenas has been an active political volunteer from a young age, experienced homelessness herself as a young child and worked for the Mayor of San Diego as a Community Representative in council district 8. Andrea supports, has worked in the licensed cannabis industry, and understands the economic benefits of licensed cannabis and the jobs that will be created in Chula Vista when all voter-approved licenses have been issued.

The re-election of Steve Padilla in District 3 is also a positive for cannabis, as Steve understands the issues facing the industry and the benefits that it can bring to the local community.

What To Watch For

With the highest licensing fees of any jurisdiction in San Diego County, Chula Vista must fix its flailing application and licensing process. Between the pressing need to fill revenue shortfalls created by the pandemic and the support of Mayor Mary Salas, re-elected Councilmember Stephen Padilla and the newly elected Cardenas, not to mention multiple applicant lawsuits, look for adjustments to the process and, perhaps, the current practice of turning over the grading of license applications to an outside source.

 

Encinitas: WIN

There were two local measures to create commercial cannabis in San Diego County: Measure H in Encinitas and Measure S in Solana Beach (see below). As of our publication date, Measure H is leading by more than two percentage points, a lead that has been holding steady since election night. Measure H is expected to pass, and will take effect 30 days after its passage.

What To Watch For

Measure H allows for four retail licenses in multiple commercial land use zones as well as indoor cultivation, cannabis product manufacturing and distribution. With a 30-day “in effect” timeline, expect the application process to be available in the very near term and licenses to be issued quickly.

 

Escondido: LOSS

The results from Escondido this election are among the most disappointing in San Diego County, where the three pro-cannabis candidates endorsed by the Blue Dream Democrats were all defeated. Cannabis is currently prohibited in Escondido, even though the City Council has been considering it for over a year. On August 26 of 2020, the City’s Assistant Manager presented a year-long investigation into commercial cannabis regulations without making a recommendation either for or against developing an ordinance.

Voters in Escondido voted in favor of Proposition 64 by 52.09%, and recent community surveys have found similar percentages. Outgoing Councilmember Diaz has stated that “communities that have decided to take no action are those where ballot measures came forward that they could not control.”

What To Watch For

The City of Escondido has a very large budget deficit and should be looking at cannabis to help close revenue shortfalls. As of now, however, there are no explicit plans to do so.

 

Lemon Grove: WIN

The City of Lemon Grove currently has one licensed medical cannabis dispensary operating and expects two additional dispensaries to open in the near future. Lemon Grove has been watching the rollout of recreational cannabis in neighboring La Mesa closely and is expected to follow suit in early 2021. Current City Manager Lydia Romero has said that we can expect to see a co-location ordinance, where any dispensary with a current medical cannabis license will be allowed to apply for a recreation license easily and without having to go through a lengthy application process a second time.

San Diego cannabis advocacy group Blue Dream Democrats endorsed two candidates for Lemon Grove City Council’s at-large seats: current Councilmember David Arambula and former Councilmember and Community College teacher George Gastil. While Gastil was successful in his bid, Councilmember Arambula was not.

Also on the Lemon Grove ballot was Measure J, a Cannabis Business Tax, proposing a retail tax of up to 8% of gross receipts and up to 4% on all other cannabis businesses. This measure was approved by the City Council on July 7, 2020, passed with a resounding 71.90% of votes and will go into effect on January 1, 2021. Estimates are that Measure J will generate between $560,000 and $1,120,000 annually for the City’s General Fund. City Council will be able to adjust the CBT rate annually up to the limits prescribed in Measure J.

What To Watch For

Lemon Grove was already experiencing budget shortfalls before the Covid-19 pandemic, so we can expect swift action on both the rollout of recreational cannabis in Lemon Grove and the issuing of further licenses.

 

National City: WIN

The City Council in National City was scheduled to vote on its proposed commercial cannabis ordinance on March 17, 2020, just as the coronavirus epidemic was breaking out. The March 17 vote was postponed and has yet to be rescheduled. The ordinance will allow for up to six cannabis businesses including dispensaries, delivery, testing facilities, and manufacturing.

The City Council pro-cannabis candidates were labor organizer Marcus Bush, Jose Rodriguez and current Councilmember Gonzalo Quintero. In this at-large contest, Jose Rodriguez placed first and Marcus Bush came in second, unseating both incumbents.

What To Watch For

If the ordinance passes in its current form, National City will become the first jurisdiction to allow cannabis consumption lounges in its dispensaries. Many HOAs, apartment complexes, senior living communities and skilled nursing facilities either completely prohibit cannabis or smoking on site. The cannabis advocacy community has been fighting for the inclusion of cannabis lounges on behalf of those who cannot use cannabis where they live for a long time, and it would be a big win if consumption lounges in National City prompt other local jurisdictions to allow them also.

 

Oceanside: LOSS

Oceanside, San Diego County’s northernmost city, and has allowed commercial medical cannabis operations since April of 2018. Recreational cultivation was added in June of 2020, and Measure M, establishing a retail, manufacturing and distribution cannabis tax (CBT) of up to 6% and a cultivation CBT of up to 3.5%. With 12 cultivation licenses, 4 manufacturing, 3 distribution and 2 non-storefront retail licenses already issued, Oceanside expects to generate an estimated $1.9 million per year from its CBT.

Even though Measure M passed easily, all pro-cannabis City Council candidates were defeated by wide margins, and the newly elected Mayor, Esther Sanchez, has a long-standing opposition to legal cannabis.

What To Watch For

While the rollout of licensed medical cannabis in Oceanside has proceeded well, it seems unlikely that cannabis will advance much in Oceanside in the current political environment.

 

Solana Beach: LOSS

After a 2018 signature gathering drive by the Alliance for Safe Access, where over 1,000 signatures were gathered and certified, the City Council voted to place Measure S on the ballot. The measure proposed up to two dispensaries in non-residential ones, cultivation and delivery.

Complaints were filed after certification that there was subterfuge during the signature-gathering phase, and some signatures were uncertified but not enough to invalidate the effort. After Measure S was placed on the ballot, it appears that the sponsoring group did no further outreach or voter engagement.

Even though Solana Beach voted in favor of Proposition 64 by 61.23%, they rejected all previously proposed cannabis measures, including W which would have allowed a medical dispensary in 2012. Opponents were so confident that Measure S would not pass, that there was virtually no anti-S campaigning. Ultimately the measure received a mere 38.22% of the vote and was defeated.

What To Watch For

With two council members just re-elected after having run unopposed and a Mayor-elect who also ran unopposed and has served three previous council terms, the approach in Solana Beach seems unlikely to change. With an entrenched NIMBY attitude, any serious campaign to bring cannabis to Solana Beach would have to include a robust outreach and education effort.

 

California Statewide Results: WIN/NEUTRAL

Taxes: 100% Win

There were over 40 cannabis measures on local ballots throughout California. Twenty one of those were tax-only measures, and 20 were for regulations, taxes or some combination thereof. All 21 of the tax-only measures passed, and tax rates ranged from 2.5% in Trinity County to 15% in Artesia (tax is for cultivation only). The lowest passing rate for a tax measure was 59.26%, showing heavy voter support for taxing licensed cannabis.

Passage of Measure S in San Bruno (San Mateo County) and Measure CC in Hawthorne (Los Angeles County) show that voters heavily favor cannabis taxes, even when commercial cannabis is not yet allowed in those locations.

Commercial Regulation: Neutral

Of the 20 local cannabis regulation and/or tax measures, as of November 23, 10 have failed, 7 passed and three are still too close to call (two are over 50%, and one is below). See “Competing Measures” below for a deeper analysis of these measures.

The Problem with Competing Measures

Multiple measures on the same issue can be confusing to voters and often result in across-the-board no votes. The City of Commerce gave us a prime example of this with six competing measures to regulate cannabis on the same ballot. As of November 23, 2020, only Measure SB had received more that 45% of the vote, and all proposed measures failed.

In Pomona, there were two competing measures, PM requiring a 600-foot sensitive-use separation, and PO requiring a 1,000-foot separation. Both passed, but Measure PO received a larger percentage at 59.08% to PM’s 51.04%.

Finally, in the City of Sonoma, which currently allows one dispensary, one non-store front dispensary, one testing lab and one manufacturer, Measure X, which establishes a 4% gross receipts tax, passed with 77.83% of the vote. Measure Y, which would have added cultivation, delivery, distribution and special events, failed with only 43.56% of the vote.

Industry and cannabis access advocates should take these lessons to heart and ensure that competing measures or initiatives do not dilute the vote in future efforts.

What To Watch For

Multiple cities attempted to pass commercial cannabis for the first time this election, including Solana Beach (see Solana Beach below for more on this) and Yountville. The initiatives failed badly in both of these locations with neither receiving more than 38% support. Campaigning for these initiatives was severely hampered by Covid-19 and, most likely, had a large impact on election results. Yountville is home to the country’s largest residential veteran’s facility, and with even extremely conservation organizations like the American Legion in support of descheduling cannabis, the inability to engage almost one third of Yountville’s voters was a major factor in Measure T’s defeat.

Bureau of Cannabis Control (BCC) Chief Lori Ajan announced last week that she will be stepping down as of December 2, 2020. Ajax was appointed in 2016 by Governor Jerry Brown, when only medical cannabis was legal in California. She oversaw the rollout of recreational cannabis after Proposition 64 was passed in 2016 and became the first, and so far, only chief of the BCC. The BCC is scheduled to merge with the state’s other two cannabis regulatory agencies, CalCannabis Cultivation Licensing and the Manufactured Cannabis Safety Branch. The new agency will be called the Department of Cannabis Control, and the merger, delayed by the coronavirus, is expected to happen during the 2021-2022 budget year.

 

National Results: Solid WIN

Every single recreation cannabis measure on the ballot across the nation passed on November 3rd. The residents of Arizona, Montana, New Jersey and South Dakota overwhelmingly approved commercial cannabis regulations. Voters in Mississippi and South Dakota also approved medical cannabis in their states.

Recreational cannabis is now legal in 15 states and the District of Columbia, and medical cannabis is legal in 35 states (and D.C.). According to Politico.com over 100 million people, o4 1 in 3 Americans, now live in a state where it is legal for adults over the age of 21 to use cannabis. There are only 8 states where cannabis remains fully illegal: Alabama, Idaho, Kansas, Nebraska, North and South Carolina, Tennessee and Wyoming, a clear signal to the incoming administration that the time for federal reform has arrived.

What To Watch For

The global pandemic hampered legalization efforts in multiple states including a medical legalization effort in Idaho and recreational initiatives in Arkansas, Florida Missouri, Nebraska, North Dakota and Oklahoma. With pro-cannabis fundraising far outstripping that of opponents, we can expect to see all of these initiatives again in the near future.

 

Federal Results: WIN

The 2020 election was good for the cannabis industry on the national level with President-elect Biden’s official platform including decriminalization of cannabis use, automatic expungement of prior convictions, legalization for medical purposes and the reclassification of cannabis to a schedule II substance. The election results are a win for the cannabis industry, consumers, medical researchers and advocates.

The 2016 and 2018 elections both saw Republicans either hold onto or increase their majority in the Senate. Under the Trump administration, the GOP-controlled Senate was consistent in its refusal to address cannabis legalization, the lasting inequities of the War on Drugs or the tax and banking regulation changes that are critical for the long-term viability of the cannabis industry in states where it has been legalized.

With control of the Senate for the next two years still undecided, the Biden administration’s path forward for meaningful cannabis legislation reform is still unclear. If the two democratic candidates win election in the January runoff election in Georgia, there will be a 50-50 tie in the Senate and Vice President-elect Harris, as President of the Senate, will be the tie-breaking vote.

What To Watch For

Biden’s nominee for Attorney General could signal the incoming administration’s intentions for meaningful cannabis policy reform. And, since cannabis reform and legalization was part of Harris’ campaign while running for President, and she was the Senate sponsor of the MORE Act, we expect Harris to follow through on her “deal” with President-elect Biden to advocate for progressive policies that Biden has previously opposed.