Green Light, Red Tape: California’s Last Chance to Rescue Legal Cannabis
by Jason Piazza on March 6, 2025
A recent article in SF Gate really hit home for me. There’s a lot that needs to be done to correct the wrongs inflicted on the cannabis industry for over a century, and California’s current legal framework isn’t cutting it. Federal foot-dragging isn’t helping, but the state’s policies are actively making things worse. SF Gate raises an important concern — if California increases its excise tax in July, it could be an “extinction event” for legal operators.
Taking that in stride, I wanted to put in writing what I’ve been saying in calls and meetings for several years. Here’s my $0.10 on what needs to happen to right the ship:
1. Increase access, not taxes
Require every municipality in the state to license at least one dispensary per 50,000 residents within 12 months—or face financial penalties. If a city has fewer than 50,000 people, it still needs at least one dispensary, unless the population is 10k or fewer. The lack of access is fueling the illicit market. Let’s be real—cannabis has always been in your city, and it always will be. The state should mandate safe, legal access. Period.
2. Crack down on the illicit market – publicly and decisively
I respect the outlaws who took the risks when the laws were unjust, but cannabis is no longer illegal in California—unlicensed operations are. The state should launch a coordinated enforcement and PR campaign, with national news coverage and high-profile press conferences making it clear that the illicit market’s free ride is over.
Team up with DEA if possible, but I suggest a public notice: “You have 90 days to cease operations. Shut down and provide proof, and the state will offer a benefit—such as a streamlined licensing process, state tax breaks, or record expungement. If not, expect real enforcement including, but not limited to: asset seizure, arrest, criminal charges, and fines/penalties.” Without visible action and a clear message, the grey market will continue undermining legal businesses, regardless of the tax rate.
3. Release nonviolent cannabis prisoners – immediately
Expunge their records so they can fully reintegrate into society and provide real compensation for the years lost to wrongful imprisonment.
4. Lower the excise tax, don’t raise it
Instead of increasing the tax in July, reduce it, then phase it out entirely over 2–3 years. For example, keep it at 15% in 2025, then reduce it by 5% each year until it hits 0%. The goal should be a thriving legal market, not one burdened to death by excessive taxation.
5. California needs to lead the federal fight
The state should actively work with lobbying groups and other cannabis-friendly states to pressure the federal government on key issues like banking access, interstate commerce, and fair tax treatment. California has the largest cannabis market in the country—if any state has the influence to drive federal change, it’s this one. But that won’t happen if state leaders remain passive. It’s time to take the fight to Washington.
6. Make social equity actually social
SE licensure isn’t working in its current form. I won’t rehash why—if you’re in the industry, you already know.
A real social equity program wouldn’t just issue licenses; it would reinvest cannabis tax revenue into communities hit hardest by the war on drugs.
That means funding schools, rebuilding infrastructure, supporting job training programs, and offering business grants—not just for cannabis entrepreneurs but for all industries in affected neighborhoods. If the goal is to repair past harms, then let’s stop pretending a licensing structure alone can fix generational damage. Money talks. Put it where it’s needed.
7. The Hidden Costs of Over-Regulation
The current regulatory framework isn’t just burdensome—it’s actively destructive. Licensed operators face a maze of compliance requirements that often conflict between state and local jurisdictions. Every added regulation means more staff hours, more consulting fees, and more capital diverted from business growth. Meanwhile, unlicensed operators face none of these hurdles, creating an uneven playing field that grows more lopsided by the day. The state needs to streamline its regulatory approach, creating a single, coherent system that protects public safety without strangling legitimate businesses.
8. Banking Reform Needs State
Action While federal banking reform would be ideal, California can’t afford to wait. The state must implement its proposed banking program and actively incentivize lenders to offer competitive rates and terms to cannabis operators. This isn’t just about basic financial services—it’s about giving legitimate businesses access to the same financial tools every other industry takes for granted. The infrastructure and framework already exists; what’s missing is the political will to finally pull the trigger and create a functional cannabis banking system that works for operators of all sizes.
9. Education is Public Safety
While fixing the industry’s structural issues is crucial, we can’t ignore the ongoing need for public education and destigmatization. The state should launch a comprehensive public education campaign about legal cannabis, highlighting not only the benefits of regulated products but also the very real dangers posed by illicit market cannabis. Consumers need to understand that unregulated products often contain dangerous pesticides, heavy metals, and other contaminants that can cause serious health issues. This isn’t just about increasing sales—it’s about protecting public health and creating an informed public that understands why supporting the legal market matters.
Have We Reached the Breaking Point?
California’s cannabis industry is at a breaking point, but it doesn’t have to be. There’s still time to course-correct—if policymakers have the courage to act. More access, fewer burdens, real enforcement, and reinvestment where it counts. It’s not rocket surgery, but it does require political will. The alternative? A collapse that only benefits the illicit market.
Your move, California.
