Cannabis Business Licensing Woes in Portland Costing $22M/ Month

The cannabis licensing process in Portland is reportedly so bogged down with problems, entrepreneurs and businesses are taking a major financial hit every month. Some have even been forced out of business.

That’s according to a new report released by the city of Portland and Office of Neighborhood Involvement. A chief economist who works closely with marijuana businesses hoping to forge a legal path into local industry says the complicated bureaucracy of the process has forced some applicants to go belly-up. As of last month, only 19 out of 355 applicants had received their licenses. Another 30 cleared the process, but were waiting to pay their respective fees.

The economist noted that if the city fails to license a significant number of more cannabis businesses soon, the effect on the marijuana market in Oregon overall is going to be greatly adverse.

Starting on January 1st, sales of recreational marijuana at medical marijuana dispensaries was put to an end. Many businesses want to make moves to cater more to the recreational market. But those businesses by law have to be licensed by the Oregon Liquor Control Commission. Statewide, the agency has issued some 500 licences and had anticipated issuing some 900 more by the close of 2016. However, because of the problems in Portland, a number of marijuana companies in the city might not have the necessary credentials needed to be in operation.

Our Portland marijuana attorneys know that these licensing issues are the second major problem Portland marijuana dispensaries have faced of late. In October, the state required a series of stringent new packaging and testing standards. That resulted in smaller supplies and lower sales. Some businesses were forced to close shop.

Meanwhile, the state is potentially losing out on an estimated $1.3 million in monthly tax revenue due to issues in Portland. The city itself is losing an estimated $233,000 a month in tax revenue.

Those in the industry called it ironic that the city that has vowed to do its best to promote economic activity would fail to be proactive on this issue. In recent weeks, Portland has been referred to as one of the state’s least cannabis-friendly cities.

The new licensing requirement policies were imposed in the fall, and those were in addition to the use and occupancy permitting stipulations. Several commissioners have discussed taking another look at the rules and whether revision is required.

A senior policy adviser said it is on the city’s near-future agenda.

Marijuana dispensary owners lament the lack of transparency and communication in the licensing process. Some have characterized it as confusing, convoluted and daunting. Our marijuana business licensing lawyers know understand that some owners have been tossed back and forth among city agencies, with the requirements seeming set and changed arbitrarily – and after the fact. On top of all that, the wait times at every leg of the process are onerous.

Although some proponents of these regulations contend this is simply the result of a new industry not accustomed to having to deal with a bureaucracy, cannabis industry insiders say it goes beyond that. This bottleneck of licensing has meant that the livelihoods of these business owners are on the line. The licensing fees are extraordinarily high and there seems to be a basic lack of understanding as to how the industry is operating elsewhere in the state. Businesses that need help with this and other bureaucratic processes should contact an experienced marijuana lawyer.

The Los Angeles CANNABIS LAW Group represents growers, dispensaries, collectives, patients and those facing marijuana charges. Call us at 949-375-4734.

Additional Resources:

Portland’s cannabis licensing logjam could cost businesses $22M a month, Dec. 13, 2016, By Pete Danko, Portland Business Journal

More Blog Entries:

Documentary Details Underground Medical Marijuana Trade in the UK, Nov. 28, 2016, Portland Marijuana Lawyer Blog