California Governor Signs Cannabis Licensing Reform Act Aimed at Helping Small Cannabis Farmers

Gov. Gavin Newsom signed legislation into law last month that its sponsor, Sen. Mike McGuire, D-Healdsburg, hopes will provide relief to struggling small cannabis farmers across California.

Senate Bill 833, the Cannabis Licensing Reform Act, allows cultivators to either pause their license fee and maintain an inactive license, or reduce their license size based on crop size, according to Lake County News.

The law takes effect Jan. 1, 2024.

McGuire has said that small cannabis farmers in the state are struggling to keep their businesses afloat due to volatile market conditions, Lake County News reported. Meanwhile, cultivators must pay up to tens of thousands of dollars annually to renew their licenses, even if they cannot afford to plant a crop that year.

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While some local governments have enacted processes to allow farmers to hold inactive or downgraded cultivation licenses, S.B. 833 will provide this relief at the state level and essentially allow licensees to pay less in license fees when they grow less cannabis.

“S.B. 833 is all about common sense,” McGuire told Lake County News. “Just like with other agricultural crops, cannabis farmers shouldn’t go under from one bad season, whether it’s from a tough market, drought, or even a wildfire. Right now, cannabis farmers must pay their state license fees regardless—or forfeit them all together. This is nuts and that’s why we advanced this legislation. Farmers need flexibility in this erratic market and if they grow less, they should pay less. It’s that simple.”