wrote on this topic, the Cannabis Regulatory Department (“DCR”) made a number of suggestions to the City Council on how to correct phase 3 licensing for efficiency and relevance. The city council rejected quite a lot. However, last week, the Council started and Phase 3 will look much different than anyone might expect. It goes without saying that there will be some winners and a lot of losers in the city of angels.
On 8 March, the City Council asked the city council to draft a regulation (based on these guidelines ), inter alia, to renew the phase 3 license for type 10 retailers. It is no secret now that only 200 retail licenses remain in the city when you make mathematics at unreasonable concentration limits. And all 200 licenses are for social capital applicants due to existing city laws. Previously, DCR weighed what to do with these 200 licenses – should they be given as a first serve principle? Via lotto? Via Achievement? Friday is how the city is going to move in step 3 for retail store access rights, which is now in two stages:
In the 14-day window, DCR first handles the first 100 stores' licenses for those who are "pre-established" as level 1 or 2 social capital applicants (not mentioning Tier 3 applications that get any difference). Pre-screening means that applicants can prove how they meet their social capital levels and sign a compensation agreement with the city. In addition, the Tier 1 and 2s, which are at the time of submission of the complete application, must also complete the "basic training" which is:
issue a signed lease with proof of payment or deposit or asset document;
meet all sensitive usage requirements, including excessive concentration;
pay the required license fees;
offer ownership arrangements;
provide financial information;
propose an establishment plan;
give a complete and detailed chart;
submit the proposed security plan;
provide the applicable beam map;
to provide a labor peace agreement; and
show that the City Equity Share rules are respected (eg, level 1 gets 51% of business and secondary 2 is 33%).
In addition, “75% of licenses are reserved for first-level applicants unless 75 qualified level 1 applicants can be identified”, only one application per applicant is allowed, and Type 10 EMMDs cannot participate in this sub-step 1. It is important that these people cannot transfer their business during the licensing process, and an individual of grade 1 or 2 may not sell their equity in their business and keep their ownership in the business during the licensing process.
Unless and until the first license series has been sorted and the city has established or funded compliance support programs for social capital applicants, retail licensing will no longer be used. So it could be some time before we see what another retail store license will lower.
When the first 100 licenses are handled and social capital conditions are met, DCR will continue to handle 100 level Tier 1 and Tier 2 e-commerce retail stores in the 30-day window, but there will be a priority for Tier 1 and Tier 2 in this phase 2 during. The basic requirements are less than in the first stage, but within 90 days of the submission of the application, the applicant must present the right to lodge the property as well as the other documents required for eligibility, including the SOP and the radiation map. The limitations of this phase are the same as those of Phase 1 – no moving places during the licensing process, nor the sale of a legitimate social capital individual holding equity throughout the licensing process
The city and the applicants are undoubtedly faced with questions about sending "complete applications" during open windows. In both phases, applicants have 5 days to submit an application to correct any application errors and then they are closed, so I do not expect a city that allows applicants to change their applications after it completes. The second question is what happens if the city receives more than 100 applicants in the first stage? Presumably, this "complete application" mechanism solves this problem, although there is certainly no question of timing without official entry, first serving the standard (although your application is a timestamp and dated on delivery). And if someone in front of you is DQ, are you going up the line? And if so, when? For those people who have been in Los Angeles for some time, it is unlikely that Phase 1 success will be guaranteed if you do not act quickly and all the ducks are in line in a two-week window.
The general good news is that we now have a clear roadmap for licensing in step 3 of L.A. No one knows yet when this window really comes. open but when it is undoubtedly a serious competition for these 100 first licenses.