D.C. Council Approves New Penalties for Cannabis Gifting Shops

Journal

Jan 31

Written By Damian Nicholas

Washington, D.C. Council Members has approved measure for civil enforcement on unlicensed cannabis dispensaries.

Cannabis | Washington D.C

Words by Damian Nicholas

MARTIJN BAUDOIN/UNSPLASH

Washington D.C District Council members approved an emergency measure to expand the medical marijuana program and establish new penalties for cannabis gifting shops. The bill, which passed on Jan. 10th, would empower city officials to penalize unlicensed marijuana gifting shops that have not applied to the medical cannabis program.

Recreational cannabis has been legalized in the nation's capital since 2014, with the passage of Initiative 71. Since then, city officials have tried to regulate adult-use cannabis dispensaries, but actions from the council have been derailed by Congress, which has jurisdiction to change or overturn bills padded by the district council. Lack of regulation has caused a massive influx of cannabis gifting shops opening in Washington D.C. Under the gifting shop business model, customers buy inexpensive merchandise at inflated prices– and receive a gift of cannabis in return.

In 2022, Council Members passed a measure to lift the cap on the number of cannabis dispensaries allowed to open in the city. The expansion also allows gifting shops to apply to become licensed medical marijuana businesses. Under the law, cannabis gifting shops that have failed to apply for the program or are unable to meet the requirements are subject to enforcement measures. However, issues between the council and Congress have meant the law has not been meaningfully enforced since it was passed.

The Medical Cannabis Enforcement Emergency Amendment Act of 2024

Empower the Alcoholic Beverage and Cannabis Administration (“ABCA”) to issue warnings, fines, and cease and desist orders to unlicensed businesses that have not applied to become licensed under the District’s Medical Cannabis Program.
Mirror several provisions from the District’s Alcohol Code enforcement scheme and apply them to the enforcement of medical cannabis. These include:
Giving ABCA and MPD authority to inspect an establishment’s books and records;
Authorizing the seizure of cannabis manufactured, sold, or exchanged in violation of the Medical Cannabis Program; and
Requiring the Department of Licensing and Consumer Protection (DLCP), Office of Tax and Revenue, and the Fire and Emergency Medical Services Department to notify ABCA if a licensed establishment violates one of the listed agencies’ rules within 30 calendar days.
Prohibit unlicensed establishments from displaying signs or imagery advertising cannabis or cannabis products, or advertising themselves as “I-71 compliant.”
Allow affected ANCs in neighborhoods where unlicensed establishments are applying to become medical establishments to provide input, similar to the ANC input process when considering liquor licenses.
Transfer authority to issue fines to commercial property owners for unlicensed establishments operating on their properties from DLCP to ABCA.

On Jan 10th, The district council approved Allen’s emergency bill at its legislative meeting. The measure will become law and go into effect as soon as Democratic Mayor Muriel signs it.