Assembly Bill 2691: Proposed Bill Will Allow for Temporary Cannabis Event Cultivator Retail Licenses

As licensed commercial cannabis businesses in the State of California continue to struggle due to, among other things, high taxes, onerous regulatory requirements, and a flooded market, the State Legislature is considering a number of bills that relate to cannabis. One such bill, Assembly Bill 2691, aims to help small cultivators by allowing them to sell their cannabis directly to consumers at a limited number of temporary cannabis events per year.

Assembly Bill 2691: Proposed Language

To do this, the bill’s co-authors propose that Section 26050.5 be added to the Business and Professions Code and read as follows: 

26050.5.

• (a) The department shall issue a temporary cultivator event cultivator retail licenses for cannabis events operating in accordance with this division. license for use at a state temporary event licensed pursuant to subdivision (e) of Section 26200.
• (b) 
  • (1) A licensee who meets all of the following requirements may apply to the department for a temporary cultivator event cultivator retail license:
    • (A) The applicant holds a valid state cultivation license.
    • (B) The applicant holds a valid license, permit, or other authorization issued by a local jurisdiction that authorizes the licensee to engage in cannabis cultivation.
    • (C) The applicant cultivates no more than one acre of cannabis, inclusive, of all licensed premises.
  • (2) The department shall not require an applicant to resubmit information already provided by the applicant for their state cultivation license, and shall not require an applicant to submit to background checks or other inspections already preformed for approval of their state cultivation license.
  • (3) The department shall establish a process to facilitate the submission of applications pursuant to this subdivision.
• (c) 
  • (1) Each temporary cultivator event cultivator retail license shall only be valid for the specific cannabis event state temporary event, licensed pursuant to subdivision (e) of Section 26200, for which it was issued.
  • (2) The department shall not issue more than 12 8 temporary cultivator event cultivator retail licenses to each licensee per calendar year.
• (d) 
  • (1) A temporary cultivator event cultivator retail license may sell cannabis or cannabis products at the cannabis event for which the license was issued.
  • (2) All cannabis or cannabis products sold pursuant to paragraph (1) shall only contain cannabis cultivated by that temporary cultivator event cultivator retail licensee.
  • (3) Cannabis and cannabis products intended to be sold pursuant to paragraph (1) shall be transported from the licensed premises of the temporary cultivator event cultivator retail licensee to the cannabis event venue by a distributor licensee in accordance with Section 26070.
  • (4) Except as otherwise provided in this section, a temporary cannabis retailer event cultivator retail licensee shall comply with all requirements imposed on retailers by this division. retail licensees selling cannabis or cannabis products at a state temporary event licensed pursuant to subdivision (e) of Section 26200.

Proposed Changes and Limitations of AB 2691, Temporary Cannabis Cultivator Retail License

If passed, AB-2691 would allow small cultivators to participate in temporary cannabis events like never before. Under current law, retailers are the only licensees that can provide products directly to consumers – even at cannabis events. AB-2691 would allow cultivators with a cumulative canopy size of less than 1 acre to apply for and obtain “Temporary Event Cultivator Retail” licenses pursuant to which they can sell cannabis and cannabis products at temporary cannabis events. This allowance is, of course, not without limitation. 

For example, as currently written AB-2691 would only allow the Department of Cannabis Control to issue eight (8) “Temporary Event Cultivator Retail” licenses to each cultivation licensee per calendar year. Prior to amendment in committee, AB-2691 proposed a higher limit of twelve (12) “Temporary Event Cultivator Retail” licenses per licensee per calendar year, however many believe that backlash from the licensed cannabis retailer community prompted a downward departure from the originally proposed limit. 

Current Status of Assembly Bill 2691

AB-2691 had its second reading before the Assembly on April 27, 2022 and was amended that same day. On April 28, 2022 the bill was re-referred to the Assembly Appropriations Committee, where it remains as of this writing. 
Rogoway Law Group continues to monitor new and pending cannabis legislation in the State of California and will post similar snapshots about other proposed legislation in the weeks to come.  Click here to learn about another pieces of proposed legislation, Assembly Bill 1646, and make sure to sign up for Rogoway Law Group’s newsletter so that you don’t miss out on important information about the California cannabis industry.