Leslie Hennessy, owner of Hennessy’s Wines & Specialty Foods in San Francisco, waved his hand over a glass case that sits next to his cash register, across from the deli section where he sells cheeses, gourmet salads and olives.
Inside the case were colorful boxes of Macanudo and Romeo y Julieta cigars. But Hennessy imagines that the case will soon contain another smokable product — marijuana, packaged attractively because “a rolled up joint in a baggy isn’t going to do it,” he said.
“It would be very similar to the way we sell cigars, where it’s humidity controlled, where it’s under lock and key and there are certain times when it would be sold,” said Hennessy, 63, who markets his own wine and once led the California Retail Liquor Dealers Association.
Hennessy said that he had even begun to negotiate prices with marijuana suppliers.
A week before Californians vote on Proposition 19, which would legalize marijuana for recreational use, businesses are preparing to enter what is expected to be a robust retail market if the measure passes. The activity is particularly intense in the Bay Area, where cities like Oakland, San Francisco, Berkeley and Richmond are positioning themselves to take advantage of the burgeoning industry.
In Oakland, nearly 300 individuals and businesses have listed themselves as “interested parties” to obtain business permits to sell or grow marijuana. The city’s largest medical marijuana dispensary is considering a 7,000-square-foot expansion if it is allowed to sell to recreational users.
Cafe owners are exploring plans for Amsterdam-like coffee shops where marijuana could be sold and consumed. The California State Package Store and Tavern Owners Association, which represents black liquor store owners, is holding discussions about how to position itself if the measure passes.
“We want to be in the ballgame if it’s going to happen,” said Andre Isler, the owner of Isler’s Liquors in Oakland and a long-time member of the association.
A state report puts the value of California’s marijuana crop at $14 billion, dwarfing even the wine industry. Robert Jacob, who operates the Peace in Medicine medical marijuana dispensary in Sebastopol, said that entrepreneurs of all types were jostling to get a piece of the action.
“So many people want to get into the business, and even aside from actually selling it you have packaging needs, management needs, bookkeeping needs,” Jacob said. “You have every single industry gearing up for the next dot-com boom.”
However, even if Proposition 19 passes — polls show that the vote will be close — it will take a while to gauge the full impact of the law. The measure would allow Californians 21 and older to grow up to 25 square feet of marijuana and possess up to an ounce for personal use. How and where it would be sold commercially would be left up to individual cities and counties.
At the same time, Tom Ammiano, a Democratic state assemblyman from San Francisco, is sponsoring a bill that would place California’s Department of Alcoholic Beverage Control in charge of regulating marijuana. Ammiano’s bill would also allow any store to sell marijuana as long as it has liquor license. That would include liquor stores, most convenience stores and even supermarkets.
Complicating matters is last week’s announcement by Eric H. Holder Jr., the United States attorney general, that the Justice Department will “vigorously enforce” federal drug laws even if Proposition 19 passes. That legal uncertainty appears to be making many businesses cautious.
“There are lots of people that say this will be in the courts for a long time,” said Libba Letton, a spokeswoman for Whole Foods Market, which has several Bay Area stores. “It’s not something we’re interested in getting into now.”
Oakland, San Francisco and Berkeley are waiting until after the election to adopt rules for retail sales, officials in those cities said. In interviews this week, the officials said they were inclined to allow existing medical marijuana dispensaries or similar types of businesses to sell to recreational users if Proposition 19 passed. Customers who are not buying marijuana for medical reasons would be required to present a California identification card instead of a medical cannabis card to be admitted, and they would be permitted to buy only fixed quantities of marijuana.