Legal weed in Calif. hasn't been economic boon expected, and has corrupted some local officials, L.A. Times finds

A dispensary advertisement in California.
(Photo by Mel Melcon, Los Angeles Times) 

Hoping for increases in tax revenue and an economic kickstart, some rural California communities quickly embraced the legal cannabis boom after a 2018 state law allowed them to decide whether weed businesses could sell or grow pot inside their borders. But a Los Angeles Times investigation found that the state's decentralized system has set the stage for rampant bribery and corruption of local officials. 

Over half of California's cities and counties don't allow any type of recreational marijuana sales or farming, but the newspaper found that those that do allow sales generally issue a limited number of business licenses, "creating fierce competition among entrepreneurs looking to cash in." The local officials, who have the power to issue those licenses or make local laws more weed-friendly, are essentially able to "choose winners and losers."

“You pay your way into one of the few spots,” Dominic Corva, a sociology professor and co-director of the Institute for Interdisciplinary Marijuana Research at Cal Poly Humboldt, told the Times. “Once the game was limited licensing … it was like, who gets to have it?”

The Times report details numerous instances of local officials receiving suspicious payments from weed entrepreneurs looking to get an upper hand in the local market. In the small border town of Calexico, local officials projected $700,000 in annual tax revenue. But since 2018, the city has only collected $220,000 and lost a councilman and city commissioner to corruption. 

In early 2020, a city commissioner and councilman for Calexico, began meeting with who they thought was a businessman hoping to open a dispensary in their town of 40,000. The businessman agreed to pay the city officials $35,000 for what would be a "top spot in the queue" for city permits. After the city officials accepted the money in cash, the businessman revealed his true identity -- an undercover FBI agent. Both government officials would eventually plead guilty to conspiracy to commit bribery. 

David Romero, the city commissioner who accepted the bribe, told the LA Times that the city made a mistake in only allowing for 12 permits. “If you put a number on it, you’ll turn it into a political mess,” Romero said. “It was just a ticking time bomb.”