Chula Vista is on the verge of potentially making history next week by approving an ordinance that will regulate cannabis sales and create a brand-new tax revenue stream for the city. Overall, I believe this is a positive step forward for Chula Vista and the cannabis movement as a whole – but what about the average South Bay professional? Will they be given an opportunity to own one of these new, profitable cannabis businesses?
Unfortunately, if the ordinance passes as it is currently written, the answer is “not likely.”
Chula Vista prides itself on its ability to effectively cultivate small business growth and development. An example of this was the city’s bold and unexpected inclusion of delivery service licenses. The delivery service model is viewed as an achievable entry point into the cannabis industry for many small business entrepreneurs hungry for a shot at success. However, the devil is in the details, and upon further investigation into the proposed ordinance, I would argue that the city of Chula Vista is being far too restrictive with specific licensing requirements and is creating unnecessary blockades for ambitious South Bay residents who have a strong desire to be owners and not just employees.
One of the major licensing restrictions placed on small business applicants is the section of the ordinance requiring that all potential storefront and delivery service owners provide documentation demonstrating control of a staggering $300,000 in liquid assets. Let me remind everyone that the median household income in Chula Vista is $66,000 per year; the median household income for the entire South Bay is $57,000 per year. This requirement alone will exclude a large majority of local community members from owning even a small piece of this new and exciting industry.
However, I can sympathize with the council’s decision to require proof of substantial income from applicants interested in opening expensive retail locations. These storefront operations, that allow for on-site sales, demand a significantly higher long-term financial investment than smaller, boutique-style delivery services. Retail storefronts can potentially see thousands of customers per day and easily do over $20,000 in daily sales. Delivery, on the other hand, is extremely limited in how many customers they can handle per hour and their daily intake and profit margins, on average, are much smaller than storefront locations. Therefore, these two business types are different and should have separate financial requirements that are proportional to their size, scope and profitability.
The South Bay is bursting at the seams with creative small business entrepreneurs in search of wealth and ownership. The council needs to lower the financial asset requirements from $300,000 to $100,000 for delivery-only applicants. This will allow for ambitious and capable South Bay residents to realistically compete for these new licenses. If the council refuses to budge on this specific restriction, they will completely eliminate small business from the cannabis equation, and co-sign an ordinance that allows for only the most affluent amongst us to compete and prosper.
I understand and empathize with Chula Vista’s frustration towards the unlicensed retail storefronts that have occupied their city for almost a decade; the battle to close these rouge outlets have been time consuming and largely ineffective. The city, however, should not allow for a few bad actors to cloud their judgement and cause them to mistakenly approve an overly restrictive ordinance that specifically caters to big money outsiders. I urge all small business cannabis entrepreneurs to attend the next Chula Vista city council meeting on Feb. 27 and to make their voices heard; let’s show the council that we are motivated, persistent and not going away!
Manny Biezunski is co-founder of CoastDriveManagement, a cannabis delivery consulting company.
