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City proposes longer hours for cannabis dispensaries
Right now, late-night shoppers either leave town or leapfrog the law
To make up for revenue lost to declining cannabis sales, the city raised taxes on the businesses starting in May. Now, in an effort to help dispensaries increase revenue, and also help close the city's $258 million budget shortfall, the Planning Commission has voted unanimously in favor of a proposal to extend operating hours for licensed cannabis retailers. The city estimates a $1.7 million increase in cannabis tax revenue in fiscal year 2026. (During the 2024 fiscal year, cannabis sales brought in $1.5 million less revenue compared to the year before.)
“The way we got here is, the city has a very dire budget problem,” said Phil Rath, a lobbyist for the United Medical Marijuana Coalition, a trade group of San Diego cannabis retailers. “The city decided to increase that tax, fairly significantly" — what started at 5% moved to 8% in 2019 and then 10% in May — "and in lieu of us pitching a fit and losing anyway, we said, 'Why don’t we come up with some collaborative ways where everybody wins?'”
If the city council approves the recommendation, outlets will be allowed to open one hour earlier and close one hour later, matching the state’s hours of 6 am to 10 pm. The city’s current hours, 7 am to 9 pm, pre-date those of the state, since it began regulating pot several years earlier, and cannabis businesses have argued that they’re at a competitive disadvantage, since they are surrounded by cities that use the state’s hours. A closed sign in San Diego may send a customer just a few miles down the road to Chula Vista, Oceanside, Vista, National City, Imperial Beach, La Mesa, or Lemon Grove. To make matters worse, said Christopher Ackerman-Avila, Senior Policy Advisor for San Diego mayor Todd Gloria, “Currently, there is a continued presence of illegal delivery services that operate when city outlets are closed.”
Rath agreed, noting that operators believe the new hours will bring new sales, particularly in the evening hour. “Right now, what happens, especially with deliveries – about 8 pm, we stop taking new delivery orders, because they have to be completed by nine. Every single bit of cannabis sold after 9 pm until 7 am the next day is provided by the black market. And that is a significant amount.”
A city report chalks up the post-pandemic cannabis revenue crash to a “trending decline in monthly gross receipts reported by outlets due to increased competition in neighboring municipalities, delivery services, and the illegal market, as well as an oversupply of cannabis goods.”
Several speakers argued against increasing the hours, citing concerns about health, safety and crime. Public health advocate Peggy Walker said there is no evidence that extended hours will deter illicit sales, and people “don’t need to buy pot at 6 am simply to get high and be thrust into morning commuter traffic,” causing risks to others.
Scott Chipman, of San Diegans for Safe Neighborhoods said a study found that hospital visits have gone way up since pot was commercialized, yet the city has never provided a cost-benefit analysis. He also argued against marijuana’s economic significance, noting that the tax revenues it provides make up less than three-tenths of one percent of the budget. “I would provide a pie chart," he said, "but the line representing the amount of marijuana tax revenue wouldn’t even show up.”
Here's something you might be interested in.
City proposes longer hours for cannabis dispensaries
Right now, late-night shoppers either leave town or leapfrog the law
City proposes longer hours for cannabis dispensaries
Right now, late-night shoppers either leave town or leapfrog the law
To make up for revenue lost to declining cannabis sales, the city raised taxes on the businesses starting in May. Now, in an effort to help dispensaries increase revenue, and also help close the city's $258 million budget shortfall, the Planning Commission has voted unanimously in favor of a proposal to extend operating hours for licensed cannabis retailers. The city estimates a $1.7 million increase in cannabis tax revenue in fiscal year 2026. (During the 2024 fiscal year, cannabis sales brought in $1.5 million less revenue compared to the year before.)
“The way we got here is, the city has a very dire budget problem,” said Phil Rath, a lobbyist for the United Medical Marijuana Coalition, a trade group of San Diego cannabis retailers. “The city decided to increase that tax, fairly significantly" — what started at 5% moved to 8% in 2019 and then 10% in May — "and in lieu of us pitching a fit and losing anyway, we said, 'Why don’t we come up with some collaborative ways where everybody wins?'”
If the city council approves the recommendation, outlets will be allowed to open one hour earlier and close one hour later, matching the state’s hours of 6 am to 10 pm. The city’s current hours, 7 am to 9 pm, pre-date those of the state, since it began regulating pot several years earlier, and cannabis businesses have argued that they’re at a competitive disadvantage, since they are surrounded by cities that use the state’s hours. A closed sign in San Diego may send a customer just a few miles down the road to Chula Vista, Oceanside, Vista, National City, Imperial Beach, La Mesa, or Lemon Grove. To make matters worse, said Christopher Ackerman-Avila, Senior Policy Advisor for San Diego mayor Todd Gloria, “Currently, there is a continued presence of illegal delivery services that operate when city outlets are closed.”
Rath agreed, noting that operators believe the new hours will bring new sales, particularly in the evening hour. “Right now, what happens, especially with deliveries – about 8 pm, we stop taking new delivery orders, because they have to be completed by nine. Every single bit of cannabis sold after 9 pm until 7 am the next day is provided by the black market. And that is a significant amount.”
A city report chalks up the post-pandemic cannabis revenue crash to a “trending decline in monthly gross receipts reported by outlets due to increased competition in neighboring municipalities, delivery services, and the illegal market, as well as an oversupply of cannabis goods.”
Several speakers argued against increasing the hours, citing concerns about health, safety and crime. Public health advocate Peggy Walker said there is no evidence that extended hours will deter illicit sales, and people “don’t need to buy pot at 6 am simply to get high and be thrust into morning commuter traffic,” causing risks to others.
Scott Chipman, of San Diegans for Safe Neighborhoods said a study found that hospital visits have gone way up since pot was commercialized, yet the city has never provided a cost-benefit analysis. He also argued against marijuana’s economic significance, noting that the tax revenues it provides make up less than three-tenths of one percent of the budget. “I would provide a pie chart," he said, "but the line representing the amount of marijuana tax revenue wouldn’t even show up.”
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