Cannabis: The New Frontier in California Tourism

  • Adult-use cannabis laws in California have created a new genre of tourism for the state.
  • Regulatory restriction require consideration when designing a cannabis tourism experiences.
  • Cannabis Tours and Cannabis Events will be the main draw for tourist dollars.

California, with its many natural beauties and iconic urban attractions, has long been a popular tourist destination for visitors from around the world. The non-profit group Visit California reports that in 2017, tourism in California brought in $132 billion in gross revenue to the state, supporting more that 1.1 million jobs and producing over $10 billion in state and local tax revenue. But in 2018, California has introduced something new that could have tourists spending even more in the Golden State: adult-use cannabis.

Adult-use cannabis is available to any individual 21 year or older in California, and the potential for revenue from cannabis has not escaped the attention of the tourism industry. According to research by Arcview Market Research and BDS Anayltics on the legal cannabis market, California is projected to see $3.1 billion in annual revenue from adult-use cannabis in 2018, and $7.6 billion by 2022. Couple this with the fact that in 2017, California saw an increase of cannabis tourism searches by 299%, and it becomes clear why a whole new genre of tourism is developing. The interest is so strong that it has led the emergence of avant garde industry organizations like the Santa Rosa-based California Cannabis Tourism Association (CCTA). The CCTA is working state-wide to collaboratively bring together all aspects of the hospitality and tourism industries with the cannabis industry by educating the public and business owners alike and facilitating desirable tourism experiences while boosting business revenue.

The potential for the tourism and cannabis industries to join forces is an exciting prospect to say the least. Much like the San Francisco North Bay Area is world renowned for being “wine country,” certain areas of California could soon find themselves well known for being “weed country” and become highly sought-after tourist destinations in their own right. Alas, cannabis is a highly regulated industry, and with that comes rules and restrictions that can hinder the brilliant ideas of even the most savvy entrepreneur. With that in mind, let’s examine the various ways the tourism industry can (and cannot) incorporate cannabis into their business model while maintaining legal and regulatory compliance.

Cannabis Tours

In response to the mass influx of curious travelers, cannabis tours are popping up all over the coast. Following the example of their wine and beer based predecessors, cannabis tours are now on the travel agenda. These tours can come in different forms. Some tours focus on one particular aspect of the supply chain, such as cultivation or manufacturing, and offer an up close and personal look at how cannabis is grown or how cannabis products are made. These experiences are much like taking a tour at a brewery or winery. Other tours may take a broader approach and shuttle patrons to multiple locations to experience everything from seed to sale; offering an opportunity for visitors to purchase cannabis from licensed retailers along the way.

For tour operators already working in the wine or beer space there is the opportunity to combine this experience with a cannabis experience. For example, San Diego’s MJ Tours offers a “Bud and Brews” tour that takes you across the city to various cannabis retailers and ends the day at a brewery. This model can facilitate professional relationships between alcohol, cannabis, and tourism businesses and could lead to various expansions and partnerships in the future. Though the retail sales of cannabis and alcohol can only occur at licensed premises that are separate from one another, that doesn’t prevent the premises from being co-located on the same property if local zoning allows for it. Also, it doesn’t prevent a brand from crossing the boundary line. We have already seen the wildly popular beer brand Lagunitas join forces with one of the largest cannabis manufacturing brands, Absolute Extracts, to create a line of cannabis vape cartridges infused with hops terpenes.

Cannabis Consumption Events and Lounges

Cannabis consumption events are sure to be a big tourism draw in California since it is the only state that currently has the legislation in place to offer the opportunity for this sort of experience. In California at the moment, there are only two places that a public cannabis consumption event can legally occur; county fairgrounds or district agricultural grounds. But, thanks to the passing of AB 2020, come January 1, 2019, cannabis consumption events will be allowed anywhere that event organizers can obtain a local event permit for a cannabis event. This opens the flood-gates of possibilities for the cannabis industry to draw additional tourist dollars into the state.

From well known large-scale events like the Emerald Cup and High Time’s Cannabis Cup that have been in existence prior to adult-use legislation to small-scale culinary cannabis-infusion experiences and 420 festivals, the market is wide open to creative entrepreneurs who want to craft events where patrons can buy and consume cannabis. In California, it is still illegal to consume cannabis in public, so the ability to provide a safe and inviting place where people can come to procure cannabis in its many forms, without recourse from local law enforcement, will be hugely attractive to tourists seeking a canna-vacation. Additionally, California law allows for consumption lounges at licensed cannabis retail facilities.

However, would-be cannabis event promoters and retailers wanting to have consumption lounges must remember that all commercial cannabis consumption is subject to approval and permitting from the local jurisdiction where consumption will take place, and it is subject to state-wide smoking ban laws. Many jurisdictions at this time do not address consumption events or lounges as part of their cannabis ordinance, and the smoking ban will prevent events from occurring at any public park, most public beaches, and many indoor locations. Furthermore, for consumption events, a state issued Cannabis Events Organizer license is required to host cannabis events, and additionally, a state Temporary Cannabis Event License must be applied for and obtained for each individual event.

The New Frontier

Despite existing restrictions, the world of cannabis tourism in California is just beginning to blossom. Opportunities to cash in on this new tourism market are ripe and ready for the taking. The time is now for cannabis and tourism entrepreneurs to collaborate and create fun and unique cannabis experiences for California tourists. With a reputation for producing the best cannabis in the world and some of the best policy regarding consumption events, it shouldn’t be long before California passes other states and countries as a top canna-travel destination.

Jennifer Price

Jennifer Price is the COO and Director of State Compliance at Golden State Government Relations (www.goldenstategr.com). GSGR is a consulting firm in California that focuses on land use planning, state licensing, regulatory compliance, and advocacy for businesses in age-restricted markets. They are best known for their work in the newly regulated cannabis industry. Jennifer has been actively involved in California cannabis regulatory affairs and policy since 2016. Her expertise in state licensing and compliance has helped dozens of clients successfully navigate the transition to a regulated market in 2018. 
https://www.goldenstategr.com/

3 thoughts to “Cannabis: The New Frontier in California Tourism”

  1. Thank you Jennifer Price for your article, I though it was well written and very informative. I’ve learned more about the many vertical business involving Cannabis that I had no idea, that they even existed, I just thought you either grew or sold marijuana not understanding how integrated the many ad-hoc associate business would be developing.

    I hope you write again.

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