LA Phase 2 Opening Tomorrow

With August 1st just a few hours away, many people are confused on what documentations are needed in order to begin the process with the DCR. In this email, I hope to provide you with a wealth of information despite the Department of Cannabis Regulations not giving a clear manual on how licensing will work. Indeed, the DCR said they would publish the manual by 5 PM on July 30th, yet they only posted:

Apply for a Phase 2 License Quick Reference Guide: The document is not loading properly and staff are working to resolve the issue. Please check back later.

Thus, I will be referring to other documents posted on the DCR website. First, the DCR wants you to establish eligibility for Phase 2. In minute 11:00 of the YouTube video ( you can hear Cat Packer explain that properties are not necessary in order to get verified for the Social Equity Program. Also please note that Phase 2 is ONLY for Social Equity NON-RETAIL.

So what exactly are they looking for? They’re asking for evidence of the following a) activity prior to January 2016 b) that you provided an EEMD with product and c) that you qualify for Social Equity. The suggested documents can be found here:

The guidelines give an extensive list of documents that might be considered evidence. Moreover, the DCR is only asking for declarations from Tier 3s. The reason for this is that, if you check on 1:49:30 of the YouTube video, the DCR explains that there is a movement for an in-lieu fee.

What is the in-lieu fee?

The in-lieu fee is not in place, but it would mean that incubators would just pay a fee instead of having to incubate. The City has not yet decided whether or not this will take place; however, this would be a much easier route than having to draft an agreement between an incubator and an Social Equity Applicant. In order to get this enacted, it is imperative that businesses show up to City Council meetings and voice their approval of the “in-lieu” fee as it would relieve many of the hurdles towards licensing. Moreover, it would relieve many of the Tier 3s of having to pay for the negative effects of the War on Drugs (a war that the City enacted on its own citizens).

What will be asked for in the application?

The DCR has not yet released a list of documents necessary for the temporary approval. The only information available, at the drafting of this email, is the presentation which has a few screenshots of what the process will look like:

Starting on page 19, there are several documents that can be added to the application.

Additional Documents:

– Staffing Plan
– Organizational Chart
– Proof of Bond or Insurance
– Security Plan
– State of California Operational Requirements
– LAFD Notification Form
– LAFD Certified Union Program Agency (CUPA)
– Community Benefits Agreement
– Labor Peace Agreement
– Dated Radius Map
– Labor Peace Agreemetn

Owner Submittals

In addition to the cannabis license application, owners also need to submit the following items:

– Government issued ID
– Eligibility evidence for Phase 2
– Work History
– Any cannabis licenses denied
– Any cannabis licenses currently held
– Criminal Violations

Once you’ve submitted your documents, the DCR will provide you with an invoice. The invoice needs to be paid at the Office of Finance, where they will begin the process to register you with the City for taxes. Moreover, you need to have the LAFD form ready for inspections, as the fee you pay the Office of Finance triggers the LAFD to schedule you for an inspection. The forms are found here:

I hope this blog post is helpful and useful, especially considering the opening date. Thank you for your time. Should you have any licensing questions or need of assistance, please do not hesitate to contact me.

Sergio Ingstrom
Senior Consultant