California’s cannabis industry is preparing for a pivotal battle. A new trade group, the California Cannabis Operators Association (CaCOA), has launched with an ambitious agenda to advocate for retailers across the state. With a potential excise tax increase looming, industry leaders are uniting to defend their businesses and push for policy changes.
A New Coalition With Big Players
The newly formed CaCOA represents a collective force of 17 members, including well-known cannabis retailers like Catalyst Cannabis Co., Embarc, and Stiiizy. Together, these operators run about 75 dispensaries, signaling a substantial market presence. The group is headquartered in Sacramento, aiming to influence state legislation directly.
Amy O’Gorman Jenkins, CaCOA’s executive director, brings years of experience to the table. As a seasoned lobbyist and founder of Precision Advocacy, Jenkins has been instrumental in shaping marijuana reform policies for over a decade. Her leadership has already sparked optimism within the industry.
Top Priorities: Taxes and Regulation
The association’s immediate focus is clear: stopping an impending cannabis excise tax hike. Under current plans, the state’s tax rate would jump from 15% to 19% on July 1. This increase could further strain an industry already grappling with high operating costs and competition from the illicit market.
But taxes aren’t the only concern. Jenkins also highlighted the need for new regulations on intoxicating hemp products, which have muddied the market and created challenges for compliant operators. The goal is to level the playing field and ensure that all market players adhere to the same standards.
Why This Matters:
- Economic Strain: Many cannabis retailers already operate on razor-thin margins due to high taxes and stringent regulations.
- Illicit Market Growth: Higher taxes could push more consumers toward unregulated sellers.
- Consumer Confusion: The proliferation of unregulated hemp products can undermine trust in legal cannabis brands.
Changes at California’s Oldest Trade Group
Jenkins’ move to CaCOA marks a significant shift in California’s cannabis advocacy landscape. Until recently, she served as the lead lobbyist for the California Cannabis Industry Association (CCIA), the state’s oldest and largest trade group with over 100 members. Following her departure, CCIA has announced a search for new legislative representation, signaling potential shifts in its own strategies.
Despite the competitive dynamics, both groups share common goals of supporting the industry. However, CaCOA’s narrower focus on retail operations and immediate challenges could differentiate its approach.
Leadership and Vision
CaCOA’s leadership team reflects its strategic ambitions. Alex Freeman, president of the association, brings legal and regulatory expertise from his tenure at Los Angeles-based cannabis company Traditional and the city’s Department of Cannabis Regulation. Together, Freeman and Jenkins aim to craft policies that address the sector’s most pressing challenges.
Industry Outlook
As July approaches, the stakes for California’s cannabis industry are higher than ever. A tax increase could have far-reaching implications, from discouraging investment to exacerbating consumer costs. At the same time, the regulatory landscape continues to evolve, requiring proactive advocacy from groups like CaCOA.
The formation of this new coalition signals a growing recognition among cannabis operators: collective action is essential to drive meaningful change. While the road ahead remains uncertain, CaCOA’s efforts could set the tone for how the industry navigates its next chapter.