Los Angeles City Council President Herb Wesson has called on the city’s Department of Cannabis Regulation (DCR) to suspend all Round 1 applications in light of recent allegations that the online application process was compromised. In his letter to DCR’s Executive Director, Wesson urges that the City “1) suspend all Retail Round 1 applications; 2) refund all monies paid by Retail Round 1 applicants and cancel all invoices; and 3) prepare a full audit and report by an independent third party not involved in the process — unless there are other options like processing every application…”

Wesson’s statement comes just five days after hundreds of outraged applicants showed up to the Cannabis Regulation Commission meeting to voice concerns regarding the application process for Round 1 of Phase 3 retail licensing. Following the closure of the application cycle on September 27th, several accusations related to the integrity of the online system have circulated. When confronted by applicants and the Cannabis Regulation Commission alike, DCR Executive Direction Cat Packer confirmed that there were at least two incidents during which the online process was compromised.

The City has only authorized 100 licenses to be issued to Round 1 applicants per Los Angeles Municipal Code. Given the competitive nature of the process, the City predetermined a method of issuing licenses based on the timestamp associated with each application’s online submission. Although the City’s first-come-first-serve plan was intended to provide a fair and equally accessible system, the DCR confirmed that some individuals were able to access the City’s application website and submit their application prior to the intended time window.

Thus far, the City has upon preliminary review issued 38 invoices to 800 of the individuals who applied during Round 1. Upon paying the invoice and submitting their final materials, these applicants are set to be issued a retail license. The DCR has declined to comment on President Wesson’s letter and recommendations, and it is unclear whether or not the Department will continue to review applications and issue invoices, halt the process altogether, or issue licenses to all eligible Round 1 applications as Wesson and others have recommended. Issuing licenses to all Round 1 applicants would require City Council approval and a change to the existing ordinance.

Our team has been in regular communication with the DCR and members of the Los Angeles City Council to stay up to date on the status of Phase 3 licensing. We are in attendance at various city meetings and doing all we can to lobby on behalf of our clients and their applications. If you are interested in learning more about our licensing success rate and lobbying services, contact a member of our team today.