Alan Riquelmy

SACRAMENTO, Calif. (CN) — An adult can legally buy cannabis from retail stores in California, but they can’t enjoy a soda or snack while smoking it on site.

Assembly Bill 374, now heading to the state Senate for a vote, could change that.

The bill, sponsored by Assemblyman Matt Haney, a Democrat from San Francisco, would allow cannabis retail stores to sell prepackaged food and beverages and permit cannabis businesses with an on-site consumption license to sell food prepared at the location. The bill would also allow on-site consumption license holders to host live music and performances.

The bill would not, however, let cannabis retailers sell alcohol.

There are about 20 businesses in Haney’s district that have on-site consumption licenses.

"This bill does not allow coffee shops to sell cannabis,” Haney told the Senate Business, Professions and Economic Development Committee on Monday. Rather, he said, it would allow cannabis stores to sell coffee.

The committee voted 6-1 to send the bill to the Senate.

One reason for the bill, Haney said, is the struggling legal cannabis marketplace. The industry, legalized in the 2016 with the passage of Proposition 64, suffers from high taxes and a thriving black market. Haney said that in 2021 the legal market saw some $4 billion in sales while the illegal market saw an estimated $8 billion in sales that same year.

“These struggling, small businesses can’t diversify,” Haney said.

Enter AB 374, a bill Haney said enjoys broad bipartisan support.

Several people urged the committee to support the bill. Ben Bleiman, chairman of the California Nightlife Association, said the law is needed for several reasons. He said many areas have onerous rules for consumption sites and pointed to one site that requires a $140,000 ventilation system for a 1,000-square-foot space.

Jerred Kiloh, president of the United Cannabis Business Association, drew a comparison between bars and cannabis consumption sites. People are willing to pay $12 for an alcoholic drink because a bar provides a safe place to have it, as well as a social atmosphere.

According to Kiloh, few legal spots exist in the state where people can consume cannabis. This means people can legally buy the product, but are then forced to hide to use that legal substance.

“The culture of California cannabis is something tourists are traveling here to experience,” Kiloh said. “The world is adapting to the new view of cannabis.”

A handful of individuals urged the committee to oppose the bill. Tim Gibbs, speaking on behalf of the American Lung Association, said that second-hand smoke from cannabis is dangerous.

“That’s not up for debate,” he added. “The science is rock solid.”

Cannabis smoke has the same carcinogens as cigarettes, Gibbs said. He dismissed arguments that employees who work in those environments make a choice. Not everyone can quit a job and find a new one over the issue of smoke. Gibbs decried what he said would be a return to the days of people smoking inside restaurants.

Laurie Dubin, with the nonprofit Be The Influence, said voters for Proposition 64 did not envision that cannabis stores would also become restaurants.

“We did not vote for drugs with muffins and coffee,” she added.

While AB 374 may financially assist cannabis businesses, it would also encourage and support more cannabis use, to people’s detriment, Dubin said.

Individual cities and counties in California are permitted to determine what types of cannabis businesses are allowed in their areas. Forty-four percent of cities and counties in the state allow at least one type of cannabis business, while 56% restrict all cannabis businesses.

“This is ultimately a local-control measure,” Haney said in his closing remarks.