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Black Market Pot Shops Thrive In L.A. Even As City Cracks Down

LAPD officers detain employees of an illegal marijuana dispensary on Sepulveda Boulevard. (Allen J. Schaben / Los Angeles Times)

From the street, it looked like an old-school drug raid.

A half-dozen police and city vehicles sat near the entrance of the White Castle cannabis dispensary near the Los Angeles Harbor, where a sign bearing a giant green cross faced Pacific Coast Highway.

But the cops didn’t seize any marijuana from the illegal shop. No one was arrested, just detained briefly while utility workers moved to shut off power. The officers had been there before and would likely be back. One detective guessed the business would be up and running again in a week.

Amid growing complaints from lawmakers and cannabis lobbyists about the city’s teeming marketplace for unregulated weed, Los Angeles in recent months has ramped up enforcement against illegal pot dispensaries. But with so much money on the line, many violators are choosing to stay open even after the city has cut off their power or threatened them with arrests or fines.

The state’s marijuana market got off to a sluggish start in 2018, with revenue from the first year of legal sales falling $160 million short of what was projected in former Gov. Jerry Brown’s final budget. High taxes and the refusal of many cities to allow legal cannabis sales have been blamed, while those restrictions have allowed a resilient black market to thrive.

Nowhere is that problem more glaring than in Los Angeles, where the number of illegal storefronts rivals legal dispensaries. In what should be the state’s most lucrative pot market, many legitimate business operators say they can’t compete with the hundreds of stores that are able to sell at a lower price by skirting taxes.

More than 200 illegal marijuana dispensaries operate in L.A., according to police estimates and a Times review of city records and listings on Weedmaps, a popular online directory for marijuana businesses.

To Read The Rest Of This Article By James Queally & Ben Welsh on Los Angeles Times
Published: May 30, 2019
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