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There’s a Way to Legally Serve Cannabis in Restaurants, But It’s Not Easy

CBD is already legal, but THC is trickier for restaurants and bars

Marijuana leaf and cookie on white wooden backround
Roxana Gonzalez/Shutterstock

Yelp Reservations hosted a lunchtime panel on March 18 for a timely discussion about the recreational use of cannabis in Los Angeles. The LA restaurant community attended to learn how State Bill 94 applies to restaurants and bars. Out of caution, most local eateries have steered clear of adding any type of cannabis to their menus. Eater previously covered that it is perfectly legal to add CBD to any food or drinks, but only from sources that comply with California and federal law. The panel also spoke about the legalities of serving THC-infused dishes or drinks.

The Yelp panel included chef Holden Jagger, founder of Altered Plates, along with Yannick Crespo, founder of Pot d’Huile infused olive oil. Attorney Benson Lau, who specializes in cannabis law, offered legal advice while Rachel Burkons of The Clever Root moderated.

There are already a number of restaurants and bars that serve CBD foods and drinks in Los Angeles, and they’ve carefully been watching the law to make sure they don’t overstep. But the law can be a bit tricky, as federal and state laws can conflict. THC, or psychoactive cannabis is a Schedule 1 drug, and is illegal for anyone in California to sell without a permit.

Jagger made some recommendations for restaurants that want to serve THC-infused foods. They should apply for a state and local permit, and opt to serve the meals in a private setting. Each panelist spoke about issues with federal banks, which will not work with businesses associated with cannabis. The panel suggested using an overseas bank, or a state-chartered banking institution like a credit union. These organizations do not protect illegal activity, but help to conduct business and limit interference from the federal government. Lau also recommends using organizations that work as a cannabis payment processor. While Lau doesn’t recommend any particular company, there is PayQwick, which allows customers to utilize card payments to make day-to-day business run smoothly.

According to Lau, the CBD must be from federally-approved retailers, and must clearly state that their CBD is derived from industrial hemp, not actual cannabis. Lau also suggested caution when marketing anything related to CBD or THC, and knowing where the CBD comes from. Even though there are some federally approved outlets, it is still unknown whether the Feds are fine with CBD.

While Lau hasn’t witnessed a case of government coming after a restaurant or bar for serving CBD, he has noticed repercussions on social media. He pointed to a business that had their profile taken down, and lost thousands of followers by violating Instagram’s terms of service. The exact violation was for soliciting cannabis sales. Lau recommends making any social media posts informative, and speak about CBD’s benefits to accompany a photo of the cocktail.

Many attendees wondered aloud whether Attorney General Jeff Sessions would enforce federal law, Lau and Burkons stated that they had no concerns about restaurants and bars being targeted. Lau added said that most of the government efforts are focused mostly on permits and licenses.

California’s rollout of recreational use is unprecedented, and many local governments are banning cannabis sales outright in spite of the new law, including the city of Orange and San Bernardino County.

When asked about the future of THC in restaurant settings, panelists offered different possibilities. Burkons noted that if CBD or THC is served at a restaurant or bar, staff should be trained to explain specifics so customers understand the nuances and effects of each cannabis strain. California provides year-round outdoor growing as a possibility, and Jagger believes that the next big trend is sun-grown cannabis as a vintage, similar to wines.

Benson noted that the previous stigma around cannabis is waning, even as many local governments are wary. He believes these municipalities will have a change of heart if on-site cannabis consumption becomes more acceptable. Most experts are watching West Hollywood, which is leading the charge by working towards cannabis consumption lounges. Yannick noted something that all restauranteurs desire: A higher profit margin. Any restaurant or bar that adds a few drops of CBD or even THC could see their sales increase considerably. Gracias Madre charges $15 for a CBD snowcone with no alcohol, and Pattern Bar charges an extra $5 dollars for a dose of CBD.

Prank Bar

1100 South Hope Street, , CA 90015 (213) 493-4786 Visit Website

Gracias Madre

8905 Melrose Avenue, , CA 90069 (323) 978-2170 Visit Website

Spring

257 South Spring Street, , CA 90012 (213) 372-5189 Visit Website

Pattern Bar

100 West 9th Street, , CA 90015 (213) 627-7774 Visit Website