The Hemp Store owner Chris Fowlie is keen to open a cannabis store in Karangahape Rd. Photo / Michael Craig
How will cannabis cafes and retail stores work if cannabis is legalised? Bernard Orsman reports.
Pencil in Auckland's Karangahape Rd as a "green zone" for cannabis cafes if the vote on legalising weed passes.
Two advocates for a "yes" vote in the cannabis referendum with shops on K Rd, the Hemp Store's Chris Fowlie and Cosmic vaping store owner Mark Carswell, are keen to enter the cannabis retail market.
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"It would be a dream come true," says Carswell, who has built up a vaping and clothing business with nine stores in Auckland, Wellington, Mt Maunganui, Christchurch and Dunedin.
It would be done in a way that is "very socially responsible" with trained staff and "very high levels of customer service", says Carswell, who has built up a successful business since 1997.
Fowlie, a member of New Zealand's oldest cannabis reform group NORML, said K Rd is the perfect place to have a "green zone" that is cannabis friendly.
"It is where people would come for this type of thing. I would say that K Rd could perhaps have a dozen cannabis outlets. We already have that number of vape stores and 50 to 100 liquor outlets," he said.
Fowlie is keen to turn the Hemp store into a cannabis outlet and supports the proposed licensing model.
"It is not going to just anyone who applies. There will be a limited number and they are going to rank people in terms of the social good that they do in their community; who has local partnerships with Maori and people harmed by the existing policies," he said.
Fowlie said the trade would be self-regulating because only the best operators will get a licence and have to perform to a level to keep it.
Should Carswell and Fowlie get the green light, how will their plans pan out? Will it be like Amsterdam's coffee cannabis shops where the age limit is 18 or Canada where some provinces restrict the number of stores?
A report by economic consultants BERL for the Ministry of Justice calculated 420 cannabis stores across the country based on an average of one store per 8660 people aged over 20. Auckland would have 125 stores, Wellington 27, Christchurch 25 and Hamilton 14.
The highest concentration of stores would be seven in Gisborne - one store per 4870 people aged over 20.
BERL also looked at the economics of running a cannabis business and calculated a retail store in the large cities would sell 150kg of cannabis a year, have sales of about $5 million and make a profit of about $570,000. Sales and profitability were less in provincial and rural towns.
The retail price of cannabis to compete with the illegal market, said BERL, could be set at $20 a gram, of which $12.11 would go to the Government in GST, excise duty and a harm minimisation levy. Growers would make a profit of $1/g and retailers 90 cents.
Drug Foundation executive director Ross Bell said the Cannabis Legislation and Control Bill sets out the broad parameters for retail stores, cannabis cafes or a mix of the two, but acknowledged some of the details have still to be worked out.
He said cannabis outlets will not be "in your face", but very modest with no advertising on store fronts to indicate the sale or use of cannabis.
They have to abide by smokefree legislation and have a dedicated area outside for smoking cannabis. Inside the stores, cannabis will be sold in plain packaging with limits on potency.
"There might be somewhere on K Rd with a back alley that has a storefront and a smoking room at the back. You are not going to have someone on a pavement having eggs benedict and a smoke," Bell said.
Bell can envisage cannabis outlets in places like K Rd and Wellington's Cuba St - "where the customers are" - and, in smaller towns, down side streets and potentially in semi-industrial areas near a local craft brewery.
"The law states the stores will have to be spread out so we don't have clustering. That might prevent K Rd becoming a place that has all the Auckland cannabis stores."
Another option is non-profit licences. In Spain, there are social cannabis clubs where people get together and bring their own weed, said Bell.
He describes the bill as the "sandpit we are allowed to play in" with enough information for voters to make a decision, and the details and regulations finalised by lawmakers if the referendum is successful.
At this point, many details remain unknown or are hazy at best. There is talk of cannabis outlets being kept away from schools and churches but this is not set out in the bill.
Nor are the hours of operation included or the level of taxes and levies. Voters know
stores can sell cannabis and cannabis accessories and cannot sell alcohol or tobacco, but it's unclear if vaping stores will be able to sell cannabis.
The role of councils is unclear. Auckland Mayor Phil Goff said councils will be responsible for issuing licences according to criteria set out by the Cannabis Regulatory Authority, whose main objective is to oversee regulation of the supply and use of cannabis that reduces the harm associated with the drug.
The council's environmental health manager, Mervyn Chetty, said: "We will be considering the outcome of the upcoming cannabis referendum, and the implications for council and its regulatory role as the process unfolds."
In other words, the council doesn't yet know the extent of its role.
"There isn't enough clarity yet about the interface between the central decision making by the authority and the role of the council. That has yet to be worked through and I think that will be quite important," Bell said.
What part people and communities will have in the licensing process is another unknown.
The bill includes a "Cannabis Appeals Authority" to hear appeals to licensing decisions that "any party to the proceedings" can take part in.
Lydia Sosene, chairwoman of the Mangere-Otahuhu Local Board, said adding cannabis outlets to an oversupply of alcohol stores, tobacco and pokie machines in South Auckland is a concern.
"It is important from a community perspective to have more detail. I'm not sure the referendum gives that."
Sosene said medicinal cannabis for pain or treatment may be very useful, but accessibility and oversupply in a patch like Mangere or Otahuhu with a young population could be damaging.
This point was made by Salvation Army social policy analyst Ronji Tanielu on Newshub's The Cannabis Question debate on Wednesday where he criticised the "broken models" with pokie machines, liquor stores and loan sharks in South Auckland.
"Now we're thinking about experimenting by legalising cannabis," he said.
Former Prime Minister Helen Clark, a strong supporter for legalising cannabis, said "if people have an image of sitting outside the Manukau Mall or whatever smoking, this isn't going to happen".
"We are starting here with something that is far stricter than you ever saw for alcohol or tobacco. Tobacco can be sold in any store, alcohol is very loose. This starts tough, and it should start tough," said Clark.
Bell said New Zealand could follow the experience overseas and see a bit of a "gold rush" at first from people thinking they could make a lot of money selling cannabis.
"But the market is not like the alcohol market with 15 per cent of users, compared to 80 per cent for alcohol. You are going to get a bit of a boom but the market will recalibrate," he said.
Carswell said if the referendum passes it will take two-to-four years, at least" for the draft legislation to be enacted.
What we know about the retail side of cannabis
• People can buy up to 14g of cannabis
• Cannabis for sale has limits on potency and plain packaging
• Minimum purchase age is 20
• Retail stores/cannabis cages/combined stores will be tightly regulated
• Cannabis retail stores can sell cannabis, cannabis products and cannabis accessories
• Alcohol and tobacco cannot be sold at retail stores/cannabis cafes/combined stores
• Advertising cannabis for sale is prohibited
What we don't know
• Location of stores
• Hours of operation
• Public input into licence applications
• Regulatory role of councils
• The amount of excise duty and harm minimisation levy
• Whether vaping stores can sell cannabis
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