A California lawmaker has introduced a bill that would allow the state’s licensed cannabis consumption lounges to sell freshly prepared foods and beverages and host live events. The measure, Assembly Bill 374 (AB 374), was introduced last week by Democratic Assembly Member Matt Haney.

Under California law, cannabis consumption lounges are not allowed to sell freshly prepared food to their patrons. A rule change adopted in November 2022 allows lounges to offer prepackaged food and beverages and for customers to bring their own freshly prepared items on a limited basis, but the businesses themselves are denied the opportunity to serve most non-infused products to their customers.

Haney’s bill would allow consumption lounges in California to sell freshly prepared food and drinks and to host live entertainment events. In the Netherlands, more than 700 cannabis cafes, often referred to as coffee shops, draw 1.5 million visitors per year, according to information from Haney’s office. Allowing the state’s consumption lounges to operate under a similar business model would give the businesses new economic opportunities and could serve as a draw for tourists and locals to visit struggling downtown business districts.

“Lots of people want to enjoy legal cannabis in the company of others. And many people want to do that while sipping coffee, eating a scone, or listening to music,” Haney said in a statement. “There’s absolutely no good reason from an economic, health, or safety standpoint that the state should make that illegal. If an authorized cannabis retail store wants to also sell a cup of coffee and a sandwich, we should allow cities to make that possible and stop holding back these small businesses.”

The bill would not permit cannabis consumption lounges to sell alcoholic beverages. Additionally, Haney noted that the proposal is limited to licensed consumption lounges and does not permit other types of enterprises to enter the legal cannabis market.

“To be clear, we’re not saying that coffee shops should be allowed to sell cannabis,” Haney said. “We’re saying that cannabis shops should be allowed to sell coffee. It shouldn’t be illegal for an existing cannabis business to move away from only selling marijuana and instead have the opportunity to grow, thrive and create jobs by offering coffee or live jazz.”

Bill Offers New Opportunities For Consumption Lounges

Supporters of the legislation say that Haney’s bill would give cannabis consumption lounges opportunities to grow and serve their customers. Although he has not taken a position on the legislation, Nikesh Patel, the director of San Francisco’s Office of Cannabis, said that new sources of revenue could help businesses survive in a competitive and highly regulated industry.

“We hear from our operators that it’s a very challenging time to be in the cannabis space,” said Patel. “And some of the reasons are reduced foot traffic on the streets and higher tax burdens on cannabis businesses. There is still competition with the illicit market, and the cost of flower as a whole has gone down, and that’s had a trickle effect on the entire supply chain.”

Haney’s bill does not automatically permit cannabis consumption lounges to serve food and drink or host live events. Instead, local governments would also have to approve the change for the businesses in their jurisdictions. City leaders in West Hollywood, Palm Springs and Cathedral City have already passed such ordinances, according to Haney’s office. In San Francisco, Supervisor Rafael Mandelman plans to introduce legislation on Tuesday to allow the city’s consumption lounges to take advantage of Haney’s proposal.

“I think those (current) restrictions don’t make sense and they’re not helpful to the lounges,” Mandelman said. “And I think that in terms of making those more enjoyable spaces and building out our local cannabis industry, tourism and economic developments — for all those reasons, it makes sense to take advantage of what Assemblyman Haney is putting forward.”

Before it can become law, AB 374 must first be passed by the California Assembly and state Senate before heading to the office of Democratic Governor Gavin Newsom for his consideration. Although he is unsure if the governor will sign the bill if he is given the chance, Haney said that hopes Newsom will give California’s consumption lounges a new way to succeed in a challenging business environment.

“California’s small cannabis businesses are struggling,” said Haney. “Issues like over-saturation, high taxes, and the thriving black market are hurting cannabis businesses who follow the rules and pay taxes.”

“I hope that the governor, as a small-business owner himself in the past who has been involved in the hospitality industry, can now see this as an opportunity,” he added.

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Tennessee’s first bar and restaurant to serve THC opened today in the Germantown neighborhood located in Nashville. The restaurant gets away with it as the THC in the products is derived from hemp, making it legal at the federal level, according to the company.

Buds & Brews is the state’s first brick-and-mortar THC-friendly bar and restaurant located at 1246 3rd Avenue in Nashville. “Buds and Brews features a menu of upscale bar fare paired with our own line of delicious cannabis-infused sauces,” the website reads.

In other words, the restaurant and bar will serve all-American type dishes, but also provide over 25 THC-infused condiments for common dressings like ketchup, honey mustard, ranch dressing, steak sauce, but infused with hemp-derived THC in 1-5 mg servings.

The restaurant will also feature recently released Cannabis-Infused Beverage Coolers and sauces that contain hemp-derived THC. WKRN reports that you can choose things like “Smokey Margarita” or “Bloody Maryjane.”

While cannabis will be at the bar to consume, the products are divided into individual pouches and jars.

The coolers come in pouches in the following flavors: GrapeApe, LemonHaze, and Sweet Tea OG Kush. The sauces, on the other hand, are made with locally grown and extracted hemp-derived THC. Each sauce contains 5 mg of THC in each jar.

Restaurant patrons can choose from 28 sauces with locally grown and extracted hemp-derived THC. The culinary sauce line includes ingredients such as olive oil or the company’s own specialty barbeque sauce.

Mike Solomon is part owner of Buds & Brews, along with part owner Dalton Crow, and discussed what patrons can expect with local media.

“You can get chicken tenders and then you can order some THC ranch,” Solomon told WKRN. “What is infused is the condiments. We have the 25 most common used condiments from ketchup, honey mustard, ranch dressing, steak sauce.”

In addition, all products are made in Tennessee by Craft Cannabis products.

“Everything is 1 to 5 milligrams a serving, which is very small so you can try a bunch of things,” Solomon said. “A rookie, a novice or an experienced cannabis person can have a fun time here portion controlled micro-dosing.”

“I’m excited to make my footprint and teamed up with some great guys to do it,” said Dalton Crow. “We want to appeal to everyone. We want everyone to try and come give us a shot and try us out.”

For now in Tennessee, only hemp-derived THC can be served at establishments like Buds & Brews. An adult-use bill in the state recently failed to gain ground. The bill, called the “Free All Cannabis for Tennesseans Act,” is effectively dead after its sponsor, state House Representative Bob Freeman, pulled the legislation from the floor.

The Free All Cannabis for Tennesseans Act would have authorized the possession of cannabis and concentrates for adults who are 21 years of age or older and “transfer of marijuana or marijuana concentrate between adults, in permitted amounts, without remuneration,” and the “cultivation of up to 12 marijuana plants for adults.”

It also would have opened up medical cannabis options for minors under the age of 18 by authorizing “a parent, guardian, or conservator to administer a marijuana product, excluding any combustible product, to a minor, over whom the parent, guardian, or conservator has legal authority.”

Until then, fun establishments like Buds & Brews have figured out how to operate within the boundaries of the law.

Buds & Brews will hold an official grand opening on August 20.

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