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Cannabis Manufacturing Gets Small Start In San Diego

Products made with cannabis concentrates sit on the shelf of Torrey Holistics...

Above: Products made with cannabis concentrates sit on the shelf of Torrey Holistics, Dec. 28, 2017.

Three San Diego businesses have secured temporary state licenses to manufacture cannabis concentrates, thanks to a special grace period granted to them by the City Council one year ago.

The businesses, Allegiance Wellness Center Inc., Humanity Products Inc. and Vista Prime Management, LLC, are all licensed for so-called "nonvolatile extraction." This method uses tools such as water, carbon dioxide or glycerin to extract concentrated oil from the cannabis plant.

Volatile extraction uses chemicals such as butane, and is more tightly regulated by the California Department of Public Health. Unsafe butane extraction has caused explosions at some illegal labs across the state.

Cannabis concentrates can be consumed with vaporizers or they can be infused into edible or drinkable products.

The city of San Diego is currently processing more than 60 applications for permits to operate "marijuana production facilities" that will cultivate, manufacture and distribute cannabis and its byproducts. These businesses have to go through an extensive review by the city's Development Services Department, and a maximum of 40 permits can be issued.

However a handful of cannabis-related businesses were granted special permission to keep operating in San Diego for two years if they held a business tax certificate prior to Jan. 31, 2017. That was when the City Council voted to "grandfather in" non-retail cannabis businesses that had been operating in a quasi-legal environment before the city had figured out how to regulate the cannabis supply chain.

Some cannabis supply chain businesses may be forced to shut down or relocate if they fail to obtain one of the 40 permits from the city before the two-year grace period expires.

Three San Diego businesses have gotten licenses to manufacture cannabis concentrates. They appear to be part of a group of cannabis businesses with special permission to continue operating in the city.

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