Dazed and Confused: “Undue Concentration” for L.A. Marijuana Cultivation

Dazed and Confused: “Undue Concentration” for L.A. Marijuana Cultivation

It’s no easy calculation in Los Angeles when it comes to cannabis cultivation.When the City of Los Angeles passed its ordinances allowing commercial cannabis businesses, the City placed limits on the total amount of licenses available in each community for each license category, based on “undue concentration.” The City made it easy to understand the “soft caps” for most of the licensing categories. For each neighborhood’s retailers (Type 10), microbusinesses (Type 12), and manufactures (Type 7) –the ratio is one license per 10,000, 7,500, and 7,500 residents, respectively. The City has even provided the exact number of licenses available on its Commercial Cannabis License Capacity Chart (“License Capacity Chart”), here.
However, the cultivation license limits are more difficult to understand. Here is how the city defines cultivation limits for Undue Concentration:
a ratio of 1 square foot of cultivated area for every 350 square feet of land zoned M1, M2, M3, MR1, and MR2 with a maximum aggregate of 100,000 square feet of cultivated area and a maximum aggregate number of 15 Licenses at a ratio of one License for every 2,500 square feet of allowable cultivated area for Cultivation (Types 1A, 1C, 2A, 3A, 4 and 5A).
After careful examination of this definition, here’s what we think the City means to do with undue concentration and available plant canopy:
On the License Capacity Chart, if you take the Total Square Feet of a given neighborhood and divide that number by 350 square feet, the result is the listed as “Cultivation + Microbusiness (with cultivation)”. For example, Harbor Gateway has 43,982,470 total square feet, which means that Harbor Gateway has about 125,664 total square feet of eligible canopy (43,982,470/350=125,664).
There can also only be 1 license for every 2,500 square feet of allowable cultivated area. Sticking with the Harbor Gateway example, 125,664 eligible square feet divided by 2,500 equals 50 potential licenses, max. However, that number assumes that all licensees will have grows no larger than 2,500 square feet, which probably isn’t the case. To that end, the City informs us that cultivation licenses will be processed on a first come, first serve basis.
The rules also stipulate a maximum of 100,000 square feet and a maximum of 15 licenses, but it is unclear whether these maximums apply to the neighborhood as a whole or to the individual licensee (who could stack up small cultivation licenses to secure 100,000 feet of canopy in aggregate). However, the initial total calculation of the eligible canopy area would be irrelevant for multiple communities if there was a maximum of 100,000 square feet total for that community. Therefore, we can assume that the 100,000 square feet should be applied per individual license, with no one person or entity holding more than 15 cultivation licenses within a given community.
All of that said, the key question remains: How many square feet can I apply for in my application? The ultimate answer is that “it depends.” No matter how much available canopy space there is in a community, the situation depends on factors like how many people apply for cultivation space, how much space each person applies for, how much space the City will grant, etc. We do know that as the City of Los Angeles grants licenses, the Undue Concentration license soft caps will become clearer.
For now, here’s a chart (with approximate numbers) to summarize how many licenses per community we will most likely see:

Community Plan Area

Square Feet of Canopy

Maximum Amount of Licenses (Actual*)

Average Canopy Space**
(sq. ft.)

Arleta – Pacoima

63,309

15 (25)

4,220

Bel Air – Beverly Crest

N/A

Boyle Heights

97,034

15 (38)

6,468

Brentwood – Pacific Palisades

N/A

Canoga Park – Winnetka – Woodland Hills – West Hills

22,392

2,799

Central City

72,563

15 (29)

4,837

Central City North

98,647

15 (39)

6,576

Chatsworth – Porter Ranch

169,165

15 (67)

11,277

Encino – Tarzana

2,422

Granada Hills – Knollwood

48,254

15 (19)

3,216

Harbor Gateway

125,664

15 (50)

8,377

Hollywood

20,825

2,603

LAX

N/A

Mission Hills – Panorama City – North Hills

38,553

2,570

North Hollywood – Valley Village

47,735

15 (19)

3,182

Northeast Los Angeles

100,725

15 (40)

6,715

Northridge

18,331

2,618

Palms – Mar Vista – Del Rey

33,528

2,579

Port of Los Angeles

N/A

Reseda – West Van Nuys

127,800

15 (51)

8,520

San Pedro

29,633

2,693

Sherman Oaks – Studio City – Toluca Lake – Cahuenga Pass

4,807

Silver Lake – Echo Park – Elysian Valley

3,028

South Los Angeles

16,453

2,742

Southeast Los Angeles

168,657

15 (67)

11,243

Sun Valley – La Tuna Canyon

222,321

15 (88)

14,821

Sunland – Tujunga – Lake View Terrace – Shadow Hills – East LA Tuna Canyon

2,291

Sylmar

66,600

15 (26)

4,440

Van Nuys – North Sherman Oaks

62,941

15 (25)

4,196

Venice

4,955

West Adams – Baldwin Hills – Lelmert

13,477

2,695

West Los Angeles

26,300

2,630

Westchester – Playa del Rey

34,770

2,674

Westlake

1,560

Westwood

N/A

Wilmington – Harbor City

248,428

15 (99)

16,561

Wilshire

4,284

*Actual maximum amount of licenses available if the City does not cap at 15 licenses.
**Average canopy space assumes that City will allow the maximum amount of licenses, and that each applicant will apply for an equal amount of canopy space.

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