LA Is About to Open Cultivation Licensing to the Public. Here's What That Does to the License You're Holding.

On August 18, 2026, the Los Angeles City Council's Government Operations Committee approved a draft ordinance that would change how the City issues cultivation licenses. It now goes to the full Council for first consideration, and then to the Mayor.

If you are sitting on a Los Angeles cultivation record - active, dormant, lapsed, or one you were told was dead - this is the most consequential thing to happen to its value in years.

What the ordinance actually says

The measure is Council File 26-0301, and the draft ordinance amends Section 104.06 of Article 4, Chapter X of the Los Angeles Municipal Code. The operative sentence is short: "Licenses for Types 1A, 1C, 2A, 3A, 5A, and 7 shall be issued on a first come, first served basis in each available Community Plan Area until Undue Concentration is reached."

It also deletes subsections (e) and (f) of Section 104.06.01 entirely, which removes the older Social Equity pathway language for these non-retail license types. The Department of Cannabis Regulation recommended this in its April 30, 2026 report, noting the City's cultivation provisions had not been updated since 2018. DCR's report also states that applications for uncapped activities would be accepted on a rolling basis indefinitely.

Why this matters if you hold a record

Right now, a Los Angeles cultivation record has value largely because you cannot simply go and get one. Entry has been gated. That gate is what a buyer is paying for. Once licenses are issued first come, first served, a buyer who wants to cultivate in Los Angeles has a second option: apply. That option did not meaningfully exist before.

But it does not go to zero - and the reason is Undue Concentration

Read the clause again: first come, first served until Undue Concentration is reached, measured in each available Community Plan Area. Undue Concentration is a per-plan-area cap, and that has two consequences pointing in opposite directions.

If your premises sits in a Community Plan Area already at or near Undue Concentration, the first-come-first-served window may never meaningfully open there. New applicants get turned away. Your record stays scarce, and arguably becomes more valuable, because it is one of a fixed number of ways into that specific area.

If your premises sits in a Community Plan Area with headroom, the value of your record compresses toward the cost and time of a new application. That is a much lower number. So the honest answer to "is my license still worth anything" is: it depends entirely on which Community Plan Area it sits in. This is not a citywide question anymore. It is a map question.

Here are the actual numbers

Per DCR's cultivation Undue Concentration data as of July 7, 2026, the City has capacity for 829 cultivation licenses. 292 are spoken for through pre-applications, applications and licenses. That leaves 538 citywide still available to issue before Undue Concentration is reached.

Read that number carefully, because it cuts against the easy story. In most of Los Angeles there is a great deal of room. If your premises sits in one of those areas, a buyer will soon have a realistic alternative to buying yours, and you should price accordingly.

Eight Community Plan Areas are already at Undue Concentration and closed to new cultivation licenses: Bel Air - Beverly Crest; Brentwood - Pacific Palisades; Canoga Park - Winnetka - Woodland Hills - West Hills; Encino - Tarzana; Sherman Oaks - Studio City - Toluca Lake - Cahuenga Pass; Silver Lake - Echo Park - Elysian Valley; Westlake; and Westwood.

A second group is close enough to matter, with only a handful of slots left before they close: Northridge (4 remaining), West Adams - Baldwin Hills - Leimert (4), South Los Angeles (5), Van Nuys - North Sherman Oaks (5), Boyle Heights (6), Hollywood (6), and North Hollywood - Valley Village (7).

If you hold a record in any of those areas, you are in a genuinely different position from someone holding one in Wilmington - Harbor City (111 remaining), Sun Valley - La Tuna Canyon (50), Chatsworth - Porter Ranch (47) or Harbor Gateway (44). Same ordinance. Opposite outcome. It depends entirely on the map.

What this ordinance does not do

It does not touch storefront retail. The amended subsection applies expressly to Commercial Cannabis Activity that is not Storefront Retailer Commercial Cannabis Activity. The Social Equity language being removed sits in the non-retail section of the code. If you hold a retail license, nothing here changes your position.

Where it stands, and how fast

As of August 18, 2026, this is not law. The committee report carries the standard notation: not official until Council acts. The remaining steps are Council adoption, approval by the Mayor, and publication by the City Clerk. Los Angeles ordinances generally take effect roughly a month after publication. Realistically that puts the change weeks out, not days - but the direction of travel is now clear.

What to do now

1. Find your Community Plan Area and find out where it stands on Undue Concentration for cultivation. This is the number that determines whether you hold or sell.

2. Check your record's real status on both sides. A surprising number of operators have an active City Temporary Approval with no active State cultivation license, or an active State license with a lapsed City record. Both are fixable, and both affect value.

3. Check whether a lapsed record is refilable. Under LAMC 104.03(h), an expired license can still be refilable in certain circumstances, even where the annual application itself is gone. Plenty of people have been told their record is dead when it is not.

To be direct: if you are holding a cultivation license you are not using, sell it now

I am not writing this as a neutral observer. I represent buyers, and I am actively looking for Los Angeles cultivation licenses to bring them.

If you are holding a cultivation record you are not operating on - dormant, lapsed, or active but idle - this is the window to sell it. Not because the license becomes worthless the day the ordinance passes, but because the premium a buyer will pay is highest while applying is still not an option for them. A dormant license also costs you money every year in City and State fees, whether or not you ever grow anything on it.

If you want to know what yours is worth, send me the DCR record number and I will tell you what I am seeing on both the City and State side, at no cost and with no obligation. If the answer is that you should hold it, I will tell you that too - in a saturated Community Plan Area, holding may well be the better call.

Alan Fakheri is a commercial real estate broker in Los Angeles (DRE #02182069, KW Commercial - Larchmont Village) who works on cannabis license transactions, business sales, and compliant real estate in the City of Los Angeles. Reach him at 818.268.8000 or alan@afre.la. This article summarizes public records and is not legal advice. Confirm the status of any specific record with the Department of Cannabis Regulation before acting.