The Abridged version:
- The Sacramento City Council is slated to vote on cannabis lounges later this month, which could mark one of the last political hurdles for the program.
- At least five local dispensaries want to open lounges, and a Midtown dispensary is already marketing itself as “Sacramento’s first cannabis consumption lounge.”
- While California opened the door for recreational cannabis dispensaries in 2018, few places exist for consumers to legally smoke or vape in public.
Legally smoking cannabis in public once was something reserved for tourist exploits in Amsterdam. Now, almost a decade after the broader legalization of cannabis in California, the city of Sacramento is on the cusp of adding consumption lounges to its lineup of cannabis businesses.
The city has been laying the groundwork for on-site consumption lounges for more than two years. In November 2024, the Sacramento City Council voted narrowly to launch a pilot program.
The council is expected to take up the topic of lounges again in the next few weeks. That could mark the final political hurdle the program needs to clear before lounges can become a reality.
Sacramento city staff is compiling a final look at where lounges would be allowed and what the business fees would look like.
The plan for legally toking it up in public arrives as drinking rates among Americans decline, especially among younger adults.
“They don’t drink, but they do consume cannabis. Maybe these are the new bars for the younger folks,” said Peter Coletto, finance director with the city of Sacramento, who is helping shape the pilot program.
How it could work
The city’s pilot program would set up two different types of lounges, those for “nonsmoking consumption” such as edible products, and lounges “all consumption,” which would include smoking or vaping products.
The pilot program already has set requirements for “odor-absorbing ventilation” and ways to prevent odors from being detectable outdoors. The lounges would be capped at 1,500 square feet. The program also would allow customers to consume only cannabis that’s purchased directly from the dispensary.
City staff is set to put zoning laws before the council that will dictate which dispensaries can add a lounge onto their business and how close the lounges can be to “sensitive uses,” such as churches, child care centers, parks and schools.
New rules could open the industry to more areas
The changes are also expected to broaden Sacramento’s cannabis zoning laws substantially for the first time in years.
“Right now we’re largely confined to former industrial areas. … There’s a big concentration in (City Council) District 2 and District 6,” Coletto said. District 2 includes much of Del Paso Heights and North Sacramento, and the city’s District 6 includes eastern parts of the city bounded by Highway 50 and Stockton Boulevard.
Staff studied how the recreational cannabis industry has rolled out since 2018 and found that it may be ready to go beyond those industrial areas.
“We didn’t see these negative impacts that were were worried about initially, so we can open up the zoning a little bit,” Coletto said.
All dispensaries eligible to apply
All of the city’s 43 dispensaries would be eligible to apply for the pilot program, according to city spokesperson Julie Hall.
The number of dispensaries that have the space to add a lounge, plus the number of dispensaries that meet the zoning requirements, could slim that number down considerably though.
Only five dispensaries said they had enough space to add a cannabis lounge, according to a city survey taken last year. Three dispensaries told the city that it would take between six and 36 months to build enough improvements on their sites to add a lounge.
If the council approves the zoning changes and business fees later this month, it would allow dispensaries to start readying their applications, Coletto said.
Who will be first in line?
The city is planning on using a “first-in-line” process to judge applications based on when they are time stamped and if they have the adequate materials in their application, such as security measures and licensing.
Dispensaries would also have to receive a conditional use permit from the city’s planning department and approval from the city’s cannabis office. Lounges likely would not be open until “late fall at the earliest,” Hall said.
One dispensary confident of success
One Midtown Sacramento dispensary already has its sights on being among the first cohort of new cannabis lounges.
Crystal Nugs was cofounded by a group of Sacramento-based family friends initially as a delivery business. The company now operates a dispensary from its bright green building at 23rd and J streets, which became the city’s first Black-owned dispensary in 2023.
A banner on Crystal Nugs website prominently describes the dispensary as the home of “Sacramento’s First Cannabis Consumption Lounge,” noting that the “lounge caters to all” with flower, concentrates and edibles, plus luxury seating and curated lighting.
“We believe cannabis culture deserves a space as elevated as its experience — The J Street Lounge is that space,” the site states.
Cofounder and CEO Maisha Bahati says she feels optimistic about the company’s plans to open a 1,500-square-foot lounge. Crystal Nugs purchased the two-story building in 2021 and has long had hopes of expanding.
“I feel pretty good about it,” Bahati said. “We already have the space, we already have the room, it’s just about us building out.”
Businesses already talking to councilmembers
She said her business and a coalition of local cannabis industry have been working with city councilmembers to discuss concerns about how the program is being developed.
For example, Bahati wanted to ensure that if a church or other sensitive use were to open nearby in the future that she’d be able to keep her cannabis lounge permits.
The coalition includes local cannabis industry names like A Therapeutic Alternative, Pocket Dispensary, Perfect Union, Kolas, Embarc and The Sanctuary. Those businesses also include dispensaries that are considering adding a cannabis lounge to their stores, according to Bahati.
For now, Bahati says she’s more focused on relieving concerns Sacramento’s leaders might have about the lounges, rather than marketing what hers could look like.
“I’m excited about it, but I know it’s going to be a rough journey,” she said. “I want to assure people that we’re trying to build this as compliant as we can, we’re taking all the risks and concerns people might have.”
Coletto said that Crystal Nugs is poised to be “one of the first ones to apply” but emphasized that all dispensaries will still have to go through the conditional use permitting process.
Isleton dispensary has offered a lounge since 2022
Deep in the Delta, the city of Isleton, population 794, is home to the only place in Sacramento County where people can legally consume cannabis in public.
The small lounge in the back of the Delta Boyz dispensary has been home to the county’s only on-site consumption lounge since 2022.
Sacramento’s city staffers have visited the Isleton lounge, as well as cannabis lounges in San Francisco, Long Beach and Palm Springs, as they develop the local program.
“It’s a little gem in the Delta that has good weed and good people,” said store manager Jax Eubanks.
She is used to seeing regulars coming in on Friday afternoons and tourists enjoying a drive down the levee roads before they stop by. It’s not uncommon to see a customer stop in the lounge by themselves and find a small sense of community, Eubanks described.
“Some guy is back there smoking a joint, and some other guy comes in, now they’re having a conversation. It has that social bar element to it, minus the alcohol, of course,” Eubanks said.
While a few times Eubanks has observed customers who “overconsume,” she said she typically sees customers come in with a designated driver or go for a long walk until they feel more able to drive. Others will stop and enjoy the arcade games for a while before continuing along their drive to Sacramento or the Bay Area.
Public health advocates warn about smoke impacts
In Sacramento, the initial pilot program passed 5-4 in 2024 amid heavy opposition about public health concerns.
Councilmember Eric Guerra held a press conference at the time arguing that the program “sets us back” and had the potential to “normalize the issue,” CBS 13 reported.
Then-Mayor Darrell Steinberg cast a deciding vote on the pilot program, expressing that he was torn between the economic benefits and the public health concerns.
Public health concerns
Those concerns remain top of mind for advocates as the council gears up for another vote on the cannabis lounges.
“Allowing on-site cannabis will expose employees, customers and other community members to secondhand smoke, which puts everyone at risk for health problems,” said Rachel Alvarez, with the Greater Sacramento Smoke and Tobacco Free Coalition.
Alvarez said she was concerned that youth, in particular, could see the marketing associated with the lounges, or that young people would be the target demographic for the lounges, which would make them susceptible to becoming “lifelong consumers.”
“The current City Council seems to be very focused on business growth (and) it’s no secret that our economy is in rough shape” Alvarez said. “They’re trying to grow Sacramento’s business community. … They seem less focused on the health implications.”
Felicia Alvarez is a reporter at Abridged covering accountability. She’s called Sacramento home since 2015 and has reported on government, health care and breaking news topics for both local and national news outlets.