Cannabis is big business in California, but companies must adhere to strict waste management requirements or risk severe fines or loss of licensure. Remaining in compliance isn’t always easy, though. Cannabis is regulated by multiple agencies each with its own requirements, and the requirements themselves are sometimes vague and subject to interpretation. Improper waste management can place a business in jeopardy, so it’s important to understand the essentials.

Cannabis Waste Management Requirements

Cannabis waste regulations can vary by jurisdiction, so it’s important to consult with all applicable licensing and regulatory agencies when establishing a cannabis business plan.

At the state level, cannabis waste is governed by three agencies:

  • The Bureau of Cannabis Control (BCC), which oversees commercial cannabis licenses for medical and adult-use cannabis.
  • CalCannabis, a division of the California Department of Food and Agriculture (CDFA) that oversees commercial cannabis cultivation and manages the state’s track-and-trace system.
  • The Manufactured Cannabis Safety Branch (MCSB), a division of the California Department of Public Health (CDPH) that regulates cannabis manufacturing.

In addition, hazardous cannabis waste falls under the jurisdiction of the Department of Toxic Substances Control (DTSC) and Environmental Protection Agency (EPA).

As a general overview, most commercial cannabis businesses are required to heed the following requirements:

  • Cannabis must be rendered “unusable and unrecognizable” prior to disposal. The rendering process is what legally distinguishes cannabis goods from cannabis waste. Cultivators in California are exempt from the rendering requirement, but manufacturers and retailers must render all waste.
  • Cannabis goods intended for disposal must remain on the licensed premises until rendered and must be stored separately from other cannabis goods.
  • Stored cannabis waste must be secured in a locked or monitored receptacle that is accessible only to the licensee, the licensee’s employees, and an authorized waste management provider.
  • Hazardous cannabis waste streams must be stored in labeled drums according to the individual waste profile.
  • The cannabis waste must be weighed on site prior to removal and again when it reaches its final destination. All disposal information must be entered into the state’s track-and-trace system.
  • As a business owner, you’re responsible for your waste streams from cradle to grave, meaning that you must abide by all applicable laws when disposing of your waste, storing your waste, and removing your waste from your site. Even when the waste is sent to the landfill, you’re still technically responsible for it unless you opt for recycling.
  • Cannabis waste management is subject to all standard waste requirements in the state. That would include Division 30 of the Public Resources Code and Title 14 of the California Code of Regulations (Chapter 3.1).

More details are available from the Bureau of Cannabis Control, California’s lead agency for cannabis regulation.

Common Cannabis Waste Violations

The following are the most common waste violations in the cannabis industry:

  • Dumping hazardous wastes down the drain.
    • This is a problem with both hazardous and non-hazardous waste. Many counties require a permit for wastewater to be drained into the sewer. Monterey and LA County both prohibit cultivators from dumping their reverse osmosis (RO) and brine waste into the sewer.
  • Not having—or having inadequate—hazardous waste manifests.
    • All hazardous waste streams must be shipped on a hazardous waste manifest, and each generator in California must have an EPA ID number. Only certified personnel can sign a hazardous waste manifest. GAIACA offers a 4-hour certification class.
  • Failing to properly train employees in hazardous waste management, handling, and emergency preparedness.
  • Lack of, or improper, labeling.
    • All waste containers must be properly labeled. Hazardous waste with the hazardous waste yellow label can be stored at the facility for 90 days. Storing hazardous waste is a violation that comes with hefty fines. A complete label with accumulation date must be on every drum.
  • The presence of open containers of hazardous waste on site.
  • Failure to comply with hazardous waste generator regulations.
  • Failure to have hazardous waste determinations on file.
    • Copies of executed Hazardous Waste Profiles have to be on file at the facility for 3 years.
  • Improper consolidation of waste from other nearby facilities.
    • Waste consolidation (from different originating facilities) is illegal and is considered treatment.

While hazardous waste violations are the most common examples of improper waste management (and the easiest to overlook), all types of cannabis waste violations can have serious consequences.

How Do Cannabis Agencies Track Improper Waste Management?

The important thing to emphasize is that the DTSC, the BCC, and other regulatory bodies do keep a close watch on the waste management practices of cannabis businesses. Any potential or suspected instances of improper waste management are investigated immediately.

How Hazardous Waste Violations Are Tracked

In California, each business must obtain an EPA ID number. For EPA-recognized waste generators, all hazardous waste must leave the premises on a hazardous waste manifest. The manifest is how the EPA tracks:

  • What the generator produces
  • Whether or not the waste material was properly transported over the highway per DOT regulations
  • Where the waste was discarded (the end disposal facility)

All hazardous waste disposal facilities are regulated by the state and national EPA and must adhere to certain permitting requirements, such as how to treat the waste, what waste they can treat, and how much volume they can treat. The permitted facility is required to report any hazardous waste violations they encounter from waste generators.

Even if your manifests are perfect, you still need to ensure that everything on site is up to code at all times. The EPA will often send surprise inspectors to the facilities of hazardous waste generators, and you don’t want to be caught with improperly labeled drums or open containers.

How Cannabis Waste Violations Are Tracked

Cannabis waste regulators use a track-and-trace system to monitor accumulated waste. The generator’s job is to accurately record the weight into the system, and the weight is also recorded prior to removal and again at the landfill. When the regulatory agency discovers discrepancies or anomalies in the reporting, this may indicate a hazardous waste violation and trigger an investigation.

For example, let’s say that you’re a cultivator, and you harvest 2,000 pounds of product: 1,000 pounds of flower, and 1,000 pounds of trim. You record the 1,000 pounds of trim as waste material in the Metrc tracking system. Later on, your waste management provider comes to remove the waste. They start by weighing the waste and providing a certificate of destruction. Once they take the waste to its final destination, it’s weighed again by the facility and documented for the official record.

Ideally, the weight should be about the same each time it’s recorded. But if the BCC discovers that you listed your weight as 1,000 pounds in the Metrc tracking system, and then the waste management provider and landfill recorded the weight as 600 pounds, this may trigger an investigation. The weight is expected to remain within a 5% range each time it is recorded.

The Penalties for Improper Waste Management

Canna-brands can face a number of serious penalties for improper waste management. In California, the following infractions can result in a fine of $501 to $1,000 per violation:

  • Failure to dispose of cannabis waste according to the approved terms of the licensee’s waste management plan.
  • Failure to store cannabis waste in a secured waste receptacle or secured area on the licensed premises.
  • Failure to transport cannabis waste to an approved landfill, composting facility, digestion facility, or chip-and-grind facility.
  • Failure to maintain accurate, comprehensive records of cannabis waste accumulation, storage, and disposal.

While that might not sound too serious, it’s important to note that California businesses have been fined up to $25,000 per day, per violation, for improper storage and removal of solid cannabis waste. And the fines can be especially devastating if hazardous waste is involved. Mismanagement of hazardous waste can carry a fine of $70,000 per day, per violation.

Can You Lose Your Cannabis License Due to Waste Violations?

It is absolutely possible for a cannabis company to lose its license over improper waste management. In fact, loss of licensure is a more common penalty than monetary fines. We have rarely seen companies get fined for improper rendering or weight discrepancies, but we have seen companies lose their license.

According to the BCC:

“The applicant may be denied a license for any violations of law related to the operations of the commercial cannabis business or for any violations of law related to licensure.”

In other words, you may be denied a license renewal if the regulating agency determines that you have violated the terms of your licensure.

Cannabis licenses must be renewed every year, so it’s extremely important to remain in good standing with the BCC, CalCannabis, or whichever organization regulates your piece of the industry.

Most often, minor violations will incur a fix-it ticket. The BCC or other regulatory body might send a stern letter and schedule an on-site audit with an inspector. If you take the necessary steps to fix the problem (such as by remedying any weight discrepancies or re-rendering your waste according to BCC recommendations), you may remain in good standing.

However, if you fail to properly heed the recommendations, or if you’re caught with a more serious violation (like fraud) or repeat offenses, you may have your license pulled. That’s why it’s so important to work with an experienced cannabis waste disposal provider.

For serious hazardous waste violations, you’re unlikely to lose your license (as these types of violations aren’t policed by the cannabis industry), but you could face major fines or even jail time.

Can You Appeal a Cannabis Waste Violation?

It is possible to appeal a violation, but it’s not easy and it often requires costly legal assistance.

Appealing a Hazardous Waste Violation

Often, the most effective route is to try and negotiate a reduced fine in exchange for corrective action. For instance, we once had a client in Alameda County that had incurred major hazardous waste fines. They were storing aqueous acid waste in steel drums (which is a huge violation, as acid eats through metal). The acid spilled onto the floor toward the loading dock. If not for the quick actions of the employees on site, the waste would have gone into the sewer, incurring a potential $2 million fine.

Despite the averted crisis, the company was still caught with a slew of other violations including unlabeled drums, a manifest signed by an uncertified person, and hazardous waste stored for more than 90 days. All in all, the company incurred $55,000 in fines from the DTSC. By hiring a legal team and also hiring us to help them bring their facility up to code, they were able to reduce their fines to just $22,000.

Just note that it can be difficult to negotiate or appeal with the DTSC. As a self-funded agency, they earn much of their revenue through collections. So while you may be able to get your fines reduced, it’s unlikely that you’ll have them eliminated altogether. Even with a rock-solid negotiation and all of the necessary fixes, you’ll usually be responsible for at least half of the initial fine.

Appealing a Cannabis Waste Violation

Cannabis regulation is still a new industry, and so the processes aren’t as clear-cut or well-defined. As a result, there is no formal appeals process for waste violations, nor is there even a uniform definition as to what constitutes a violation. In a market where generators are allowed to self-haul, self-treat, and self-manage their waste, there’s still a tremendous amount of gray area.

For example, nowhere in the regulations will you find a clear definition of what constitutes “unusable and unrecognizable.” The BCC offers only the following directive in Section 5054 of its cannabis regulations:

“To be rendered as cannabis waste for proper disposal, including disposal as defined under Public Resources Code section 40192, cannabis goods shall first be destroyed on the licensed premises. This includes, at a minimum, removing or separating the cannabis goods from any packaging or container and rendering it unrecognizable and unusable.”

Unlike in some states, California does not offer specific instructions or guidelines for rendering, and the different regulatory agencies don’t always agree as to what satisfies the definition. During one particular audit in Los Angeles, we worked with inspectors from both the CDPH and the BCC. We used our automatic rendering vehicle to shred plant waste and vape pens. The BCC approved the entire rendering process, but the CDPH rejected the job, saying that the vape pens required manual rendering.

Because it’s still not an exact science, you’ll usually be given a chance to correct any honest errors without having to file a formal appeal. You’ll receive a warning letter, a fix-it ticket, or another indication that changes need to be made. Then your best bet is to work with a skilled cannabis waste management provider to address the violations promptly and remain in good standing.

How to Avoid Cannabis Waste Violations in the First Place

The best way to avoid a costly waste violation is to work with a trusted cannabis waste management provider. This offsets much of the liability and provides you with some level of third-party protection and reassurance. The regulations are comprehensive and complex, and you’re far more likely to run into trouble if you manage your waste on your own.

GAIACA is one of the only waste management companies that use body cameras. Whether we’re at a client’s facility to render waste or simply pick it up, the whole process is captured on video. So if a regulatory agency ever has a concern about a waste rendering or disposal, we have the footage on file. We also weigh the waste on site and provide all necessary certificates to keep our clients in compliance.

Our processes are the culmination of extensive experience and direct collaboration with all of California’s cannabis regulatory bodies. We know the expectations of each agency, and we work as tireless advocates for the cannabis businesses we serve.

However you decide to proceed, remember that proper cannabis waste management is essential. Even honest oversights can place your business in serious jeopardy, so make waste disposal compliance a priority. It’s a small inconvenience when you consider how high the stakes are.