D.C. shuts 50th illegal weed shop amid cannabis crackdown

Behind the scenes: The shop at 1919 18th Street Northwest near Adams Morgan was padlocked by the task force and police arrested one individual. A search warrant was issued, and police swarmed the building, carting out boxes.

• While licensed to sell medical cannabis, the Alcoholic Beverage and Cannabis Administration (ABCA) director Fred Moosally tells Axios that investigators found illegal products on the premises, including psychedelic mushrooms, a Schedule 1 offense.

Catch up quick: It's been two years since the city provided an on-ramp for weed gifting shops and newcomers to become legal medical marijuana dispensaries — often a hugely expensive, months-long process that ABCA officials say costs around $24,000 in licensing alone, plus a $16,000 annual renewal fee.

• Dozens of shops continued or opened unlicensed, while the city was criticized as being too lenient and slow in its enforcement.
• The city started escalating inspections and enforcement last year. In July, Mayor Muriel Bowser signed emergency legislation allowing a multi-agency task force that includes ABCA, the police and the attorney general to padlock unlicensed operations. The ABCA Board also has the authority to issue a $10,000 fine to each property owner.

Most recently, the city set an April 1 deadline for all businesses that received cannabis dispensary licenses to be up and legally running, or face consequences.

• ABCA says 45 businesses converted by the deadline.

By the numbers: Since padlocking operations began last year, the task force has recovered roughly:

• 530 pounds of marijuana
• 82 pounds of hallucinogenic mushrooms, plus 17 pounds of mushroom edibles
• 312 pounds of THC edibles
• 43 pounds of vape cartridges
• Nine firearms
• $142,635

Meanwhile, 17 adults have been arrested.

Stunning stat: The city has gone from under 10 medical cannabis dispensaries to over 60 in the past several months amid deadlines and enforcement.

Between the lines: Padlocking doesn't necessarily permanently close a shop. Business owners may request a hearing before ABCA's Board, which may require a remediation plan to address how they'll prevent future illegal sales.

What's next: Continued crackdowns. Moosally estimates there are up to 30 illegal shops on their current hit list, plus "a number" of businesses operating illegally online.

The intrigue: Legal cannabis retailers have been some of the loudest voices about the need to create an even playing field. Several have gone out of business in D.C., while others say they're struggling with high operational costs, curtailed inventory and illegal competition.

• "I know this is hard to believe, but now that we have 45 businesses that just came from the unlicensed market to the legal market, if they have businesses that are operating illegally around them, they will call our agency," says Moosally.

What we're watching: D.C.'s medical cannabis market hasn't seen sales above $3 million in a month since 2023, Moosally says. But things are changing: this March peaked over $3.5 million — "The highest medical cannabis retail sales in the history of the program."

• For the first 22 days of April, sales have topped $4 million, with more to go.