California Marijuana Surety Bond

Every California cannabis business applying for or holding a state commercial cannabis license is required to post a $5,000 cannabis surety bond with the Department of Cannabis Control (DCC). California operators may also be required to post additional surety bonds at the local city or county level, with amounts that vary by jurisdiction. The state-level $5,000 bond covers all license types: cultivation, manufacturing, distribution, retail, microbusiness, and testing.

 

We have been writing surety bonds since 1971. If you are facing this requirement, call us at 800-333-7800 or request a free quote online. Cannabis bond regulations are fairly new and constantly changing, so feel free to reach out to us regarding the latest underwriting and pricing policies that apply to your specific situation.

 

California's Cannabis Regulator: The Department of Cannabis Control

California's commercial cannabis program is regulated by the Department of Cannabis Control (DCC). This is important context because the regulatory structure changed substantially in 2021. In July 2021, under SB 158 and AB 141, California consolidated three separate cannabis regulators into one. The Department of Cannabis Control now combines the functions of:

• The Bureau of Cannabis Control (BCC), which previously regulated retailers, distributors, microbusinesses, and testing labs
• The Manufactured Cannabis Safety Branch of the California Department of Public Health (CDPH MCSB), which previously regulated manufacturers
• CalCannabis Cultivation Licensing of the California Department of Food and Agriculture (CDFA), which previously regulated cultivators

If you see older guidance referencing BCC, CDPH MCSB, or CalCannabis as the regulator for your license type, that guidance predates the July 2021 consolidation. Today, all commercial cannabis licensing and enforcement runs through DCC.

 

Who Needs a California Cannabis Bond?

Every applicant for and holder of a California commercial cannabis license must post the $5,000 state bond. This includes:

• Cultivators growing cannabis for commercial sale
• Manufacturers processing, extracting, and producing cannabis products
• Distributors moving cannabis between licensees
• Retailers selling cannabis to consumers, including storefront and non-storefront delivery
• Microbusinesses performing multiple activities under a single license
• Testing laboratories

The state-level bond protects the State of California by covering the costs the state could incur if it must destroy cannabis or cannabis products as a result of a licensee's violation of state law. The bond runs to the Department of Cannabis Control.

 

How Much Is the California Cannabis Bond?

The state-level bond face amount is $5,000. This is a relatively small bond compared to other states, reflecting that the bond is designed to cover product destruction costs rather than the full financial responsibility for the licensee's operations.

 

What you actually pay for the bond is a small annual premium, and for a bond of this size the underwriting is straightforward in most cases. Cannabis bond regulations are evolving, so call us at 800-333-7800 for the latest pricing.

 

Local Cannabis Bonds: City and County Requirements

Beyond the $5,000 state bond, many California cities and counties impose their own cannabis bond requirements as a condition of local commercial cannabis permits. Local bond amounts vary widely. Some examples we have written:

• City of Coalinga: $25,000
• Yolo County: $10,000
• Various other cities and counties: $5,000 to $25,000

If you are operating in a California jurisdiction that requires a local cannabis bond, both the local bond and the $5,000 state DCC bond are required. Visit our jurisdiction-specific California cannabis bond pages or call us at 800-333-7800 to confirm what applies to your specific city or county.

 

Statute and Regulator

California's commercial cannabis program is governed by the Medicinal and Adult-Use Cannabis Regulation and Safety Act (MAUCRSA), codified in Division 10 of the California Business and Professions Code. Implementing regulations are adopted by the Department of Cannabis Control in Title 4, Division 19 of the California Code of Regulations.

 

The DCC consolidation that combined BCC, CDPH MCSB, and CDFA CalCannabis took effect in July 2021 under SB 158 (Budget Trailer Bill) and AB 141. The previous three-agency structure is no longer in effect.

 

What Underwriting Looks Like

For the $5,000 state bond, underwriting is generally straightforward. As a general rule, bonds over $10,000 typically require a credit check on the company owners, and at the $5,000 level the bar is lower. For larger local bonds, expect a credit check and possibly basic financial documentation.

 

Cannabis bond underwriting standards are evolving across the country, so reach out to us at 800-333-7800 for guidance specific to your situation.

 

California Cannabis Bond FAQs

How much is the California state cannabis bond?

$5,000. This is the state-level bond required by the Department of Cannabis Control for all commercial cannabis license types.

Who is the obligee on the California cannabis bond?

The Department of Cannabis Control (DCC), which since July 2021 consolidated the functions of the former Bureau of Cannabis Control, CDPH Manufactured Cannabis Safety Branch, and CDFA CalCannabis.

What statute requires the bond?

The Medicinal and Adult-Use Cannabis Regulation and Safety Act (MAUCRSA), codified in Division 10 of the California Business and Professions Code.

Do I also need a local cannabis bond?

Many California cities and counties require their own cannabis bonds for local commercial cannabis permits, in addition to the $5,000 state bond. Local amounts vary. Check with your city or county, or call us at 800-333-7800 and we will confirm.

Did California change its cannabis regulator?

Yes. In July 2021, under SB 158 and AB 141, California consolidated three separate cannabis regulators (BCC, CDPH MCSB, and CDFA CalCannabis) into the new Department of Cannabis Control (DCC). The DCC now handles all licensing and enforcement.

How long does it take to get a California cannabis bond?

For the $5,000 state bond, we can typically issue same-day for applicants with reasonable credit. Larger local bonds may require a bit more underwriting time. Call us at 800-333-7800.

What does the California cannabis bond cover?

The state bond is designed to cover the costs the state could incur to destroy cannabis or cannabis products in the event of a licensee violation. Local bonds vary in scope by jurisdiction.

 

Get Your California Cannabis Bond Today

California has the largest commercial cannabis market in the country, and the bond structure (state plus local) requires getting the details right for your specific operation. We have been writing surety bonds since 1971 and we work with the carriers writing both the state DCC bond and the major local cannabis bonds across California. Call us and we will tell you exactly what bonds you need and what they cost.

 

Get a free quote online or call us at 800-333-7800. For broader cannabis bond context across other states, see our national marijuana and cannabis surety bond page.