California Will Allow Amsterdam-Like Cannabis Cafes

Marijuana businesses will be allowed to serve food and have live music performances as a way to attract more customers.

Marijuana dispensaries in California will be allowed to sell food and nonalcoholic beverages, as well as host live events on their premises, under legislation that Gov. Gavin Newsom signed on Monday that paves the way for full-scale pot lounges in the state.

The bill, which was backed by celebrities like Whoopi Goldberg and Bill Maher who own marijuana businesses, is seen by the cannabis industry as a significant boost for legal shop owners, who say they have struggled to keep up with hefty taxes and stiff competition from illegal marijuana outlets.

Several other states already allow dispensaries to serve hot food and nonalcoholic beverages on site, according to the Marijuana Policy Project. California has the most cannabis consumers in the nation, though, and demand for cafes is so great in the state that some businesses have tried workarounds in West Hollywood, which has been called “the Amsterdam of the Far West.”

Last year, Governor Newsom vetoed a previous version of the bill, concerned that it would undermine the state’s smoke-free workplace protections. But he encouraged the author of the bill — Assemblyman Matt Haney, Democrat of San Francisco — to try again with a bill that addressed those concerns.

The version that the governor signed on Monday included a provision requiring that employees of the cafes be given information about the hazards of secondhand smoke and be permitted to wear masks.

Mr. Haney said the legislation was a much-needed innovation that would create jobs, increase revenue and attract tourists.

“This is the future of legal cannabis consumption,” he said. “People want to consume cannabis with others. They want to be a part of the culture and community of cannabis, and California should lead on that.”

Mr. Haney said he became involved in the issue after meeting with owners of legal cannabis retail shops in his district who felt their growth was stymied by the state’s rules.

Unlike dispensaries, a lounge or cafe offers a place for customers to stay and smoke. But until now, legal marijuana outlets in California have been prohibited from offering even a bottle of water for sale.

“That’s irrational and arbitrary and misguided and is empowering the illegal illicit market,” Mr. Haney said.

Critics argued that the legislation would make public smoking more acceptable, giving the tobacco industry an opening to make a case for its return to communal settings.

“We have a culture that has been built over decades in California, due in large part to passage and successful implementation of smoke-free laws in places like bars and restaurants and public spaces,” said Jim Knox, the California managing director of the American Cancer Society Cancer Action Network.

“Right now, marijuana use is beginning to eclipse tobacco use,” he added, “and we need to make sure that our smoke-free policies are maintained and enhanced, not chipped away at.”

Mr. Knox called the changes in the latest bill mere window dressing, and said they underscored the danger of secondhand smoke and subverted the initiative that legalized cannabis in California. Passed by voters in 2016, the Adult Use of Marijuana Act included the stipulation that marijuana could not be smoked anywhere that people were prohibited from smoking tobacco.

When Mr. Newsom was lieutenant governor, he was the highest-ranking state official to back the recreational marijuana initiative.

He explained in a signing message on Monday that he vetoed last year’s cannabis cafe bill because it did not provide enough safeguards for workers, and changed his position this year because of the additional safety measures in the new bill. But he warned that he may reconsider allowing cannabis cafes if local governments do not ensure that businesses comply.

“While I am signing this bill, any future measure that diverges from this tailored approach will not be looked upon favorably,” Governor Newsom wrote.

The bill signed on Monday takes effect next year. It gives local governments the authority to decide whether to allow cannabis cafes within their borders, and to issue and require permits for them.

Cannabis smoke is on the state’s list of chemicals known to cause cancer or reproductive harm. But because it is a restricted substance at the federal level, research and public awareness of its effects have so far been limited, said Dr. Michael Ong, a professor in medicine and health policy and management at the University of California, Los Angeles.

“We know it’s not the same as tobacco smoke, there are different chemicals,” he said. “But just because they’re different, doesn’t mean that they’re better.”

Dr. Ong is also the chairman of the Tobacco Education Research and Oversight Committee, which advises the California Department of Public Health and opposed the bill.

“If you’re burning it,” he said of marijuana, “you’re going to create the same type of chemicals that are in tobacco that are linked to cancer, lung issues, respiratory infections and cardiovascular issues.”

Supporters of the new law say cannabis lounges keep secondhand smoke in contained areas where customers have chosen to partake.

Governor Newsom’s signing was celebrated on Monday in West Hollywood, a city of 35,000 in Los Angeles County that has a high concentration of cannabis dispensaries and lounges.

“West Hollywood is kind of the Beverly Hills of weed,” said Scott Schmidt, the executive director of Emerald Village, which markets the city’s cannabis industry. “We have these amazing destinations, lounges, celebrity-owned dispensaries.”

Those lounges have been coming up with creative ways to provide food and drinks, like having customers order items that are prepared in an adjacent building and are delivered with a separate bill. The new law will let current owners skip the workarounds and expand their businesses.

“It’s definitely groundbreaking, and it makes perfect sense,” said Jay Handal, 70, the operating partner of The Woods WeHo, an upscale lounge that features private cabanas, a koi pond and a garden. Among its owners are Mr. Maher, Woody Harrelson and John McEnroe.

When the bill takes effect, Mr. Handal said, he plans to serve cappuccino and pastries.