On November 8, 2016, Proposition 64, also known as the Adult Use of Marijuana Act, passed by a vote of 57% to 43%, legalizing the sale and distribution of cannabis in both a dry and concentrated form. Adults are allowed to possess up to one ounce of cannabis for recreational use and can grow up to six live plants individually or more commercially with a license.

In 2016, in response to Proposition 64, State Treasurer John Chiang set up a working group to explore access to financial services for legal marijuana-related businesses operating in California, as access to banking services has been a problem due to the additional burdens mandated by the Financial Crimes Enforcement Network (FinCEN) on financial institutions to assure that any marijuana related business clients are in compliance with all state laws. In January, 2018, Los Angeles had no licensed retailers; the closest cities with licensed retail sales were Santa Ana on January 1 and West Hollywood on January 2.