May 8, 2020
USDA approves hemp plan for Massachusetts
The US Department of Agriculture announced Thursday that it approved Massachusetts’ hemp regulatory plan, as well as the plans for five more tribal proposals. Massachusetts is the 17th state to have its plan federally accepted. The Miccosukee Tribe of Indians of Florida, the Winnebago Tribe of Nebraska, Cheyenne and Arapaho Tribes, Rosebud Sioux Tribe, and the Pala Band of Mission Indians also had their plans newly accepted. The USDA has been signing off on hemp plans on a rolling basis since the crop and its derivatives were federally legalized under the 2018 Farm Bill. Last month, Florida and Kansas joined the list of states where proposed regulations for hemp were approved. The department said in a new notice that it “continues to receive and review hemp production plans from states and Indian tribes.” While the agency released an interim final rule for a domestic hemp production program last year, industry stakeholders and lawmakers have expressed concerns about certain policies it views as excessively restrictive. The USDA announced in February that it will temporarily lift two provisions that the industry viewed as problematic. Those policies primarily concern testing and disposal requirements. The department declined to revise the THC limit, however, arguing that it’s a statutory matter that can’t be dealt with administratively. Agriculture Secretary Sonny Perdue has said on several occasions that the Drug Enforcement Administration influenced certain rules, adding that the narcotics agency wasn’t pleased with the overall legalization of hemp. Meanwhile, the Food and Drug Administration is still in the process of developing regulations for CBD. It sent an update on its progress to Congress in March, explaining that the agency is actively exploring pathways to allow for the marketing of the cannabis compound as a dietary supplement and is developing enforcement discretion guidance.
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A group of investors says a Canadian cannabis producer misled them when it said it was acquiring a UK-based agricultural company that could “almost immediately” start exporting hemp and CBD products to the European Union. Afederal lawsuit filed in New York Thursday alleges that the representations Sundial Growers, Inc. made on January 2019 were “grossly exaggerated and materially misleading.” The lawsuit filed on behalf of a handful of investment groups says Calgary, Alberta-based Sundial told investors the company it was acquiring, Bridge Farm, had a “hemp cultivation license” that would allow them to be “first to market” in exporting to the EU, thus giving them a “stronghold in Europe’s nascent cannabis market.” Based on those representations, the plaintiffs invested more than $4 million in Sundial before its initial public offering. But, the lawsuit says, it turned out Bridge Farm did not have the necessary licenses to cultivate or export hemp and CBD to the EU. Sundial trades on the Nasdaq as SNDL. The lawsuit seeks monetary damages to be determined by a jury, “but no less than $4 million.”
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For Massachusetts Cannabis Control Commission Chairman Steven Hoffman, the COVID-19 pandemic has brought several concerns relating to the marijuana industry: first, the health and safety of employees, but also the long-term viability of small businesses that were just getting started. “These are relatively new businesses, many of them are owned and operated by new and not particularly well-financed entrepreneurs,” said Hoffman, who is among the panelists speaking during a webinar being hosted by NJ Cannabis Insider and Advance 360 and titled “Cannabis and COVID-19: Where Does America Go From Here? presented by Duane Morris.” At the May 13 event, the conversation will focus on medical marijuana, legalization, and the hemp and CBD industries during the coronavirus pandemic, while also looking ahead at the Nov. 3 national elections. Audience members will be able to submit questions ahead of the event, which starts at 1 p.m., and can purchase tickets, which cost $8.50, at advance360.com/cannabis-insider-live. As chair of the CCC, Hoffman and other Massachusetts marijuana regulators have been flexible as the pandemic has stretched on. The commission itself is working remotely. Since March, the commission has made changes to try and ease the burden on cannabis businesses and medical patients, allowing medical dispensaries to offer curbside pickup, allowing patients to renew their registration via telehealth methods and allowing the recreational market to support the medical market via wholesale transfers. In Massachusetts, recreational marijuana businesses have not been deemed essential business by Gov. Charlie Baker and have been forced to close while medical dispensaries can still operate. Massachusetts is the only state with legal marijuana that has shut down recreational stores.
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Top officials at the independent agency that oversees the Massachusetts marijuana industry say they’re confident they can safely reopen recreational pot stores if Governor Charlie Baker reverses his emergency order forcing the businesses to close amid the coronavirus pandemic. Cannabis Control Commission chairman Steve Hoffman told reporters after the agency’s monthly meeting Thursday that he believes Massachusetts marijuana shops can operate safely by employing curbside pickup, appointment-only shopping, and other similar measures adopted by retailers that have remained open (including medical marijuana dispensaries overseen by the commission). Hoffman said he “wants it known” that the commission is prepared to monitor the facilities and enforce state rules, including around social distancing, should they reopen. And in his strongest comments yet on the controversial cannabis shutdown, he noted that Massachusetts is the only state where marijuana is legal to have completely closed its recreational (or “adult-use”) industry. Marijuana firms are ineligible for federal bailouts, because the drug remains illegal under US law. “It is unfair that Massachusetts adult-use operators are the only ones that are shut down across the country and are not eligible for any kind of federal assistance,” Hoffman told reporters during a virtual press conference. “I have no concerns whatsoever that we can operate this business safely. I think we’ve demonstrated that we can do so on the medical side of the business... [and] I think there’s absolutely no reason we can’t do exactly the same thing on the adult-use side.”
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May 6, 2020
Top Minnesota Lawmaker Unveils Long-Delayed ‘Best’ Marijuana Legalization Bill In The Country
It was mid-February when Minnesota House Majority Leader Ryan Winkler (DFL) pledged to introduce what he’d called “the best legalization bill in the country” within the coming weeks. Shortly after, the state plunged along with the rest of the country into the global coronavirus outbreak, and marijuana reform was put on ice. Now, as states begin taking steps toward normalcy, Winkler has finally revealed the promised bill, introduced on Tuesday with 33 cosponsors. “Our current priority is responding to the COVID-19 pandemic,” he said after filing the legislation, “but after the town halls and discussions around this issue, we still wanted to put a strong bill forward. As we look to come out of this crisis as a better, stronger Minnesota, we need to continue working toward legalizing cannabis for responsible adult use.” At 222 pages, the bill is an ambitious attempt to address some of the most salient issues around cannabis legalization in 2020, and it reflects an awareness of the challenges encountered by other states that have already legalized. It would prioritize social equity and diversity in industry licensing, try to limit cozy corporate relationships and outlaw unregulated adulterants in marijuana products. The bill also sketches a vision for what Minnesota’s legal cannabis landscape might look like: generous personal possession limits, home cultivation, on-site consumption at licensed businesses and events and a focus on craft cultivation. Leili Fatehi, campaign manager for Minnesotans for Responsible Marijuana Regulation, told Marijuana Moment the legislation was the result of months of hard work with Winkler’s staff. Unlike many other states, Minnesota does not have a system to allow citizens to put initiatives on the ballot, so going through the legislature is the only path for legalization. “We’ve been working with Majority Leader Winkler and his team for nearly a year now to advance conversations in and out of the Capitol,” she said. “Today’s introduction of a comprehensive, equity-focused cannabis legalization bill is a big step for Minnesota and all Minnesotans who know we can responsibly legalize and regulate.”
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Tuesday, Minnesota House Majority Leader Ryan Winkler, DFL-Golden Valley, introduced legislation that would legalize the adult-use of cannabis. According to the Minnesota House of Representatives, the legislation is the result of months of public discussions on how to responsibly legalize and regulate cannabis. "We made a commitment to introduce legislation this session, and we wanted to follow through on that commitment," said Majority Leader Winkler. "Our current priority is responding to the COVID-19 pandemic, but after the town halls and discussions around this issue, we still wanted to put a strong bill forward. As we look to come out of this crisis as a better, stronger Minnesota, we need to continue working toward legalizing cannabis for responsible adult use." The bill includes the following items: Creates a regulatory structure focused on developing micro-businesses and a craft market, Provides for expungement of most cannabis convictions, Provides for a limited allowance of home grow, Requires testing and labeling of products, Restricts packaging based on dosage size, Provides funding for public health awareness, youth access prevention, and substance abuse addiction and treatment, Provides grants, loans, technical assistance and training for small business, Uses best practices from other states to account for negative externalities.
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On Tuesday, Massachusetts State Senator Diana DiZoglio chaired a Zoom hearing to consider her bill for a Bay State version of the federal Paycheck Protection Program (PPP). The legislation would give cannabis operators and other small companies in Massachusetts access to loan funds denied them under the federal measure. Turns out that DiZoglio’s hearing wasn’t the only Zoom event that day to reflect on how cannabis companies are responding to the economic threat of COVID-19. During a separate online media briefing hosted by the Cannabis Information Project, topics ranged from veterans’ loss of medical cannabis due to adult use closures; to the resurgence of the illicit marijuana market; to the challenges the patchwork of different state regulations pose. In the case of neighbors New York and New Jersey, for instance, two dramatically different sets of criteria for access to medical cannabis are separated by ... a river. And ultimately such state-vs.-state and federal-vs.-state differences take an economic toll, speakers agreed. “The decision to limit recreational sales in some states, as well as the limits in curbside pickup in others, has hampered the industry’s ability to be an instrumental economic engine at a time when our country needs it the most,” pointed out Linda Greene, who is owner and CEO of Anacostia Organics. That message fell on the sympathetic ears of nine other industry professionals, who included other company executives like Greene, a cannabis pharmacist and a certified cannabis educator. That educator, Heather Allman, underlined the medical benefits of cannabis by introducing herself as a multiple sclerosis sufferer. Until she embarked on a medical cannabis course of treatment, Allman said, she was confined to a wheelchair and subjected to a regimen of 25 daily medications.
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It took almost two years for Massachusetts marijuana company T. Bear, Inc., to receive approval to commence operations, which finally came down on March 20, recounted owner and CEO Angela Brown. That approval authorized the East Wareham company to start operations on March 24, which happened to end up being the day an order from the governor shut down businesses deemed non-essential, including marijuana companies. “Just one day before we were able to make our first sale, we were shut down,” said Brown on Tuesday, testifying before state lawmakers in support of a bill that would offer a Massachusetts version of the federal Paycheck Protection Program, or PPP, amid the COVID-19 pandemic. Brown said her company was forced to furlough its whole team. “All I can do now is wait, with no income and no revenue,” she said. “And while I wait, I still pay my rent, my lenders, my utilities and my health insurance for my furloughed employees.” Gov. Charlie Baker in March issued an order that shut down non-essential businesses starting March 24. While medical marijuana companies are allowed to operate during the pandemic, adult-use marijuana businesses have been shuttered since. The order has been extended multiple times, and now has an end-date of May 18. The Joint Committee on Community Development and Small Businesses met virtually Tuesday to hear testimony on two bills, S. 2564, An Act to support MassMakers, and S. 2643, An Act establishing a Massachusetts Paycheck Protection Program (PPP) for businesses ineligible for the comparable federal PPP. While the PPP bill would assist several different industries that have been left out of the federal PPP, the majority of the conversation during Tuesday’s hearing was centered around recreational marijuana. “We can’t keep having cannabis be the odd business out," said Caroline Pineau, the owner and CEO of Haverhill Stem and an economic empowerment applicant. “Governor Baker said liquor stores can stay open yet closes down cannabis. This arbitrary reasoning further disproportionately impacts the entire industry, an industry that has demonstrated we can safely operate with proper social distancing, appointment only and online ordering." Pineau reiterated that cannabis businesses like hers have payrolls, taxes, licensing fees, mortgages and high insurance premiums. But because marijuana is still federally illegal, marijuana businesses have been left of economic relief measures. “What am I supposed to do,” asked Pineau, who told the committee she invested millions into her business while doing everything by-the-book. Business owners repeated many of the same points: Massachusetts is the only state with legal marijuana that has shut down adult-use sales amid the pandemic, and that the state is not benefitting from tax revenue with these businesses shuttered. Without the bill’s passage, the future for small businesses in the state’s marijuana industry could be grim, some predicted
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May 6, 2020
Most California marijuana industry legislative priorities likely dead for the year due to COVID-19
Count the California marijuana industry’s legislative agenda among the victims of the coronavirus. Although the state Assembly reconvened on Monday after the entire legislative session was suspended in mid-March because of the pandemic, the state Senate won’t return until May 11. And it’s clear there is only one major priority for Assembly members: handling the COVID-19 fallout. That’s left cannabis industry advocates confronting the political reality that they’re unlikely to make much headway – if any – this year, especially with a pared-back schedule for lawmakers and a tight time frame for passing legislation in the coming weeks. “If State Assembly members are pushed to choose five or six bills out of the 10 or 15 they usually run, it doesn’t look like cannabis is going to be at the top of their priority list,” said Jerred Kiloh, president of the United Cannabis Business Association. “I don’t think any of us feel like a lot is going to happen this year.” Legislative advocate Max Mikalonis, at Sacramento-based K Street Consulting, said he received word May 1 that a key measure cannabis businesses were hoping to push this year – Assembly Bill 1948, an MJ tax reduction measure by Oakland Democrat Rob Bonta – won’t receive a committee vote this year before an Assembly deadline. Not only that, but there are even serious logistical hurdles between the Assembly and Senate – such as their differing calendars – that make it less likely that bills such as AB 1948 or other marijuana industry priorities will be heard or voted on. The coronavirus, in effect, has transformed the legislative session into one not about systemic progress for cannabis companies but about survival and maintaining the status quo. “It really is a time of curtailing and managing expectations,” Mikalonis said, noting that cannabis has rightfully taken a “back seat” to the more immediate problem lawmakers must deal with: the coronavirus and the state’s response to it. Mikalonis said the state is looking at a revenue shortfall that could easily run into the tens of billions of dollars, and part of the problem now is chronological.
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Leaders of chambers of commerce, marijuana companies, and other groups that are ineligible for federal coronavirus business relief funds are pleading with Massachusetts legislators for financial assistance, saying their organizations otherwise face imminent failure. The leaders testified Tuesday at a virtual hearing of the Legislature’s joint committee on community development and small businesses. The committee met to consider a bill by its chairwoman, Senator Diana DiZoglio, that would extend millions of dollars in forgivable loans to state businesses and nonprofits ineligible for the federal Paycheck Protection Program. The federal program is designed to help small businesses cover payroll, mortgages, utilities, and other expenses while they weather closures or disruptions related to the COVID-19 pandemic. But it excludes marijuana operators, because the drug is illegal under federal law, plus certain nonprofits such as chambers of commerce and trade groups. “I’ve heard from so many small businesses and nonprofits who tried to apply for federal loans or grants but were denied due to eligibility requirements,” DiZoglio, who represents the North Shore, said following the hearing. “We filed this legislation to try to fill some of those gaps left by the federal program and assist our small business community by creating parity across the board.” Business leaders testified that trade groups and chambers of commerce are vital institutions whose members are relying on them to help navigate the unprecedented changes brought on by the virus. Allowing them to fail, they argued, will only hold back the state’s eventual economic recovery. Mark Iannuccillo of the Greater Newburyport Chamber of Commerce told lawmakers the bill could decide the business group’s fate. “We’ve [only] collected about 10 percent of our dues, all of our events have come to a grinding halt, and the future of our organization remains uncertain," he testified. Similarly, numerous marijuana entrepreneurs testified that being excluded from federal aid, combined with Governor Charlie Baker’s decision in late March to shutter the recreational pot market as a “nonessential” industry, has been devastating. They also highlighted a depressing irony: Their firms pay far more into government coffers than other companies, yet are ineligible for government payouts.
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