Top 5 Amendments To Watch For In Congressional Committee Next Week
by Michelle Rutter, NCIA Government Relations Manager
Every year, Congress must pass appropriations legislation to fund the government for the upcoming fiscal year. This annual budget bill, which is currently set to expire on September 30th, has been one of the only avenues by which pro-cannabis reform language can be inserted into federal law– even if only for a year at a time.
But, like most things in Washington, D.C., the appropriations process is lengthy, complicated, and chock full of procedure.
Early next week, the House Rules Committee will hold a hearing to discuss amendments to the upcoming appropriations bill that will fund the government for FY2018. The Rules Committee is used by leadership to maintain control over the House floor, and is heavily stacked in favor of the majority party (by a 2:1 ratio). Despite that, over a dozen cannabis related amendments have been filed and submitted by various members of Congress, but it is up to the Rules Committee to determine which provisions will be ruled “in order.” Let’s take a look at a few of the amendments that, if passed, could significantly affect the cannabis industry:
Rohrabacher-Blumenauer Amendment: This provision, formerly known as the Rohrabacher-Farr amendment, has been included in the federal budget since 2014. The amendment bars the Department of Justice from interfering with states’ medical cannabis laws and businesses. Those protections will expire on September 30th if this amendment is not renewed. The amendment has 12 cosponsors: seven Republicans and five Democrats.
McClintock-Polis Amendment: First introduced in 2015, this amendment would ban the Department of Justice from interfering with states’ adult-use cannabis laws and businesses. When voted on in 2015 on the House floor, the amendment narrowly failed.
Heck Amendment (1): This amendment would protect financial institutions that choose to service the cannabis industry from interference from the federal government. The provision protects banks in adult-use states, medical cannabis states, and CBD-only states.
Heck Amendment (2): The second cannabis related amendment introduced by Congressman Heck would prohibit any changes to the guidance issued by the Financial Crimes Enforcement Network titled “BSA Expectations Regarding Marijuana-Related Businesses.”
Heck Amendment (3): Similar to the second Heck amendment, this provision would prohibit the Department of Justice from revoking the guidance issued by the Financial Crimes Enforcement Network titled “BSA Expectations Regarding Marijuana-Related Businesses.”
It is important to note that in recent years, House Republicans have essentially shut down the appropriations process by not allowing any controversial amendments (including cannabis) to be ruled “in order”. Just a few months ago, the Rules Committee blocked a measure that would have allowed Veterans Affairs physicians to talk to their patients about medical cannabis in states where it’s legal. Should this happen next week, NCIA will be working closely with our allies and Members of Congress to ensure that the Senate’s version of the budget bill, which does include the Rohrabacher-Blumenauer amendment, is passed into law.
Navigating Congress and all of its procedural quirks can be stressful and difficult, but that’s what NCIA is for. Stay tuned for updates on appropriations throughout September as we continue to watch this process unfold.
Cannabis Industry Sector: Information Technology and Software
NCIA Member Since: July 2016
Tell me a bit about your background and why you launched your company?
My name is Joel Milton and I am the co-founder and CEO of Baker. I’ve spent the last 8 years in the software industry, and have been working with my co-founder and Chief Product Officer, David Champion, for that entire time. Our third co-founder and CTO, Roger Obando, has been a developer for the past 20 years.
The three of us got interested in the cannabis industry in 2014 as adult use was rolling out in Colorado. We saw an opportunity to bring our years of software expertise to the industry as it was coming out of prohibition. We knew there would be a lot of issues specific to the industry, and we saw there were few entrepreneurs with technical backgrounds trying to tackle them.
What unique value does your company offer to the cannabis industry?
We proudly boast that we are on the dispensary’s team.
The Baker team at Representative Jared Polis’s fundraiser. Glenn McElfresh (Business Development) David Champion (Co-founder and CPO) and Roger Obando (Co-founder and CTO)
When we first started, we saw vendors come to the industry to take advantage of dispensaries. They had a misconstrued image of cannabis businesses: safes full of cash, lines out the door, and that businesses couldn’t stock shelves quickly enough. As a company that only serves the industry, we understand real issues like 280e, marketing restrictions, and constantly changing regulations. Due to these misconceptions, many of the early players were charging outrageous fees for basic services (like 10 cents for a text message vs. 1 cent for ours) because few companies were willing to work with dispensaries to begin with.
Additionally, everyone in this space was competing for the same end customer – trying to get them to their dispensary, download their app, go to their website, etc. We saw a dangerous “race to the bottom” on price, and realized there was an opportunity to help dispensaries engage with their customers directly.
Today, we help more than 500 dispensaries in 14 states build their brand, connect with customers, and generate more revenue. We are on the dispensary’s team and our goal is to make them have more successful businesses. We are a true business to business cannabis tech company, and we take pride in showing our clients the ROI they see by using our platform.
Cannabis companies have a unique responsibility to shape this growing industry to be socially responsible and advocate for it to be treated fairly. How does your company help work toward that goal for the greater good of the cannabis industry?
We have been NCIA members for over a year now, and have made sure to contribute not just money but time as well. We send our regional reps to quarterly NCIA caucuses all over the country to keep a pulse on local and national initiatives to see where we can help. We also try to attend and sponsor cannabis events in the regions where we operate and beyond.
In the next month we will be attending events on both coasts, and at a few cities in between. We will also have a booth at the California Cannabis Business Conference (booth 204) if you will be there please swing by our booth or send us an email (marketing@trybaker.com) to set up a time!
We take pride in the professionalism we bring to the industry, and are constantly bringing a mainstream approach to the way we operate – from hiring people out of Fortune 100 firms into the industry, to building quality software products that’s on par with anything coming out of Silicon Valley. Our toolset is uniquely specific to help cannabis brands and retailers run better businesses. We have been approached by retailers in other industries, but our entire focus is on cannabis.
We also work with mainstream investors – many of whom are getting their first exposure to cannabis. It has been such a rewarding experience to promote the industry to influencers who can propel the industry forward with investment and leadership.
Lastly, we also are proud to have brought a lot of public and positive press to the industry. In the past year we have been featured in publications like Business Insider, Forbes, Fast Co, and dozens of others. We position ourselves as a professional company, creating jobs in our headquarters of Denver. We have 35 full-time employees and counting!
Our exposure in the mainstream media has helped millions of readers from around the country learn about cannabis in a more positive light. They can see that there is a large degree of professionalism in the industry and that it would not be a bad thing if it came to their backyard.
How do recent advances in technology, and how we use it, impact the growth and direction of the cannabis industry?
We believe this is a big industry and we have a responsibility to enhance the cannabis ecosystem – when companies cooperate, the sum is greater than its parts.
We are proud of the integrations we have with fellow members of NCIA. We work with POS companies like MJ Freeway, Green Bits, Treez, and Flowhub, as well as data companies like New Frontier (we contributed to their Report earlier this year).
Additionally, retailers across all industries have invested a lot in bringing their shopping experience into the digital age. Cannabis retail should be on par with other shopping experiences, and by providing beautiful, easy to use products, we can help make cannabis more accessible to a larger audience.
We are proud to bring retailers a modern experience that has been called the “shopify of cannabis.” We enjoy hearing stories from our clients about how our products have helped customers see that the stigmas around cannabis shopping are dissipating.
Baker at NCIA Lobby Days. Eli Sklarin (Director of Marketing) Carter Davidson (VP of Sales) Joel Milton (Co-founder and CEO) and Geoff Hamm (COO).
Why did you join NCIA? What’s the best part about being a member?
We are big believers in NCIA, it is an important group with a fantastic mission. I went to Lobby Days along with our COO, VP of Sales, and Director of Marketing. We were all impressed with how organized the experience was.
There is something special about getting the cannabis conversation started with influencers. Most staffers would be hesitant to bring it up, but if you go in-person and inspire confidence in the industry, you can watch the ball start rolling and it was very rewarding to be a part of that.
In an increasingly hostile marijuana environment championed by Attorney General Jeff Sessions, tracking of marijuana from “seed to sale” is more critical than ever. All other threats aside, if you can’t document it, you’re in trouble.
And, that’s not just at a federal level. In an effort to document total compliance and control of this rapidly-growing industry, states have taken it upon themselves to require comprehensive due diligence from all cannabis purveyors.
Forbes magazine addresses this in a recent article entitled, “Tracking America’s Cannabis Industry Through Big Data.” Citing Colorado, the article states in part, “This harnessing of an information technology to track the cannabis market is key to Colorado’s forceful march towards creating a thriving legal marijuana industry. Crucially, the state’s ability to use tracking and Big Data could provide a reference point for other jurisdictions interested in the regulatory potential offered by tracking. This ‘closed loop’ ‘seed to sale’ inventory tracking system embodies a ‘full traceability’ mode…”
The article continues, “The use of tracking as a regulatory device is expanding, operating in Oregon, Maryland and Alaska. There are other cannabis tracking companies such as MJ Freeway operating in Nevada and BioTrackTHC in Washington, New Mexico, Illinois, New York, and Hawaii. After all, tracking is part of day to day life. We track parcels and Uber drivers with our phones while retailers track us through those pesky cookies on our computers. Whatever the context, whether it is a regulator or us doing the tracking or whether it is marijuana or us being tracked, the technology is an essential part of contemporary commercial and regulatory life.”
Cannabis Barcode labels to the rescue An established staple in retail and inventory environments, barcodes/QR codes facilitate trackability. Now that message is resonating in the cannabis industry. A primer in motherboard.vice.com points out, “Walk into any licensed cannabis grow op in Colorado and one of the first things you’ll notice are the barcodes.” They point out in another article, “There are a number of advantages of having a bar code for cannabis growers, producers and retailers. The most important is proper inventory control – which is mandated, in Washington, by the Washington State Liquor Control Board. Having bar codes on inventory items allows rapid identification of specific SKUs. The likelihood of inventory quantity irregularities is greatly reduced.”
They also emphasize, “The reasoning behind implementing these cannabis surveillance systems is pretty straight forward. Since cannabis is still illegal on a federal level, the burden is on the states that have legalized weed to prove that legalization has not aided black market activity.”
Systems spring up to support tracking Regardless of what type of cannabis tracking label is used, sophisticated systems are springing up to oversee the entire process. An article in the Cannabis Industry Journal entitled “The Importance of Traceability” cites insights of Cody Stiffler of BioTrackTHC, one such system, at a Cannabis Labs Conference in 2016: “The primary goals of a traceability system, according to Stiffler, are to prevent diversion and promote public safety. Our software helps get safe products to patients and consumers in a responsible manner. BioTrackTHC’s tracking software covers everything from seed to sale, involving regulatory bodies in oversight. In the beginning of cultivation, each plant is assigned a bar code or sixteen-digit identifier.”
While “location, location, location” is the driver in real estate, “tracking, tracking, tracking” is the name of the game in the cannabis industry.
Mark Lusky is a marketing specialist who has worked with Lightning Labels since 2008.Lightning Labels uses state-of-the-art printing technology to provide affordable, full-color custom labels and stickers of all shapes and sizes, along with barcode labels and consecutive numbering. From small orders for individuals, to the bulk needs of big businesses, Lightning Labels is equipped to handle and fulfill custom label and sticker projects of all types. Lightning Labels was established in 2002 and based in Denver, Colorado.
New Member Benefit: Group Health Options – Minimal Essential Coverage (MEC)
Typically, benefits and cannabis mentioned in the same sentence refer to the qualities medicinal marijuana provides patients and those suffering from numerous maladies.
But benefits can mean so many things, for instance health coverage benefits. The hottest topic in Washington these days revolves around health benefits: repeal, replace, or just repeal. In any event the result is confusion for the employer and employee. What will be the law?
It’s interesting though, that no one is talking about the positive and creative benefits that were born during the “Obamacare” era. Minimal Essential Coverage (MEC) programs were birthed and flourished for the past 4-years. Some of the plans were and are lousy for employees… they cost $50+ per month and provided only one prevention visit to a doctor. Hardly enough. Some of the plans defy logic because you get so much coverage for so little money! So, how do you find those benefit rich plans… just turn to the NCIA’s exclusive relationship with ProducerHub’s Apex suite of MEC products.
Buy Apex products and support NCIA’s efforts to support your business and the Cannabis Industry. Apex donates money back to NCIA every time an NCIA member company buys Apex.
More of that later, something else happened along the way as “Obamacare” matured. Small and mid-size businesses used MEC benefits to attract new and more skilled employees… their businesses were strengthened by the new employees accepting the work and opportunities because benefits were being provided.
So, the better the benefits, the better the employee. Imagine, what a concept… keeping good people relies on creating and sustaining a safe and considerate workplace. Affordability is essential, and a plan that offers a RARE 4-year rate cap* requires everyone’s attention. That same plan only requires 4 employees to sign up… another RARE benefit.
As an employer in a “gold rush industry” you need to ask yourself how important is your credibility? Are you a more credible company by offering benefits? Are you more trustworthy and therefore, a better option for an employee in a competitive marketplace?
Expand the meaning of benefits for you and your employees. See and find Apex’ products, and by doing so, support NCIA’s mission.
Continuing the Momentum – Q3 #CannabisCaucus Events Unite NCIA Members During Successful Summer
by Brian Gilbert, NCIA Events Manager
NCIA and our dedicated members have been keeping busy during the Summer months, and July was no exception as our acclaimed Quarterly Cannabis Caucus event series returned with numerous editions held across the country in both new and familiar locations.
We took these opportunities to further connect with and update our network on the incredible positive energy exhibited by our members and supporters throughout the summer including:
• The 4th Annual Cannabis Business Summit, our most highly attended & well publicized event to date. Read and watch more highlights from the #CannaBizSummit here.
• The 7th Annual Cannabis Industry Lobby Days, our most impactful advocacy-focused event. This Summer, following our trip to D.C., we have seen a substantial increase in the number of co-sponsors on cannabis-related legislation we focused on in May.
Huge thanks to our nearly 900 individual supporters, 400 member businesses, 8 sponsors, 5 guest speakers, and 2 state affiliates that joined us throughout July for our Quarterly Cannabis Caucus event series. Continue on to review event highlights from our Q3 events with photo coverage from our Colorado and Midwest events, and view the full album on Facebook here.
In our first week, NCIA’s hosted our first event in Maine, and it was a smashing success! Attendees were caught up to speed on how the landscape has been developing with implementation of the adult use initiative passed last November by David Boyer, the Maine Political Director of Marijuana Policy Project.
In addition, our Washington members and supporters were joined by guest speaker Rep. Roger Goodman (D- 45th District) who provided attendees with a Washington Legislative Update.
At the end of the week, we had yet another record setting event in Colorado! Just over 200 cannabusiness professionals joined us for an inspiring evening of networking and information sharing. The event was extra special as we were joined by newly elected members of our Board of Directors; Christie Lunsford of Pro MAX Grow and Endocannabinoidology, Sean McAllister of McAllister Garfiled P.C., and Shannon Fender of Native Roots Colorado.
In our second week, we hosted our Tri-State event in Brooklyn, NY where special guest Dylan Schwartz, Candidate for New York City Council in the 51st District of Staten Island provided a New York Legislative Update and explained the history and importance surrounding his cannabis friendly candidacy. In Oregon, we returned to Portland where we hosted Jesse Sweet, Administrative Policy & Process Director of Oregon Liquor Control Commission at ecotrust once again.
In our final week, we were excited to hold our first-ever event in San Jose, CA, at our Northern California Caucus, as well as officially welcome the new Executive Director of the California Cannabis Industry Association, Lindsay Robinson! In Southern California, we moved our caucus to San Diego and Josh Drayton, Deputy Director of the California Cannabis Industry Association provided attendees with an in depth update on the current status of MAUCURSA. We concluded our Q3 #CannabisCaucus series in the Midwest with an inaugural event in Columbus, Ohio where we also officially launched our newest state affiliate, the National Cannabis Industry Association of Ohio. In addition to an optional, pre-caucus tour of member business Apeks Supercritical, attendees were also treated to hearing from State Senator Kenny Yuko (D-25th), a lead proponent of the recently passed medical cannabis legislation.
We hope you join us for our final Quarterly Cannabis Caucuses of 2017 in October! As a show of appreciation for the continued support of these community building efforts, we’re pleased to announce that we’ll be offering an exclusive early bird rate for all those who register in the next week! Secure your spot before August 24th to receive 50% off admission, this includes non-member tickets and additional tickets outside of those allotted to current NCIA members businesses. See below for a full list of dates, locations & venues:
Washington – Georgetown Ballroom – Seattle, WA – Tuesday, October 10 – REGISTER NOW
Northeast – Providence Biltmore – Providence, RI – Tuesday, October 10 – REGISTER NOW
Colorado – The Riverside – Boulder, CO – Thursday, October 12 – REGISTER NOW
Oregon – The Kennedy School – Portland, OR – Tuesday, October 17 – REGISTER NOW
Tri-State – [Venue TBD] – New York City, NY – Tuesday, October 17 – REGISTER NOW
So. California – [Venue TBD] – Los Angeles, CA – Thursday, October 19 – REGISTER NOW
No. California – Hyatt Vineyard Creek – Santa Rosa, CA – Tuesday, October 24 – REGISTER NOW
Midwest – The Robey Hotel – Chicago, IL – Thursday, October 26 – REGISTER NOW
As always a huge thanks goes out to all our sponsors, media partners, and event hosts that continue to support the growth of this thriving community and which made Q3 another success! Follow the links below to learn more about each of these amazing businesses or groups then reach out to see how they might be able to help you with your cannabis industry needs.
Granting credit has not yet become standard in the cannabis market, but as discussed in my article “Trade Credit in Cannabis,” published in the May issue of mg, I believe it will be in the future. Therefore, it is important that a company create a credit policy to define how it will manage its credit and collection processes and evaluate credit risk. Once that is accomplished, the next, and most important, step is to develop a credit application.
Why do you need a credit application?
A credit application provides basic information about a customer’s business and offers measures of protection that will increase the ultimate collectability of an account if the customer doesn’t pay. Companies in the cannabis market may aid their collection efforts by requiring all customers, even those that are on cash terms, fill out a credit application. I cannot emphasize enough how many times my firm, AG Adjustments (AGA), has been successful in recovering a client’s past-due monies because the clients took a proactive approach and obtained a well-drawn-up credit application.
The credit application is one of the primary tools available for protecting a company and controlling credit risk when extending trade credit to customers. Remember, taking a check from a customer is a form of credit. Even customers who are paying cash on delivery should fill out a credit application.
What is a credit application?
A credit application is a contract between seller and buyer. A good credit application will benefit the seller; a bad one, the buyer. Therefore, it is important to be certain the credit application, whether electronic or on paper, contains all the safeguards and guarantees available to reduce risk.
Securing a credit application does not guarantee payment, but it is one of the more significant documents to assist in making good credit decisions and ultimately collecting past-due accounts receivable and associated collection fees. The adage “the sale is not complete until the money is in the bank” is as true today as ever. A good credit application will assist in getting money into the bank.
What do companies selling into the cannabis market need to know to control credit risk?
A credit application is the first step in gathering information about potential customers. Even if customers pay in cash, the day will come when that system changes, and getting information about accounts at the start of business relationship is key. The more you know about its debtors, the better. In addition, collecting credit information will make it easier to determine exactly how much credit to extend a customer.
Never assume all information on the application is correct. Verify the information provided before granting credit. The sales department must make sure every customer fills out and signs a credit application prior to delivery of any goods or services, even if the customer is paying C.O.D.
A credit application serves two purposes: It is a data-gathering tool and a contract. As a contract, it specifies the rights and obligations of both the customer and the creditor. The application should be written in a way that provides the creditor an advantage if business relationship with the client falters. As the saying goes, “Credit is not a right but a privilege.”
Verifying the credit application
The first thing to do once an application is obtain a commercial credit report from a leading credit bureau such as Dun & Bradstreet or Experian. Many prospective customers may not have a lengthy credit history, but that will change as the cannabis industry moves forward. Contact at least three trade-credit references, as well as the applicant’s bank, to verify the existence of accounts. Be sure all references are legitimate, or at least exist if one or more are difficult to contact. Any false information on the credit application is a strong indicator the potential customer may not be reliable. If the buyer is looking for a substantial credit line, review their financials, especially a statement of cash flow. If the applicant is operating in a negative cash position, ensure they will have enough cash available to pay their debt. Limit their credit line or, at the very least, modify payment terms if it seems an applicant may have a cash flow problem.
After credit is extended
Periodic credit reviews are a necessity. Account defaults arise with existing long-term customers as well as new ones. Customer credit limits should be reviewed periodically—at minimum, once a year. Obtaining current credit bureau reports about the largest customers annually is a good idea. Stay on top of aging accounts receivable. If a customer is always sixty to ninety days past-due on part of their balance, they are only one period away from becoming a problem.
When trade credit becomes the norm in the cannabis industry, asking a new customer to fill out a credit application will become standard practice. Currently, this is not the case in the cannabis industry; nevertheless, AGA recommends companies operating in the market implement sound credit policies and processes now in order to prepare for the near future.
Sam Fensterstock is the SVP of Business Development at AG Adjustments, a leading provider of 3rd party commercial collection services and a member of the NCIA’s Finance & Insurance Committee. Sam has spent his entire business career as an entrepreneur and senior executive in the commercial credit & collection space. He has been a founder and played a key role in the dynamic growth of several leading niche commercial credit risk management companies and is considered an expert in the order to cash and credit and collection process. Prior to joining AG Adjustments, Sam was the Director of Business Development at PredictiveMetrics, a statistical based credit and collection scoring and modeling company that he helped grow and sell to SunGard (FIS) in 2011. Sam can be reached at samf@agaltd.com or 631-719-8096.
Photo Credit: Cafe Credit via Flickr, under the Creative Commons License
Video: Member Spotlight – A Therapeutic Alternative
Based in Sacramento, California, this month we meet Kimberly Cargile, director of the medical cannabis dispensary A Therapeutic Alternative, focused on holistic healing and patient support. Learn more about how her dispensary has integrated and become a part of the local community. They also offer additional holistic services such as yoga, massage therapy, sound therapy, meditation, and more.
This site uses cookies. By using this site or closing this notice, you agree to the use of cookies and our privacy policy.
Early next week, the House Rules Committee will hold a hearing to discuss amendments to the upcoming appropriations bill that will fund the government for FY2018. The Rules Committee is used by leadership to maintain control over the House floor, and is heavily stacked in favor of the majority party (by a 2:1 ratio). Despite that, over a dozen cannabis related amendments have been filed and submitted by various members of Congress, but it is up to the Rules Committee to determine which provisions will be ruled “in order.” Let’s take a look at a few of the amendments that, if passed, could significantly affect the cannabis industry: 
Baker Technologies
An established staple in retail and inventory environments, barcodes/QR codes facilitate trackability. Now that message is resonating in the cannabis industry. A primer in motherboard.vice.com points out, “Walk into any licensed cannabis grow op in Colorado and one of the first things you’ll notice are the barcodes.” They point out in another article, “There are a number of advantages of having a bar code for cannabis growers, producers and retailers. The most important is proper inventory control – which is mandated, in Washington, by the Washington State Liquor Control Board. Having bar codes on inventory items allows rapid identification of specific SKUs. The likelihood of inventory quantity irregularities is greatly reduced.”
But benefits can mean so many things, for instance health coverage benefits. The hottest topic in Washington these days revolves around health benefits: repeal, replace, or just repeal. In any event the result is confusion for the employer and employee. What will be the law?
A credit application is the first step in gathering information about potential customers. Even if customers pay in cash, the day will come when that system changes, and getting information about accounts at the start of business relationship is key. The more you know about its debtors, the better. In addition, collecting credit information will make it easier to determine exactly how much credit to extend a customer.