Best Practices for Cannabis Companies and Consumers During COVID-19
In this time of national crisis, the cannabis industry has come together in a continued commitment to ensuring the health and wellbeing of the public. Cannabis companies have donated personal protective equipment to first responders, hired workers laid off in other industries, and some businesses have even adapted some of their manufacturing capabilities to produce hand sanitizer. As this pandemic has affected every aspect of our lives, we must all do our part to flatten the curve. We are working with state health officials and medical and public health professionals to ensure continued safe access to cannabis medicines and products. To this end, we are providing information to help keep you healthy and ensure safe and responsible cannabis use.
What can the industry do to keep our communities safe?
Industry has been proactive in implementing social distancing measures in accordance with guidelines issued by the Centers for Disease Control (CDC) to ensure the health and safety of our communities, including those most vulnerable to COVID-19.
Proactive measures include:
Increased sanitation and safety measures pursuant to regulations set by the Occupational Health and Safety Administration and local health departments.
Screening employees for symptoms of illness.
Limiting customers and employees in stores, and to the extent allowed by local law conducting transactions through delivery and curbside pickup.
Provide additional or distinct store hours for high-risk groups, like customers over the age of 60.
Calling on cannabis authorities to reduce medical caregiver and patient application fees to limit travel by vulnerable members of our community.
What can cannabis consumers do to stay safe?
(1) Consult with a medical professional before consuming cannabis if you are experiencing one or more of the symptoms of COVID-19.
(3) Do not share joints, pipes, vapes, or other products shared mouth-to-mouth.
(4) Avoid group consumption and follow social distancing guidelines.
(5) Get cannabis from licensed and regulated sources.
(6) Cannabis patients and consumers should consult with medical professionals and CDC guidance to identify the safest methods of use.
(7) If possible, consider choosing non-pulmonary methods of cannabis for consumption
(8) Don’t spread false information about cannabis as a cure or treatment for COVID-19
Important Note from the International Association for Cannabinoid Medicines (IACM):
“There is no scientific evidence that individual cannabinoids – such as CBD, CBG or THC – or cannabis preparations protect against infection with the SARS-CoV2 virus or could be used to treat COVID-19, the disease produced by this virus… Please do not pass on false information that is circulating on the Internet [about cannabis preparations and cannabinoids as a cure or treatment for the SARS-CoV2 virus/COVID-19 disease].”
Webinar Recording: In the Weeds – Cannabis Advocacy from the Statehouse to Capitol Hill
Watch this recent webinar from March 31 for a lively discussion about how to leverage your company, customers, and industry partners to achieve your state, local, and federal advocacy goals. Whether cannabis is already legal in your state or on the path to being so, learn the advocacy basics to ensure the industry’s, and your company’s, long-term success.
This panel of industry experts discuss:
– What types of activities and interactions with government officials trigger lobbyist registration requirements;
– Best practices for forming coalitions to achieve your advocacy goals, whether at the ballot box or in the statehouse;
– How to form a PAC or other advocacy vehicle; and
– What types of gifts to public officials may be off-limits because of the nature of your cannabis business.
Speakers
Moderator: D. Michael Stroud, Jr.
Partner at Nossaman LLP
Michael Stroud, Jr. brings more than 15 years of legal and legislative policy expertise in border security, infrastructure, national security, tax, transportation, trade, state and local municipal government, and water and wastewater utility. He has advised clients on federal campaign and lobby laws, gift rules, ethics compliance and investigations. Michael has also led efforts on appropriations legislation to obtain legislative changes to advance clients’ interests in the cannabis industry.
Amber Maltbie
Partner at Nossaman LLP
Maltbie is a campaign finance and election law attorney who advises clients in the cannabis industry, including trade associations, private, and publicly traded companies. She advises them on the permissibility of making contributions at the state and local level, preparing and filing campaign finance reports, tracking and notifying public officials who have received client gifts. She has helped develop a banking relationship and facilitated getting its PAC banked. She also advises on support and promotion of ballot measures and legislative advocacy. Amber’s practice covers all 50 states.
William Powers
Partner at Nossaman LLP
William Powers focuses his practice on political law and campaign finance issues. Drawing on his decade-long career in government, including as a top enforcement official at the Federal Election Commission (FEC), Bill helps clients navigate laws related to campaign finance, lobbying, ethics, gift and gratuities and pay-to-play. His clients include companies and nonprofits at the cutting edge of their industries, and he brings a collaborative and flexible approach in helping them achieve their advocacy goals in elections, the legislative arena, and the ballot measure and initiative process.
Meet The Team: Madeline Grant – NCIA’s Government Relations Manager
by Madeline Grant, NCIA’s Government Relations Manager
It’s funny how things just happen… one day, like any normal day, I was working the lunch shift at a restaurant called Carolina Ale House in Columbia, South Carolina. At first, I was worried about how much I would make in tips that day, as anyone with experience in the service industry can relate to, but then I started chatting with one of my tables… small talk, really. I told them how I was a sophomore at the University of South Carolina studying journalism and mass communications with a focus in public relations and a minor in women and gender studies. One man asked, “Well what do you want to do after college?” A question I thought about often but never had an answer to. He handed me his business card and asked if I was interested in politics. A few days later, I reached out, interviewed with the firm partners, and successfully scored the internship.
As I entered the political realm, I knew close to nothing but had a desire to learn as much as possible. Growing up, I was never really introduced into the world of politics as my parents didn’t say much about it – it was a whole new world to me! I attended caucus meetings, sat in the Senate and listened, followed legislation pertaining to their clients, researched, etc. My boss walked in one day and said he had an interesting project for me: to research and find everything I can about medical cannabis. I discovered so many fascinating miracle stories such as the effectiveness of medical cannabis for children with epilepsy. Seeing the great benefits and possibility, I kept thinking: why is this classified a Schedule 1 substance?
Fast forward to the classic “college graduate in search of a job” situation. I moved back home to Frederick, Maryland and started as an intern on Capitol Hill. After two months of interning, I landed a job on Capitol Hill and fell passionately in love with health issues (every staffer that went the legislative route had their assigned issues to become experts on). I began to learn more about cannabis and the detrimental effects of its Schedule 1 status.
Cannabis being classified as a Schedule 1 substance deems it to have a high potential for abuse, no currently accepted medical treatment use, and lack of accepted safety for use under medical supervision. Because of this classification, we can’t fully explore the medicinal benefit that it can in fact offer.
As I started taking more meetings with cannabis advocates, lobbyists, and patients, there was one significant group that stuck with me: a group of mothers and children with debilitating chronic diseases. The mothers were there to advocate on behalf of their children who significantly benefited from CBD oil. They told me a story about a family that uprooted their entire lives for their epileptic child because CBD was the only medicine that was working to reduce the seizures. On that day, I realized how important cannabis is for patients and how it truly can make an unlivable life livable. And that was JUST CBD. Can you imagine what we could gain from the whole plant? If we had the ability to research every single component of the plant, we could begin to know the full, true potential of medical cannabis.
The Schedule 1 status of marijuana hinders research and that needs to change, but thankfully, I can help.
As the Government Relations Manager at NCIA, I passionately lobby for those patients and businesses. I’ve been at NCIA for nearly three years and slowly but surely I’ve seen a significant change in the stigma associated with cannabis on Capitol Hill. It is my job to educate members of Congress, Hill staffers, and the public on all issues the cannabis community faces. This can include anything from cannabis business getting access to banking to educating members on the injustice the war on drugs had on Americans. My job is to educate and tell your stories which I do with great honor. I’m proud to represent you and what you do in the cannabis community.
As we are at home, I would love to meet with you virtually!
As I am unable to be on Capitol Hill right now, I want to use my time to compile your stories to forward to Hill offices, so please reach out if you are able and willing to tell your story. Stay safe and healthy.
Update On the Prospects of Federal Relief for the Cannabis Industry
by Michelle Rutter Friberg, NCIA’s Deputy Director of Government Relations
The last few weeks have been difficult for everyone, and most people are justifiably concerned about what the future holds for their health, safety, and livelihoods. This is certainly the case in the cannabis industry, so we wanted to provide an update about where things stand regarding cannabis businesses and federal relief.
As the debate over the most recent federal coronavirus aid package was raging, NCIA and our allies were working tirelessly to urge members of Congress to make legal cannabis businesses eligible for loans and direct payments. A coalition of trade groups also sent a letter to congressional leadership and key committees specifically asking them to include cannabis businesses in consideration for loans through the Small Business Administration.
Unfortunately – but understandably – lawmakers were more concerned with providing assistance to all Americans in need as quickly as possible, and did not incorporate many requests related to special issues and disproportionately impacted industries. However, we received a lot of positive feedback from a number of congressional offices.
As things currently stand, individual cannabis industry employees who filed taxes last year should be eligible for the direct household payments included in the latest relief legislation as long as they meet the standard criteria. It may also be possible for states to use some of the funds they receive from the federal government to support the industry. But for the time being, cannabis businesses are not eligible for SBA loans or direct federal funding.
This battle is far from over though. Congress is in recess until the end of April, at which point efforts will commence on approving the next stage of coronavirus relief funding. Rest assured, NCIA’s dedicated Government Relations and Public Policy team is working night and day to make sure that the cannabis industry is included in the next round of funding so that we can continue to provide our communities – particularly medical cannabis patients – with the safe and reliable access they need. In addition to pushing for SBA loans and direct funding eligibility, we are also exploring ways to remedy some of the other financial problems caused by outdated federal policies, as well as urging state governments and regulators to continue to allow some form of cannabis access for the duration of the pandemic response.
At a time when cannabis businesses are being increasingly recognized as a vital component of public health and economic well-being, they deserve to be treated fairly and have access to the same benefits other businesses are receiving. We will keep you posted on any developments, and please contact your members of Congress to respectfully request that they explicitly include the cannabis industry in future federal aid packages.
Committee Blog: Working With Your Local Government as a Cannabis Processor
If you want to open and operate a regulated cannabis business, there’s no avoiding local government. Every state grants different amounts of power to towns and cities, with some allowing localities to ban cannabis businesses outright, and others simply giving them the same power over time, place, and manner of operations that they have for other businesses. But since cannabis can be a hot-button issue, a proposal to open a cannabis facility often attracts far more attention than opening any other type of business.
To help NCIA members and other cannabis entrepreneurs navigate local government, we at the State Regulations Committee have launched a series of blog posts, with each taking a close look at a different type of cannabis license. Last month, we published our first post, “Working With Your Local Government as a Cannabis Cultivator.”
Today, we’re moving one step down the supply chain and talking about cannabis processors (sometimes also called manufacturers or infusers). Since state programs vary widely, with some licensing cannabis processors independently and others combining processing with cultivation (or even a single vertically integrated license), we will be focusing on the operations rather than the licenses themselves. If you’re seeking a combined license, be sure to read the blog for each activity your business will be allowed to engage in — while there is some overlap, there are also some major distinctions in how different operations can most effectively interact with municipal officials, and you will need to be well-versed in answering questions unique to each phase of your business.
ECONOMIC IMPACT
Like the three rules of real estate being “location, location, location,” the three rules of economic development are “jobs, jobs, jobs.” When proposing a new business in a town or city, local officials are going to want to know how many jobs it will bring, as employment can put money directly into the hands of their constituents and have ripple effects throughout the local economy.
In addition to the raw number of jobs your business will create, it’s also important to highlight the qualifications for those positions. Processing facilities often need to have highly qualified individuals with PhDs or other certifications to manage production processes, and officials will be happy to see the salaries that come along with such positions. Entry-level jobs, such as working production lines, are also worth talking about — even though they have lower salaries than someone with a doctorate, it’s usually much easier to hire local talent for these positions. Any commitment to hiring locally as much as possible is usually a big plus to politicians. Additionally, be sure to mention how much these new employees will add to the local economy, through all the typical living spending they will do.
Setting up and maintaining your facility will also have a major economic impact, especially in smaller communities. If you’re constructing a building to suit, get estimates from your contractors about the jobs your project is supporting, and let officials know how much you’re investing in the build-out. If you’re moving into an existing space, you’ll almost certainly be doing significant renovations to meet the state’s strict safety standards, which is also worth talking about. Towns and cities that are struggling economically will often be very happy to see unused commercial space become occupied, especially if those properties are being improved. If possible, also identify local contractors (like electricians) or suppliers (like lumberyards) you will use for construction.
Finally, there are direct payments to the local government. While officials love to see any sort of economic development, they still have services to provide and a budget to balance, and will want to know what the municipality will be receiving directly. Calculate your building’s expected property taxes, both on an annual basis and 5-10 years out — since cannabis licenses are usually very difficult to re-locate, emphasize that you are in it for the long haul. Be sure to understand your states’ tax structure, and know whether there are any local taxes that the town will receive, or if towns that host cannabis licensees receive any portion of state tax revenue.
PUBLIC SAFETY
The top public safety issue in local officials’ minds when it comes to cannabis processing is almost surely to be butane fires and explosions. This is for good reason — while hydrocarbon extractions can be very safe and effective when done properly, when done improperly they can be incredibly dangerous. City councilors or fire chiefs may have read some of the many headlines about butane-related accidents over the past few years, and it’s up to you to address these concerns directly and honestly. Of course, before diving into these conversations, check to see if the municipality or county has already banned such extraction methods, as some state laws allow local control in this area.
If you’re not planning to perform hydrocarbon extractions at your facility, be sure to tell that to your local officials. They may not realize that there are many other types of cannabis extracts that do not present such safety risks, such as CO2 extracts (carbon dioxide is not flammable, and similar processes are used for decaffeinating coffee) or bubble hash (which uses only cold water). If you have zero interest in ever using hydrocarbons in your facility, putting this agreement into writing may make local officials even more comfortable.
If you do plan to perform hydrocarbon extractions, educating officials on the risks and safety measures is paramount. Most states have extensive regulations on how extraction labs must be set up, which you can email or print out for meetings to demonstrate what you’ll need to comply with. Since the vast majority of butane-related accidents have come from illegal labs with makeshift equipment, show officials the equipment you’ll be using, emphasizing the price and professional quality. The manufacturers may even have fact sheets or other information you can share to demonstrate the safety of their equipment. As you educate officials on your methods and equipment, be sure to keep open lines of communication with the fire chief and building inspector, who will have the most expertise and authority on this aspect of public safety.
Beyond the processing-specific concerns about fires and explosions, all cannabis businesses will have to deal with officials’ concerns about theft. These may be particularly acute for processors since your end products have a much higher value-to-weight ratio than raw cannabis plants. To address these concerns, explain the security requirements in state laws and regulations, and any areas where you are going above and beyond what is mandated. Things like external security cameras and floodlights can both protect your own business and your neighboring community, making a cannabis business a net gain to public safety.
COMMUNITY IMPACT
Once economic development and public safety have been considered, local officials will wonder about the broader community impact of your cannabis business in areas like odor or traffic. This is an easy topic for processors, as they arguably have the smallest impact of any type of cannabis operation.
Processors are generally much smaller than cultivation facilities, and since they’re not full of growing cannabis plants, they also have much less odor to address. Unlike a dispensary or retailer, processors are not open to the public, so town planners won’t need to worry about an influx of traffic. Once you explain how you’ll be operating, local officials should be able to rest easy knowing that to an outside observer, your business will be virtually indistinguishable from a commercial kitchen or light manufacturing facility. If there are still concerns about odor, inform them that modern odor mitigation technology can completely eliminate any odor from leaving your facility.
GOING FURTHER
Once you’ve explained what you’d like to do and how you think your facility would fit into the local community, the conversation isn’t over — it’s just beginning! If the local government needs more time to consider your proposal, then it’s good to keep in close touch and address any additional concerns they have as they arise. If the local officials are already comfortable with your business and are welcoming it into their community (or if your state law doesn’t give local officials the power to stop you from opening up), it’s still great to build that relationship and keep an open dialogue.
Elected officials usually need to know a little bit about everything, but don’t have the bandwidth or in-house expertise to go very deep on most subjects. That’s where you, someone working full-time in the cannabis industry, come in — you almost certainly know more about state laws and regulations than they do, which is a great opportunity for you to serve as a resource. If you hear about changes in the law or proposed bills that could impact their town or city, send over news articles or bill text to help keep them informed.
Once you’re open, it’s always great to offer tours of your facility. This will help officials gain first-hand knowledge of what you actually do, and in municipalities where legal cannabis is new, it can help dispel negative stereotypes and demonstrate how professional you and the rest of the regulated cannabis industry are.
Be sure to stay tuned for future installments in this series, where we will be addressing other cannabis license types. Our next blog will focus on retail.
Welcome to NCIA Today – tune in for our latest episode!
Host Bethany Moore, NCIA’s Communications Manager and host of NCIA’s weekly Podcast ‘NCIA’s Cannabis Industry Voice‘ brings you an in-depth look at what is happening across the country in federal cannabis policy reform and with NCIA.
Off the top, Bethany discusses NCIA’s response to the COVID-19 pandemic, including postponing NCIA’s Cannabis Caucus event series originally scheduled throughout the month of March.
We also check in with NCIA’s Director of Media Relations, Morgan Fox, to hear some of the recent highlights in the news surrounding cannabis policy reform.
Bethany gives a summary of the key findings from the Illicit Market Summit held in Boston in late February. We also check in with NCIA’s Executive Director and Co-founder Aaron Smith to hear more about the industry and NCIA’s response to COVID-19.
Webinar Recording: A Spring Federal Policy and Government Relations Update
In this webinar from the morning of Friday, March 27 at 10:00 AM MT, NCIA’s Director of Public Policy, Andrew Kline, presents an update focused on federal cannabis policy issues taken up by NCIA’s Policy Council, including vaping illnesses, highlights of the findings from the Illicit Market Summit, and comments to be submitted to the DEA and NIDA. We also explore the COVID-19 responses across the United States.
Michelle Rutter Friberg, NCIA’s Deputy Director of Government Relations, shares information about how to stay politically active on behalf of cannabis policy reform while still practicing physical distancing during the COVID-19 pandemic. We explore the impact that COVID-19 is having on small cannabis businesses, plus an update on the action and movement we’ve seen in Congress, including a recent letter sent regarding Small Business Administration loans for cannabis businesses.
Speakers
Michelle Rutter Friberg
Deputy Director of Government Relations, National Cannabis Industry Association
Michelle Rutter Friberg is deputy director of government relations for the National Cannabis Industry Association. Prior to working for NCIA, Michelle was a research analyst at a government affairs firm in Washington, D.C., where she analyzed and tracked legislation on numerous issues. Michelle graduated from James Madison University in 2012, receiving her Bachelor of Arts degree in Political Science with a minor in History. During her studies, she held a year-long internship with Virginia House of Delegates member Tony Wilt (R). There, she communicated with constituents, businesses, and government officials alike, facilitating meaningful conversations. Michelle was also a member of a pre-law fraternity where she planned events and hosted social functions that sought to encourage long-lasting professional and personal relationships with members. A native Virginian, Michelle currently resides in the Washington, D.C. neighborhood of Capitol Hill.
Andrew Kline
Director of Public Policy, National Cannabis Industry Association
Andrew Kline is NCIA’s Director of Public Policy. In this new role established in early 2019 at NCIA, Andrew leads NCIA’s substantive public policy efforts, striving to prepare and protect the state-legal cannabis industry. He will also lead NCIA’s Policy Council, a group of NCIA members focused on influencing federal and state public policy. Kline most recently served as President of the National Association of Cannabis Businesses (NACB), the first self-regulatory organization for the high-growth cannabis industry. At the NACB, Andrew led the creation of national standards for the state-legal cannabis industry, oversaw its standards governance board, and led day to day operations and strategic planning. Kline has a deep and celebrated background in public policy, law enforcement, and coalition creation/management. He is renowned for his ability to create solutions to complex domestic and global public policy issues that appeal to both private and public constituencies.
A Message For Our Members About COVID-19
As the coronavirus pandemic becomes more severe and containment measures increasingly disrupt our normal lives, I’m sure many of us share the same concerns. Will my loved ones and I be safe and healthy? What will happen to my job or business? What does the future look like?
In periods of such uncertainty, I always look to family. Not just my own, but my NCIA family – our staff and valued members who have stood with us through so many challenges. I know that together, we can all get through any struggle.
Perhaps just as importantly, I rely on NCIA’s core values to guide me in difficult times.
First and foremost, we have a responsibility to promote the health and safety of our communities by doing whatever is necessary to halt the spread of the virus.
For the past several days, NCIA’s staff has been working remotely in Washington, D.C., Denver, and California. And we are proudly advocating for federal relief for the industry, still pushing for Congressional reforms as much as possible under the current limitations, and continuing to build inclusive coalitions across the country.
And we are educating state policymakers on the need for consumers, especially patients, to obtain clean and tested cannabis from legitimate sources for the duration of the coronavirus response. NCIA and our allies are reaching out to state governments, urging them to declare cannabis businesses “essential” as early as possible and to take measures to facilitate safe access. You can help us by personalizing this template letter and sending it to your governor.
We understand the frustration and fear that many of our members may be feeling as we move forward into unknown territory. However, our industry is used to weathering the worst of storms and thriving in the harshest environments. The number one priority for everyone should be to minimize the duration and impact of this horrible situation that is costing lives.
As such, we are urging all our members to do the following, as applicable to you or your businesses:
Please strictly adhere to all federal, state, and local health guidance. This is essential for slowing the spread of the virus as soon as possible.
Prioritize patient access. At a time when the healthcare system is already overburdened, it is vital for our most vulnerable neighbors to be able to get the medicine that works best for them.
Limit in-person retail operations to maximize social distancing and utilize alternative service options. We should try to go above and beyond official guidance, as well as encourage things like delivery, online ordering, drive-thru, and curbside pickup where available.
Implement additional cleaning and sanitary practices at every level. This industry is already a great example of cleanliness, but we can always do better.
Encourage telework to the greatest extent possible. There are many ways to make this easier in the modern workplace, and it is quickly becoming the norm during the pandemic.
If you can, please consider contributing to local efforts to assist those most in need in your communities. Coronavirus is affecting everyone, but some are feeling the impact much more than others. Generosity and compassion will help us all get through this together and come out stronger.
In order to protect the safety of our staff, event partners, and members, we have postponed our 10th Annual Cannabis Industry Lobby Days — originally scheduled for May — to September 15-17. We are committed to providing the value embodied by the affected events to our members later this year, and in the meantime, we will be creating new digital opportunities to learn, network, advocate, and make your businesses stand out.
We continue to monitor all our other events including the Cannabis Business Summit in San Francisco, and will be in touch in the days ahead with any updates.
NCIA is confident that the industry will rise to this occasion and continue to grow and thrive. Because that is exactly what we do best! We persevere and overcome obstacles that seem insurmountable. And we assure you that NCIA will continue to represent the industry in our nation’s capital and offer support to help you get through the weeks and months ahead.
In health and unity,
Aaron Smith
Executive Director and Co-founder
National Cannabis Industry Association
How To Stay Politically Engaged in the Age of COVID-19
Photo By CannabisCamera.com
by Michelle Rutter Friberg, NCIA’s Deputy Director of Government Relations
Over the last few weeks, life in America has changed, and will remain so for the foreseeable future. However, even though most of us are practicing social distancing and working from home, there are still ways to remain politically engaged during this election year. Whether you use these tips to talk to members of Congress about COVID-19 or cannabis legislation, we encourage you to continue to communicate with your elected officials.
Here are a few ways you can do that from the comfort (and safety) of your own home:
Call your legislators
In the age of technology, we are lucky to have so many different ways to communicate with each other. Arguably, one of the most effective ways to contact your representatives and senators is by calling their offices. You can check out NCIA’s website for some do’s and don’t’s of calling, and if you need your elected officials’ contact information, you canfind it here. Pro-tip: try calling your legislators’ district offices – they are usually less inundated with calls than their D.C. counterparts.
Go old school: write a letter (or an email)
Sometimes it’s nice to be able to sit with your thoughts and write them down – plus, it’s also a great way to pass some time while at home. Put those skills to work and consider writing your elected officials a letter or an email. Remember to always keep it professional, but also be sure to include your personal story.
Stay informed: read the news, a book, or listen to a podcast
As citizens, we all have a duty to stay informed, and this is a great time to delve into some new content! You can settle in with your favorite cannabis product and a good book (politics, history, or whatever you like!), or hop online to check out the news or go down a Wikipedia rabbit hole. If reading isn’t your thing, try searching for a new podcast – we recommend NCIA’s Cannabis Industry Voice. One rule, though – always make sure whatever you’re consuming is from a reliable source.
While no campaigns are knocking on doors right now, there are still opportunities to get involved with one and help out from home. With 2020 being an election year, it’s important to remember that you don’t have to volunteer to help with the presidential race, either – you can help a local or state candidate, or a member of Congress. You can volunteer for the RNC, or if you’d prefer, help out the DCCC. Making phone calls for a candidate is also a great way to get some social interaction!
Follow your elected officials on social media
Once you’ve identified who your elected officials (or candidates) are, find them on Facebook, Twitter, and Instagram. Not only is this another great way to get in touch with them, it’s also a way to stay informed as many of them are holding virtual town halls and “live” sessions. When interacting with these accounts, always remember to remain respectful.
Here at NCIA, we are all encouraged by our members and their dedication to patients, consumers, and overall public health, and we will continue to serve and advocate for you, even during these difficult times. COVID-19 will not last forever, and we will soon be back in the halls of Congress talking to members and their staff about the importance of reforming our outdated cannabis policies. Until then, stay home, stay safe, and stay healthy!
The Importance of PACs and Political Involvement
by Madeline Grant, NCIA’s Government Relations Manager
Like the Olympics, we only have a presidential election every four years. Usually, this means more voters are engaged and paying attention to the political process than normal. It’s more important now than ever for voters to get involved, and there are many ways to do just that. Some people campaign by making phone calls and knocking doors to get out the vote, others simply vote on election day. Some choose to make financial contributions to candidates or issues-based PACs (political action committees) that they care about.
As a trade association, NCIA has a PAC (the NCIA-PAC) that collects and contributes funds to candidates that support cannabis reform on Capitol Hill. In recent years, you may have heard that PACs are considered “special interest” or part of the “D.C. swamp.” Some candidates go so far as to not accept contributions from PACs to their campaigns. However, many small PACs, like the NCIA-PAC, are misrepresented by these characterizations and are fully funded by the hard-working members of their associations. The NCIA-PAC gives our cannabis professionals a united voice in the political process. Keep reading below to learn more about NCIA’s PAC and how you can get involved.
There is a common misconception that political contributions buy votes, however, the reality is that political contributions gain access. Of course, a politician’s goal is to get elected or re-elected and campaign contributions are a vital component of that goal. The NCIA-PAC helps support our champions and politicians that will fight for us on Capitol Hill so that they can continue fighting for our industry in D.C.
Another common misconception people have is that a one-time contribution will get you a friend for life, but unfortunately, that is not always the case. As long as a member stays in office, they will continue to ask for financial support. Think of it like this: supporting the NCIA-PAC lets us support elected officials who support the cannabis industry, and it’s imperative that they continue to be re-elected! Even the smallest donations make an impact.
At this point, you may be asking yourself: why should I support the NCIA-PAC? Well, your dollars support candidates who understand the cannabis industry’s concerns and who focus their attention on issues important to NCIA. A donation also affords you opportunities to collaborate with other concerned and politically active members to ensure our industry’s involvement in the legislative process and provides engagement, support, and information that is helpful to you, our cause, and your business.
NCIA’s government relations team works year-round to build relationships on Capitol Hill and represent the cannabis industry. As a team, we reiterate the importance of access to banking, fixing the 280E tax provision, the necessity of descheduling cannabis, and ensuring that our industry is diverse and equitable, among other issues. Our efforts here in D.C. make an impact, but members of Congress and their staff also need to hear from you. So, we hope you will consider joining us and NCIA’s PAC Leadership Circle at our 2nd Annual VIP Day in Washington D.C., on May 19.
Through a donation of $1,000 dollars or more, you will participate in an exclusive day including briefings, a luncheon and meetings with members of Congress, meetings with committees of jurisdiction, complimentary entry to the NCIA-PAC Fundraiser, and networking with NCIA’s most politically active members. Additionally, you will receive even more benefits all throughout the year, such as complimentary registration for our annual conferences, prominent listing and link to your company website featured on NCIA’s PAC page, customized branding opportunities at NCIA’s Cannabis Business Summit & Expo, and much more. If you are interested in attending VIP Day or hearing more about the NCIA-PAC, please fill out an interest form here or contact Maddy Grant at Madeline@TheCannabisIndustry.org.
It was January 28, 2020: It’s a full house at the Berkeley City Council meeting, with comprehensive changes to the city’s marijuana regulations on tonight’s agenda. The biggest issue, with supporters of both sides attending, is the vote to consider legalizing cannabis consumption at specially designated licensed dispensaries.
The proposal to allow smoking, vaporizing, and consumption of edible goods is supported on one side by a phalanx of marijuana advocates and dispensary operators, and on the other side, it’s the city Health Department and Berkeley’s famously NIMBY neighbors. This conflict runs deep; cannabis users want dignified, legal facilities where they can gather and use marijuana, and several dispensary neighbors and the health department want this idea squashed, full stop.
Fact is, people have long gathered together to share cannabis, as shown by an extensive recorded history of use. This spans from ancient Sumerians, who built huts and vaporized cannabis on burning coals inside, to underground marijuana smoke-ins in the 70s and 80s, to now, where cities are licensing legal cannabis consumption facilities for adults.
California is helping lead the United States consumption lounge movement. For example, California’s Bureau of Cannabis Control (BCC) regulations (Section 5025) explicitly contemplate the possibility of consumption lounges, stating that “this section shall not be interpreted to prohibit cannabis consumption on the premises of a licensed retailer or licensed microbusiness authorized to engage in retail sales,” as long as they are locally licensed and approved.
The state law also created Temporary Cannabis Event Licenses, where onsite consumption is allowed at festivals like the High Times Cannabis Cup and the Emerald Cup. Yes, with city or county and state permission, it is possible to throw your cannabis dream event, but there are a limited number of locations in only a handful of places that allow these uses (including my hometown, Oakland). This makes it hard to get these licenses, and the costly and complicated regulations are hard to meet once you have one. Anyone hosting a Temporary Cannabis Event can expect to interact closely with the BCC regulators, who will surely attend to ensure compliance.
Cannabis consumption facilities are nothing new in California. They have long existed, ever since Dennis Peron opened his first dispensary in San Francisco in the early-1990s. His famous location on Market Street was five stories high, literally, as each floor contained tables, couches, and chairs where patrons could hang out and consume cannabis. When the Compassionate Use Act of 1996 passed, collective dispensaries started opening across the state, despite federal illegality and the occasional raid because of it (Dennis was raided by the feds and forced to close in 1998).
I opened my first cannabis consumption lounge at Berkeley Patients Group in 1999, which was long before it was legal to do so. This was under the cover of tolerance provided by Proposition 215; after all, not even dispensaries were actually made legal by this groundbreaking initiative. That didn’t happen until the state legislature passed the aptly named SB 420 in [year], after which most cities grandfathered in their existing cannabis dispensaries. (Not all, though. Some municipalities used this transition as an excuse to ban dispensaries, or to close existing ones, during long periods of regulatory contemplation.) Berkeley allowed onsite consumption until the early 2010s, when the local regulatory processes changed. Hence, the City Council vote tonight to decide the fate of onsite consumption here once again.
Now, I own Magnolia Wellness dispensary in Oakland, where local regulations have allowed cannabis consumption at specifically licensed dispensaries since 2017. Magnolia’s Dab Bar and Vapor Lounge was the first legal consumption lounge in the East Bay. We have café style tables, a gorgeous full, copper top bar, glass dab rigs with e-nails, Vapexhale and Volcano vaporizers, and a variety of tasting events where people can try samples. Unfortunately, Oakland’s dispensary law only allows vaping, edibles, and topicals, limiting smoking to additionally permitted outdoor patios, none of which currently exist. (Full disclosure: I also co-own Hi Fidelity dispensary in Berkeley, too.)
San Francisco, on the other hand, has more than a dozen shops where cannabis smoking, vaping, and edibles consumption are all allowed. SPARC, one of the first lounges in the city, has tasteful tables and chairs right in the main dispensary, where volcano vaporizers can be used onsite. Vapor Room, a few blocks away, is a smaller neighborhood joint, with a handful of seats for people to sit and enjoy smoking or vaping. According to owner Martin Olive, it was a costly HVAC system, at a near six-figure expense, that allowed his facility to host its cannabis smoking patrons. Moe Greens, the latest licensed lounge to open in the city, took four long years to get licensed, but is now a beautiful facility, with cushy booths for smoking and a counter service dab bar with top-of-the-line e-nails and dab rigs for patrons to use.
West Hollywood is the biggest news on the California consumption lounge scene, as the city recently licensed 16 facilities for on-site consumption. Half of these facilities will allow retail sales and consumption, while the others are allowed to sell only single-use items, designed to be consumed café style, while patrons are on-site. This plan has been controversial, though, because in issuing these licenses, the city took permits away from several of the long-existing dispensaries, re-issuing them to new operators. The ensuing lawsuits and legal battles will surely play out through 2020.
There is another big problem in West Hollywood: the state law does not match up with their rather forward-looking ideas for cannabis cafes. For example, cannabis cannot be blended into café food and served on the spot, as the city imagined when creating this law; Cannabis can only be sold pre-packaged and tested, per BCC regulations. Furthermore, state-licensed cannabis businesses are not allowed to sell anything but cannabis products (and a shortlist of branded items like mugs, lighters, and pipes). In other words, they can’t sell non-infused foods or beverages like coffee, soda, or tea (or, since we are talking West Hollywood, kombucha and smoothies).
Until state law changes, the plan is stuck in limbo, with facilities looking for creative workarounds to allow food and beverage service.
So, despite the West Hollywood ordinance passing in late 2018, only one facility has opened there, and even this has hit roadblocks. In fact, they recently re-branded after only a short time in business, from Lowell’s Café to the Cannabis Café, after a regulatory crackdown hit the Lowell’s brand hard. It remains to be seen when the other 15 cannabis lounges will open there.
Back in Berkeley, staff from the Health, Planning, Police and Economic development offices joined forces with the Berkeley Cannabis Commission to present the City Council with a comprehensive plan to update the city’s cannabis ordinance. Diverging opinions meant that the agenda contained competing proposals on several of the ten proposed ordinance changes, with the Cannabis Commission leading efforts to create progressive changes, and the Health Commission stuck on the old trope, “we need more research.”
Elizabeth Greene, City of Berkeley Senior Planner, explained to Council that these proposals have been in development since 2017, with the goal of expanding the rules to protect the entire cannabis supply chain, from seed to sale. This includes development of two new license types, cannabis consumption lounges and non-retail dispensary licenses.
“State law allows for consumption lounges as part of a retail license, as these are the only facilities open to the public,” Greene says. “Currently, consumption lounges are not permitted in the City of Berkeley.” Her presentation made it clear that city staff recommended cannabis lounges be permitted, despite the worries of the Health Commission, whose representative commented that “legalization is new,” despite that cannabis sales have been regulated by the city for around 20 years.
Long time senior advocate, and ICANN dispensary owner, Sue Taylor spoke eloquently in support of the proposal to allow lounges. “Seniors need a place to learn about cannabis, how to use it and dosing, and you could do that in a vape lounge. I can’t go into their homes, but I can provide this education at a lounge,” says Taylor. “It’s not like a bar; at a bar, you just get sicker. A vape lounge helps people.”
Ultimately, the City Council agreed. By 11:30 PM, Mayor Jesse Arreguín called the vote, with the Council unanimously approving the entire proposal. Supporters filled the room with cheers, and long-time advocates like myself reflected on the fact that, yes, hard work and determination do pay off. Together, we may just end prohibition, once and for all — and have some fun, too.
The Illicit Cannabis Market Puts Consumers At-Risk and Is an Existential Threat to the State-Legal Cannabis Industry
by Andrew Kline, NCIA Director of Public Policy
Photo By CannabisCamera.com
The illicit market is not working for anyone. The illicit market puts consumers at risk by offering untested, unregulated, and dangerous products, including “vape cartridges” filled with additives that are not intended for inhalation. These illicit vape products alone have caused 2,768 injuries and 64 deaths to date nationally. Pop-up dispensaries are selling illicit, unregulated, and untested products to unwitting consumers. Unscrupulous people are unlawfully selling cannabis products over the internet in violation of state and federal law, and online platforms are enabling the illicit market by advertising for illegal online and brick and mortar stores. Counterfeit and ready-to-fill packaging is being sold with fake lab results, batch numbers, and barcodes. Illegal growers are causing serious environmental harms. Even illicit market operators with the best intentions still put consumers at risk when they sell untested products produced in unregulated facilities.
And these illicit operators pose an existential threat to the regulated markets that voters have demanded. Operators are laying out significant funds for licenses and compliance to compete against an illegal, untested, unregulated, untaxed marketplace. Law enforcement is playing whack-a-mole. Consumers are often unaware of which operators are legal, particularly where illegal operators often have a veneer of legitimacy or have stolen the intellectual property of these regulated businesses to gain consumer trust. We need to make certain that reliable and safer products (tracked, tagged, and tested) are being sold in the regulated market. Trust in the safety of the supply chain is key here, with laboratory testing, traceability, and safeguards (eg: ability for recalls) as mandatory prerequisites.
On February 19, 2020, NCIA, along with NCIA’s Policy Council, former Boston Police Commissioner Ed Davis, and Commissioner Britte McBride, public safety appointee on the Massachusetts Cannabis Control Commission, partnered to facilitate an important discussion with law enforcement, advocates, and industry stakeholders seeking solutions to the illicit cannabis market. The summit brought together federal, state and local law enforcement; state regulators, cannabis entrepreneurs and multi-state operators, ancillary technology companies, and social equity experts. The purpose of the summit was to dialogue about the illicit cannabis market with the goal of developing recommendations on resources, policies, best practices, and public-private partnerships to share information.
Here are some key takeaways:
First, the cannabis industry needs to help law enforcement find alternatives to arrest and incarceration. Some states have been creative in their approach to combating the illicit market, by locking doors and shutting off electricity and water, levying fines, and prosecuting tax evasion. It is essential that we rely most heavily on alternatives to arrest and prosecution so that we don’t perpetuate the myriad problems associated with the “war on drugs.”
Second, the industry must better define the illicit market. The illicit market looks very different in Idaho than it does in Colorado. In Idaho, all sales are illegal and diversion from legal states into Idaho is a serious problem. In Colorado, state regulators are concerned about unsafe products being manufactured and sold outside of the state regulatory regime. So, we need to take a hard look at the products that are causing the most significant problems (injuries and deaths) and focus our attention on the most serious of those cases. Until we prioritize what we deem to be illicit market activity, it will be difficult to prioritize limited law enforcement resources.
Third, the industry needs to definitively determine the root cause of the illicit market. We know that three probable causes of illicit market activity are: (1) lack of legal access to cannabis and cannabis products and (2) price disparity between legal and illicit markets, largely due to high taxes of legal products, and (3) a lack of economic opportunities in marginalized communities causing people to turn to illicit sales. But, what are other causes and effects?
Fourth, the industry needs a forum for collaboration with law enforcement. The middle of a crisis is not the time to develop relationships.
Fifth, the industry needs a pathway for illicit market operators to enter the legal market. We can’t displace the illicit market unless we create a pathway for previous illicit market entrepreneurs to enter the legal market. That means that states must create realistic pathways to enter the regulated market for legacy illicit market actors. There are an increasing number of potential models here, from the states such as Massachusetts (which has led on attempting to prioritize social equity during license application processes) and Illinois (which made such pathways a key point in the legislation to create a legal market) to industry groups such as the Minority Cannabis Business Association (which has published recommendations for state regulators intent on incorporating social equity requirements into their licensee applications).
Sixth, law enforcement has competing demands and needs help prioritizing cases. What are the most egregious cases that warrant criminal arrest and prosecution? What are the cases that warrant automatic expungement? And what do we do with the cases that fall in between?
Finally, the industry needs to speak with one voice and start rowing in the same direction. The industry needs national messaging from states that have a regulated market to help dispel myths and prepare warnings for responsible use. We need to share information on packaging and labeling, testing, universal symbols, etc., nationally. And most significantly, the industry needs to start speaking with one voice and work to bring legacy businesses into the regulated market. NCIA’s Policy Council is committed to continuing efforts to create a safe place for everyone in the industry to begin that dialogue.
Andrew Kline is the Director of Public Policy for the National Cannabis Industry Association and leads NCIA’s Policy Council. He can be reached at Andrew@TheCannabisIndustry.org
Meet Anya – NCIA’s New D.C. Office Intern
By Michelle Rutter Friberg, NCIA Deputy Director of Government Relations
There’s no shortage of work to be done in cannabis policy reform here in Washington, D.C. and it seems like there’s never enough hours in the day! That’s why for more than two years, the NCIA D.C. office has utilized the help of interns to assist us with all of the important work we do here. From attending meetings and briefings, to doing research projects, to doing social media, our wonderful interns have done it all. This week, we want to introduce you to our newest intern in D.C., Anya Vining.
Tell us about yourself! Where did you grow up and go to school?
I was born in Ukraine but spent most of my childhood in upstate New York. I then moved to Boston where I went to school at the University of Massachusetts and studied political science and psychology.
What did you do before this internship?
After graduation, I began working at one of the first licensed hemp farms in Massachusetts, BayGrown Farms. It was a great opportunity to learn more about cultivation and product development. After the harvest season, I spent some time traveling around the United States exploring new places!
When did you realize you were interested in cannabis, whether personally or professionally?
Once I began working for BayGrown Farms I got to see the importance of legalized cannabis. I met so many people who relied on cannabis to improve the quality of their lives and saw first hand the positive effects! We also worked to repurpose old and unused farmland which provided farmers with another source of income. The positive impact on the community really inspired me to pursue cannabis professionally!
Do you see yourself entering the cannabis industry in the future?
I would love to continue to work in the cannabis industry. I have been considering law school and specializing in cannabis law but I am always open to new opportunities. I think this will be an eye-opening experience and hopefully will give me more insight into what I want to do in the future!
What interests you about the cannabis space?
The cannabis industry is ever-changing and growing rapidly which keeps the space interesting and exciting! So many people are impacted by the industry and there is always room for more education and advocacy.
What are you most excited to do or learn while interning here?
I am most excited to gain more professional experience and learn more about lobbying for a cause that I am passionate about. I am also looking forward to meeting more people in the industry and hope to become more involved and invested!
If you’re interested in learning more about the work we do in Washington, D.C., or meeting Anya and our government relations team, make sure you save the date for NCIA’s 10th Annual Cannabis Industry Lobby Days, happening May 19-21, 2020! See you there!
Video: Episode #2 of NCIA Today – #NECannaBizCon recap, Safe Vaping, Illicit Market Summit, and more!
Tune in to episode #2 of our new monthly video series: NCIA Today!
Off the top, Bethany looks back at #NECannaBizCon in Boston, MA this past month, our first trade show of 2020.
In our policy update, Bethany discusses “The Key to Consumer Safety: Displacing the Illicit Cannabis Market – Recommendations for Safe Vaping,” a recent report produced by our Policy Council and informed by a variety of subject experts, with NCIA Director of Public Policy Andrew Kline.
Oour annual in-person member policy and government relations update event series, the Cannabis Caucuses, are only days away in March. See where your caucus is happening!
We’ll see you next month for NCIA Today!
NCIA Board of Directors Announces 2020 Board Officers
On Tuesday, February 18, NCIA’s Board of Directors met in Boston in advance of NCIA’s Northeast Cannabis Business Conference. During the meeting, new board officers were voted upon and instated into their roles for the current term.
NCIA is pleased to announce the following board officers:
Prior to this most recent officers election, Khurshid served as the board’s Vice-Chair and Kris served as Treasurer. This will be Henry’s fourth year as Secretary and Narbe’s first year as Treasurer. All four officers now make up the Executive Committee of NCIA’s board, along with Executive Director and Board Member Aaron Smith. NCIA deeply appreciates the dedication of our new officers and the entire board of directors.
Committee Blog: Cannabis Banking – Regulatory Outlook and Effective Compliance
During a recent webinar, we polled the audience on their current positions on offering financial services – traditional financial services – to direct marijuana-related businesses (MRBs). The results, as you might imagine, were mixed but we identified one common theme: The vast majority have taken action to address cannabis banking issues. This has been the theme we’ve been championing for years. The dichotomy between state and federal cannabis laws has placed our financial institutions in a precarious position: Bank the cannabis industry, be first to the market in doing so, create a non-traditional revenue stream and help to solve public safety and other logistical issues by solving the all-cash conundrum OR continue to watch from the periphery as others take the leap?
We see the number of financial institutions – banks and credit unions – that offer financial services to cannabis businesses expanding, but not to the level suggested by FinCEN SAR data. There remains a critical need for financial services within the cannabis industry.
Why the hesitancy in tackling this issue?
The current regulatory environment is a critical factor. As it stands, our industry is relying primarily upon the FinCEN guidelines to offer financial services to cannabis-related businesses. These guidelines, coupled with a surge of proposed legislation and a regulatory perspective on risk-based risk-taking, have allowed financial institutions across the country to effectively provide financial services to cannabis-related businesses. There is a key term we’ve been using: cannabis-related businesses. Within this term, we encompass direct and indirect marijuana-related businesses, hemp, and CBD entities. The majority of those polled feel more comfortable with hemp and CBD entities primarily due to the passage of the 2018 Farm Bill. Getting into the intricacies of how the Farm Bill and the USDA’s resulting interim final rule have added a layer of complexity to banking hemp and CBD businesses is more than we can cover in this blog post. Let’s focus instead on those providing financial services to direct MRBs, those that are state-legal, licensed cultivators, extractors, and dispensaries.
It IS possible to actively bank direct MRBs, to offer stable banking services that bring the cash off the street and provide a means for these businesses to operate more effectively and efficiently, and surely in a less costly manner than an all-cash business. The regulators are not criticizing financial institutions for providing financial services to MRBs; they review these services as they would any higher-risk, complex activity. When an institution takes on too much too fast or does not have sufficient controls to know whether it actually has a higher risk or complex business concentration within its customer base, the regulators will be critical… as they should be.
So, what are they looking for?
This goes back to the theme we mentioned: Financial institutions actively addressing cannabis banking issues.
Every financial institution, whether it intends to bank direct or indirect MRBs, hemp or CBD should have a Cannabis Banking Program that assesses the inherent risks of doing so, speaks to the controls necessary to effectively manage those risks, and determine whether they are well-positioned, or have a risk-appetite for, providing financial services to the cannabis industry. Conversely, if a financial institution that has no appetite for, or does not reflect sufficient regulatory health to bank cannabis, it must establish effective controls to ensure that position can be maintained.
But, this post is about empowerment. It is about speaking to the regulatory environment in which we find ourselves. It is about providing the perspective that banking marijuana, hemp and CBD CAN be done effectively, safely and soundly. Yes, there is a significant level of infrastructure needed to do so. Yes, it does come with the need for ongoing, strong risk management and control enforcement. Yes, it can be a bit scary. By establishing a Cannabis Banking Program, comprised of a comprehensive risk assessment that drives an equally comprehensive policy, a financial institution can provide financial services across the spectrum of marijuana, hemp and CBD, and undergo regulatory scrutiny with confidence. Moreover, such a program has become a regulatory expectation to support a financial institution’s cannabis position. This is also not a program where a financial institution will set it and forget it. The risk assessment and policy must remain dynamic as legislation evolves, as regulatory perspective changes, and as a financial institution’s position or outlook may shift.
This is an industry that has already proven prolific. This is a time that will be ingrained within our nation’s history. Let’s be remembered as those who championed the issues, established the country’s infrastructure, and set the standard for those who follow.
As a former Federal bank regulator and seasoned consultant, Angela’s knowledge of regulatory compliance, risk management and investment advisory services has established her reputation as a leading resource within the financial consulting industry, spanning consumer protection and anti-money laundering statutes, fraud and cannabis banking issues.
Angela is the Managing Partner and Co-Founder of Sterling Compliance, LLC, a consumer compliance consulting firm based out of Pittsburgh, Pennsylvania. Sterling specializes in consumer protection and anti-money laundering compliance within the community banking industry and enjoys a significant online presence with a client base spanning the coasts.
In December 2019, Angela joined Integrated Compliance Solutions, LLC (ICS) upon the ICS acquisition of Sterling Compliance as an independent operating subsidiary. Angela oversees the firm’s Compliance Strategies division, of which cannabis banking is a significant component. ICS is a financial technology, banking compliance and innovative payments solution provider helping financial institutions with complex solutions. In joining the ICS team, Angela has continued the firm’s mission of bringing its complete SEED-TO-BANK™ solution to financial institutions and cannabis-related businesses throughout the United States, and has expanded the firm’s industry engagement as a well-respected authority on the regulatory and compliance issues surrounding cannabis banking.
Member Blog: The Women in Cannabis Study – Advocacy, Allies, and Voting
It can be easy to forget the beginnings of the cannabis industry. The stigma we had to fight. The laws we had to change. The pounding anxiety stemming from societal pressure and legal threats. But here we are in 2020, leading a nearly $10 billion industry in the U.S. with a promising future.
Being at the beginnings of a new industry is a powerful experience; seeing the fruits of our labor and the positive effects of legalization have been galvanizing and heartening. We’ve built something unique. But it’s still subject to the pressures and pitfalls of any other industry.
We’ve worked on legalization, supply chains, and policy, but what about equity? What about ensuring that the industry was diverse? And most importantly, how do we even know where we’re starting from?
The only way to move forward was deceptively clear: gather the data. I founded the Women In Cannabis Study after hearing stories of real women and recognizing the need for our undivided attention to shift to diversity and inclusion in the cannabis industry.
Much like a lot of the research in the cannabis industry, anecdotal data has ruled. In some ways, the lack of clinical research in cannabis has gotten us away from valuing qualitative data when looking for insights into particular issues in the cannabis industry. Ultimately, we need substantial numbers and stories to understand our industry and ultimately, form a game plan for equity.
So let’s start with the numbers. So far, data from our survey shows that 68% of women identify as heterosexual compared with 2010 U.S. census data showing 95% heterosexual. It’s a heartening sign that on its face, this is a welcoming environment for people of various sexual orientations.
Unfortunately, our findings also show the industry isn’t immune to sexist behavior.
By asking hard questions through the study, we’ve pinpointed that 33% of our sample as of February 5 have been sexually harassed while working in the cannabis industry. 1 in 3 is a huge number. It’s also worth noting that in our survey, 52.6% of women reported being sexually harassed in another industry—a sign that there might be a substantial difference in the cannabis industry to build on so that we can get that number to 0.
Additionally, only 23% of our study sample say they are paid the same salary as male coworkers in similar positions and 52% feel they have lost opportunities because they are a woman. Fifty-nine percent of women have experienced bullying or lack of support from other women in the industry, showing that even new industries are not free of toxic professional dynamics in the wider business world.
So we have work to do. Or as I like to think of it, we have an opportunity.
That means not going down the same rabbit hole many industries have. It means data points sourced from an academically rigorous study. It means stories about bud-tenders, growers, scientists, extraction and edibles manufacturers, lawyers, doctors, and activists that emerge as a direct result of an academically rigorous study. It means industry-wide alliances.
Alliances come from a shared desire to make big changes. And that only happens when we decide that our goals are worth sharing.
The reality is, we need everyone’s help to tell the full story. While we have enough responses to tell the story of women as a collective group, we are lacking diversity and representation in our sample. We need at least 50 of each of the following populations of women in order to compare communities of women and we aren’t there yet.
If you believe our goal is worth sharing — if you believe that doing the work of creating equity is worth it — tell your story. Encourage your employees to tell theirs. This industry doesn’t belong to one person. Let’s find a way to show that to the world.
The Women In Cannabis Study (WICS) is an academically rigorous, global, comprehensive quantitative study to explore, document and ultimately support women’s participation in the cannabis industry. This groundbreaking study supports the development of actionable recommendations and strategies to make the cannabis industry equitable and inclusive for everyone. The WICS mission is to tell the story of women, as well as individual women’s stories—with data. The study was developed by Jennifer Whetzel, founder of Ladyjane Branding, joined by U.S. research lead Dr. Nicole Wolfe of Wolfe Research & Consulting.
Ladyjane Branding empowers entrepreneurs to build a smart, strategic and consistent brand identity. Founded by veteran marketing executive, Jennifer Whetzel, Ladyjane has simplified the branding techniques used by Fortune 500 companies. Her signature creations include the Two-Hour Brand Makeover, Ladyjane’s Brand Archetype Quiz, and an Archetypal Segmentation Model – all designed to provide inspiration and guidance to help brands create deep emotional connections with consumers, multiply the effects of marketing and advertising and increase their company’s value.
Committees And Coalitions: Legislative Update On The SAFE Banking Act
by Michelle Rutter Friberg, Deputy Director of Government Relations
Photo By CannabisCamera.com
While you may not have seen or heard much news recently about the SAFE Banking Act (H.R. 2215, S. 1152), NCIA has been hard at work behind the scenes gathering intel, lobbying offices, and educating lawmakers and their staff. The bill is currently stalled in the Senate, however, there have been many discussions between lawmakers, committee staff, and advocates to encourage the legislation’s swift passage through the chamber. This week, let’s recap where the bill stands currently and what we’re doing to get the bill to the next step in the legislative process.
In September, the SAFE Banking Act (H.R. 2215) became the first piece of cannabis reform legislation to ever pass out of the United States House of Representatives by an astounding bipartisan vote of 321-103. The first iteration of the bill, named the Marijuana Businesses Access to Banking Act, was introduced to the 113th Congress back in 2013 and has made a long journey to get to this point in the legislative process.
After the SAFE Banking Act passed the House, its journey continued in the more conservative, Republican-controlled Senate. NCIA and other advocates. Then, just before Christmas, Senate Banking Committee Chairman Mike Crapo (R-ID) issued a press release detailing his opposition to cannabis policy reform — including the SAFE Banking Act as it’s currently written. In the release, Chairman Crapo said,
“I remain firmly opposed to efforts to legalize marijuana on the federal level, and I am opposed to legalization in the State of Idaho. I also do not support the SAFE Banking Act that passed in the House of Representatives. Significant concerns remain that the SAFE Banking Act does not address the high level potency of marijuana, marketing tactics to children, lack of research on marijuana’s effects, and the need to prevent bad actors and cartels from using the banks to disguise ill-gotten cash to launder money into the financial system.”
NCIA is continuing to work with Sen. Crapo, congressional and committee staff, coalition partners, and the bill’s cosponsors to ensure that all parties have the materials and information that they need in order to solve this pressing public safety issue and pass the SAFE Banking Act.
But, that’s not all we’re working on for SAFE Banking! In addition, NCIA and a coalition of more than 30 national and state cannabis industry organizations sent a letter last month to Sen. Crapo urging him to advance the House-approved version of a bill aimed at addressing the state-legal cannabis industry’s lack of access to banking and other financial services.
NCIA has collected over a thousand signatures from cannabis and ancillary businesses on a similar letter that is on its way to Sen. Crapo’s office this week. Lastly, but perhaps most importantly, NCIA is currently in the process of taking a deep-dive into Sen. Crapo’s concerns that he listed in December, and replying to them line-by-line to ensure that he and his staff have all of the relevant information necessary to pass this bill out of Committee and send it to the Senate Floor.
We will continue working on your behalf in D.C., but here are a few ways you can help, too:
If your business is not yet a member of NCIA, the best way you can help this effort is by joining today so that our team in D.C. can start the year off stronger than ever in our efforts to move sensible banking reform through the Senate and to the president’s desk.
Make sure you’ve signed up to attend one of our upcoming Cannabis Caucuses, happening nationwide in March, where you can get updated on the latest with the SAFE Banking Act and all of our other congressional priorities.
Mark your calendar for May 19-21 for NCIA’s 10th Annual Cannabis Industry Lobby Days! Registration will be opening soon, so keep an eye out for more information on how you can join us in Washington, D.C. to make 2020 the biggest year yet for cannabis policy reform!
While we still have work to do in the Senate, the NCIA team is excited about the opportunities ahead for 2020! Thank you to the nearly 2,000 member businesses of NCIA that help make this critical work possible.
#IAmTheCannabisIndustry: Joseph Hopkins, The Greener Side
Joseph Hopkins, with his wife Chelsea, owns and operates The Greener Side, a dispensary in Eugene, OR. As some of the original entrepreneurs to open a dispensary in the state of Oregon, their story of being raided by federal authorities shows how resilient one needs to be in the cannabis industry. Hear their story in this video feature.
Committee Blog: Interstate Cannabis Commerce Will Benefit Public Safety, Consumer Choice, and Patient Access (Part 2)
By Sean Donahoe, Founder and CEO, Sungrown Developments Inc. Member of NCIA’s State Regulations Committee
In Northern California’s legendary cannabis growing region of Mendocino, the elected county sheriff was recently a competitor at a homebrew festival, jovially pouring samples of his “Pretty Sour Powerful Sider” (jokingly referring to the “Public Safety Power Shutoffs” recently implemented by the electricity utility PG&E to prevent wildfires.) While this relaxed scene of neighbors bonding in the wake of shared inconveniences was not exceptional in itself, here, Sheriff Allman was posing for selfies with licensed (but possibly a few unlicensed) cannabis cultivators sharing the liquid bounties of harvest for the benefit of a local nonprofit.
For nearly a decade, the elected officials and staff of Mendocino county have worked together to normalize the local cannabis farmers by providing a pathway for medical cannabis cultivation permits, long before the state established a licensing system. This public policy process brought once-outlaw cannabis growers into conformance with every regulation of modern life: from building code standards to streambed alteration regulations to the quantification of gross receipts for tax collection. Bringing regulators onto these farms has curtailed previous practices that may have threatened consumer safety: pesticide and other chemicals are now tracked and regulated, while every gram can now be tracked back to its very plot of origin (in case of a safety recall or other concerns post-harvest.) This has been unquestionably difficult for and disruptive to many heritage and small farmers, but it has also allowed in these regions for simple scenes of social bonding and neighbors trusting neighbors again, as participants in the illicit sector were normalized into first their local county’s community then into a system of state license and next (hopefully soon) into a web of regulated interstate commerce. The process of bringing every farm into the regulated supply chain is far from complete, of course, and there are still illicit operators producing for consumers in urban areas in the state and beyond.
Rather than dwell on the incomplete success of California’s ongoing efforts to bring order to the world’s largest cannabis marketplace, it is essential to focus on the quality of life benefits from every cannabis operation successfully brought over from the traditional market to the regulated sector. Each licensed operation makes for one more safe workplace, one more source for lab-tested products for consumers and patients, and one more farm abiding by environmental regulations while providing stable employment and economic sustainability in rural communities. Under the previous medical cannabis paradigm, while there was certainly an abundance of responsible operators, there was virtually zero guidance from the state on matters of workplace safety, manufacturing standards, or environmental compliance. We are now several years into a robust legislative and administrative rulemaking process that has established a (mostly) clear set of rules of the road for commercial cannabis activities. It has unquestionably been a bumpy road for many of the legacy farmers to comply with new regulatory standards, but we are nonetheless able to say that there are now thousands of well-regulated cannabis farms in California (and southern Oregon) eager to sell their clean and craft quality products in a hopeful system of interstate commerce.
Has every cannabis farm in California transitioned? Of course not, but neither have the illicit cannabis economies been entirely supplanted by adult-use cannabis retailers in Colorado and Washington. Sensible and sustainable cannabis policy reform is a process, not a simple flipping of a switch from “illegal” to “legal,” and Americans should be realistic about the progressive and iterative nature of this process. This process, like most evolutionary processes, has already experienced several inflection points, transformative moments that noticeably shifted public opinion or opened up new frontiers in policy reform. While the earlier era of medical cannabis state laws certainly created a base of public opinion and laws, it was questionably the passage of adult-use ballot measures in Colorado and Washington which brought onto the global stage and accelerated the awareness that adult consumers could buy cannabis in clean, responsible retail locations rather than furtive or even dangerous transactions in the illicit marketplace
Throughout this policy process, we have established that licensed retail options can be scaled without negatively affecting public safety and are highly efficient competitive enterprises, offering consumers ample product selection and low prices. In both Colorado and Washington states (but also in later states) we have seen imbalances for some time as market forces, regulatory factors and new cultivation capacity coming online have all helped to create price fluctuations, product shortages, and other supply disruptions. These disruptions were not unique to these early states and will likely continue in every market as new in-state regulated options come online in fits and starts (but when interstate commerce becomes possible we should expect significant price fluctuations unlike any seen to date.) During these fiscally trying periods, we have often seen cannabis operators attempt to cut corners on compliance to make ends meet, which can lead to compromised consumer safety and public safety. The goals of consumer availability and cost competitiveness should be foremost in the minds of policymakers crafting cannabis policy reform nationwide, most notably in the anticipated markets of the Northeast. As these next anticipated adult-use states are designing the framework of their retail and distribution systems, strong consideration should be taken on the potential benefits of quickly and effectively scaling their programs by incorporating interstate commerce as soon as (politically) possible.
The Interstate Commerce Conversation
As the serious policy conversations about compliant interstate cannabis commerce begin, it is helpful to study how in our proverbial laboratories of democracy we can see that decreasing retail friction and shifting consumers from the illicit marketplace benefits crime reduction efforts and improves overall public safety. We should also note that retail cannabis sales have continued to grow in Colorado and Washington, even after the initial novelty and the surge of tourism waned, while legal sales have supplanted illicit sales. These early-adopting states have created models that are addressing consumer demand as national interest in cannabis for wellness and adult-use purposes are soaring and the cultural normalizing continues to occur on a global scale. Interest is high, consumer demand is real, and evidence shows that our drug reform policies should be crafted to bring every cannabis consumer transaction into the regulated supply chain in order to fulfill the demand while benefiting from increases in public safety.Interstate commerce could provide not only safer products but also a greater variety of quality and highly competitive offerings. For medical patients and wellness-oriented consumers, interstate commerce may be the only viable means of access for certain formulated cannabis products or cultivars, especially in smaller state markets.
In addition to the above benefits, regulated interstate cannabis commerce system could provide a more robust and differentiated production and distribution network combined with the ability to rapidly scale retail sales and address insufficient cultivation capacity in new adult-use markets.Cannabis consumers are price sensitive and illicit market retail options continue to entice consumers in states with functional adult-use programs such as California (or Canada), where there is an insufficient amount of licensed retail options to address total consumer demand. With the beginning of adult-use sales in Illinois and larger adult-use states yet to come, it is frankly a bit difficult to envision how total consumer demand will be able to be fulfilled in any near term by relying on licensed cannabis cultivated in-state alone.
The Safe Vaping Discussion
While moving to allow interstate commerce will best position licensed operators to compete with the prices available to consumers in the illicit sector, moving towards a borderless system of production and distribution will also increase safety and access for patients and consumers. Most prominent is the recent nationwide discussion on vaping and vaping-related issues, where tainted products and resultant injuries have been found in the unregulated, illicit sector (or in a very few instances from licensed but arguably under-regulated sources.)Notably, NCIA’s Policy Council established a Safe Vaping Task Force to work on these issues and has released a more comprehensive document advocating for the expansion of a regulatory approach for the safe manufacturing and distribution of cannabis products, whether vape cartridges or otherwise.
The issue of vaping extends to broader issues of product safety including educational campaigns, quality assurance, and testing programs, supply chain integrity, track and trace, and other reporting systems, and (when all else fails) a capable and sophisticated product safety recall system and these are all necessary components of a well-regulated marketplace. These consumer safety programs have already been carefully designed and stress-tested in Colorado and California and the insights from these systems and those in other states should be incorporated into the crafting of interstate cannabis policy (which will require significant harmonization of Certificates of Analysis and testing standards, packaging and labeling standards, etc., again all of which will benefit patients and consumers by offering greater predictability and reliability of their preferred products.)
Multi-State Coordination
In various forums, we have begun to see state regulators liaise with each other and we hope to see more coordination in the future and potentially an earnestness in harmonizing standards where statutorily possible. This multi-state coordination on product safety standards would be accelerated as part of the regulatory coordination efforts that are likely necessary for interstate commerce and, again, consumers and patients will benefit from safer cannabis and cannabis products, and we see NCIA as the critical player in this coming national conversation. In conclusion, moving to a system of regulated interstate cannabis commerce will have tangible benefits for the general public, for consumers and patients and I encourage forward-thinking members of the industry to participate and help manifest a system of interstate cannabis commerce with NCIA, its Allied Associations and other industry groups.
After studying Russian affairs and working as a political consultant, Sean Donahoe co-founded the California Cannabis Industry Association. He served as its Deputy Director through 2014 when he transitioned to consulting for investors and operators, communicating with public stakeholders, serving on local government committees, and advising industry trade groups. He holds an MSc in Government from the London School of Economics and is CEO of Sungrown Developments Inc., an advisory firm and holding company in Oakland, California.
What is Happening in D.C.? Come see for yourself!
by Madeline Grant, NCIA Government Relations Manager
There has been a lot of cannabis action in the 116th Congress and that is not an accident — it’s time for cannabis policy reform!
We’ve seen historical hearings, votes, and mark-ups take place with the help of our champions on Capitol Hill. We need to continue to support these efforts and support Members of Congress who fight for cannabis reform. So… how can you help to impact reform in Washington, D.C.?
Mark your calendars for NCIA’s 10th Annual Cannabis Industry Lobby Days on May 19-21! There is no better way to network with other NCIA members, meet with congressional staff and members, attend events, and most importantly tell YOUR stories on Capitol Hill.
What you don’t want to miss out on…
NCIA’s 2nd Annual VIP DAY(taking place during the day of May 19) forNCIA PAC Leadership CircleMembers! To participate you must be a member of the PAC Leadership Circle by contributing to the NCIA-PAC. The NCIA-PAC maintains no overhead costs so that 100% of donations are used to support industry-friendly candidates and build the political influence of our emerging business sector. For more information on joining and participating in this exclusive day please email Vanessa at Vanessa@thecannabisindustry.org.
Below are a few examples of what VIP Day consists of…
-Luncheon with Members of Congress -Meetings with Members of Congress -Meetings with committees of jurisdiction -Networking with NCIA’s politically active members -Capitol Hill briefings with Hill staffers and professionals
Pictured: Congresswoman Katie Porter (CA-45), NCIA’s Director of Government Relations, Michael Correia, and Maddy Grant, NCIA’s Government Relations Manager. Last year, Rep. Porter attended our VIP Luncheon.
Video: Episode #1 of NCIA Today – Industry Socials, #NECannaBizCon, and Sen. Crapo, and more!
Check out the first episode of NCIA’s new monthly video newsletter, NCIA Today! In this episode, we cover NCIA’s first Industry Socials and Trade Show of the year, Sen. Mike Crapo’s comments on cannabis legalization, and what NCIA’s Allied Associations Program is!
There’s been a lot of positive press lately about the success of the cannabis industry in Nevada, and with good reason. The cannabis industry contributed more than $110 million dollars in FY19 to state coffers and is poised to overtake the mining industry in annual tax contributions; all of this in just its second year of operations. But while the tax-generating retail industry continues to steam ahead, much of the business and opportunity in the balance of the industry remains on hold (since early October). The responsible moratorium has largely been erased from public awareness by the intervening holiday season and the ongoing success of tax collections over projections.
Unfortunately, while this suspension was necessary in light of the surrounding circumstances, its indefinite duration has created market instability at a time when cannabis-friendly markets are competing for business and tax dollars. Regrettably, this uncertainty has made Nevada look more like the nearly paralyzed California market. The time has come to complete the necessary work, end this moratorium and let the critical behind-the-scenes elements of our nationally leading industry get back to work.
For those that don’t recall, the present moratorium was announced by the Nevada Department of Taxation on October 17, 2019 following the recommendations of a task force initiated by the Governor. The launch of the task force was in response to two scandals: one involving the awarding of retail licenses earlier in the year and the second being the discovery that the foreign nationals identified in a national campaign finance scandal (involving former New York Mayor Rudy Giuliani), had sought to invest in and seek influence over the local cannabis industry.
Few can argue the need for a regulatory pause given the state of affairs last October, and I believe the Governor’s response was the single most effective way to stifle inappropriate corporate activity. By the simple administrative step of freezing all pending and future license transfers, the state was able to get the lawyers involved in these transactions to shut them down. The final step in almost any merger or acquisition transaction became temporarily unlawful. There’s no need for a police force when every lawyer in the industry can be deputized.
This Friday will mark ninety days since the moratorium was put into place, and would be a fine time to release this de facto suspension of all mergers, acquisitions, sales, financing, etc. After a decade and a half of practice in transactional law, I can tell you that the “invisible hand” of the market that most of us rely upon to guide capitalism isn’t invisible to the people in the transactional trenches. If the machinery behind the scenes is seized up for too long, inevitably, even the very of the supply chain (i.e. retail) will suffer.
Many capital rich companies, who only recently became comfortable with the cannabis space, are looking to deploy resources into the cannabis industry. The mechanisms to do so, and to create the jobs and economic development desired by the state and its taxpayers, are restricted to mergers, acquisitions and equity investment. Capital markets are not static. They are as dynamic as the cultures they serve and forcing them all to the sidelines for an extended period owing to the misdeeds of a small number of them, is painting with too broad a brush. It is perhaps due to the recent legality of the cannabis industry and its vestigial stigma that a transactional moratorium has been tolerated for as long as it has. It is difficult to imagine a comparable capital markets freeze in any other industry.
In the ten years I have called Las Vegas home, I have watched our city and, indeed, our state, transform from side show to main event – as we are no longer content to ride shotgun to California’s success. We Nevadans have proven capable of, and even better equipped for, leading in multiple industries, including cannabis.
To that end, we are, or certainly should be, capable of completing an “extended review” of the license transfer process as well as developing a “more thorough and appropriate vetting process” in ninety days. Ostensibly, freezing all pending transfers was undertaken to ensure that those aspiring licensees were subject to such “more thorough” process. It is difficult to imagine, however, how this process could presently be incomplete. If anything, as the state is writing the rules as it goes, it makes sense to at least unlock the “pending” transfers and provide some guidance as to the expected timeline for future transfer approvals.
We spent most of 2019 advising clients to avoid cannabis transactions in California, as the regulatory structure there is widely agreed to be in disarray. During most of that time, we were able to credibly suggest Nevada as an alternative market, free from such chaos, and capable of sustaining robust merger and acquisition activity without issue. However, as large and popular adult-use markets (e.g. Chicago, IL; Detroit, MI) open and expand, and agriculturally experienced markets expand into hemp and CBD production, we are left to advising clients that their dollars are better spent elsewhere.
However, there is still time to start the new year and new decade with a local cannabis market that is looking to lead and provide prototypical regulatory and compliance guidance, as it was prior to last October. If we don’t, we can’t expect other cannabis-legal states or businesses choosing between them to wait for us to figure it out. And when federal legalization undoubtedly arrives, the loss of time in developing the Nevada market will no longer be treated trivially.
Glenn H. Truitt, Esq. is the Managing Partner of Ideal Business Partners, a boutique multi-disciplinary professional firm focusing on serving businesses in the cannabis, hemp and CBD spaces. He is a graduate of the U.S. Naval Academy and Stanford Law School, is licensed to practice in California and Nevada and has been practicing for 15 years.
NCIA Policy Council Publishes New Safe Vaping Recommendations Report
by Morgan Fox, NCIA Director of Media Relations
In September of last year, reports began surfacing of mysterious respiratory illnesses generally associated with the use of vape cartridges, including those containing cannabinoids. Over the following months, reports of these cases climbed to more than 2000 nationwide, including more than 50 deaths. The Center for Disease Control and state health agencies struggled to determine the proximate causes, but it became increasingly clear that the vast majority of these cases were linked to unregulated cannabis vape products. As the focus began to narrow on the presence of Vitamin E acetate and other additives in unregulated products, NCIA and members of the industry urged producers, regulators, and lawmakers to take steps to prevent the use of these substances in vape cartridges and enact changes that would make legal, licensed, and tested products competitive with illegal market products that were making people sick.
New reports of this illness – called EVALI – have slowed, and the CDC has ended its official state of emergency related to vaping. However, there is still significant confusion on the part of stakeholders and the government about how to avoid similar issues in the future and the huge causal role prohibition played in this outbreak. In an incredibly misguided statement earlier this month, the CDC even lumped all “commercial” sources for vape cartridges together as a source for one sixth of the harmful products, despite only a handful of links to regulated businesses out of thousands of cases. This is especially troubling for states like California, where no cases were linked to regulated businesses and where unlicensed storefronts greatly outnumber those with licenses. Equating licensed, regulated businesses to those operating without oversight or regulations completely misses the mark and creates a dangerously inaccurate set of assumptions that could lead to even worse public health issues in the future.
As such, NCIA is proud to be releasing a thorough report on EVALI this week entitled “The Key to Consumer Safety: Displacing the Illicit Cannabis Market – Recommendations for Safe Vaping” which was produced by our Policy Council and informed by a variety of subject experts. This paper explores not only the additives that were the primary culprit but also potential areas for future concern such as heavy metals in vape cartridge manufacturing, potential problems caused by poor temperature control, and the use of certain types of flavorings and terpenes. It clearly lays out suggestions for both producers and regulators that will help avoid potentially dangerous products in the legal market, as well as ways to make sure that unregulated counterfeit products don’t make it into the hands of consumers. Just as important, this paper offers a guide on how states – as well as the federal government – can combat the illicit market by removing the onerous burdens placed on legal businesses, lowering barriers of entry to the industry and creating easier pathways for legacy businesses to become licensed, and exploring non-criminal methods to shut down illicit operators.
Whether you are a producer, regulator, policymaker or just concerned with public health and cannabis policy, this paper is an important tool for you. We ask that you please read and share it with your networks and urge your elected representatives at every level to explore and implement these evidence-based recommendations.
As members of the responsible cannabis industry, it is our duty to look out for the safety of cannabis consumers and shine a light on the policies that are bolstering the unregulated market.
As this paper concludes, the American consumer clearly wants cannabis products to be both accessible and legal. It’s time for the federal government to deschedule marijuana and regulate it like alcohol. Legalization through descheduling, regulation, and testing is the best path forward to keeping consumers safe. In the end, sensible regulation and a clear path to licensure and compliance will be the most compelling force in driving people from the illicit market to the state-legal market.
Call For Signatures: Move The SAFE Banking Act Through Senate Committee
The National Cannabis Industry Association, in collaboration with other cannabis-related organizations, drafted a letter to Senate Banking Committee Chairman Mike Crapo (R-ID), urging him to move the House version of the SAFE Banking Act through committee and to the Senate floor for a vote.
The letter also addressed serious concerns the industry finds with one of Sen. Crapo’s suggested amendments to limit the provisions of the SAFE Banking Act to products containing less than 2% THC. Now we need the help of businesses in the cannabis industry to join us in letting Chairman Crapo know how important it is to move the SAFE Banking Act through Committee this session of Congress. Please follow the link below to add your name to the growing list of industry voices calling for fair and safe banking access.
Oversupply and shortages, high prices and lack of choice for patients and consumers, illicit markets, tainted products, and the inability to access banking and capital all plague the burgeoning cannabis industry. While cannabis advocates and industry leaders are working on each of these problems, there is one solution that would ease the burden on all of them. Allowing for interstate trade between states with legal cannabis markets would improve each of these issues while supporting the individual solutions to each that the industry has been working on. This is the first post in a series that explores the benefits and barriers to setting up a legal framework for interstate trade, even before wholesale legalization at the federal level.
Since the beginning of legal, adult-use cannabis, when Colorado and Washington passed the first ballot measure allowing for adult-use, the industry was guided by the Cole Memo, which laid out the parameters for the federal government staying out of the states’ cannabis experiments. Among other things, the Cole memo stated that the DEA could crackdown on cannabis moving from states with well-regulated systems to states that do not allow cannabis. This statement has been interpreted conservatively to mean that no cannabis should cross state lines for any reason, ever, based on the fact that at the federal level, cannabis is still a Schedule I drug under the Controlled Substances Act.
Today, there are 10 states which have legalized adult-use, another 19 which allow for medical use, and six more which allow the use of CBD products only. Many of these states share borders, and producer states could serve several nearby markets without ever entering a state that does not allow cannabis in any form. Furthermore, the Cole Memo, which was rescinded by Jeff Sessions in 2018, has not been replaced by any guidance whatsoever. This means that each U.S. Attorney’s office is free to set their own enforcement priorities around state-legal cannabis activities, and there is no official overriding policy at the DOJ on interstate trade between states with medical or adult use. Corresponding guidance from FinCEN, however, remains in effect and similarly discourages the transfer of cannabis between states.
Cannabis markets vary widely from state to state with regard to the underlying market dynamics and challenges that they face. Some states produce too much while other states experience shortages. Meanwhile, new states pass legislation or have voter initiatives that allow medical or adult-use every year without any infrastructure in place to supply that state’s demand. In each new legal market, the vast majority of demand had long been met through illicit market supply, and generally from outside of the state’s boundaries.
The artificial boundaries around cannabis markets have far-reaching impacts for local economies, patient access, illicit market activity, and social equity. Later posts in this series will take a deep dive into each of these issues, and in this post, we will look at how this has impacted states, the industry, and consumers so far.
Lessons Learned:
Washington State chose to take the strictest possible reading of the Cole Memo, and insist that not only must cannabis not cross state lines but also sources of funding must come from within the state. Combined with their high capitalization requirement for licenses, the result was a disaster from an equity standpoint: only wealthy and well-connected individuals in the state (which are overwhelmingly white males) were able to even attempt a license. This decision was based substantially on the fact that interstate trade was not allowed.
In Oregon, which has an ideal growing climate and a long tradition of exporting cannabis (albeit in the illicit market), the artificial boundaries created by the ban on interstate trade lead to a massive oversupply for its small population, which crippled the industry and tanked many small businesses. Despite the fact that Oregonians consume more cannabis per capita than any state, their climate and culture have led to growing massive quantities of world-class cannabis that cannot reach patients and consumers, even in neighboring states that might have under-supply issues. The result is that hundreds of small, mom-and-pop shops and family farms have gone out of business, eradicating millions of dollars of local capital, and accelerating mass consolidation of the industry into the hands of a few foreign corporations. Meanwhile, in medical markets like Illinois and Michigan, patients have had sporadic access to quality cannabis-based medicines.
When Nevada originally launched, due to the influence of local liquor distributors, it was almost impossible to get products to market, and the state’s dispensaries sold out on the first day of sales. After ironing out some of the kinks, sales are going strong, but the practice of growing thirsty plants indoors in the desert is of dubious value when the same plant can be grown with a fraction of the inputs in northern California and southern Oregon.
California’s legal system is a perfect example of how over-regulation fuels illicit market activity. Because of the structure of their regulatory framework and high taxes, the state is served by only 800 licensed dispensaries, whose prices are double and triple those found on the illicit market for similar products. This has led to the emergence of thousands of “pop-up” or unlicensed dispensaries, selling untested products tax-free in a thriving illicit market. The booming illicit market in California has also led to massive wholesale markets of hardware, branded packaging, and flavoring and cutting agents (all technically legal) to supply the illegal operators with everything they need to look legitimate. This is a major contributing factor to the wide-spread vaping related illness cases popping up all over the country, as many illicit market operators purchase their supplies in downtown Los Angeles.
The ban on interstate trade promises to continue to create new and novel problems as well. If New York, the 4th most populous state in the union, legalized adult-use (which seems likely in the near future), and interstate trade were still banned, it would require a massive investment, on the order of billions of dollars, to create enough indoor and greenhouse grow facilities to supply the demand created by its 19 million inhabitants. The recent legalization of hemp under the last Farm Bill has created a number of legal dilemmas as well, as some individual states that do not recognize any difference between hemp and cannabis flower have seized products and arrested individuals taking hemp legally grown in one state to a market where it is legal to sell.
Some suggest that these issues will be sorted in local markets, and in each state individually this approach might seem to make sense. When you add these problems together, though, a much more elegant, efficient, and obvious solution emerges: let states that have always exported cannabis send it to states that have always imported it. A set of different and seemingly unconnected problems become each other’s solutions.
Historically, people across the country have consumed cannabis, and the vast majority of it was grown in a few locations that are particularly well-suited to the plant. It is highly likely that a fully-matured nationwide legal market (one which must account for not only interstate, but also international competition) will ultimately be best served by the same general market dynamics. The only question is: how long will we allow the artificial market boundaries around each state to decimate local capital, curb access for patients and consumers, encourage investments that are attractive short-term but disastrous long-term, and prop up the illegal markets that pose a public health risk?
Interstate trade between states that allow some form of legal cannabis would provide much-needed relief on a number of fronts for cannabis businesses, and could be structured in such a way to support social equity efforts. With a little guidance on enforcement and thoughtful programs and agreements between states, there is a path to legal interstate commerce even before cannabis is removed from the Controlled Substances Act. The state of Oregon has already passed legislation allowing for the export and import of cannabis products provided that the Federal Government allows it. This could be either through legislation such as the proposed Blumenauer/Widen State Cannabis Commerce Act, or though DOJ enforcement guidance (whether from the Attorney General or the relevant local U.S. Attorney’s). There are multiple paths that can lead to the end of banned interstate trade, and it seems increasingly inevitable that we will see legal cannabis trade across state borders in the near future. For most operators in the cannabis industry, and for all patients and consumers, this will be a good thing, and can’t come soon enough.
Gabriel Cross is a Founder and CEO at Odyssey Distribution, LLC, a distributor for locally-owned craft cannabis producers and processors in Oregon. Gabe worked in the sustainable building industry for a decade before starting Odyssey and brings his experience with sustainability and systems thinking to his work in the cannabis industry. Odyssey manages logistics, sales and marketing for boutique producers so they can focus on creating great craft cannabis products for the Oregon market.
Congress Holds First Cannabis Policy Reform Hearing of 2020 This Week
by Morgan Fox, NCIA’s Director of Media Relations
This week, Congress will hit the ground running by holding the first cannabis policy reform hearing of 2020 only weeks into the new session. The hearing, entitled “Cannabis Policies for the New Decade,” will be held by the House Energy Subcommittee on Health on Wednesday.
This hearing is expected to explore the barriers to cannabis research, the health impacts of current federal cannabis policies and the implications of reform, as well as several pieces of cannabis-related legislation including the Marijuana Opportunity, Expungement, and Reinvestment (MORE) Act, the Marijuana Freedom and Opportunity Act, the Medical Cannabis Research Act of 2019, the Medical Marijuana Research Act of 2019, the Legitimate Use of Medicinal Marijuana Act, and the Veterans Medical Marijuana Safe Harbor Act.
This hearing is an excellent sign that Congress is willing to continue the groundbreaking progress it made last year.
Unfortunately, all the witnesses for the hearing are representatives of government agencies that have not been overly receptive to ending cannabis prohibition, namely the Drug Enforcement Administration, the Food and Drug Administration, and the National Institute on Drug Abuse. But while we do not expect these witnesses to be cheerleaders for meaningful cannabis policy reform, there will no doubt be many tough questions asked by lawmakers who understand the importance of changing our nation’s outdated and harmful federal laws.
The hearing also presents an opportunity to help inform members of the subcommittee and others in Congress about the facts on this issue, as well as to show them that the cannabis industry is united in its common goal of removing cannabis from the schedule of controlled substances in a way that helps address the harms caused by prohibition, and let them know we are committed to working with them to address any concerns. A coalition of cannabis industry groups will be submitting a joint letter to the subcommittee, which will be available later this week, outlining these areas of agreement. NCIA will also be submitting written testimony for the congressional record.
You can watch the hearing here and we will be following up afterward with more information as well as responses, so stay tuned!
Ten Years Of NCIA Featuring Aaron Smith
The National Cannabis Industry Association, which currently represents nearly 2,000 member businesses, turns 10 years old in 2020!
NCIA was founded in 2010 at a time after the release of the Ogden Memo by Justice Department directing prosecutors not to prioritize the use of federal resources to prosecute patients with serious illnesses or their caregivers who are complying with state laws on medical marijuana, laying the groundwork for a new national industry.
It’s been a long, wild ride representing the next great American industry. Hear from our Executive Director Aaron Smith about what it’s been like to advocate for the responsible cannabis industry and grow the association for over a decade!
Committee Blog: Working With Your Local Government as a Cannabis Cultivator
The regulated cannabis industry is inextricably linked to politics, and all politics is local — so when trying to open and operate a cannabis business, you’re almost sure to need to work with local government in some way.
To help our members understand how to start these relationships right, the NCIA State Regulations Committee hosted a webinar on how to approach local government earlier this year. That focused on identifying your relevant local authorities, how to introduce yourself, and how to properly navigate those relationships.
Once you’ve figured out who to talk to and have gotten in touch with them, they’ll often have questions about the cannabis industry, and there is plenty of good information you can proactively share as well. To help NCIA members inform their local governments about the wide range of issues surrounding our industry, we’ll be diving even deeper with a series of blog posts.
We’ll be starting this series where the whole cannabis supply chain begins: cultivation. Future posts will touch on processing, retail, and more. Even though states categorize their licenses differently, with some issuing stand-alone cultivation licenses and others combining cultivation with processing (or sometimes issuing vertically integrated licenses, with retail too), we’ll be focusing in on the various operations individually.
ECONOMIC IMPACT
When elected officials hear about a new business wanting to open in their town or city, their first question is usually, “how many jobs will it bring?” Mayors, city and town councils, departments of economic development, and other government entities are often laser-focused on building up the local economy, so explaining how your business will help them towards that goal is integral to moving your project forward.
Lucky for them, cannabis cultivation is a very labor-intensive endeavor, and you’ll likely be hiring dozens of people to staff your facility. If you’re an experienced operator who knows exactly how many people you need to hire and in what roles, let your local government know! They’ll be interested to see the range of responsibilities and necessary experience, from entry-level trimmers to mid-career managers to botanists with a Ph.D. If you’re still figuring out your exact staffing plan, providing a range of possibilities will help them understand the scale of your project. Be sure to avoid pie-in-the-sky estimates that you’ll never be able to reach — in the long run, it’s always better to under-promise and over-deliver than to make it seem like you were pulling a bait-and-switch. Also do not forget to include all the contract jobs created by constructing or retrofitting your facility.
Beyond the sheer number of hires you’ll be making, it’s important to talk about the compensation and benefits that you’ll be providing to your employees. If you’re starting everyone above the state’s minimum wage — or better yet, starting everyone at a living wage (generally thought to be at least $15/hour) — highlight that! If you’re providing health insurance or other benefits to your hourly employees, let them know! Elected officials like to see companies doing better than the bare minimum, and love to see companies that do even more.
Your physical facility will also have an economic impact on the community that’s worth talking about. If you’re buying your building, you’ll be paying property taxes, and you can let your elected officials know just how much you’ll be contributing to the tax base. Mayors and councilors always love to see unused space being occupied, so if you’re making use of a vacant or neglected building, be sure to let them know. This goes double if you’ll be making improvements to the building that increase its value (and triple if you’re using a local construction company to make those improvements).
Finally, consider whether you will be providing any additional revenue to the local government. While some state cannabis laws do allow for local taxes, these typically apply to retail rather than cultivation. Massachusetts and some other states also make heavy use of “community host agreements,” or CHAs, where a business commits a percentage of its revenues to the local government for a limited period of time. If either of these applies to you, be sure to provide elected officials with the relevant parts of state law, and the specifics you’re willing to offer. If you plan to financially support any charities, provide details — and if you’d like some guidance on what local charities are doing the most good, just ask, since most officials would be happy to tell you some of their favorites.
PUBLIC SAFETY
Elected officials also care about public safety, but usually follow the lead of their police chief and fire chief, for whom safety is their one and only priority. It’s good to proactively highlight the ways your facility will improve public safety — if you’re installing outdoor security cameras or floodlights, those can protect your neighbors as well as yourself, and there have been multiple cases where cameras on a cannabis business have helped solve an unrelated crime.
It’s important to remember that police and fire chiefs are spread thin and need to know a little about a wide variety of topics. Unless there are already cannabis businesses in their town, they probably haven’t read the state security requirements to open a facility, so providing an overview of the state law can help demonstrate how tightly regulated you will be. Knowing that the state already has rules for waste disposal, product storage, and controlled access areas can alleviate many of their initial concerns.
Once you’ve explained the security features of your building and run through the state requirements for cannabis businesses, you should address any lingering fears or questions that they may have. Two of the most common concerns are the safety of employees while transporting product or cash, and the risk of your building being targeted by burglars looking to steal product.
Regarding employee safety, explain how you will be shipping product to processors or dispensaries. Are you delivering it, are they picking it up, or are you using a third-party transporter? If you are transporting product yourself, explain both the state requirements and your own operating procedures, from GPS tracking to using two employees for each delivery.
You should also go into detail about your banking relationships. Many people outside the industry assume that it’s 100% cash, but if you’re part of the large majority of cannabis businesses with bank accounts, let your local officials know, especially the police chief. They will be much more comfortable if they know your customers will be wiring payments directly to your bank, rather than dropping off duffle bags full of cash at your facility.
Regarding burglary, be sure to re-emphasize your security measures, from cameras and fencing to access control and alarms. Explaining the cannabis life cycle may also be helpful — since plants are not useable products for most of their life, they’re poor targets for theft. This means that cultivation facilities are not prime targets for burglars, but in the rare cases that they are targeted, you can point to examples where cameras have led to burglars’ arrests.
COMMUNITY IMPACT
While economics and public safety are almost always the top two concerns of local governments, they may also be worried about other impacts on the community and how your business will affect residents’ quality of life. Common questions include whether your facility will emit any odor, and if it will increase traffic in the area.
Cannabis is famous for its strong odor, so it’s understandable that people would ask about it. Whether your state requires it or not, it’s advisable to use charcoal scrubbers or other odor mitigation technology to prevent your plants’ odor from escaping the building. Knowing that you’re taking steps to address this concern will help elected officials feel comfortable welcoming you into their community, especially if it’s in a densely populated area.
Traffic concerns may arise, especially if there are recent news stories about mile-long lines at dispensary grand openings. You can address this easily by explaining how cannabis cultivation facilities are not accessible to the public, and the main people coming to your building will be employees and inspectors, not customers.
When built and operated properly, cannabis cultivation facilities should be virtually indistinguishable from any other commercial warehouse. Unless you have very explicit signage (which we do not recommend), most people driving or walking by will not even know that you’re a cannabis business.
GOING FURTHER
Even after you have addressed all of your local government’s concerns, there will probably be even more questions — and that’s okay! This is a great opportunity to keep the dialogue open. Be sure to stay up to date on state laws and regulations so that you can serve as a resource for local officials. Because they’re spread so thin, they will appreciate having someone like you as a go-to when they have questions about cannabis politics or the industry.
If you’re able to offer tours of your facility, that’s a great way to build relationships with your local officials while educating them about your business and the cannabis industry as a whole. They may also appreciate invitations to events hosted by state cannabis regulators, or local industry conferences where they can get broader exposure to the cannabis world.
And of course, it’s important to be a good member of your community. Whether it’s participating in local projects, supporting local organizations, or organizing your own trash clean-ups or other events, staying active and visible will help the community know that they can count on you being a good neighbor.
Be sure to stay tuned for future installments in this series, where we will be addressing other cannabis license types. Our next blog will focus on processors.
Senate Banking Committee Chairman Gives Cannabis Industry Coal for Christmas
by Michael Correia, NCIA’s Director of Government Relations
NCIA’s Director of Government Relations, Michael Correia
As you may have heard by now, Senate Banking Committee Chairman Mike Crapo (R-ID) issued a very disappointing press releaseabout his opposition to the SAFE Banking Act yesterday. If you recall, the SAFE Banking Act passed the House of Representatives in September with an overwhelming bipartisan majority (321-103) and is waiting for a legislative markup in the more conservative Senate.
In the release, Chairman Crapo said, “I remain firmly opposed to efforts to legalize marijuana on the federal level, and I am opposed to legalization in the State of Idaho. I also do not support the SAFE Banking Act that passed in the House of Representatives. Significant concerns remain that the SAFE Banking Act does not address the high-level potency of marijuana, marketing tactics to children, lack of research on marijuana’s effects, and the need to prevent bad actors and cartels from using the banks to disguise ill-gotten cash to launder money into the financial system.” Perhaps the most alarming change Chairman Crapo suggested was a 2% THC potency cap on products in order for a business to have access to the banking system. This provision alone is unworkable and unacceptable.
Chairman Crapo continued by outlining numerous areas that he believes need to be addressed:
Add public health and safety solutions as a requirement for banks to do business with legally-operating state cannabis companies. Options to consider include THC potency; clear and conspicuous disclosures on products; marketing; effects on minors, unborn children and pregnant women; and age restrictions, among other considerations.
Prevent bad actors and cartels from using legacy cash and the financial system to disguise ill-gotten cash or launder money.
Update 2014 FinCEN rulemaking and guidance regarding marijuana-related businesses, and ensure FinCEN has all of the necessary tools it needs to prosecute money launderers and promulgate rulemakings.
Respect state rights in interstate commerce and banking for institutions who operate in multiple states with different state rules.
Eliminate “Operation Choke Point” and preventing future “Operation Choke Point” initiatives. Under fear of retribution, many banks have stopped providing financial services to members of lawful industries for no reason other than political pressure, which takes the guise of regulatory and enforcement scrutiny.
Unfortunately, Chairman Crapo’s views are out of step with the majority of Americans, and every day that he delays a markup on this legislation is another day that puts public safety at risk. While the Chairman may oppose broader cannabis policy reform, he clearly recognizes the problems created by lack of access to financial services. The SAFE Banking Act already addresses many of the chairman’s concerns, particularly public safety, clarity, and transparency. We’re happy to discuss these items with the Senate Banking Committee in a markup. However, efforts to slow this legislation’s momentum will not fix the underlying problems and will continue to put people at risk.
NCIA will continue to work with industry stakeholders, advocates, the financial services industry, and other coalition partners to address Chairman Crapo’s concerns and reach a conclusion that aids public safety, is good policy, and delivers a positive outcome for the burgeoning cannabis industry. That being said, here is how you can help.
Chairman Crapo is requesting public feedback on the SAFE Banking Act and the concerns that he outlined. Interested? You can submit proposals to Banking Committee staff at submissions@banking.senate.gov. Here are a few important tips to remember:
Be polite. While the Chairman’s opinions may not align with your own, remember that he is the sole person deciding whether or not the SAFE Banking Act will continue on in the legislative process.
NCIA, the American Bankers Association, and many other stakeholders have already provided the committee with relevant information on several of the issues identified by the Chairman including legacy cash, interstate commerce and ‘Operation Chokepoint.’
The SAFE Banking Act is a narrow financial services bill that will increase transparency, accountability, and public safety in communities around the country. It does not legalize marijuana.
The SAFE Banking Act is supported by a wide range of national organizations and state officials, including: National Association of Attorneys General (NAAG), United Food and Commercial Workers (UFCW), Credit Union National Association (CUNA), Independent Community Bankers Association (ICBA), American Bankers Association (ABA), Mid-size Bank Coalition of America (MBCA), National Bankers Association (NBA), Electronic Transaction Association (ETA), Law Enforcement Action Partnership (LEAP), The Real Estate Roundtable (RER), National Association of REALTORS, Safe and Responsible Banking Alliance (SARBA), American Land Title Association (ALTA), American Property Casualty Insurance Association (APCIA), The Council of Insurance Agents and Brokers (CIAB), Reinsurance Association of America (RAA), Independent Insurance Agents and Brokers of America (Big “I”), Wholesale Specialty Insurance Association (WSIA), National Association of Mutual Insurance Companies (NAMIC), Rural County Representatives of California (RCRC), Brinks, Inc., International Council of Shopping Centers (ICSC), National Association of Professional Employer Associations (NAPEA), National Cannabis Industry Association (NCIA), Minority Cannabis Business Association (MCBA), National Cannabis Roundtable (NCR) and the Cannabis Trade Federation (CTF). Additionally, the Mayors Coalition to Push for Marijuana Reform, 38 State Attorneys General, 20 Governors, and 18 State Banking Supervisors have endorsed the legislation.
If your business is not yet a member of NCIA, the best way you can help this effort is by joining today so that our team in D.C. can start the year off stronger than ever in our efforts to move sensible banking reform through the Senate and to the president’s desk. Although this news is not what we wanted for Christmas, NCIA has been and will continue to work tirelessly to pass the SAFE Banking Act. We will continue to advocate for a responsible, safe, legal industry in 2020 and beyond. Happy holidays from NCIA’s D.C. team to you and yours!
This site uses cookies. By using this site or closing this notice, you agree to the use of cookies and our privacy policy.
It’s funny how things just happen… one day, like any normal day, I was working the lunch shift at a restaurant called Carolina Ale House in Columbia, South Carolina. At first, I was worried about how much I would make in tips that day, as anyone with experience in the service industry can relate to, but then I started chatting with one of my tables… small talk, really. I told them how I was a sophomore at the University of South Carolina studying journalism and mass communications with a focus in public relations and a minor in women and gender studies. One man asked, “Well what do you want to do after college?” A question I thought about often but never had an answer to. He handed me his business card and asked if I was interested in politics. A few days later, I reached out, interviewed with the firm partners, and successfully scored the internship. 
As a former Federal bank regulator and seasoned consultant, Angela’s knowledge of regulatory compliance, risk management and investment advisory services has established her reputation as a leading resource within the financial consulting industry, spanning consumer protection and anti-money laundering statutes, fraud and cannabis banking issues. 
After studying Russian affairs and working as a political consultant, Sean Donahoe co-founded the California Cannabis Industry Association. He served as its Deputy Director through 2014 when he transitioned to consulting for investors and operators, communicating with public stakeholders, serving on local government committees, and advising industry trade groups. He holds an MSc in Government from the London School of Economics and is CEO of Sungrown Developments Inc., an advisory firm and holding company in Oakland, California.
Glenn H. Truitt, Esq. is the Managing Partner of 
In September of last year, reports began surfacing of mysterious respiratory illnesses generally associated with the use of vape cartridges, including those containing cannabinoids. Over the following months, reports of these cases climbed to more than 2000 nationwide, including more than 50 deaths. The Center for Disease Control and state health agencies struggled to determine the proximate causes, but it became increasingly clear that the vast majority of these cases were linked to unregulated cannabis vape products. As the focus began to narrow on the presence of Vitamin E acetate and other additives in unregulated products, 
Gabriel Cross is a Founder and CEO at 
