NCIA Deputy Director of Communications Bethany Moore checks in with what’s going on across the country with the National Cannabis Industry Association’s membership, board, allies, and staff. Join us every Friday here on Facebook for NCIA Today Live.
by Michelle Rutter Friberg, NCIA’s Deputy Director of Government Relations
It’s hard to believe that somehow it’s March again, but all the while, the NCIA team in D.C. has been hard at work lobbying and advocating on behalf of you and your business. Things are really beginning to warm up and spring into action, so keep reading below for a quick update on where things are at with SAFE Banking, comprehensive reform, appropriations, and more!
Bill reintroductions in both chambers have been off to a slow start. Between a new session, most people still working remotely, a delayed organizing resolution in the Senate, and a somewhat contentious COVID relief package that’s finally passed, members of Congress and their staff have been incredibly busy. But, now that that’s all behind us, I’d suggest preparing for many cannabis bills to be introduced soon.
Specifically, you can expect the reintroduction of the SAFE Banking Act to happen in both the House of Representatives and the Senate within the next couple of weeks. When the bill was introduced in the House during the 116th Congress, it had over 100 cosponsors. In the Senate, it was introduced with more than 20 — that’s more than a fifth of the entire chamber! The bill later went on to be passed by the entire House of Representatives in September 2019 by a vote of 321-103.
You’ll remember that the SAFE Banking Act addresses urgent public safety concerns by allowing tightly regulated marijuana businesses the ability to access the banking system and make our communities safer. The bill also provides protections from money laundering laws for any proceeds derived from these state-legal marijuana businesses. The bill also includes the Financial Institution Customer Protection Act and protections for hemp and hemp-derived CBD-related businesses, which sometimes still struggle in accessing financial services despite the legalization of hemp in the 2018 Farm Bill.
Don’t expect any big changes, however — the bill this Congress includes minor technical changes to the safe harbor language, strengthened hemp provisions, and other technical updates.
While SAFE Banking’s timeline is clear, the same can’t completely be said for more comprehensive reform. When I say comprehensive reform, I’m talking specifically about bills that would remove marijuana from the Controlled Substances Act like the MORE Act and the upcoming Schumer-Booker-Wyden bill.
In the House, we are continuing to work with various committees and members to determine the best path forward for the MORE Act and what changes should be made. I wouldn’t be surprised if that bill gets reintroduced sometime this spring, but the process is truly still in flux, so I also wouldn’t be surprised if it was postponed awhile. This will be determined by the lead sponsors’ offices and also by the congressional calendar and how various bills/issues move through the legislative process.
In the Senate, we’re excited to be working with Leader Schumer (D-NY) and Sens. Booker (D-NJ) and Wyden (D-OR) on their new cannabis bill. That bill will draw heavily on provisions from the MORE Act, but will also include expanded language on taxation and smart regulations. Now that the COVID relief bill has passed into law, I think we can expect to see their bill be introduced sometime in the near future.
It’s spring, which means it’s appropriations season here in D.C.! These bills are legislation that “appropriates,” or sets aside, federal funds to be divided between specific federal government departments, agencies, and programs. For a refresh on the history of appropriations, click here, or, if you’re interested in how these provisions relate to cannabis, click here.
While the appropriations amendment that protects medical cannabis businesses, patients, and programs has been in law since 2014, we’ve had difficulty expanding those provisions and passing new cannabis-related amendments due to the formerly-Republican controlled Senate. However, now that Democrats control both houses of Congress, we’re excited to go back to the drawing board and get creative with the appropriations process to help provide some certainty and relief to the cannabis industry.
We’ll be looking at amendments pertaining to adult-use cannabis programs, banking, veterans access, allowing Washington, D.C. to finally implement a functioning 21+ cannabis program — and that’s just scratching the surface!
All of this is to say: things are really springing into action in D.C.! Prepare for many cannabis bills to begin getting reintroduced, and remember that the appropriations process takes months, so stay tuned via our blog, newsletter, NCIA Connect, and the new NCIA Mobile App to remain in the loop and get involved!
Tune in LIVE on Facebook every Friday afternoon, or catch our now-weekly NCIA Today video updates to hear what’s new in cannabis policy reform and here at NCIA.
While the NCIA team was hoping to welcome all of our members to Washington, D.C. this spring for our 10th Annual Cannabis Industry Lobby Days, we have made the difficult yet necessary decision of postponing the event until further notice due to the COVID-19 pandemic.
This was not a decision made lightly, as our annual fly-in is an integral part of our government relations efforts on Capitol Hill. However, with congressional buildings being closed to the public, new virus variants, and continued community spread, we believe this is the smartest and safest decision for our members, elected officials, and their staff.
That being said, the NCIA government relations team continues to virtually lobby and “meet” with various stakeholders, coalitions, and congressional personnel to further cannabis policy reform every day, thanks to the financial support of our members. We are working hard to reintroduce priority bills, include the SAFE Banking Act in the next pandemic relief package, and are helping to craft new, exciting, progressive legislation that focuses on de-scheduling cannabis and creating a thriving, diverse, and equitable industry.
Stay tuned via our newsletter, website, and NCIA Connect to learn more about NCIA’s Lobby Days and what’s next. We can’t wait to host all of you back in our nation’s capital, but in the meantime, please stay safe and stay healthy!
Host Bethany Moore, NCIA’s Deputy Director of Communications 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.
From the top, Bethany discusses the “cautious optimism” bouncing around the D.C. Government Relations office, as the 117th Congress begins to get to work with GR Director, Mike Correia.
Check out how your member of Congress rated on our Congressional Scorecard, on our website.
We check in with Mike Lumoto, Committee Organizer for NCIA’s Diversity, Equity, Inclusion Committee on the incredible growth they saw in 2020 and the plans taking off in the new year.
Don’t forget to download the new NCIA Mobile App and never miss the latest cannabis news.
by Jimmy Young, founder of Pro Cannabis Media
Thanks to Democracy and the grassroots efforts of cannabis advocates from coast to coast, there are now 15 holes in the cannabis prohibition wall (legal states), and 36 cracks (medicinal programs). So when will that wall come down and how fast? More importantly, what will the industry look like when the dust settles?
Over the past few weeks, cannabis media pundits from all over the world have chimed in with their predictions for 2021. (Some even pontificated before knowing the results of the Georgia State runoffs in the Senate.)
With President Joe Biden now in the White House and the Democrats controlling both houses of Congress, cannabis advocates are wondering when, and if, we will see federal legalization of cannabis in 2021. Will it succeed or will our dutifully elected politicians do something that will derail the will of the people during this Green Wave of reform?
Already, a Republican congressman from Florida, Greg Steube, decided to file the first draft of reform to a committee that will move cannabis from schedule 1 to schedule 3 on the Department of Justice list of “controlled substances.”
But for many, this does not go far enough. I recently interviewed the Media Relations Director of NCIA, Morgan Fox, who told me, “It’s not something the NCIA or other Cannabis advocacy groups is going to support….we are all focused on de-scheduling, (this draft) it just doesn’t go far enough.”
So what position are lobbyists in Washington, D.C. taking now that their arguments for reform may find a more supportive group to talk to? What is the best thing for the industry? What’s the right thing to do?
I also interviewed Michael Correia, the Director of Government Relations for NCIA, who explained that the target should be for full legalization, but that at the heart of the issue, there is something more important that needs to be dealt with – racism. In my interview with him, he said, “…let’s just stop arresting people for this. Stop arresting people in this war on drugs so no one’s lives are ruined because they’re consuming a natural plant, that 30 plus states have said, Hey, we’re okay with this. There shouldn’t be these differences. So just stopping, arresting these people, and then worrying about what’s the next step?”
Why does he feel so strongly about this? The evidence is overwhelming that law enforcement has used simple possession as a profiling tool to fill our privately run prisons with black and brown people over mere cannabis possession. “The vast majority of these arrests (92%) were for simple possession of the drug. 500,395 of [the 545,602] arrested for cannabis [crimes] were simply found [to be] in possession of cannabis.”
So are you convinced now that cannabis, a plant, is not illegal because it is considered a drug, but rather because of a racist system and the fact it can be used as a means to profile and jail black and brown people? Do you want more evidence of the racial bias in cannabis arrests? Check out this 2020 report on the racial makeup of those simple possession “crimes.”
So what’s the 2021 plan for lobbyists, policymakers, and elected officials? What exactly does this industry look like if one of the following changes happens in the next year or two?
Each one of those changes is not only positive for this young industry but will have a ripple effect that will impact other industries. The trickle-down effect for any of these changes being implemented will impact the private prison system, banking, and financial markets, big alcohol, big pharma, social equity, expungement of past convictions, interstate commerce, and the international markets.
The cannabis lobbyists know that with Democrats in charge of the direction of the Congress over the next two years, this is their opportunity for serious reform. After all, the House passed a legalization bill, the MORE Act, in December of 2020. In 2019, the previous year, the SAFE Banking Act was also approved by the House, but neither even got to the floor of the Senate because of the then-Majority Leader Mitch McConnell’s anti-marijuana stance.
2021 is now upon us, and “grown-ups are now back in charge in D.C.” However, many advocates I’ve talked with are understandably wary and skeptical about the Federal Government dictating governance of this industry if cannabis is federally legalized and falls under the control of the alcohol and Beverage Commission.
Most cannabis advocates can at least agree that cannabis should be removed from the schedule that was created by the Controlled Substances Act in 1971. This change alone would allow banks to do business with the cannabis industry and allow for the removal of the restrictive 280E tax code that has limited the profit margins of already existing businesses.
Here are some links to other predictions from leading media sources about what cannabis reform democratic control of Congress may lead to:
Marijuana Moment: What The New Democratic-Controlled Senate Means For Federal Marijuana Legalization In 2021
Politico: Democratic-led Senate could clear a path to marijuana legalization
Forbes: Democrats Win The Senate: The Impact On Marijuana Policy
So after reading all this information, here’s what I think will happen over the next four years.
It’s 2021, the year of the cannabis plant as a political issue is here and reform is as pungent as the odor of this amazing plant. Stay tuned, this will be an ongoing theme in D.C. politics this year as we all hopefully witness another chapter in the historic end to prohibition.
Jimmy Young is the founder of Pro Cannabis Media. An Emmy Award-winning talk show host from New England, and a resident of Massachusetts who holds a medical card after 4 major surgeries in 22 years.
The founder of Pro Cannabis Media is the current host of In The Weeds with Jimmy Young, a weekly podcast distributed over the CLNSMedia.com, site, iTunes, Spotify, Googlecast among others. In July of 2019, he teamed up with the founder of Cannabis.net, Curt Dalton, to host a two hour live monthly Weed Talk Show where the two Massachusetts natives have interviewed some of the biggest names in Cannabis, like Steve DeAngelo, Bruce Linton, and Tommy Chong. Locally local cannabis advocates and representatives from the medical establishment in the Bay State have all appeared on that show that is now being distributed nationwide. Young also produces a weekly news video, called News Dabs, highlighting and commenting on the biggest stories around the world in the emerging cannabis universe.
by Michelle Rutter Friberg, NCIA’s Deputy Director of Government Relations
Last week, I wrote about what to expect during the 117th Congress. This week, I want to highlight the incoming Biden Administration, and the various agencies and Cabinet officials that could affect cannabis policy going forward over the next four years.
The tradition of the Cabinet dates back to the beginnings of the Presidency itself. Established in Article II, Section 2, of the Constitution, the Cabinet’s role is to advise the President on any subject he may require relating to the duties of each member’s respective office. The Cabinet includes the Vice President and the heads of 15 executive departments — the Secretaries of Agriculture, Commerce, Defense, Education, Energy, Health and Human Services, Homeland Security, Housing and Urban Development, Interior, Labor, State, Transportation, Treasury, and Veterans Affairs, as well as the Attorney General.
In February 2014, the Treasury Department issued guidance to clarify Bank Secrecy Act (BSA) expectations for financial institutions seeking to provide services to marijuana-related businesses. However, over the last seven years, the policy landscape surrounding cannabis has changed dramatically — at the time this guidance was issued, only Colorado and Washington had legalized adult-use cannabis. Now, there are 15 states plus the District of Columbia that allow for the adult-use of cannabis and 36 states with medical cannabis laws.
Incoming President Biden has nominated former Federal Reserve Chairwoman Janet Yellen for the post of Treasury Secretary. Though her position on cannabis is relatively unknown, it’s definitely possible that this guidance could be updated or expanded. Additionally, if the SAFE Banking Act is passed by Congress, the Treasury Department would then be in charge of ensuring that the implementation of that legislation goes smoothly.
Here’s the big one everyone in cannabis will be watching: the Department of Justice. President Biden has selected Merrick Garland as his nominee for Attorney General, and everyone seems to be wondering the same thing: could there be a new “Garland Memo” ala the Cole Memo?
If you’ll remember, during the Obama Administration in 2013, the Department of Justice issued the Cole Memo, which outlined enforcement priorities for the Department as states were beginning to set their own cannabis policies. Under the Trump Administration, that memo was rescinded in January 2018 by then-Attorney General, Jeff Sessions.
It’s certainly possible that a Garland DoJ could unveil a new cannabis-related memo. Outside of enforcement priorities, the Department could also direct other agencies to reevaluate their policies around cannabis and housing, immigration, and the armed forces.
In 2018, the Small Business Administration (SBA) came out with a notice to all employees and lenders that updated their policies surrounding marijuana businesses. They stated, “Because federal law prohibits the distribution and sale of marijuana, financial transactions involving a marijuana-related business would generally involve funds derived from illegal activity. Therefore, businesses that derive revenue from marijuana-related activities or that support the end-use of marijuana may be ineligible for SBA financial assistance.” They then went on to outline the ineligibility of direct and indirect marijuana businesses, as well as hemp-related businesses (this was pre-2018 Farm Bill) to participate in SBA programs.
This could all change under a Biden Administration, however. The President-elect has tapped Isabel Guzman as Small Business Administrator — she currently serves as the director of California’s Office of the Small Business Advocate. While her position on marijuana is unknown, I’m incredibly hopeful for reform under Guzman — her familiarity with small businesses in California means she is surely well informed on the struggles the cannabis industry faces.
These are just a few of the agencies that I’m watching, but there are many others to keep an eye on: the Veterans Administration, Health and Human Services, and FDA, just to name a few. And, as always, NCIA will be working to advance positive reforms within the executive branch at every opportunity.
Make sure you’re subscribed to NCIA’s CannaBusiness Leader to stay up to date on the latest and find me over on NCIA Connect with any questions or feedback!
by Jacob Carlson, Co-founder and CEO of EZHire
The cannabis industry has been growing exponentially over the last few years and plenty of job opportunities are coming with it. As businesses grow, they need to increase staff… and that takes time and money.
Not only do companies have to find and interview clients, because of all the legal matters tied to the industry, they also have to run background checks. The onboarding process and paperwork is another important matter to be dealt with.
Cannabis businesses must stay on the right side of the law by making sure their hiring process is done correctly, and that’s where human resources comes in. Here are some human resource tips you should be aware of when you are hiring to meet your company’s needs.
If you don’t have an HR department, hiring one comes with its own set of complications. Instead of bringing on yet more employees, considering partnering with an HR company that offers these services.
There are many HR companies that specialize in working with cannabis companies. They are familiar with all the legal requirements and they will make sure that all your I’s are dotted and your T’s are crossed. They also have advanced software to ensure processes are as efficient as possible.
For years, the legal gray areas associated with cannabis companies kept them from having access to federal banks, mortgaging and financing. Now federal policymakers are coming closer to passing legislation to give businesses access to federally insured banks. Once that occurs payroll processing will become easier.
It is advisable to partner with an HR company that is aware of what the new legislation will entail so they can make the transition as seamless as possible.
Every company should communicate with employees so they know exactly what’s expected of them. This is especially important in a cannabis company where there are stricter rules and regulations. If an employee does not follow the proper procedures, the company may have to deal with legal issues.
An employee should be aware of their responsibilities early on. This should be clearly explained in the job description and it should come into play in the training. Additional materials and meetings should be provided if updates are made.
When an employee is hired, he or she must complete an I-9 Employment Eligibility form. This ensures their identity and ability to work in the United States. It is necessary in every industry. The form must be held on to for a few months and it may be asked for during an audit.
A background check is not always necessary but it’s a good move, especially in the cannabis industry. A clean background check gives you the confidence in knowing your employee will be honest and competent.
A cannabis industry typically has a variety of employees that can include part-time, full-time, 1099 contractors, seasonal, interns, and so on. Seasonal jobs are especially common as trimmers and holiday sales reps may not work for the company year-round.
It is important to know how each employee should be classified so you can give them the proper paperwork during the onboarding process.
Here are some steps you should take to ensure you are classifying your employees correctly.
A good HR company will help you classify your company correctly to keep you from incurring penalties.
The hiring process takes time and money. In order to avoid hiring new employees, companies should integrate fair practices within the workplace. This includes:
The cannabis industry is growing in leaps and bounds. If your company is expanding, these tips will ensure that your hiring and payroll processes are above board. Which practices do you enforce to avoid penalties in your cannabis business?
Jacob Carlson is the Co-Founder and CEO of EzHire Cannabis. EzHire is a talent engagement platform designed for the cannabis industry. Jacob is a serial entrepreneur having previously co-founded a corporate event service (Just Enjoy!) and social media automation tool (RapidCrowd), and he is primed for scaling his next venture with his team of technology veterans.
Hiring in the cannabis industry is hard, EzHire Cannabis makes it easy. We help businesses in the cannabis, CBD and hemp post jobs, review qualified candidates profiles with video interviews and share them among their team. If you are tired of weeding through thousands of unqualified applicants or struggling to find someone with specific experience, we can help
by Michelle Rutter Friberg, NCIA’s Deputy Director of Government Relations
We’re barely halfway through January, and it already feels like so much has happened in 2021! We at NCIA anxiously watched along with the rest of the country to see who would be victorious in the Georgia Senate races and, subsequently, which party would control the U.S. Senate. Both of the Democrats, Rev. Raphael Warnock and Jon Ossoff defeated their Republican opponents and won their races —- ensuring that the Senate will be split 50-50 with Vice President-elect Harris being the tiebreaker.
The 117th Congress has barely begun, but after Inauguration Day on January 20th, things will really take off here in the nation’s capital. Keep reading to see my answers to FAQ’s for the new Congress:
During the 116th Congress, the SAFE Banking Act (H.R. 1595/S. 1200) became the first cannabis-related bill to be passed by a chamber of Congress. In September of 2019, SAFE came to the House Floor under a suspension of the rules and passed by a whopping 321-103. While the bill had a hearing in the Senate Banking Committee back in the summer of 2019, it never received a markup or moved further than that. In addition to the bill itself, the SAFE Banking Act was also included in not one, but two COVID-19 relief packages passed by the House, colloquially known as HEROES I & II.
This session, the SAFE Banking Act will be back, and with even better chances to pass! The bill will be reintroduced in both the House and Senate in the next 1-2 months and we expect little to no changes to the text. Additionally, we’re also continuing to work with our Hill champions on this issue to see if we can get the language included in the next COVID-19 relief package — something that both President-elect Biden and Democratic leadership has said is pretty much priority number one.
In the meantime, keep an eye out for reintroduction and for how many cosponsors the bill has when it’s dropped — when the 116th Congress ended, SAFE had already passed the House as but also had 33 Senate cosponsors — that’s one-third of the entire chamber!
Cannabis policy ended the year on a high note (no pun intended!) when the Marijuana Opportunity, Reinvestment, and Expungement Act (H.R. 3884), commonly known as the MORE Act, passed out of the House of Representatives by a vote of 228-164.
As I mentioned earlier, all eyes were on the Georgia Senate races as we strategized over what could be possible for the 117th Congress depending on the outcome. With the results in, we now have a better idea about what’s possible with comprehensive reform, but there’s still a lot of unknowns.
We know that the MORE Act will be reintroduced sometime in the coming months in both the House and Senate. In the Senate, the lead sponsor was Kamala Harris, who is now Vice President-elect, which means another Senator will have to pick up the torch. I can’t share with you who it’s going to be just yet, but trust me when I say they will be a wonderful lead and are a true champion for cannabis reform!
A reintroduced MORE Act will likely have a good number of edits and changes, but the underlying intent of the bill will be the same: to remove cannabis from the Controlled Substances Act and help repair the harms the war on drugs has done — specifically to communities of color.
We also know that comprehensive reform, in general, has a better chance of advancing given that Democrats now control the Senate. Sen. Schumer (D-NY) was quoted in October as saying if he’s reinstalled as Majority Leader he “will put this bill in play,” and “I think we’ll have a good chance to pass it”, talking about his own bill, the Marijuana Freedom and Opportunity Act (S. 1552).
All of that being said, legalization, or the passage of comprehensive reform is far from a done deal. Legislation requires 60 votes for passage in the Senate, and we have a lot of hard work to do to get to that level of support in the upper chamber. In the House, Democrats have an even slimmer majority now than during the 116th Congress, so we also have to make sure we don’t lose support there.
You’ve been involved in cannabis for a long time if you remember when the appropriations process was the only way to get Congress to talk about this issue. But now, with Democrats controlling both chambers, you may be hearing more about these amendments again.
Appropriations bills are legislation in Congress that “appropriates,” or sets aside, federal funds to be divided between specific federal government departments, agencies, and programs. Read more about this process and why it matters for cannabis here.
Over the last few years, the House has continued to pass marijuana-related amendments but were unable to get through the Senate due to Republican control and a “gentleman’s agreement” between the Chair and Ranking Member of the Senate Appropriations Committee. But now, all of that will change.
In the past, appropriations amendments have been introduced that touch on a multitude of issues: research, veterans, medical and adult-use cannabis, hemp, banking… the list goes on! In this session, expect to see cannabis-related amendments included in the final budget. Just remember that budget bills must be passed annually, so anything that comes into law this way must be renewed again next year!
If you’re following cannabis policy at the federal level, definitely keep your eyes on what’s happening in various congressional committees. Given who controls both chambers, all of the committees will now be chaired by Democrats, which means you’re going to see a lot of cannabis-related bills come up for hearings and markups. Some I’ll be keeping my eye on, including both chambers’ appropriations, financial services, tax, and judiciary committees.
The opportunities for reforming our outdated cannabis laws have never been brighter than they are right now as we begin the 117th Congress. Bills are going to begin dropping left and right — and that’s because there’s a ton of excitement, enthusiasm, and optimism about what we can accomplish over the next two years.
Want to learn more about what’s possible? Make sure your company is an active member of NCIA and register for our next members-only webinar with our government relations team on Wednesday, January 27, or, if you can’t make it, hop on over to NCIA Connect to chat with us and learn more about what we’re working on in D.C.!
Join NCIA Deputy Director of Communications Bethany Moore and our Government Relations Director Mike Correia for a quick discussion about last week’s historic passage of the MORE Act.
by Madeline Grant, NCIA’s Government Relations Manager
On Friday, December 4, the House of Representatives made history by voting to approve H.R. 3884, the Marijuana Opportunity, Reinvestment, and Expungement (MORE) Act. The MORE Act would remove marijuana from the federal Controlled Substances Act and work to repair the social and personal harms caused by federal marijuana enforcement. This is the first time since marijuana was made federally illegal that either chamber of Congress has held a floor vote on- or approved- a bill to make the substance legal again. The final vote count of 228-164 fell mostly along party lines, with five Republicans crossing the aisle to support, and six Democrats voting to oppose.
This monumental victory shows just how far Congress has come over the years. Although this vote more closely aligns the House of Representatives with the majority of voters who overwhelmingly support cannabis legalization, the Senate is a different story.
As we have seen over and over again, the Senate Republicans continue to obstruct cannabis reform measures. The House passed the SAFE Banking Act in September 2019 and included the SAFE Banking language in two COVID-19 relief packages, however, there has been little activity on these topics in the Senate. Republican Senators have repeatedly spoken out in opposition of bringing up cannabis policy amidst the pandemic, stating that it’s not the time or place. But as I mentioned before, it’s also important to note that the House has passed not one, but two COVID relief packages in the last 6+ months that the Senate (namely, Leader McConnell) has refused to take up. That being said, despite a global pandemic, support for cannabis reform remains strong, a recent Gallup poll showed a record 68% of Americans support making cannabis legal. On Election Day, voters in Arizona, Montana, and New Jersey approved measures to regulate cannabis for adults, while Mississippians overwhelmingly approved a medical cannabis referendum, and voters in South Dakota passed both adult-use and medical initiatives. The vote and passage of the MORE Act on the House show that House leadership is listening.
The MORE Act, sponsored by the House Judiciary Committee Chairman Jerry Nadler (D-NY) and 120 cosponsors, would not only mitigate the federal-state conflict by removing cannabis from the Controlled Substances Act, but it would also require the expungement of past federal cannabis convictions. The bill would also establish a Cannabis Justice Office to administer a program to reinvest resources in the communities that have been most heavily impacted by prohibition, funded by a tax on state-legal cannabis commerce. It would also allow the Small Business Administration to provide loans and grants to cannabis-related businesses and support state and local equity licensing programs, permit doctors within the Veterans Affairs to recommend medical cannabis to patients in accordance with applicable state laws, and prevent discrimination based on cannabis consumption during immigration proceedings.
When the House version of the MORE Act was originally introduced in 2019, it was referred to eight Committees (with the Judiciary Committee being primary). Each Committee had provisions of the bill that fell under its jurisdiction and had authority to hold hearings and or amend specific jurisdictional provisions. Two Committees (Energy and Commerce and Ways and Means) were expected to be very active on language affecting regulations and taxes. The Energy and Commerce Committee even held a legislative hearing on MORE in January, and were expected to hold more… and then COVID hit… and priorities changed.
Before the Floor vote, the main sponsor of MORE, Judiciary Chairman Jerry Nadler, offered a “manager’s amendment.” The majority of the language was taken straight from H.R. 1120/S. 420: the Marijuana Revenue and Regulation Act. It included a graduated tax, and language on federal permitting and bonding. During debate, Congressional leaders gave assurances to include the cannabis industry advocates in future discussions and listen to cannabis industry concerns. Although passage of the MORE Act is historic, no legislation is perfect and NCIA staff will continue working with congressional champions to improve MORE and eventually get it passed into law.
Now, as we near the end of the 116th Congress, the NCIA team will continue to work and strategize various ways forward in Washington, D.C– on SAFE Banking, the MORE Act, and beyond. As we see more and more legislative victories each Congress, it is important to relish in our success and continue to propel the momentum forward (we could all use a moment to celebrate after 2020!). The MORE Act vote, being the most comprehensive cannabis bill on Capitol Hill, gives us the momentum to accomplish more in the next congressional session. Thank you to each and everyone one of you who took the time to call your Representative. Stay tuned for the 117th Congress!
by Madeline Grant, NCIA’s Government Relations Manager
Following the presidential election, we’ve entered the lame-duck session. This occurs after an election, but before new members are sworn in, and allows for time on the legislative calendar for Congress to pass additional legislation. Before Congress heads home for the holidays, a new administration takes office, and the 117th Congress returns, let’s take a look at what to keep an eye on during the lame-duck session.
The House of Representatives has approved the SAFE Banking Act in some form THREE times in just over a year. The text of the Secure and Fair Enforcement (SAFE) Banking Act has passed through two different COVID-19 relief packages on the House side: the HEROES Act, and the HEROES Act 2.0, and also passed as standalone legislation in September 2019. However, in the upper chamber, we’ve seen Senators criticize including marijuana components in coronavirus legislation, arguing that it is not germane to the issue at hand. Specifically, Senate Majority Leader McConnell (R-KY) took to the floor to complain that the House bill provides “special treatment to the marijuana industry,” stating that the legislation “mentions the word ‘cannabis’ more times than the words ‘job’ or ‘jobs.’” Regardless, it’s evident that SAFE banking has bipartisan support and could help mitigate the spread of the virus by ending the industry’s reliance on cash transactions.
Additionally, Senate Minority Leader Chuck Schumer (D-NY) introduced a coronavirus relief bill last month that contains the SAFE Banking Act. We’ve seen pushback from the Republican-controlled Senate and the Trump administration, however, Senator Schumer’s inclusion of cannabis provisions is a positive sign that Democrats will make an effort to continue to push for these provisions. As Congress and the Trump Administration continue to negotiate coronavirus relief legislation, we will continue to keep our eyes on banking. Also, a friendly reminder to call our representatives and senators and encourage them to support cannabis banking reform. If they are already a champion on our issues, thank them for their support.
Regardless of all of the trials and tribulations that 2020 has brought, there is still great excitement and optimism around the MORE Act! House Majority Leader Steny Hoyer (D-MD) confirmed that marijuana legalization is still on the table before the presidential transition and will get a vote in December. Previously, Representative Hoyer announced this past summer that the chamber would vote on the MORE Act in September, but that plan was postponed following pushback from certain offices who were concerned about the optics of advancing cannabis reform before passing another coronavirus relief package.
The MORE Act is the most comprehensive cannabis legislation to date. The bill would: federally deschedule cannabis, completely removing it from the Controlled Substances Act, expunge the records of those with prior marijuana convictions and impose a federal give percent tax on sales, revenue from which would be reinvested in communities most impacted by the drug war. Additionally, the legislation would also create a pathway for resentencing for those incarcerated for marijuana offenses, as well as protect immigrants from being denied citizenship over cannabis and prevent federal agencies from denying public benefits or security clearances due to use. The fact that we have a potential vote on the MORE Act before the end of the 116th Congress is exciting news for the cannabis community. As we gear up to the end of the year, look out for updates on the MORE Act, and remember, please call your representative and senators and urge them to support this significant piece of cannabis legislation.
This year has been unlike any other year we’ve faced as a country. Since March, Congress has exhausted their legislative efforts to agree on coronavirus relief bills. With differences on both sides of the aisle and with the administration reaching any sort of legislative success seems near impossible. However, on a positive note we’ve seen our champions on Capitol Hill not give up on cannabis-related provisions. Although we are faced and halted by frustrations in the Republican-controlled Senate, we still see members of Congress working to include the much-needed cannabis reform our nation is calling for. Not to mention Election Day – Arizona, Montana, New Jersey, and South Dakota all passed measures making cannabis legal and regulated for adults, while Mississippi and South Dakota chose to legalize medical cannabis. Every success and victory in cannabis policies around the country creates more momentum for Congress to fix the out-dated cannabis laws. As we wrap up the 116th Congress, we will be left with more momentum than ever before to enter the 117th Congress to reach new legislative victories.
Did you miss the special live stream of NCIA Today this Election Day morning on Facebook? Get caught up to speed with this recording of the episode while we prepare to see results the results coming in as Americans cast their votes all across the country.
Cannabis is on the ballot in states across the country and a new Congress will be elected today, possibly the one that will end federal cannabis prohibition. Join NCIA staffers for an exclusive power hour of cannabis conversations with elected officials, Hill staffers, campaign directors, and more.
by Bobby Combs, Kisan America Corporation
There are many challenges to running a successful cannabis business, including finding the correct product to sell, hiring and training qualified budtenders, dealing with state regulations, accepting cash payment, and depositing cash into the limited number of banks and credit unions that accept cannabis business. Although many economists and magazines believe cash is going away with the recent introduction of digital and app-style payment solutions, in the cannabis space, cash is king. Cash payment is really the only form of payment for many states except for the rare occasions an app can be used. The questions that have been asked for years are what does the cannabis industry do with the cash payments they receive, how is the cash counted and secured, and how can it be deposited into the business bank account?
Cannabis businesses are always looking for ways to effectively count cash and make deposits in their retail locations while simultaneously trying to lower labor cost, increase accountability and productivity, and reduce risk. Traditional deposit preparation methods have not drastically evolved in the last 50+ years. A budtender will pull their till from the drawer and count down to the starting till amount, leaving the remaining funds as the deposit. In addition, it is also common practice for businesses to incorporate dual authentication practices, essentially double counting, or counting in the presence of a witness to ensure the count is correct. While dual authentication can give the impression of good quality control and insurance, unfortunately, it raises the cost of counting the deposit inside the store by tying up at least two employees’ time and attention on trivial cash counting responsibilities. Granted the store manager is a salaried employee, but the downside is the store manager is managing for time to count cash instead of the daily sales, however, there is a much better, faster, and more accurate way to make deposits in the cannabis industry.
A high-speed smart safe is faster than counting by hand and a more secure way to deliver cash deposits to the select banks. The reason is, at the end of the night, the procedure of making a deposit at the bank location is a dangerous one and is why many organizations will have utilized the same type of dual authentication to drive to the bank to make the deposit in the night drop box. Again, there is an illusion of safety with having two people make a deposit in the night drop. Here are five of the many reasons to use a high-speed smart safe in a cannabis business:
The smart safe provides individual user accountability, by capturing critical transactional data: who is making a deposit, the date and time stamp of the transaction, and the total value of the deposit. Individual user accountability allows customers to abandon the need to deploy dual authentication practices, allowing managers to reallocate their time and attention towards revenue-building responsibilities: supervising employees, training employees, inventory, customer service, etc.
An online dashboard provides detailed transaction statements, trend/behavior tracking potential, and simplified reconciliation reporting. Reports can be accessed online from any device, downloaded/exported, and shared across your network, which improves the efficiency of accounting and loss prevention departments. The online dashboard will have different reports ranging from daily deposit, transactional history for the day, and a monthly deposit report for easy reconciliation.
Incorporated bill validators will count and authenticate each note before securing funds into their final depository, thus creating a closed-loop system-cash is deposited, not dispensed.
By incorporating drop policies that align with the placement of the cash management device, customers can achieve an efficient and secure deposit process, but also reduce unnecessary cash exposure that may accumulate within a till drawer or within the back office. Smart safes are designed to only allow the Cash In Transit Company to pick up all deposited cash thus reducing the risk of theft.
Provisional Credit is an online credit to the business bank account prior to the removal and secondary validation of funds offsite. In conjunction with your banking relationship, a smart safe has the ability to transmit a daily electronic file to the bank where said bank will give credit on the day’s deposit.
With the proper smart safe in place, it will allow cannabis business owners to manage the cash deposits more efficiently and reduce risk inside the location, and to reduce lower/short deposits. The smart safe gives each owner the ability to log in to the online dashboard from any device connected to the internet and see all the transactions from all smart safes across all their cannabis locations. Just imagine having the ability to see all deposits and transaction history in one convenient place to allow for better transparency and reconciliation. With the CARES Act being introduced and voted on, if passed, it would afford for more banking partners and offer more options for the smart safe to send provisional credit to your bank.
Bobby Combs is National Account Executive at Kisan America Corporation. He has over 6 years of experience in the cash automation industry and utilizing previous experience to formulate best practices and redesign cash handling procedures to maximize efficiency and reduce risk and labor. Kisan provides cash management solutions through smart banknote deposit and sorting systems.
by Michelle Rutter Friberg, NCIA’s Deputy Director of Government Relations
As you may have heard by now, Election Day is just around the corner! Let me take this opportunity to remind you to vote, to do so safely, and come up with an election plan! If you need help determining if you’re registered, or need more information about anything election-related, you can click here for some great resources.
Over the last two years, NCIA and the cannabis industry have had some success in Washington, D.C.: passing the SAFE Banking Act out of the House, passing the MORE Act out of committee (we expect a full House vote during the lame duck session!), and even getting the language of the SAFE Banking Act included in three proposed COVID-19 relief packages. But, the same challenge has remained: the upper chamber of Congress, the Senate.
This year, there are 35 Senate seats up for election, and the results will impact cannabis policy for years to come (remember, Senate terms last for six years). Let’s take a look at three races that could not only impact cannabis policy, but the makeup of the Senate as a whole.
Incumbent: Sen. Martha McSally – Republican
Challenger: Mark Kelly – Democrat
The Details: Senator Martha McSally, Mark Kelly, and seventeen other write-in candidates are running in this year’s special election in Arizona. The winner will fill the rest of the 2017-2022 term that former Sen. John McCain (R) won in 2016. You may remember McSally’s name– that’s because back in the 2018 general election, McSally ran for Arizona’s other Senate seat and lost to Kyrsten Sinema (D) 47.6% to 50.0%. After the 2018 election, interim Sen. Jon Kyl (R) announced his resignation and Gov. Doug Ducey (R) announced McSally as Kyl’s replacement in December 2018. Easy to keep up with, right?!
On Cannabis: This year, Arizonans will vote on Proposition 207, which would legalize adult-use cannabis in the state. During a debate in October, the candidates were asked about the initiative. Mark Kelly responded, “I think I’m gonna vote yes. It has some provisions in there to decriminalize it and address some incarceration rates for marijuana offenses — I think that’s good. I think there’s a funding source there. So I’m probably gonna vote yes.” When asked if he’d support removing marijuana as a Schedule 1 narcotic were such federal legislation to come before him, Kelly replied, “Based on my vote here in Arizona, I would seriously consider removing it.”
Senator McSally, on the other hand, has been essentially silent and inactive on this issue since assuming office. Last month, when asked about the initiative, McSally said “I’ll let the Arizona voters decide that [Proposition 207].” During her time as a Congresswoman prior to being appointed to the Senate, McSally voted against several cannabis-related appropriations amendments. She has not co-sponsored any cannabis-related legislation in the Senate.
Incumbent: Sen. Cory Gardner – Republican
Challenger: Former Governor of Colorado, John Hickenlooper – Democrat
The Details: This race is one of the most contested in the country– both the Democratic Senatorial Campaign Committee (DSCC) and the National Republican Senatorial Committee (NRSC) have added it to their election target lists. The previous three U.S. Senate elections in Colorado—2016, 2014, and 2010—were decided by margins of 5.7, 1.6, and 1.7 percentage points, respectively. Gardner was first elected in 2014 after defeating incumbent Mark Udall (D) 48.2-46.3%.
On Cannabis: Sen. Gardner has long been touted as one of the most pro-cannabis Republicans in the Senate. He has sponsored and co-sponsored a number of cannabis bills, including the STATES Act and the SAFE Banking Act. However, Sen. Gardner has been unable to convince his colleagues to bring SAFE Banking up for a committee vote, or even have a simple hearing on the STATES Act. That being said, if Republicans retain control of the Senate, but Gardner loses his seat, it may have adverse consequences for the cannabis industry.
During his time as governor, Hickenlooper actively opposed cannabis legalization, even going so far as to unsuccessfully campaign against the state’s marijuana legalization ballot referendum. He then went on to implement it after voters approved the measure. During his last year as governor, he also vetoed proposals to add autism as a medical marijuana qualifying condition, to increase flexibility for investments in the cannabis industry, and to allow dispensaries to operate tasting rooms. But Hickenlooper has come a long way since then– his campaign website states, “As U.S. Senator, I will fight to remove cannabis from classification as a Schedule I drug.” Plus, he even responded to an op-ed penned earlier this year by NCIA’s own Social Media Manager, Vince Chandler, tweeting, “Yes, I support decriminalizing & descheduling marijuana. Colorado set the gold standard, and I’m eager to work with you and Colorado’s cannabis industry and entrepreneurs to get this done in Washington.”
Incumbent: Sen. Steve Daines – Republican
Challenger: Former Governor of Montana, Steve Bullock – Democrat
The Details: Incumbent Sen. Daines was first elected in 2014 with 58% of the vote. Bullock was first elected Governor of Montana in 2012 with 49% of the vote to his opponent’s 47%. His margin increased in 2016 when he won 50% to 46%. That same year, Donald Trump (R) won Montana in the presidential election with 56% of the vote to Hillary Clinton’s (D) 36%.
Both the National Republican Senatorial Committee and the Senate Majority PAC, a Democratic PAC, have targeted the race. Prior to announcing his bid for Senate, Bullock joined the crowded Democratic presidential field before dropping out in 2019.
Implications: This year, there are two cannabis-related initiatives on the ballot in the Treasure State. Montana I-190, the Marijuana Legalization Initiative, is on the ballot and would legalize the possession and use of marijuana for adults over the age of 21, impose a 20% tax on marijuana sales, require the Department of Revenue to develop rules to regulate marijuana businesses, and allow for the resentencing or expungement of marijuana-related crimes. The second initiative, Montana CI-118, the Allow for a Legal Age for Marijuana Amendment, would amend the Montana Constitution to allow for the legislature or a citizen initiative to establish a minimum legal age for the possession, use, and purchase of marijuana, similar to the regulation of alcohol in the state constitution.
While neither Senate candidate has weighed in on the state’s cannabis initiatives, we do have some understanding of their views on the issue– Sen. Daines has consistently voted in favor of appropriations amendments related to hemp, medical cannabis, and banking. In 2015, he co-sponsored an industrial hemp bill. It’s important to note that all of these votes were more than three years ago. On the other hand, while running for president last year during July 2019, Bullock stated, “I think this [cannabis legalization] should be left up to the states. I think the federal government should get out of the way and this is a state-by-state decision.”
Now, remember to get out there and VOTE! Here at NCIA, we’ll be analyzing other initiatives, candidates, and what it all means for you and your business as we get closer to the election, and doing the same once we get the results!
Why philanthropy can be the most effective weapon in the fight for banking and 280E reform
by Kevin J White, Founder, Corporate Compassion, LLC DBA CannaMakeADifference
In a recent announcement by the IRS, they may allow deductions through Section 471, but it is still unclear this impact as of this writing is still unclear, so with that said, I am proposing this argument because of the impact needed TODAY to help in the economic recovery effort, given it is an election year, as well.
Before I begin, please do not construe my argument as a Republican argument for legalization. When I say conservative, I am speaking from a purely fundamental belief and values perspective, not a contemporary political ideology. There is hypocrisy on both sides and I recognize this fact.
Having a nonprofit background, most of my life has been spent hovering on the political lines, mostly policy, not parties. Liberals are traditionally more aligned with causes than conservatives, although conservatives have traditionally been more fiscally supportive of charitable causes. Why are conservatives more fiscally supportive of charitable causes? Conservative values.
In the fight for legalization, there appears to be a definite challenge from conservatives.
I came into this industry four years ago and noticed a disconnect between the arguments from the industry and the conservative response. Although support is growing from conservatives, most of the arguments being discussed for legalization seem to be falling on deaf ears.
Why is that? It is because the current arguments for legalization are being fed to conservatives in a language which they do not understand and are hearing as a direct challenge to their values.
The values and language of the right are fundamentally different from the left in most ways. One value which is, in my opinion, grossly undervalued by the industry is philanthropy.
The health and economic ramifications of COVID-19 have caused us to look at the government and our nonprofit sector for help. The political discourse of our governments, from local to federal, unfortunately, is not helping to meet the needs of individuals or communities and thus someone has to step up. Something I haven’t heard many conversations about is our community-based nonprofits and how they are working to address the needs around COVID-19 and the economic challenges COVID-19 has manifested. Nonprofits, which are on the front line of meeting communities’ needs, from animals to veterans and every population in between, are fighting a battle from a deficit position.
According to the Stanford Social Innovation Review’s “Giving With Impact Podcast,” our community nonprofits, especially 501(c)(3) nonprofits, are being “…asked to do more with less money and reduced staff while taking on an expanding client population, and all of this at the same time that revenues from services have dried up and donations from their traditional fundraising activities have declined. Some have had to lay off staff and cut salaries and others have had to cut programs.” This is according to Amir Pasic, the Eugene R. Tempel Dean at the Lilly Family School of Philanthropy at Indiana University and a professor of philanthropic studies. He also highlights that although disasters cause a spike in giving, which the pandemic did, in a recession, which seems to be a by-product of the political response to COVID-19, he states, “…we see the opposite effect… It took many years, several years, for individual giving, in particular, to recover. So in recessions giving does go down, simply because the resources that we have available go down, as well.”
Amir also states in the podcast that “…over 60% of nonprofits are anticipating significant decreases in terms of their fundraising ability. And I think many of them will be in crisis further, depending, in part, also, in terms of how federal help continues or does not continue going forward… So there is certainly a sense of crisis and pressure for many nonprofits because their services are increasingly… many of them in the human services, increasingly in need, and yet there is the sense that their sources of revenue are going to be under severe pressure at the same time.”
In the same podcast, Mary Jovanovich, Senior Manager for Relationship Management at Schwab Charitable, states that clients involved with their donor-advised fund are actually giving 50% more at this time. Looking at this in the most simplistic way, those who can give more are giving more, but giving is being done by fewer people and thus still creating a deficit.
Of course, those companies and people who are doing extremely well are the usual suspects. But what about a flourishing industry? One which is new and growing, and has been growing through a pandemic? An industry that is doing better than most industries and has the reach and means to impact the communities which they serve and beyond? What would be holding them back from coming to the rescue of the communities they serve and ultimately helping the entire nation?
If you are a company with an effective tax rate of between 60 and 70%, you might need to hold on to your profit in order to make sure you and your employees survive in case something else is looming on the horizon. Say an election?
Imagine a time when the cannabis community comes together to elevate those nonprofits which are providing the most impact on our economic and social recovery. The world is watching and in awe of the support being provided to tens of thousands of deserving nonprofit 501c3’s and the Senate is watching as thousands of the nonprofits in their states are participating, which is a statement that they are willing to accept support from the cannabis industry. This is the way you sway minds and hearts.
Conservatives believe in free markets and thus less regulation, in the belief that the growth of companies and the economy will thrive and ultimately self-regulate as much as it can with limited governmental intervention. This needs to be applied to the cannabis industry as well. But not just for the reasons you may think. 280E reform needs to take place NOW so that philanthropy can be elevated and help address COVID-19 and economic recovery challenges.
The effective tax rate is high specifically due to the IRS code 280E, which does not allow cannabis companies to write off typical business expenses, things like marketing, depreciation on equipment, and other expenses including charitable donations to 501c3 nonprofits! Just imagine what could be done if a cannabis company, many of which are already giving without the tax advantage, was given a tax incentive to donate? Everyone understands the taxes imposed by the states and municipalities for the legal purchase drive the cost of cannabis up. So the margins are fairly thin when compared to that of other companies that do not have to abide by 280E. 280E is government regulation. Conservatives tend to be for free markets. If, as we all know, even my fundamentalist Christian friends know, that cannabis will be federally legal eventually, why not take this opportunity to deregulate this industry allowing it to assist in addressing community resource deficits at a time when it is needed most? This argument also addresses the fundamental hierarchy, which conservatives believe should be the path of assistance, self, family, church, community, local government, and finally state government, in that order.
I do not mention the federal government, because another value of conservatism is small government and that the federal government is there to protect the inalienable rights of humans as well as the right to property. Traditional conservatives believe in a helping hand, but only a temporary one as they understand many might not have all the support systems in place mentioned previously.
So the argument for 280E reform, in the context of nonprofits and helping with the health and economic crises stemming for COVID-19, addresses the conservative values of human rights, property rights, individual responsibility, free markets, lower taxes, and deregulation of businesses.
Now, imagine that 280E was reformed or no longer applicable to LEGAL cannabis companies. There is still a problem. Even if 280E was rescinded for the cannabis industry, banks may still not allow them the same banking services because it would in effect still be federally illegal. If this is the case, even if a company chose to donate to a willing charity, the charity would fall under these very same banking laws and thus might not be able to deposit funds from the cannabis industry into their bank accounts, running a risk that their accounts could still be closed for accepting money from a federally illegal activity. So truly, banking and 280E reform are not just a cannabis industry issue, but a nonprofit sector issue, which needs to be addressed sooner than later!
Now, we all know many charities will still not accept the funds offered from cannabis companies due to many factors, however, many of those most impacted by the pandemic and economic decline, such as those focused on food, housing, homelessness, veterans, mental health, senior citizens, and others, could benefit from receiving funds from cannabis companies as their own resources are diminishing. Therefore, the fight for our nation’s recovery needs to include banking and 280E reform for an industry which can make a difference for many!
Because TOGETHER WE CANNA MAKE A DIFFERENCE (If given the opportunity)!
Founder of Corporate Compassion, LLC and DBA CannaMakeADifference, Kevin J White is a social entrepreneur, nonprofit evangelist, volunteer activist, community engagement advocate, tennis player, golfer, BUCKEYE, and Avid shoe wearer. Kevin began his journey into social entrepreneurship after a 20+ year career in the nonprofit sector. Having started his career as a direct care counselor for at-risk children he advanced through the nonprofit sector, eventually moving to Colorado for a job with a major animal welfare nonprofit, overseeing 4 departments and over 100 staff and volunteers, eventually creating his own nonprofit 501(c)(3) public charity. With a strong background in nonprofit management and resource management, he began his cannabis journey through his Colorado-based, 501c3 nonprofit, having to identify the benefits and challenges of accepting support from the cannabis industry. He realized that there were some challenges for both sectors and decided to further his social entrepreneurship by consulting with cannabis companies looking to strengthen and develop their cause-marketing and philanthropic goals. This was the birth of CannaMakeADifference.
CannaMakeADifference is a strategic consulting company created to assist purpose-driven cannabis companies with meeting their cause-marketing and philanthropic goals. He has co-authored two white-papers, one for cannabis companies and one for nonprofits, highlighting the benefits and challenges of working with each other.
He also founded the Women of 420 Charity Calendar, highlighting causes supported by pro-cannabis women.
Kevin also hosts a podcast called Together We CANNA Make A Difference which highlights philanthropy in the industry and companies making a difference from the cannabis sector. You can download the podcast on most major podcast platforms including Google Podcasts and Apple Podcasts.
By Rebecca Lee Katz, President, Pakaloh LLC
This year, a national outcry against police violence and the impact of COVID-19 on Black and brown communities initiated a reckoning with the legacies of oppression and injustice in the U.S. Along with recognizing our institutionalized and internalized racism, we have started to come to terms with our economic inequality now that the income gap is worse than it has been in 50 years and three families alone control more wealth than 50% of Americans.
As with the rest of the country, the cannabis industry is lived differently based on the intersectionalities of race, class, gender, orientation, (dis)ability, and veteran status. For example, already wealthy, white, male individuals have amassed fortunes in cannabis with roughly 74% of U.S. cannabis businesses owned by men and 81% by whites, according to a 2017 Marijuana Business Daily survey.
After most states designated cannabis “essential” during COVID-19, private individuals, family funds, and pension funds plowed $2.6 billion into corporate cannabis, and multi-state operators posted record sales in the hundreds of millions. Earlier in September, the second cannabis exchange-traded fund (ETF) was announced which involves an investment portfolio of multi-state operators, REITs, and CBD companies. In contrast, Black and brown communities face mass incarceration for that same plant whereby African Americans are four times more likely nationally to be arrested for cannabis offenses than whites, while in states such as Kentucky and Montana, almost 10 times more likely, cited by a 2020 ACLU report.
These economic barriers to entry entrench the lack of representation in cannabis. For most entrepreneurs, the main obstacle to starting a cannabis business is the lack of access to traditional banking. It takes at least $300,000 to open a cannabis retail store, and up to millions of dollars for other cannabis enterprises, according to the 2019 Marijuana Business Factbook. Without traditional banking, most professionals finance their businesses through family wealth or personal contacts – 84% of U.S. cannabis companies are self-funded by founders, and 22% capture additional funding through a Family and Friends Round, cited by that same report. In this system, minority entrepreneurs are at a disadvantage. U.S. median household net worth ranges from $171,000 for white families to $17,600 for African Americans, $20,700 for Latinx, and $64,800 for “Other,” based on a 2016 Federal Reserve Board survey.
In addition to funding challenges, cannabis entrepreneurs must navigate onerous state and local regulations to obtain and maintain licensing. Some states have launched Social Equity Programs to help communities historically targeted by the criminalization of cannabis to now participate in the profits of legalization. However, even Illinois’s Social Equity Program, which is considered the gold standard, awarded only 21 out of its total 75 retail social equity licenses, leaving unclaimed 54 licenses that could have transformed the applicants’ economic circumstances. The 21 finalists were taken from a total pool of 1,667 applicants, which equates to only 1.3%. Low success rates stifle market entry and ensure that corporate, multi-state operators continue to saturate the cannabis space.
Beyond media proclamations, we must actualize an inclusive cannabis industry that reflects and celebrates the rich diversity of our community and provides equal opportunities to all professionals throughout the growth cycles of the market. We must operationalize sustainable businesses that produce unionized jobs and foster generational wealth. To do so, we must not only promote our own professional aspirations, but we must champion our friends’ and colleagues’ pathways into and up the cannabis industry.
While federal legalization remains the ultimate goal, local policies that would articulate a diverse, inclusive, sustainable cannabis industry must include explicitly legalized access to banking and finance, an overhaul of law enforcement and the criminal justice system, and social equity programs that encourage market activity. Until then, we must collectivize our professional resources and knowledge to build a true business community that empowers each of us to achieve our cannabis ambitions.
Rebecca Lee Katz is an attorney at an international law firm and President of Pakaloh LLC, the free business resource for an inclusive cannabis, CBD, and hemp industry. Pakaloh offers three types of membership which are all free, and members may select as many as they choose. Membership is available to 1) “Individuals”, including new and established entrepreneurs and professionals, 2) “Providers of Products”, or plant-touching businesses, and 3) “Providers of Services”, including ancillary services.
A WOC-owned company, Pakaloh provides its members with a comprehensive suite of services, starting with free information and discounts at financial institutions like banks, lenders, and payment processors that work in cannabis. Pakaloh also features free Business Tutorials that cover a range of cannabis topics from accounting to agriculture. These are informative, introductory online videos submitted by members that allow them to reach an audience of potential clients who may need to hire their services. Additionally, members may post and search for job opportunities.
Partner companies also offer discounts for members to use on individual and bulk orders. Members network on the site by accessing directories and sending messages directly to each other. Lastly, Pakaloh curates information on professional and activist organizations and events. Pakaloh is pledged to every community, and comes from pakalolo, an embrace of generations of the founder’s family in Hawai’i. Pakaloh holds true that no matter your roots, each of us aspires toward something greater than ourselves, be it our family, our nation, our cannabis movement.
Host Bethany Moore, NCIA’s Deputy Director of Communications 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.
We check in with NCIA Deputy Director of Government Relations Michelle Rutter Friberg, to hear some of the recent highlights from the nation’s capital about cannabis policy reform, cannabis, COVID-19, and more. Our resident political expert breaks down the ways that NCIA is looking to help our members improve their engagement and reach in the legislative process.
Membership Manager and DEI Coordinator Tahir Johnson joins the show to discuss the recent move by NCIA to endorse the Cannaclusive Accountability list, asking all cannabis companies to adhere to promises made in the wake of racial injustices and actively strive to build a more equitable, inclusive industry.
by Michelle Rutter Friberg, NCIA’s Deputy Director of Government Relations
It may seem like a while since you got an update on the SAFE Banking Act, but I have some exciting news to share with you!
Yesterday, House Democrats unveiled “HEROES 2.0” which is their latest COVID-19 relief package. If you’ll recall, back in May, the House also passed the initial HEROES Act, which included the text of H.R. 1595, the SAFE Banking Act.
Since HEROES passed the House in May, NCIA has been hard at work (from home!) talking to House and Senate leadership, as well as other key Senate offices about the need to pass this legislation and solve the cannabis banking conundrum. Unfortunately, those talks have been stalled for months as congressional leadership and White House officials struggle to make a deal.
Eager to return home in October with a victory to show, many moderates on both sides of the aisle have been stressing the importance of passing another relief package. As the language was just unveiled late yesterday evening, it’s still unclear how the Senate will react to the bill, and of course, the bill still has to clear the House of Representatives.
You might remember that just days before the first HEROES Act was passed in May, NCIA led ten cannabis advocacy and industry organizations in sending a letter to congressional leadership urging lawmakers to include SAFE in the next pandemic relief package. If the new HEROES 2.0 passes the House, it will mark the third time that the full body has approved the SAFE Banking language.
The language included in both packages is identical to the House-approved version of the bill and would make it easier for financial institutions to work with cannabis businesses that are in compliance with state law, as well as help address serious public health and safety concerns caused by operating in predominantly cash-only environments. The bill would also assist with the financial and practical hardships that are facing cannabis entrepreneurs of color as a result of a lack of access to capital from traditional lending institutions.
Make sure you stay engaged and continue to tell your lawmakers that you are a cannabis voter and that these issues are important to you! Contact your Senators today and ask that they support SAFE Banking as a necessary piece of legislation that can help the tens of thousands of cannabis workers stay healthy by allowing our industry access to legitimate banking and end our cash-only operations.
Want to make sure you hear the latest about what’s happening in cannabis policy? Follow NCIA on social media and be sure to share important information and resources as we release them with your networks, because we’re going to need all of us in this together!
The most important thing anyone can do to make sure SAFE Banking and other important reforms are realized in Congress is to ensure that their cannabis business is a member of NCIA. If you are not yet a member, please support our work by joining today. If you already are a member, thank you for making our advocacy work possible.
by Michelle Rutter Friberg, NCIA’s Deputy Director of Government Relations
Over the last several weeks, I’ve been taking a retrospective look at the progress NCIA has made in the ten years since its inception. This is our last installment, detailing 2018-2019, and brings us up to 2020 (the year that shall not be spoken of). While this timeline is by no means a comprehensive look at everything that’s happened in cannabis policy during those years, here are some highlights:
On January 4, 2018, then-Attorney General Jeff Sessions declared in a one-page memo that he had rescinded the Cole Memo, a similar memo related to cannabis activity on tribal land, and two other older memos. Sessions directed U.S. Attorneys to instead “follow the well-established principles that govern all federal prosecutions,” which require federal prosecutors to “weigh all relevant considerations, including federal law enforcement priorities set by the Attorney General, the seriousness of the crime, the deterrent effect of criminal prosecution, and the cumulative impact of particular crimes on the community.”
This month was filled with the political fallout of the rescission of the Cole Memo. First, a letter was written by the U.S. Treasury Department’s assistant secretary for legislative affairs to Congress that said, “We are reviewing the [cannabis banking] guidance in light of the Attorney General’s announcement [to rescind the Cole Memo] and are consulting with law enforcement”. Then, following Sen. Gardner’s (R-CO) decision to block the Department of Justice’s nominees over the rescission of the Cole Memo in January, he released his holds on nominees for U.S. attorneys in a dozen federal districts and U.S. marshals in every district. Holds continue on the nominations of seven top Department of Justice nominees.
In March, Attorney General Sessions spoke at an event where he acknowledged that the Department of Justice cannot use its limited resources to enforce cannabis prohibition against everyone who violates federal marijuana laws. He said, “We’re not going to be able, even if we desired, to take over state enforcement of routine cases that might occur.”
The Trump administration officially began accepting online comments about whether marijuana should be rescheduled under international agreements. That same month, U.S. Senate Majority Leader Mitch McConnell (R-KY) filed a hemp legalization bill.
The U.S. Small Business Administration (SBA) quietly issued a document saying that businesses that work with the marijuana industry aren’t eligible for federally backed loans. Fast forward to 2020, this document is largely what prohibited both direct and indirect marijuana businesses from receiving PPP money or federal assistance due to the COVID-19 pandemic.
Senators Elizabeth Warren (D-MA) and Cory Gardner (R-CO), introduced the Strengthening the Tenth Amendment Through Entrusting States (STATES) Act. Shortly thereafter, President Trump was asked if he supports new Senate legislation to let states set their own marijuana laws without federal interference, to which he replied, “I really do. I support Senator Gardner. I know exactly what he’s doing. We’re looking at it. But I probably will end up supporting that, yes.” The STATES Act has never had a congressional hearing or moved in any way through the legislative process.
In a slight change of tone, U.S. Attorney General Jeff Sessions said that “states have a right to set their own laws and will do so” but that “the American republic will not be better if there are marijuana sales on every street corner” and “we’ll [Department of Justice] enforce the federal law.”
A group of the top financial regulatory officials from 13 states sent a letter urging congressional leaders to solve the marijuana industry’s banking access issues. The regulators wrote, “It is incumbent on Congress to resolve the conflict between state cannabis programs and federal statutes that effectively create unnecessary risk for banks seeking to operate in this space without the looming threat of civil actions, forfeiture of assets, reputational risk, and criminal penalties.”
NCIA worked with Congressman Lou Correa (D-CA) to send a letter to the Department of Homeland Security Secretary Kirstjen Nielsen that urges the department to develop clear guidance concerning the entry into the United States of foreign nationals with authorized work visas who are associated with the cannabis industry.
Well-known pollster Gallup found that sixty-six percent of Americans now support legalizing marijuana. Support has remained near that number to the present.
This month, midterm elections were held, and a number of states voted on setting their own cannabis policies. Residents of Michigan and North Dakota both voted on adult-use measures, one passing and one failing, respectively. Additionally, Utah and Missouri both passed medical cannabis ballot initiatives. While the Senate remained in control of the GOP, the House of Representatives switched from a Republican majority to a Democratic majority.
Congress passed the 2018 Farm Bill which included hemp legalization. The bill did not create a completely free system in which individuals or businesses can grow hemp whenever and wherever they want — there are numerous restrictions — and the programs are still being adjusted today.
The 116th Congress was sworn in and quickly filed a number of cannabis-related bills, including:
H.R. 420: Regulate Marijuana Like Alcohol Act,
H.R. 493: Sensible Enforcement of Cannabis Act, and
H.R. 127: Compassionate Access, Research Expansion, and Respect States (CARERS) Act of 2019
In February, the Subcommittee on Consumer Protection and Financial Institutions held its first-ever hearing on marijuana and financial services, entitled: Challenges and Solutions: Access to Banking Services for Cannabis-Related Businesses. Up for discussion was the Secure and Fair Enforcement (SAFE) Banking Act.
Quickly following the subcommittee hearing, the House Financial Services Committee scheduled a full markup for the SAFE Banking Act. The bill passed out of committee with a bipartisan vote of 45-15.
During a House appropriations subcommittee hearing, several lawmakers asked Treasury Secretary Steven Mnuchin about what could be done to provide state-legal cannabis businesses with access to financial institutions. Mnuchin replied, “Let me just say, I hope this is something that this committee can on a bipartisan basis work with since there are people on both sides of the aisle that share these concerns. I will just say I don’t believe this is a failure of the regulators. I want to defend the regulators on this issue.”
NCIA hosted our 9th Annual Cannabis Industry Lobby Days, bringing hundreds of professionals to Washington, D.C. Over the course of 48 hours, attendees met with nearly 300 congressional offices to share their stories and experiences and dropped off informational materials to 200 offices that we did not schedule meetings with. In addition to these meetings, we had two briefings, held a PAC fundraiser, and hosted our first-ever VIP Day for members of our Leadership Circle.
In June, the Senate Banking Committee held a hearing entitled “Challenged for Cannabis and Banking: Outside Perspectives.” NCIA was proud to have Sen. Jeff Merkley introduce for the record the testimonials of nearly 100 NCIA members during the hearing.
The Subcommittee of the House Judiciary Committee held a hearing on ending cannabis prohibition in America. The hearing, entitled “Marijuana Laws in America: Racial Justice and the Need for Reform” will focus on the need to deschedule cannabis, the importance of equity, diversity, inclusivity in this burgeoning industry, and will also cover issues pertaining to cannabis and public health, law enforcement, and the failings of prohibition.
When President Trump was asked at the end of August whether or not marijuana will be federally legalized during his administration, he said, “We’re going to see what’s going on. It’s a very big subject and right now we are allowing states to make that decision. A lot of states are making that decision, but we’re allowing states to make that decision.”
For the first time in history, a standalone cannabis policy reform bill was brought before the House of Representatives for a vote and passed with an overwhelming bipartisan majority. The Secure and Fair Enforcement (SAFE) Banking Act of 2019, or H.R. 1595, was approved 321-103, including nearly half of voting Republicans, in a suspension vote.
The U.S. Tax Court ruled this week that the tax code ban on business deductions by medical marijuana companies is constitutional. The case is Northern California Small Business Assistants Inc. v. Commissioner of Internal Revenue, docket number 26889-16.
In a vote of 24-10, the House Judiciary Committee approved a bill that would effectively end marijuana prohibition. The Marijuana Opportunity Reinvestment and Expungement (MORE) Act of 2019, or H.R. 3884, was introduced by House Judiciary Committee Chairman Jerrold Nadler (D-NY) and has been moving through the legislative process steadily. The MORE Act is anticipated to be voted on by the full House of Representatives this month.
The Federal Reserve released guidance allowing banks to work with the hemp industry. Financial institutions are no longer required to file suspicious activity reports on customers operating a hemp business.
It’s been a wild ride to look back at the last 10 years of NCIA, and we are looking forward to serving you and your business for another 10 more!
by Morgan Fox, NCIA’s Director of Media Relations
We asked, you answered, and your efforts are seeing results!
Over the past months, our Government Relations team in Washington, D.C. has been hard at work gathering support in Congress for the Marijuana Opportunity, Reinvestment, and Expungement (MORE) Act, and many of our members responded to the call to contact their lawmakers to urge them to support the legislation and bring it to a floor vote in the House. Well, our mutual work is paying off!
Last week, House Majority Whip James Clyburn (D-SC) announced that the MORE Act would be called for the vote! This was confirmed Monday as taking place during the week of September 21.
This legislation would remove cannabis from the Controlled Substances Act and do away with the continuing conflict between states with modern cannabis laws and the federal government. It would also expunge federal cannabis convictions, remove barriers to research, eliminate the current problems with the 280E tax code and lack of access to banking, promote more diverse participation in the cannabis industry, and establish funds to help undo the disparate harms caused by prohibition.
Make no mistake: this vote will be historic. This will be the first time that a bill to end cannabis prohibition has come up for a full vote in either chamber of Congress, and the results of the vote could determine the path of cannabis policy reform efforts for years to come.
If your representatives are not among the 87 current cosponsors of the MORE Act, please contact them and urge them to join in showing their support for this momentous and necessary bill.
Meanwhile, our efforts to maintain momentum for cannabis banking reform have continued throughout the negotiations of the next pandemic relief bill. Despite a somewhat contentious public debate over the size and scope of the stimulus funds in general, hope is still alive for the SAFE Banking Act provision to be included in the final legislation if Congress can come to some agreements on the numerous other issues at stake.
What is not up for debate is that SAFE Banking is an absolutely necessary part of COVID-19 relief. This measure will improve public health and safety by enabling more social distancing and decreasing cannabis businesses’ reliance on cash transactions which can spread contagions and make them a target for crime. Most importantly, it will help thousands of small businesses – with hundreds of thousands of employees across the country – survive these difficult times while providing uninterrupted healthcare services. It doesn’t get more COVID-relevant than that.
While it is still uncertain when or how the House and Senate will arrive at a compromise for pandemic relief, we don’t have much time before the elections divert most of their attention.
Keep an eye out for updates on ways you can help get SAFE Banking passed this year.
We couldn’t do this work without the support and assistance of our valued members. If you are not yet a member, please support our work by joining today. If you already are a member, thank you for making our advocacy work possible.
by Michelle Rutter Friberg, NCIA’s Deputy Director of Government Relations
Over the last month, I’ve been taking a retrospective look at the progress NCIA has made in the ten years since its inception. While it’s been fun to look back at those early years, this week I’m excited to look at a time when cannabis policy was getting really active: 2016-2017! While this timeline is by no means a comprehensive look at everything that’s happened in cannabis policy during those years, here are some highlights:
District judge dismisses lawsuit against the Fed, filed by the Fourth Corner Credit Union, says Congress must fix the cannabis banking problem. The same month, President Obama announces that cannabis reform is not on his agenda in 2016.
The Supreme Court dismisses Kansas’ challenge to Colorado marijuana laws. The 6-2 vote meant the nation’s highest court would not rule on the interstate dispute, and Colorado’s legal cannabis market remains safe. “Since Colorado voters overwhelmingly passed legal recreational marijuana in 2012, we have worked diligently to put in place a regulatory framework — the first in the world — that allows this new industry to operate while protecting public health and safety,” then- Gov. John Hickenlooper (D) said following the decision. “With today’s Supreme Court ruling, the work we’ve completed so far remains intact.”
An AP poll shows that 61% of Americans support legalizing cannabis. The most recent Gallup poll on the issue, published in October 2019, shows that approval number has risen to 66%.
U.S. Senate Caucus on International Narcotics Control holds a hearing titled “Is the Department of Justice Adequately Protecting the Public from the Impact of State Recreational Marijuana Legalization?”
NCIA holds its 6th Annual Cannabis Industry Lobby Day in D.C., garnering over 150 attendees and participating in more than 200 scheduled meetings on Capitol Hill. That same month, the Tax Foundation reports a legal marijuana industry could mean up to $28 billion in federal, state, and local tax revenues.
NCIA hosts our 3rd Annual Cannabis Business Summit in Oakland with 3,000+ attendees. That same month, the U.S. Senate Appropriations committee narrowly approved a marijuana banking amendment. Ultimately, the amendment did not make it into law. The amendment has not passed this specific Committee since, though we continue to try!
Showing increased interest and momentum on this issue, the U.S. Senate Judiciary Committee holds a hearing on the potential benefits of medical marijuana. The same month, the Democratic Party included reclassifying cannabis in the party’s platform.
This was an exciting month because we got to really see our efforts at work in the real world. Four years ago this month, the Ninth Circuit Court of Appeals ruled that due to the Rohrabacher-Farr amendment, the Department of Justice cannot use funds to enforce federal law against state-legal medical cannabis businesses.
U.S. Attorney General Loretta Lynch says that marijuana is not a gateway drug, but that same month, FBI data showed that there is one cannabis arrest every 49 seconds in the U.S. The majority of those individuals are Black and brown and are arrested four to eight times more than their white counterparts.
Members of Congress and the campaigns to legalize cannabis in various forms enter the final push. That month, a report also showed that Colorado’s marijuana industry had a $2.39 billion financial impact and created more than 18,000 jobs in the state.
Five states (Arizona, California, Maine, Massachusetts, and Nevada) voted on ballot initiatives to legalize, tax, and regulate marijuana for adult use. Four of those initiatives passed, and three of them passed by more than seven percentage points.
Four states (Arkansas, Florida, Montana, and North Dakota) voted on ballot initiatives to create or expand legal medical marijuana programs. All four of those initiatives passed, with an average victory of 26.3 percentage points.
Of course, November 2016 is also when Republicans took control of both chambers of Congress and candidate Trump became president-elect Trump.
NCIA establishes the Policy Council to serve as the industry’s “think tank” in D.C., developing and publishing policy papers to educate policymakers and other stakeholders on topics relevant to the cannabis industry. The same month, Sen. Jeff Sessions (R-AL) begins his confirmation hearing to become U.S. Attorney General. He is subsequently confirmed, bringing uncertainty to the cannabis space.
White House press secretary Sean Spicer said that he expects states to see “greater enforcement” of the federal law against marijuana use, a move that would be at odds with a growing number of states’ decisions to legalize it. Spicer, taking questions from reporters at the daily briefing, differentiated between the administration’s positions on medical marijuana and recreational marijuana. Funnily enough, Spicer’s career lasted about as long as it takes me to smoke a joint.
The nation’s first-ever Congressional Cannabis Caucus is formed by Reps. Rohrabacher (R-CA) and Blumenauer (D-OR) with help from friends Reps. Polis (D-CO) and Young (R-AK). In the 116th Congress, Rohrbacher and Polis left Congress and were replaced by Barbara Lee, a Democrat from California, and David Joyce, a Republican from Ohio, as co-chairs.
NCIA’s D.C. team grew from two (myself and Mike) to three, with the addition of Maddy Grant, who was our Government Relations Coordinator at the time. Since then, Maddy has become one of my best friends and was even one of my bridesmaids! If you know Maddy, you know she’s the best and NCIA is lucky to have her!
NCIA held its 7th Annual Cannabis Industry Lobby Days in Washington, D.C., where 250 industry professionals coalesced on Capitol Hill to attend over 300 scheduled meetings. Following that, there was a substantial increase in the number of cosponsors on cannabis-related bills compared to the previous Congressional session.
The Senate Appropriations Committee voted on their equivalent of the Rohrabacher-Farr amendment, sponsored by the committee’s vice chairman, Patrick Leahy (D-VT). That amendment passed on a voice vote and was the first time ever that a cannabis-related amendment passed in such a manner. At the end of July, the Senate Appropriations Committee also adopted an amendment that would allow the Department of Veterans Affairs to recommend medical cannabis in states. That amendment passed by a vote of 24 to 7 – the most votes this measure has ever received in the Senate. The veterans’ measure did not end up becoming law.
The House Rules Committee held a hearing to discuss amendments to the upcoming appropriations bill that will fund the federal government for the upcoming fiscal year and chose not to vote on the amendment that protects medical cannabis businesses, patients, and programs. Since the protections for medical cannabis businesses were included in the Senate’s version of the budget bill but are not included in the House’s versions, it came down to a conference committee to negotiate its inclusion, and ultimately, the provision remained in law.
Senate Republicans passed their tax reform package into law. Sen. Cory Gardner (R-CO) introduced two amendments to the bill that targeted 280E, however, he withdrew both amendments before the final bill was voted on.
If you think reminiscing on all that was a lot, make sure you keep an eye on our blog and future issues of NCIA’s Cannabusiness Leader to learn more about 2018-2019 and the progress we’ve made more recently as we wrap up this series!
by Michelle Rutter Friberg, NCIA’s Deputy Director of Government Relations
Today, Senate Majority Leader Mitch McConnell (R-KY) and the GOP caucus unveiled the text of their long-awaited coronavirus relief package. The initial draft text of the bill did not include any cannabis provisions, namely, the SAFE Banking Act.
If you’ll recall, back in May, the House of Representatives passed the HEROES Act, which included the text of H.R. 2215, the SAFE Banking Act. The language included in the House-passed HEROES Act would make it easier for financial institutions to work with cannabis businesses that are in compliance with state law, as well as help address serious public health and safety concerns caused by operating in predominantly cash-only environments. After the House passed the bill, it remained in the Senate while the GOP-controlled chamber came up with their own version.
But, a lot can change in a few months. Since HEROES passed the House in May, NCIA has been hard at work (from home!) talking to House and Senate leadership, as well as other key Senate offices. The good news is that those conversations have been overwhelmingly positive and we feel incredibly hopeful that the discussion about SAFE Banking will continue to be a part of the conversation as negotiations progress.
Make sure you stay engaged and continue to tell your lawmakers that you are a cannabis voter and that these issues are important to you! Contact your Senators today and ask that they support SAFE Banking as a necessary piece of legislation that can help the tens of thousands of cannabis workers stay healthy by allowing our industry access to legitimate banking and end our cash-only operations.
Want to make sure you hear the latest about what’s happening in cannabis policy? Follow NCIA on social media and be sure to share important information and resources as we release them with your networks, because we’re going to need all of us in this together!
The most important thing anyone can do to make sure SAFE Banking and other important reforms are realized in Congress is to ensure that their cannabis business is a member of NCIA. If you are not yet a member, please support our work by joining today. If you already are a member, thank you for making our advocacy work possible.
by Michelle Rutter Friberg, NCIA’s Deputy Director of Government Relations
Earlier this month, I took a retrospective look at the progress NCIA made in its early years (2010-2013). I started with the organization in 2014, so I’m excited today to take a walk down memory lane and look back at another era of NCIA history: 2014-2015! While this timeline is by no means a comprehensive look at everything that’s happened in cannabis policy during those years, here are some highlights:
Department of the Treasury’s Financial Crimes Enforcement Network (“FinCEN”) published its own expectations regarding marijuana-related business guidelines. These guidelines, issued on February 14 and commonly referred to as the Valentine’s Day guidance, attempted to clarify Bank Secrecy Act (“BSA”) expectations for financial institutions seeking to provide services to marijuana-related businesses. FinCEN issued this guidance as states continued to set their own cannabis policies, and just months after the Cole Memo was issued.
The Rohrabacher-Farr Amendment passes the U.S. House of Representatives for the first time ever with a vote of 219-189. While I had not started with NCIA just yet, I was in touch with our Director of Government Relations, Mike Correia, that night. Mike spent that evening doing two things: lobbying in the Capitol and running to the hospital to be with his wife, who was in labor! I remember waking up the next morning to learn two things: first, that states with medical cannabis programs and patients were going to be protected, and second, to find that Mike was the father of a baby girl!
NCIA hosts our 1st Annual Cannabis Business Summit & Expo in Denver, bringing hundreds of cannabis industry professionals together.
NCIA hires their second government relations staffer, ME! At the time, I was hired to be the Government Relations Coordinator and it changed my life forever.
Oregon, Alaska, and Washington, D.C. all vote to legalize adult-use cannabis. However, because Congress has the final say over D.C. policies, the District still does not have any adult-use dispensaries.
For the first time ever, pro-cannabis legislation is introduced in the U.S. Senate as S. 683, the Compassionate Access, Research Expansion, and Respect States (CARERS) Act of 2015. I remember that day well– Mike and I were there at the press conference with the architects of the bill, Sens. Booker (D-NJ), Gillibrand (D-NY), and Paul (R-KY).
NCIA hosts its Fifth Annual Cannabis Industry Lobby Days in Washington, D.C., and brings dozens of cannabis industry professionals to the halls of Congress to talk directly with members of Congress and their staff. That same month, Mike and I moved into the first NCIA-DC office.
The Rohrabacher-Farr amendment passes the U.S. House of Representatives for the second time by a wider margin of 242-186. Later that month, the U.S. Senate Appropriations Committee passed the companion Mikulski medical cannabis amendment by a vote of 20-10.
NCIA hosts its 2nd Annual Cannabis Business Summit & Expo in Denver. This also marked the first time a Presidential contender (Sen. Rand Paul, R-KY), hosted a private fundraiser with the cannabis industry.
NCIA hires two well established D.C. lobbying firms to represent the industry on Capitol Hill. This was the first time in history that a “white shoe” firm worked to further pro-cannabis legislation. Nowadays, there are dozens of lobbying firms involved in this space!
Sen. Jeff Merkley (D-OR) introduced the Senate version of the Marijuana Businesses Access to Banking Act. This bill was the precursor to the SAFE Banking Act, and to this day, Sen. Merkley is our biggest advocate for banking in the chamber!
Sen. Kirsten Gillibrand (D-NY) gives the opening keynote speech at NCIA’s Fall Regional Cannabis Business Summit. That same month, GOP presidential contenders were asked about cannabis policy at a CNN Debate, showing the mainstream acceptance of this issue.
Democratic presidential contender and Senator Bernie Sanders introduces the Ending Federal Marijuana Prohibition Act of 2015 (S. 2237), becoming the first major-party presidential candidate to support the legalization of adult-use cannabis. Also that month, United States District Judge Breyer lifted an injunction against a California medical cannabis dispensary, citing the Rohrabacher-Farr amendment.
NCIA celebrates its 5th Anniversary in Las Vegas and honors Rep. Barbara Lee (D-CA) with the 2015 Legislator of the Year Award.
Looking back, those early years of NCIA were without a doubt integral to where we are now in cannabis policy. Make sure you keep an eye on future issues of NCIA’s Cannabusiness Leader to learn more about 2016-2017 and all the progress we made during those years!
by Morgan Fox, NCIA’s Director of Media Relations
It’s that time again on Capitol Hill: appropriations season, when Congress determines how to spend – or not spend – your tax dollars for the next year. As you can imagine, this year will be unlike any in recent memory as a cash-strapped nation struggles with how to weather the economic storm caused by the pandemic while finding the funds to support important government functions and programs. Appropriations are also a time when our champions in the legislature are once again introducing sensible cannabis policy reforms through an avenue that historically has been effective. Many of these reforms would actually save taxpayers money!
It is difficult to tell what will happen with the various appropriations bills this session. There is still time for members of the House to amend funding legislation. While the House is moving forward with these bills, the Senate has yet to introduce any of their own. However, the upper chamber is in the process of considering a new coronavirus relief package. NCIA has been working with that chamber to have cannabis banking reform language included in that bill as it was in the last relief bill approved by the House, but it is by no means certain at this point. It is also possible that Congress won’t reach an agreement on the new spending bills and will simply decide to continue with the prior year’s budget outlays, which would at least continue medical cannabis protections for another year.
Stay tuned for more updates and be sure to join us next Wednesday, July 29, for an exclusive members-only fireside chat with NCIA’s dedicated government relations team!
by Barry Saik, Chief Executive Officer of Greenbits
Big changes are coming to the cannabis industry.
At least, that is the outlook shared by cannabis experts and lawmakers across the political spectrum. Even people who oppose federal-level legalization have to admit that the current status quo is unlikely to hold, and that popular opinion continues to sway towards the creation of a legitimate nationwide cannabis industry. Technology is playing a crucial role in connecting people inside and outside the confines of that industry.
There is considerable movement towards legalization in an increasing number of states. Surging demand has been keeping the cannabis industry afloat even in the worst-hit areas of the global Coronavirus pandemic. While federal-level legalization may be a long shot for the calendar year, there is good reason to believe that several new cannabis markets will open.
Many of today’s most exciting cannabis tech trends have already started gaining inertia. These movements are likely to continue picking up steam well into 2020 and beyond, even if federal-level initiatives prove unfruitful by the end of the year:
So far, cannabis has been a cash-only industry. Debit card transactions are gradually making their way into cannabis markets, thanks to cashless ATM solutions and a variety of online payment processors. The trend towards cashless payments is likely to continue, whether federally-backed banks support it or not.
If the federal government approves a bill that allows banks to fund and support compliant cannabis businesses, consumers will see a remarkable surge in industry development. Online ordering will likely become the new norm, powered by increasingly sophisticated e-commerce systems.
Without the support of federally backed banks, the market is likely to rely on unicorn FinTech innovators who can find ways to sidestep federal stonewalling. Compliance and cash availability will be issues, but solutions similar to those already in place will nonetheless flourish thanks to steady demand.
Right now, cannabis experts rely on a broad range of ambiguous, anecdotal data to differentiate strain profiles and the experiences they offer. There is not enough hard data to offer a quantitative comparison between any two strains.
Terpene research is going to change this. These aromatic oils are responsible for the telltale smell unique to each strain, and they have been shown to contribute to each strain’s medicinal and psychoactive effects.
The availability of hard data will transform the way consumers categorize cannabis. The goal is to go beyond the “sativa vs. indica” distinction and tell consumers exactly what to expect from each strain on an individual basis. In time, this may lead to an entirely new system of categorization for cannabis products.
Colorado has implemented cannabis hospitality licenses as of 2020, and cannabis legislators around the country are taking a close look at the effects of the new rule. California already has a few consumption-friendly public locations, but this is very much a brand-new field where cannabis legislation – and cannabis technology – have yet to fully intersect.
On a similar note, Colorado is following California, Nevada, Oregon, and Massachusetts in allowing for cannabis delivery. These simple regulatory changes will have effects that transform consumer expectations in the industry, and the trend is towards convenience.
Expect a new brand of cannabis entrepreneur fusing technology and cannabis culture in ways never before thought possible. People are going to develop solutions that help solidify cannabis culture’s place in the local environment, capitalizing on convenience to do so.
There are several high-profile companies making movements towards consolidating their multi-state presence. At the moment, this is made difficult by the fact that every state has a unique set of rules for its cannabis businesses to abide by. This makes economies of scale difficult to achieve.
Operational talent is the specific kind that these large-scale organizations are going to be looking for. Until now, many multi-state operators have been run primarily by finance-oriented executives. This provides a good basis for setting up and closing acquisitions, but it will fall on newly built operational teams to build compliant solutions for multi-state organizations.
The 2018 Farm Bill has led to official, federal-level recognition of hemp products. While this has not resulted in a nationwide hemp craze, the participating states are expected to bring non-psychoactive marijuana cultivation to the forefront.
So far, the USDA has approved 2020 hemp applications in Washington, Wyoming, Georgia, Iowa, and Pennsylvania. There are also fifteen tribal plans under review. Increased attention to hemp will lead to an increased dedication of tech resources to the needs of hemp farmers – which are necessarily distinct from those of psychoactive cannabis cultivators.
A handful of ancillary industries – from cultivation-friendly real estate specialists to cannabis law firms – are expected to grow around the burgeoning industry, but market intelligence is the one most experts are excited about.
Industry leaders in every state are looking for data on cannabis users. Sales data can help inform industry players on better, more efficient ways to use limited cultivation resources. Merchandising data can help dispensaries build lasting partnerships with non-cannabis brands. A wide array of new businesses will enter the cannabis market without necessarily being growers, processors, or dispensaries.
The ability to securely turn dispensary transaction data into readymade analytic insight will prove to be one of the most valuable assets a cannabis company can have. The fact that state regulation already requires dispensaries to gather and report transaction information means that, in many cases, half of the work is already done.
Technology has historically played a crucial role in achieving civic and social progress, which then informs newer technological initiatives. Cannabis technology is already helping regulators meet the demands stipulated by voters who want safe, legal access to marijuana products, and this trend is going to continue.
Barry Saik serves as Chief Executive Officer of Greenbits, a leading cannabis retail platform that empowers more than 1,200 cannabis retail locations across 13 states with a safer and smarter way to manage day-to-day operations and maximize store performance.
Barry leads all functions of the company, which processed $3.3 billion in legal cannabis transactions in 2019. Through its platform, Greenbits offers the full suite of services that cannabis retailers need – automated state-by-state compliance, point of sale, inventory control, and personalized insights – to enable owners, managers, and budtenders to run, protect, and grow businesses with ease.
A veteran of Silicon Valley start-ups and global tech companies, Barry brings a wealth of experience in scaling and leading integrated teams building software solutions that help small businesses grow.
Barry joined Greenbits as CEO in late 2019 after founding and running the SmartLine business at GoDaddy (NYSE: GDDY), a global company that helps entrepreneurs and businesses to be successful online. Centered around providing a second phone line that connects with a smartphone, the unit grew to $8 million in revenue in the first year under Barry’s leadership.
Before GoDaddy, Barry spent 15 years working in a variety of senior roles at Intuit (NASDAQ: INTU) and its marquis tax product, TurboTax, the leading software solution for business and personal tax filings. Early in his tenure, Barry led the founding team of TurboTax Online, which 40 million people used in 2019 to pay their U.S. taxes.
As a senior leader in TurboTax’s marketing department, Barry oversaw the creation of the company’s first television ad campaign, which resulted in a 12 percent spike in sales. He also led TurboTax’s engineering team, which is charged with programming the ever-evolving federal and state tax codes into the software, a centerpiece capability of the product.
Barry graduated from Stanford University with a B.S. in mechanical engineering and an A.B. in communications. He received an M.B.A. in marketing from the UCLA Anderson School of Management.
As the pioneering leader of regulated retail, Greenbits is the complete cannabis retail management platform. Founded in 2014, we empower 22,000 users in 1,200 retail locations across 13 states. As the market share leader, Greenbits rings $3.7 billion in sales annually, comprising one-third of all cannabis sales in adult-use states. With the largest and fastest-growing network of cannabis retailers, we serve the most locations, reach the most customers, process the most transactions, and ring the most sales in the industry, making Greenbits the best-selling and most trusted cannabis retail platform nationwide.
Greenbits provides smart management solutions that help cannabis retailers maximize performance and make better business decisions. Our robust retail platform – with automated state-by-state compliance, inventory control, and personalized insights – enables owners, managers, and budtenders to run, protect, and grow their businesses with ease. www.greenbits.com
Contact Information: mbriggs@greenbits.com
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.
We check in with NCIA Deputy Director of Public Policy, Rachel Kurtz, to hear some of the recent highlights from our Allied Associations Program. Fortunately, most states have deemed cannabis as essential, and our state associations are working in their areas to make relief options, or commerce opportunities, easier to reach.
Kim Kovacs, President of the Arcview Group, checks in with Bethany to discuss the relaunch of their Women’s Investors Network. The cannabis industry leads on women in C-suite and leadership roles, but that doesn’t mean we can be complacent. ArcView has been offering regular webinars, and other digital programming options, for women energetic about entering the space. The next will be looking at the science behind the plant, join the conversation!
We’ll see you next month for NCIA Today!
by Michelle Rutter Friberg, NCIA’s Deputy Director of Government Relations
Last week, NCIA’s Government Relations team honored the veteran community and Memorial Day through our latest #IndustryEssentials webinar. Our Director of Government Relations, Mike Correia, and I “Zoomed” with congressional cannabis champions Congressman Lou Correa (D-CA) and Congressman Earl Blumenauer (D-OR), as well as the cofounders of the Veterans Cannabis Coalition, Eric Goepel and Bill Ferguson. During the webinar, we talked about how through cannabis, veterans of all generations and with various conditions have experienced improvements in their quality of life and also discussed policy and legislation to address this conundrum. NCIA members can catch the full webinar recording, but in the meantime, check out a few highlights:
“In fact, if we were able to have the Veterans Administration (VA) embrace medical cannabis, veterans would get better care because they could deal directly with their primary care physician, who is in the best position to give them appropriate advice. But sadly, the VA is caught with this federal restriction and they have a very narrow interpretation of what they can do, and how they can do it, and they simply do not permit their physicians to work with veterans to discuss and work with — let alone prescribe — medical cannabis.”
“These folks came back from the theater of war with a lot of invisible, psychological scars– many of them that never were addressed. Back when I was the Chair of the Veterans Affairs Committee in the state of California, I would go on to have town halls and I remember veterans more and more would ask me, ‘Hey state senator, what’s going on with cannabis? I prefer cannabis to opioids, it makes me feel a lot better, I’m being able to function much better, why can’t I be prescribed cannabis by my VA doctor?’ And that really set me off on a quest to address medical cannabis in reference to veterans. Now in Congress, that’s something that I’m trying to work on front and center, and when I say trying to — I am working on it — I’m trying to score some victories there and get this legislation to the President’s desk for a signature, but again in the context of an election coming up, it’s going to be a challenge. But nonetheless, I think it’s a task all of us must take to heart and work hard towards.”
Bill Ferguson: “I think it’s really cool that both of those politicians you know — and you know, they’re not backbench guys either — they essentially say that, you know, like if we can get the VA bill to pass, that will be like opening the floodgates for the rest of the cannabis legislation, you know like the banking and all that kind of stuff. And I think they’re right because you know once you poke a hole in a dam, you know eventually a dam is going to break.”
Eric Goepel: “The problem is that they’re largely out of step with the population — like the general population and the veteran population. I mean Pew’s been tracking public support for medical cannabis legalization and adult-use legalization and it’s 92% in favor of medical use and 60 plus in favor of legalization. That’s pretty overwhelming when it comes to any political issue. Like these issues out-poll most politicians and popularity and certainly, maybe beyond like universal background checks, I can’t think of too many other major policy issues that have this level of public support that see no conversion into federal legislative change.”
We are all so grateful to the Congressmen and the VCC team for joining us. While Memorial Day has now passed, I’m continuing to feel so appreciative of our fallen service members. While all gave some and some gave all, the vast majority of our veterans are still unable to access safe, regulated cannabis, and since they fought for us, we’ll keep fighting for them.
Stay tuned for upcoming Fireside Chat webinars with NCIA’s Government Relations team.
by Morgan Fox, NCIA’s Director of Media Relations
It’s been a busy week for NCIA in our nation’s capital as we try to make sure the industry can survive the pandemic and continue to develop and thrive once the country begins to focus on recovery.
Earlier this month, NCIA and a coalition of advocacy and industry groups sent a letter to Congress urging them to include the SAFE Banking Act in the next stimulus package. We worked diligently with allies and our champions in the House to this end, reminding lawmakers that this legislation was approved with an overwhelming bipartisan majority in a stand-alone bill last September and that the pandemic was creating even more need for cannabis businesses to be able to access banking services immediately.
Last Tuesday, we got our wish: cannabis banking language identical to that passed in the House last year was included in the latest COVID-19 relief package, known as the HEROES Act.
Unfortunately, the partisan backlash to the Democrat-backed legislation was almost immediate, with some lawmakers opting to use this necessary and nearly revenue-neutral provision of the legislation as a punching bag and a symbol of overreach in the lower chamber. Republican lawmakers decried things as irrelevant as the number of times the word “cannabis” appeared in the language and claimed that this provision did not belong in a COVID-related bill. Senate Majority Leader Mitch McConnell even complained about a section of the bill that would study diversity in cannabis banking access and cost a practically infinitesimal percentage of this roughly $3 TRILLION stimulus bill.
This misdirected vitriol was thankfully not enough to block cannabis banking reform from moving forward. On Friday, the House approved the HEROES Act with the SAFE Banking language included!
The public health and safety benefits of allowing cannabis banking are undeniable. Our industry employs hundreds of thousands of Americans and has been deemed ‘essential’ in most states. Forcing the majority of them to deal almost entirely in cash puts workers at risk of infection from the cash they are handling. It makes the social distancing that is so important to getting this pandemic under control much more difficult and increases the danger for workers and consumers, particularly immunocompromised patients. The public safety concerns regarding cash being a target for crime will only grow as unemployment rates increase around the country.
The economic benefit to post-COVID recovery is clear as well. Lack of access to banking and other financial services will ensure that the cannabis industry – which has been exemplary in providing continuous healthcare, preserving jobs, and generating much-needed tax revenue during this disaster – recovers at a significantly slower pace than other industries. We deserve fair access to the financial systems utilized by every other legitimate industry.
Make no mistake: this is a big step forward for cannabis policy reform. But now comes the hard part – convincing the Senate to support this legislation. With or without cannabis banking language, all signs point to an uphill battle getting the Senate to consider any additional coronavirus relief spending. But that’s all the more reason to redouble our efforts, and support continues to grow. This week, a bipartisan group of 34 state attorneys general added their voices to the chorus calling for cannabis banking reform.
And with the chances for direct access to federal relief funding looking increasingly slim, it is absolutely vital that we do everything we can to push this legislation forward.
Please contact your senators today and ask them to support the HEROES Act with the House-approved cannabis banking provisions.
by Michelle Rutter Friberg, NCIA’s Deputy Director of Government Relations
For years, NCIA has been lobbying for the SAFE Banking Act. Now, as we adjust to our “new normal,” we are trying to make lemonade out of the lemons we’ve been given and see if some provisions of the SAFE Banking Act can be attached to the next coronavirus relief package.
To that end, last week ten cannabis advocacy and industry organizations sent a letter to congressional leadership urging lawmakers to include the Secure and Fair Enforcement (SAFE) Banking Act or similar language in the next pandemic relief package which would create a safe harbor for banks and other financial services providers to work with cannabis and ancillary businesses that are in compliance with state law.
Signatories included Americans for Safe Access, Global Alliance for Cannabis Commerce, Marijuana Policy Project, Minority Cannabis Business Association, National Association of Cannabis Businesses, National Cannabis Industry Association, National Cannabis Roundtable, National Organization for the Reform of Marijuana Laws, Policy Center for Public Health and Safety, and Safe and Responsible Banking Alliance.
The coalition wrote,
Even the lead sponsors of the SAFE Banking Act weighed in. Senate lead Sen. Jeff Merkley (D-OR) told NCIA, “Locking legal businesses out of traditional banking services—leaving them with no option but to operate exclusively in cash—has long put workers in danger. And now in the face of this pandemic, it’s making it increasingly difficult for these businesses to keep their workers and customers safe while they fight to stay afloat. The SAFE Banking Act is more important than ever to these businesses and the families who rely on them, and I’m committed to doing everything I can to get it passed.”
Congressman Ed Perlmutter (D-CO) also weighed in, stating, “Cannabis businesses and their employees already face a significant public safety risk without access to the banking system, and the COVID-19 crisis has only exacerbated this risk with these essential businesses having to move their cash-only transactions outside the store. At the same time, many of these businesses are facing disruptions in their supply chain and in normal operations and they should be eligible for relief just like any other legal, legitimate business during this pandemic. I will continue to push for inclusion of the SAFE Banking Act or other forms of relief for this industry in the next package.”
The next coronavirus relief package is set to be unveiled any day. Here at NCIA, we remain cautiously optimistic that our concerns have been heard and will be addressed. Regardless, we continue to call, email, and video message with congressional offices and remain dedicated to providing relief for our industry.
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