Cannabis Law Prof Blog

Editor: Franklin G. Snyder
Texas A&M University
School of Law

Tuesday, November 7, 2017

Wildfires in California expose the Vulnerability of the State’s Marijuana Industry

The devastating fires in California this month shed a spotlight on the lack of insurance coverage the marijuana industry receives. Because marijuana is still considered a Schedule I drug under the Controlled Substances Marijuana FireAct, it is almost impossible for farmers to insure the plant. The Cannabist reports that marijuana’s federally illegal status:

makes it extremely difficult, if not impossible, for most of the marijuana businesses affected by those disasters to access crop insurance, emergency bank loans, and disaster relief assistance available to other agriculture sectors.

Meanwhile, marijuana’s legal limbo has also scared away many major insurance companies from offering their services to the cannabis industry. For instance, Lloyd’s of London, a giant in the specialty insurance and reinsurance market, stopped insuring all cannabis operations in 2015, “unless and until the sale of either medicinal or recreational marijuana is formally recognized by the Federal government as legal.”

During the month of October, the fires destroyed at least 34 marijuana farms, burning thousands of acres of land on which
the marijuana was growing. Unfortunately, the farmers that own this land have been left with almost no recourse due to the preventative federal laws, despite the fact that many of the farmers have spent thousands of dollars to ensure compliance with state law.

Last week, California’s state insurance commissioner, Dave Jones, encouraged commercial insurance companies to insure marijuana businesses that are in compliance with state law, reasoning that “it’s [their] job as state officials “to make sure [they] successfully implement the legalization of cannabis.” It remains to be seen whether any insurance companies will accept his pleas, but Jones’s efforts have come too late for farmers in the current predicament.

Given the uncertain future of insurance for marijuana and marijuana related businesses, California may be able to take a note from Colorado in order to partially protect the industry from natural disasters in the future. Gerry Jones and Mark McNeely, employees of Cannabis Insurance Solutions in Denver, explained that although outdoor agricultural programs are federally insured and back, there is some leeway when it comes to indoor agricultural programs.

You have crop insurance and general liability for the building and professional liability for the people who come in and spray the crops and those kind of things. So the full gamut of coverages any other businesses would have access to," Jones said.

In Colorado, all dispensaries and cultivation operations are licensed with the state, which provides additional funding. Therefore, a business is covered if it is destroyed by a natural disaster, as long as the business is insured. It may be worth it for California to take a look at this indoor-farm workaround as a way to recoup some losses in the case of a future natural disaster, at least until there is a response from the insurance industry after the requests made by Commissioner Jones.

--Taylor Wood

November 7, 2017 in Business, Taxation | Permalink | Comments (0)

Monday, October 16, 2017

Las Vegas Dispensaries Struggle to Meet Tourists’ Demand

Essence-stripLas Vegas Dispensaries Struggle to Meet Tourists’ Demand

              Marijuana dispensaries for adult use have been operating throughout Nevada since July 1rst of this year. According to the Nevada Department of taxation, Marijuana sales have generated over $3.6 million in taxes during July month alone. Tax officials estimate that Nevada can generate up to $120 million in revenue by July of 2019.  As expected, the immense tourism industry in Nevada has largely played a role in the massive economic success surrounding the legalization of adult use. However, with success comes new problems.

The biggest challenge many dispensaries are facing right now is a supply shortage. Dispensary employees are essentially waiting for marijuana plants to grow, so they can re-stock their shelves with fresh product.

According to Stacy Castillo, the General Operation Manager at MYNT Cannabis dispensaries:

"A lot of companies are having an issue with just being able to create production products because there's not a lot of source flower out there; so a lot of companies are moving in the direction of creating more square footage so they can create more grow space and creating more product; so that's why if we do experience any kind of delay in product it's because we're waiting for the product to be made."

              But never fear, hopeful Nevada tourists! According to 3 Months into Recreational Marijuana Sales, Nevada Dispensaries Experience Pot Shortages by Olivia DeGennaro, there have been no reports of any Nevada-based dispensaries completely running out of marijuana and marijuana derivatives. Rather, dispensaries have been reported to have run out of select products. An additional problem Nevada-based dispensaries face in meeting demand is the legal battle of the distribution right of products intended for adult use. As the adult use market continues to thrive thanks to the tourism industry, representatives from established cannabis business like Castillo will continue to push for fully integrated dispensaries. By allowing full integration, dispensaries will be able to distribute marijuana products in a more cost-effective manner. In theory, these savings will be passed on to consumer (mainly tourists) which will thus continue to give Nevada a competitive edge in the tourism industry.

October 16, 2017 in Business, Local Regulation, Taxation | Permalink | Comments (0)

Tuesday, September 26, 2017

Boston potentially breaking into the marijuana scene with a 'Puff Bus'

   
Weed bus    Marijuana advocates continue to develop new and exciting
ways to partake in the booming business of marijuana consumption. Loopr, a Denver-based marijuana party bus company, plans to create another "green line" in Massachusetts' transit economy. But instead of a green line focusing on transporting passengers via the subway, Denver's 'Puff Bus' will provide passengers a fun transportation experience largely revolved around marijuana consumption. Alban Murtishi of MassLive.com reports: 

 

Loopr allows patrons to consume various forms of marijuana while riding on a bus through downtown Denver. The bus route stops at restaurants, hotels, nightspots and marijuana dispensaries.

 

According to the company, the Loopr vehicles, called Puff Buses, offer dazzling multimedia experiences with curated music and light shows.

 

Riders are allowed to smoke or consume marijuana in the back partition of the bus. The bus comes equipped with several different smoking implements, such as water pipes, vaporizers and hookahs.

 

The company doesn't sell marijuana, but partners with different dispensaries to get riders discounts.

 

While at first glance the 'Puff Bus' sounds like a fun experience, the potential legal hurdles will likely hinder its operation. Although party buses involving alcohol consumption are quite common in America, there are many differences concerning marijuana and alcohol, especially pertaining to their legal statuses and effects on third persons.

 

The obvious concern is how the federal government will react to such a company. Loopr supporters will point to the federal government's lack of enforcing its marijuana ban on Loopr's current business model in Denver, Colorado. Supporters will argue that the states should retain their autonomy and decide for themselves if they want to enact the appropriate legislation to permit such a mobile-marijuana-consumption company.

 

Opponents of legalization will face a tough battle if they depend on federal enforcement. It has been 5 years since Colorado first legalized marijuana, and the federal government has not shown an intent to fully enforce its ban, instead requesting legalized states to follow certain priorities.

 

However, a strong argument against Loopr involves public safety. Unlike alcohol, marijuana use has a noted effect on those around it, even if they don't personally consume the drug. Opponents can argue that the bus driver will be affected by the rampant marijuana consumption in a small and enclosed bus, thus impairing the driver and creating an unsafe environment for fellow commuters on the road.

 

Opponents can bolster this argument by referring to one of the federal government's listed priorities from the 2013 Cole II memo: To prevent drugged driving and exacerbation of other adverse public health consequences. 

 

Ultimately, until the federal government clarifies the national law or decides to enforce the current ban, legalized adult-use states like Massachusetts will issue the final decision on whether to legalize businesses such as Loopr.

 

--Zachary Ford

September 26, 2017 in Business, Drug Policy, Federal Regulation, Legislation, Recreational Marijuana, State Regulation | Permalink | Comments (0)

Saturday, September 16, 2017

Hawaii Dispensaries to Go Cashless

CanPay

Although Hawaii has struggled to legalize marijuana for adult use, it is ahead of the game when it comes to paying for medical marijuana. According to KATU, this week Hawaii announced that its dispensaries would start using the mobile debit app, CanPay, as a payment method for purchasing marijuana. 

In an effort to prevent robberies and other crimes targeting dispensaries, state leaders announced Tuesday that a cashless payment system will be implemented in October.

"This cash-free solution makes sense," said Hawaii Gov. David Ige. "It makes dispensaries' finances transparent."

The implementation of this method of payment will address a persistent concern coming from those opposed to marijuana legalization: safety. 

A cashless system would reduce, if not eliminate, the desirability of robbing marijuana dispensaries. The app is one method of payment, which can help to reduce the amount of cash on site at any given time. It should be noted, however, that although opponents of legalizing marijuana claim the presence of dispensaries increases crime, several other studies, like those reported in Civilized, The Cannifornian, and NY Daily News, have actually found the opposite.

While Hawaii has not gone completely cashless, it is unclear whether they will do so in the future. However, it may be preferable to use both payment methods in conjunction with one another. A mixed payment system could serve the needs of those who prefer to use cash due to information safety and privacy concerns, while also reducing the overall amount of cash kept in the retail shop throughout the day.

Furthermore, the CanPay payment app ensures that only legally compliant transactions are made using the app. According to CanPay, because it uses a Closed-Banking Feedback Loop, "only cannabis retailers working with financial institutions operating compliance programs built around the Cole Memo and FinCEN Guidance will be allowed to participate in the CanPay network." This compliance guarantee feature gives retailers a sense of financial security when deciding whether to accept the app as a payment method at their stores. 

CanPay is also currently available in Oregon, Washington, California, Colorado, Florida, and Maine.

 

--Taylor Wood

September 16, 2017 in Banking, Business, Finance | Permalink | Comments (0)

Wednesday, September 13, 2017

Schain: Keystone State MMJ rollout "got it right"

AaaPennsylvania's medical marijuana program has hit a few bumps on the road so far, and is currently battling lawsuits claiming that regulators improperly granted licenses to the winning applicants.  But Philadelphia lawyer Steven Schain of Hobart Law Group is offering praise and support for regulators who, he says, "got it right."  He offers his take on things in a new piece on the Cannabis Business Executive site, Lessons Learned From the First Phase of Pennsylvania’s Marijuana Program.   A sample:

Ignoring the program’s primary objective of swiftly providing sick people with medicine, the first phase license denials and awards triggered a tidal wave of malevolence to wash across Pennsylvania.

 

Seduced by their own PowerPoint deck’s glitter, both high and mighty and hardscrabble applicants received a rude awakening in the form of both denied ­applications and modest scoring. Stunned by their lack of sway and convinced that shenanigans prevented fair consideration, lawsuits ranging from “striking Pennsylvania marijuana law as unconstitutional” to “disqualifying successful applicants for alleged wrongdoing in other jurisdictions” are being loudly threatened across all 67 counties.

 

Although the program allows each applicant to receive a de-briefing on how respective applications were scored, and for unsuccessful applicants to appeal their scoring, here is what the first phase results revealed:

 

▪ Life ain’t fair.  Mirroring Arizona’s 2016 dispensary permit results (in which 750 applicants sought 31 licenses), each program application had less than 1 in 11 chance of winning.  Further, because the program omits any residency requirement, Pennsylvanians, whom had never grown, processed or sold marijuana, had even less of a chance.

 

▪ Big marijuana carried the day. Approximately 70 percent of the winning applicants were affiliated with growers, processors and dispensaries already operating in multiple legalized marijuana jurisdictions. Beyond being able to demonstrate a history of being a transparent, compliant and profitable marijuana-related business, winning applications were crafted by experts at submitting winning applications, which is distinct from growing, processing and selling marijuana.

 

▪ Consultant means failed grower.  Like a rube swindled by a suddenly exiting town carny, seemingly sophisticated Pennsylvanians got suckered by consultants with shiny trade show booths leveraging claims of “Colorado or California growing experience” and selling fanciful and proprietary lighting, fertilizing and yield optimization techniques.  Also, enjoying handsome windfalls at 400 unsuccessful applicants’ expense were lobbyistS and juiced-in lawyers offering connectivity to politicos with jazzy titles and zero decision-making process impact.

 

▪ Follow the rules closely. Does your diversity definition encompass armed forces veterans or involve third-party certification?  Regardless, because Pennsylvania’s marijuana law defines a diverse group as a certified disadvantaged, minority-owned, women-owned, service-disabled veteran-owned or veteran-owned small business, the program’s unique criteria disqualified many seemingly qualified applicants.

 

▪ Pennsylvania’s Program Is Built to Last.  Perceived inequities aside, the DOH and the program got it right.  Beyond meeting every self-set deadline and blitzing through 500 applications in 90 days, licenses were generally awarded to the best-funded applicants with proven track records of success.  In an exceedingly volatile industry hinging upon timing, adequacy of funding, and fullness of regulatory compliance, in the first phase the DOH has positioned the program for its greatest likelihood of swift success.

Read the whole thing. 

September 13, 2017 in Business, Medical Marijuana, State Regulation | Permalink | Comments (0)

Saturday, September 9, 2017

Silicon Valley's Cash Crop

Marijuana Test Tube

Many industries have seen rapid changes in response to evolving marijuana laws. Next in line seems to be the technology sector. According to an article on the STAT medical site, venture firms and wealthy private investors in Silicon Valley are pumping money into the development of marijuana products--and not just for medicine.

VC firm Benchmark Capital recently invested $8 million in Hound Labs, a startup here in Oakland that’s developing a device for drivers — and law enforcement — to test whether they’re too buzzed to take the wheel.

 

And that’s just the start. Wealthy investors are pouring tens of millions into the cannabis industry in a bid to capitalize on the gold rush that’s expected when California legalizes recreational marijuana on Jan. 1. They’re backing development of new medicinal products, such as cannabis-infused skin patches; new methods for vaporizing and inhaling; and “budtender” apps like PotBot, which promises to scour 750 strains of cannabis and use lab research, including DNA analysis of each strain, to help customers find the perfect match.

Investors, in anticipation of a large increase in marijuana consumption due to the legalization of recreational marijuana on January 1st, have been rolling the dice and investing in products that incorporate the federally prohibited drug. But, as with all things, on the other end of the potentially lucrative rewards are great risks: civil and criminal liability under the Controlled Substances Act.

However, this risk is precisely what has given some of these investors the ability to step in. Because many public companies are prohibited from investing in marijuana, either contractually or by other federal law, private investors, though numerous, largely have first pick of which startups to invest in. Only time will tell if the decision to invest in the drug was a wise one.

-- Taylor Wood

September 9, 2017 in Business, Finance, Research | Permalink | Comments (0)

Marijuana production in Canada expected to grow

Canada Cannabis FlagCannabis production in Canada seems to be looking up, as at the country's top  licensed marijuana producer, Canopy Growth Corp., is set to double its production. Reuters reports that growers are rushing to ensure product to all Canadians who will be legally capable of purchasing recreational marijuana by July of next year.  Canopy's substantial increase, which will involve a C$21 million investment to upgrade its facility, is in response to an unexpected shortage in supply.  From the report:

“This is a very big leap, in terms of our output, our capacity, our footprint,” Bruce Linton, Canopy Growth’s CEO, said in an interview.

 

Canopy Growth is currently licensed to produce 31,000 kilograms of marijuana and related products, and aims to triple that by July next year, the deadline the federal government has given provinces to make pot legal for all.

 

The deal gives Canopy 450,000 square feet of greenhouses that can be immediately added to its existing 350,000 square foot facility in Niagara-on-the-Lake, Ontario. It is also building an additional 200,000 square feet of greenhouse capacity on its existing property.

 

Linton said that a 250,000 square foot greenhouse should be able to produce around 10,000 kilograms of marijuana annually, which at an average sale price of C$8 a gram could bring in C$80 million.

The company says it is expanding beyond Niagara to other parts of Canada and expects 3 million Canadians to use legal recreational marijuana next year. It also has partnerships with medical marijuana companies in Brazil and has been exporting marijuana to Germany for sale in German pharmacies for over a year.

Canopy may be expanding in Canada, but the company says it intends to stay far away from United States market due to uncertainty in a country where all aspects of marijuana are federally illegal. 

-- Erin Milliken 

September 9, 2017 in Business, International Regulation, Medical Marijuana | Permalink | Comments (0)

Thursday, September 7, 2017

'Alright, Alright, Alright,' Texas isues first medical marijuana license

TX

In 2015, Texas Governor Greg Abbott signed into law the Texas Compassionate Use Act. This Act, among other things, allows individuals with intractable epilepsy to obtain cannabidiol (CBD) oil, a form of low-THC cannabis. The Act gives authority to the Department of Public Safety (DPS), to regulate and award dispensary licenses.

Now, nearly two years later, Texas has issued its first medical marijuana license to the company Cansortium Texas.  Two more proposed growers had their applications accepted previously and it is expected that those two will also be awarded licenses in the next days or weeks.  Though these new developments might seem like a step in the right direction, there have been many critics of the Act and the stringent regulations imposed by DPS. Bob Sechler of the Austin American-Statesman, explores what lies ahead for the industry in Texas:

The Texas licenses won’t equate to quick profits, however, and success in Texas over the long haul might depend as much on the Legislature as on business acumen. Cansortium and the two other companies expected to operate in Texas are facing strict state regulations that limit their customer bases solely to patients with intractable epilepsy and that constrain how they formulate their products — on top of investment costs running into the millions of dollars.

 

“It is safe to say that it is a challenging market,” said Morris Denton, chief executive of Compassionate Cultivation.

 

Denton said an initial goal for his company will be to prove that medical marijuana can be dispensed safely in Texas and that it is beneficial, with the aim of persuading state leaders to make it available to patients suffering from a wider variety of ailments in coming years.

 

Hidalgo said Cansortium considers the market among Texas patients suffering from intractable epilepsy potentially lucrative enough and didn’t opt to expand into the state because of the prospect that additional medical conditions eventually will be made eligible. Still, he said he considers it likely that future discussions among the state’s leaders regarding medical marijuana will revolve around “what conditions and for what reasons they are considering expanding” its availability.

 

“I think it remains to be seen what will happen (in Texas), but the evidence is out there,” Hidalgo said.

 

Proponents in Texas already are anticipating a major push during the next regular session of the Legislature in 2019 to try to increase patient access to medical cannabis. Some industry experts have said the Texas market for medical cannabis could rival California’s estimated $2.8 billion market, if restrictions are loosened and it becomes more widely available.

 

 

As things stand, each of the three companies selected for licenses is required to pay a $488,520 fee upon final approval, followed by a license renewal fee of $318,511 in two years if they want to stay in business. The fees are designed to cover the cost of regulating the new industry, state officials have said.

.  .  .

The Compassionate Use Act legalized the production and sale of cannabidiol, an oil derived from the cannabis plant that doesn’t produce a high, by the state-licensed dispensaries. But the law limits use of the oil, commonly called CBD, to certain patients suffering from intractable epilepsy — and only if they have a doctor’s prescription for it and already have tried two conventional drug treatments that proved to be ineffective.

 

Observers of the burgeoning legal marijuana industry in the U.S. say the new Texas law is significantly more restrictive than medical marijuana laws in the 29 other states that have enacted them.

 

“We have not yet seen any other state try to launch a medical cannabis program based solely on a single condition,” said John Kagia, executive vice president for industry analytics at New Frontier Data, a cannabis market research firm based in Washington. “Under the (Texas) law as it is currently structured, it is going to remain a fairly narrow, constrained market. It is going to be a relatively limited business environment.”

 

The Epilepsy Foundation Texas has pegged the number of Texans with intractable epilepsy at about 150,000.

 

But only a fraction are expected to meet the Compassionate Use Act’s eligibility requirements for CBD, want to try it and know a doctor willing to write a prescription for it.

 

New Frontier Data hasn’t yet estimated the monetary value of the Texas medical cannabis market under the new law, but Kagia said it’s just a sliver of what it could be.

 

-- Victoria Olivarez

September 7, 2017 in Business, Medical Marijuana, News, State Regulation | Permalink | Comments (0)

Wednesday, September 6, 2017

Florida bank is first to accept marijuana deposits

AaaThe lurking dangers of money laundering charges have led most U.S. banks to avoid taking deposits from medical marijuana businesses, but one rather unusual Florida bank has decided to go for it.  First Green Bank, headquartered in Orlando, is now working with six of the seven Florida MMJ licensees, and has a crew of six employees dedicated solely to marijuana compliance.   

    Lex Ford, a senior vice president at First Green Bank, said he couldn't think of a competitor in Florida who was willing to try.

    "It was interesting at first, when we're telling these high net worth CEOs how little we could let them dictate the process. We expected frustration," Ford said about working with marijuana companies. "But everyone in it understands this is how it has to go."

 

    First Green Bank is a fairly small operation with just six branches, mostly in Central Florida and one in South Florida. It manages about $622 million in assets. The bank doesn't have a branch in Tampa Bay yet. Ken E. LaRoe, a seasoned banker, founded First Green Bank with a specific purpose in mind. The bank firm actively promotes environmental and social responsibility and is known for offering discounts and low-interest loans on "green" initiatives, like electric cars, LEED-certified construction and solar systems. Now it's added cannabis to that list.

    "Ken's wife used marijuana as treatment for seizures and it changed her life," said Ford, who describes himself as LaRoe's "wingman." "That's what started us down this path in 2010, about a year after the bank was founded. By 2012 to 2013, we were coming up with a plan and got approvals by 2014."

It's a risky move for the bank, but one that may carry a substantial reward.  The next move is up to federal regulators, who last year shut down a Colorado credit union that sought to serve the cannabis industry.

 

September 6, 2017 in Banking, Business | Permalink | Comments (0)

Tuesday, September 5, 2017

The 'Grass Ceiling' The Declining Role of Women in the Cannabis Industry

AaaAlthough marijuana is a relatively new area of business and law, the same issues of gender that critics have raised with respect to corporate America generally may be making their way into it.  have found their way into this seemingly progressive area. There’s been a decline in the amount of women in leadership positions in cannabis industries. Brett Arends refers to this phenomenon as the “Grass Ceiling”: 

The percentage of executives in U.S. marijuana-related companies who are women has collapsed to 27% from 36% in just one year, according to the latest anonymous survey by Marijuana Business Daily.

 

Not long ago the marijuana business was way ahead of U.S. business overall in the leadership positions held by women. But as the industry has become more mature and more mainstream, instead of building on that leadership, it’s going in reverse. Men are now edging out the women.

 

. . .

 

Cannabis companies are increasingly hiring executives from the rest of corporate America, and that favors men, notes Marijuana Business Daily’s Eli McVey.

 

More disturbing still may be an anti-female bias in financing. Women make up just 10% of the executives in the investment sector of the marijuana complex, the survey found. And men may, either consciously or unconsciously, favor companies run by men.

September 5, 2017 in Business | Permalink | Comments (0)

Tribes see tax, environmental benefits from cannabis

AaaAs the growing trend for state legalization of marijuana continues, Native American Tribes want to begin growing and selling marijuana of their own. Because the marijuana market is earning billions, Native Americans hope selling marijuana will end the poverty currently plaguing their reservations. From the VOA News, Cecily Hillary reports:

“Let’s just look at one small piece of what hemp can do,” said Leslie Bocskor, founder of Electrum Partners, which works with states and tribes looking to enter the cannabis industry. Hemp, Bocskor said, can be used to manufacture plastics that are more environmentally friendly than plastics made from oil and gas, which aren't biodegradable.

 

“When you put hemp plastic into landfill, it will break down into things that are not damaging, at worst, and, at best, it can be additive to the soil it’s put into,” he said. “It also causes far less pollution to produce hemp plastics.”

 

Tribes stand to realize even greater profits than states due to their tax advantage.

 

Native American tribes have an advantage over other companies in the cannabis business. Many businesses in the United States lower their taxes by deducting their business expenses from their profits. But companies that grow and sell cannabis are not permitted to deduct their business expenses. This means they pay a higher tax rate than do other companies.

However, Native American tribes and the companies they own do not pay federal income taxes on money earned on reservations.


Bocskor says this means that a tribe-owned cannabis company could earn a profit margin of up to 85 percent.

  --Alexandria Guiam

September 5, 2017 in Business, Tribal Marijuana | Permalink | Comments (0)

Monday, September 4, 2017

Omission in Alaskan Cannabis Legislation Inadvertently Helps a Marijuana Business

AaaDespite the passage of legislation legalizing recreational cannabis in Alaska, local government remains an obstacle for some marijuana businesses. One business owner was able to successfully set up shop on the historic main street of an Alaskan tourist town -- Talkeetna, Alaska -- in an unincorporated municipality, all thanks to an omission in the legislation.  The drafters don't always cover every base, and here we see that playing outFrom Leafly.com:

“Small towns in Alaska are harder than anywhere to break into and sort of become accepted,” McAneney said. 

His store got its approval from the borough on a technicality when the assembly was writing regulations for marijuana businesses in unincorporated areas, like Talkeetna, and inadvertently omitted special land use districts — like the town’s Main Street. Talkeetna has no local governing body, only a nonvoting community council whose sole power is sending recommendations to borough officials roughly 75 miles (120 kilometers) away. 

State regulators approved the store’s permit on a 3-2 vote last spring. 

“There’s people that are upset about it, but it’s legal,” said Sue Deyoe, the Talkeetna Historical Society and Museum’s executive director. 

-- Christopher Daves

 

 

 

 

September 4, 2017 in Business, Legislation, Local Regulation | Permalink | Comments (0)

Denver Social Use Clubs Hitting Roadblocks

Colorado is at the forefront for many things cannabis. but its laws aren’t always so friendly.  Smoking weed in public has been illegal in Colorado, but Denver voters last year approved a measure to allow licensed social clubs where marijuana could be consumed on the premises.  An Associated Press report notes that startup businesses are now seeking to fill the gap in available places for legal users to smoke.  But it's not easy.  Detailed restrictions include prohibitions against serving alcohol or being within a certain distance from places that do, restricting the ability to dispense marijuana on site, and license fees in the thousands of dollars.  From the report:

 

"There are plenty of places where you can consume alcohol. Let's give people a place to go to consume marijuana," said Jordan Person, head of Denver NORML, which advocates for pot-friendly public policy.

But Denver's would-be "social use" clubs have faced one delay after another.

 

First, the state liquor board prohibited pot use at any place with a liquor license, making bars and many restaurants off-limits. And pot shops can't allow consumption on the premises.

 

That left gathering places like coffee shops, art galleries and yoga studios. Furthermore, would-be clubs must stay twice as far as liquor stores from schools and anywhere children congregate, including playgrounds and sports fields.

 

"We can't be in places where it makes sense," said Kayvan Khalatbari, a Denver marijuana consultant who helped run last year's club campaign.

 

City officials say the rules are as flexible as possible given stiff resistance from some community groups and marijuana skeptics. The voter-approved club measure also says the club licenses are a pilot program and neighborhood groups must agree to allow a club before it could open.

 

The voter-approved club measure also says the club licenses are a pilot program and neighborhood groups must agree to allow a club before it could open.

 

"There were no surprises in the rules," said Dan Rowland, spokesman for the Denver department that regulates marijuana businesses. "They reflect all the comments we got from the community."

 

One hopeful applicant says the regulations are stringent but still a step forward for the industry.

 

"A lot of us are hoping this will ... open the doors for a new kind of business," said Connor Lux, who runs a co-work space for the cannabis industry and plans to apply for a social use license to hold public, weed-friendly events at his business just north of downtown Denver. Applying for a license costs $1,000; the licenses itself is $1,000 a year.

-- Clarissa Dauphin

September 4, 2017 in Business, Local Regulation, Medical Marijuana | Permalink | Comments (0)

Sunday, September 3, 2017

Weddings Up in Smoke?

AaaMany projected the decriminalization of marijuana would create several job opportunities. However, the legalized marijuana industry has also created a more unexpected career path for some: marijuana wedding planners. A recent article in Time titled Marijuana Is the New Moneymaker for Wedding Planners explains how the trend is all the new rave at weddings of marijuana minded couples. 

Specialists have launched entire businesses to meet this new wedding-weed demand. In Colorado, where recreational marijuana has been legally sold since 2014, Bec Koop operates cannabis-friendly Irie Wedding & Events and is one of the founders of the Cannabis Wedding Expo, an event where brides and grooms can meet marijuana vendors. Koop offers a litany of wedding services: day-of coordination, overall planning, floral arrangements, cannabis open bars. She also offers consulting services for venues looking to bring in cannabis-inclusive events.

These individuals have not only been employed to complete the typical tasks associated with being wedding planners, but also have diversified their businesses to provide consulting services for those clients looking to allow the use of marijuana in their venues. 

 Taylor Wood

September 3, 2017 in Business, News, Recreational Marijuana | Permalink | Comments (0)

Saturday, September 2, 2017

Is it getting too late for small businesses to get into the marijuana business?

AaaThe big money continues to flow into medical and recreational weed.   In new industries, small players can often get a head start and find success before the big players intervene.  Companies like Hewlett-Packard, Microsoft, and Apple were started by a few guys working out of their garages.  ,Many of the countries young cannabis businesses started the same way, but things are changing, according to a story on the  STATnews medical news website, by editor Charles Piller, Big-name tech investors pour millions into marijuana — both medicinal and not.  From the article:

The storied Silicon Valley venture firm Benchmark Capital has launched a slew of tech companies: Twitter, Uber, Snapchat, Instagram. Now its search for the next big thing has led it to … pot.

 

Benchmark recently invested $8 million in Hound Labs, a startup here in Oakland that’s developing a device for drivers — and law enforcement — to test whether they’re too buzzed to take the wheel.

 

And that’s just the start. Wealthy investors are pouring tens of millions into the cannabis industry in a bid to capitalize on the gold rush that’s expected when California legalizes recreational marijuana on Jan. 1. They’re backing development of new medicinal products, such as cannabis-infused skin patches; new methods for vaporizing and inhaling; and “budtender” apps like PotBot, which promises to scour 750 strains of cannabis and use lab research, including DNA analysis of each strain, to help customers find the perfect match.

 

Among the noted investors: tech and biotech mogul Peter Thiel, who co-founded PayPal and made a fortune with the cancer drug startup Stemcentrx. Thiel contributed $300,000 to the California ballot campaign that paved the way for legalization. And in the first public endorsement of the industry from a major biotech investor, Thiel’s Founders Fund has sent millions to Privateer Holdings, a Seattle private equity firm that backs research into medical marijuana products, among other cannabis-related ventures.

With big companies already investing millions into marijuana startups, will there be any room for small "mom and pop" type businesses? It seems that big investors are already positioned to out-compete small businesses in this new field, reducing business opportunities for small investors.

-- Zac Artim

September 2, 2017 in Business, Medical Marijuana, News, Recreational Marijuana | Permalink | Comments (0)

Friday, September 1, 2017

NFL v. NFLPA: The Battle for Medicinal Marijuana

NFLAlthough the health-related NFL issue currently occupying major headlines are focused on chronic traumatic encephalopathy (CTE), increasing rates of former and current players becoming addicted to pain killers are quietly becoming the NFL's second largest health issue. In response to the pain killer addiction crisis, the NFL reached out to NFL Players Association and agreed to use a portion of the “joint contribution funds” to study medicinal marijuana effects on treating players dealing with chronic pain. The players' union has claimed that the NFL has not been transparent regarding which players they treat for chronic pain and how the treatment is conducted, but it apparently will push for more study of the issue and ultimately for use of medical marijuana for treating current and former players.

A good overview of the debate is Peter King’s Lesson of the Week: Medical Marijuana, Painkillers Could Be Next NFL vs. NFLPA Battleground. A sample:

The MMQB has obtained the correspondence between the two sides—comprised of four letters, two from NFL general counsel Jeff Pash to the PA, and two from union lawyer Ned Ehrlich back to Pash—and it’s largely what you’d expect. Last week, we said if you give these guys a walking-on-eggshells topic (like domestic violence) then these guys will just fight on the eggshells, and this is more proof of it.

And that is on the heels of comments made by union president/Bengals tackle Eric Winston on the potential damage another work stoppage could do. (Though I’ll agree with Pro Football Talk in that Winston’s “dies out in 20 years” quote was blown way out of proportion.)

But it’s still important, and there’s a lesson in here to be learned. That lesson is this: While the public has focused on the issue of traumatic brain injury and CTE, there’s another topic out there that’s just as important and potentially scary, and that’s how painkillers are affecting the NFL.

-- Jake Wiggins

September 1, 2017 in Business, Medical Marijuana, News, Workplace | Permalink | Comments (0)

How Nevada's Gambling Regulators Plan to Separate from the Marijuana Industry

Las VegasIn Nevada, gambling regulators are refusing to collaborate with the marijuana industry.  Taking a harsh stand, the Nevada Gaming Commission disclaimed that there will be no place for marijuana in Nevada casinos as long as the federal government views its consumption and possession as a felony, according to a piece in the Insurance Journal

 

Commissioners said the reputation of the gaming industry is at stake and there needs to be clear separation.

 

“On one hand you have the gaming industry and on the other hand you have the marijuana industry … The two shall not meet,”

Commission Chairman Tony Alamo said.

 

Commissioners did, however, spend more than an hour discussing what Alamo said would be the least controversial aspects of potentially bringing marijuana into casino resorts – third-party and business associations between licensees and individuals and companies involved in the marijuana industry.

 

That aspect was shot down, though. No votes were taken, but commissioners unanimously concluded that licensees should be discouraged from hosting shows or conferences that promote the use, sale, cultivation or distribution of marijuana.

 

Licensees also shouldn’t maintain business relationships with marijuana companies, including landlord-tenant arrangements.

 

Commissioners also said licensees should not receive financing from or provide financing to an individual, entity or establishment that sells, cultivates or distributes marijuana.

 

September 1, 2017 in Business, Legislation, Medical Marijuana, News, Politics, State Regulation, Travel | Permalink | Comments (0)

Would Legalization Really Reduce Minor Drug Convictions?

Washington PostThe plight of those who have been convicted for various marijuana related crimes is being used to argue why marijuana should be legalized but these new laws don't seem to be helping the problem.  A recent article in the Washington Post e explores how these new laws are only helping further institutional racism:  Want to See Proof of Institutional Racism? Let Weed Open Your Eyes.

The disparities in Maryland and the District were among the highest in the nation, with blacks up to eight times more likely than whites to be arrested.

There were 145 applicants for licenses to grow medical marijuana. Despite a state law requiring racial diversity in licensing, none of the 15 firms selected to start growing marijuana this summer are owned by African Americans. Turns out, the commission set up to award the licenses decided to ignore racial diversity in favor of “geographic diversity,” which just happened to produce the all-white outcome.

In a one-year period since legalization took effect, arrests for smoking marijuana in public jumped from 142 to 400, according to D.C. police data. If the trend holds, there will be at least as many — if not more — arrests this year. Arrests for selling marijuana have also tripled, from 80 in 2015 to 220 in 2016, police said

September 1, 2017 in Business, Drug Policy, News, State Regulation | Permalink | Comments (0)

Friday, June 17, 2016

Microsoft To Launch Marijuana Business Program

ALove it or hate it, you've got to agree that nobody's better at chasing a buck than Microsoft.  The tech giant announced today that it is partnering with KIND Financial -- already a leading player in the cannabis business -- to develop a full seed-to-sale system for tracking marijuana plants:  

Three days after investing in LinkedIn Corp. LNKD, -0.14% in a record-setting $26 billion deal, the company announced its first venture into the world of marijuana, striking a partnership with KIND Financial to provide seed-to-sale software to state and local governments for the management of cannabis commerce and distribution.

 

The deal makes Microsoft one of the first major technology companies—and one of the first major publicly traded companies -- to acknowledge the rapid legalization of marijuana, with recreational use already legalized in Alaska, Colorado, Oregon, Washington and Washington D.C., and up for vote soon in five other major states, including California.

 

Major brands have been mute on the controversial topic, but more have started to show their support as acceptance has spread. Last month, Walgreens Boots Alliance posted a blog touting research showing the benefits of medical marijuana, which is now legal in 24 states.

 

The legal marijuana industry is expected to balloon in coming years. Sales of legalized marijuana are projected to hit $6.7 billion this year, compared with $5.4 billion a year ago, according to industry tracker ArcView Market Research.

 

KIND Financial is using Microsoft’s cloud platform to build out its services for government agencies. According to Marijuana.com., a team at Microsoft will help clients navigate regulations and laws, while tracking legal cannabis commerce and helping to stop product from reaching the black market.

 

In a statement, a Microsoft spokesperson said the company “supports government missions to regulate and monitor controlled substances and items, from the Justice Department regulating tobacco and firearms to a state regulating legal cannabis.”

 

June 17, 2016 in Business, News, Stocks | Permalink | Comments (0)

Tuesday, January 12, 2016

Seattle Relaxes Buffer Zones Around Cannabis Dispensaries

ASome new neighborhoods may be getting marijuana dispensaries in Seattle, thanks to a decision by the City Council to reduce buffer zones around cannabis-related businesses.  A combination of zoning rules and the state's default 1,000-foot buffer zone rules meant that large chunks of the city had no such businesses.  That's changed, as of yesterday:

On Monday, the City Council unanimously set buffer zones for producers and processors at 250 feet.

For retailers, the new buffer will be 250 feet downtown and 500 feet elsewhere in the city.

No more than two pot businesses can be within 1,000 feet of each other.

The 1,000-foot buffer had led to vast areas of the city without marijuana businesses and clusters in areas like SODO, where James Lathrop runs Cannabis City, the first legal marijuana store to open in Seattle.

"We're a block away from the dump. We're here because of this crazy zoning," Lathrop said.

Lathrop was among the marijuana business people who advocated for smaller buffer zones.

Supporters said loosening the buffer zones will help the state's legal marijuana system succeed by competing with the illicit market, and make it more available to visitors.

Some in the industry are also opposed to smaller buffer zones.

They urged the council to slow down, arguing that pot shops in more neighborhoods could lead to public backlash and businesses failing under competition.

 

January 12, 2016 in Business, Local Regulation | Permalink | Comments (0)