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Is HHC Legal? What is HHC

Is HHC Legal? What is HHC

What is HHC hexahydrocannabinol

Another day, another THC analog cannabinoid product!

Every few months there seems to be a new THC analog product that gains popularity. It started with Delta 8 and Delta 10. Then we saw THC-O and THCV.

The latest analog to hit the market is HHC. Also known as Hexahydrocannabinol, HHC is a hydrogenated form of THC.

What is HHC?

Like other THC analog products like Delta 8, HHC does not occur naturally in concentrations large enough to be consumed directly. Instead it is made through an extraction process similar to how a margarine manufacturer hardens vegetable oils.

Through hydrogenation, hydrogen atoms are added to the chemical structure of THC using some type of catalyst like nickel or palladium. With the addition of high pressure, the double bond chemical structure of THC breaks down, replacing one half with hydrogen. This preserves the cannabinoid’s potency and effects.

In other words, HHC is made through a chemical process that converts THC, which is also how Delta 8 and other cannabinoids are made.

HHC vs THC

Like Delta 8 and THC-O, HHC is very comparable, though slightly less potent. However users report the same effects as when consuming THC, like euphoria, increased appetite and increased heart rate.

Some HHC users place HHC somewhere in the middle of Delta 8 and Delta 9 THC, claiming HHC is more relaxing than stimulating. Due to its molecular structure, HHC also still holds many of the beneficial aspects of the cannabinoid.

However because HHC is not regulated, there are no reliable studies to confirm any of the effects or potential health benefits.

Is HHC Legal?

Just like other THC analogs like Delta 8 and THC-O, HHC is technically legal due to a loophole in the 2018 Farm Bill which legalized hemp on the federal level. Under federal law, as long as a cannabis plant has a THC content of .3% or less it is considered hemp.

However through extraction and chemical processes like those mentioned above, THC analogs are created from federally legal hemp. And because they aren’t technically Delta 9 THC, they aren’t regulated under the Farm Bill.

So while HHC is legal to buy and consume, it is completely unregulated. With products such as this, it is not uncommon for bad actors to get into the market to make a quick buck without taking into the account the safety of their products and consumers.

Where to find HHC

Because HHC is not a licensed THC product, you won’t see it a legal medical or recreational cannabis dispensary. You are most likely to find HHC products at gas stations and smoke shops where you see Delta 8 and other analog products.

When shopping for HHC or any other analog THC product, do a little research on the product before purchase. Confirm that the brand actually has a website. See if they offer lab test analyses of their products which can confirm the potency that they claim.

If you see any product that is branded as a name-brand knockoff like Skittles, Sour Patch Kids, Oreos, Chips Ahoy, etc., avoid it. Aside from the obvious legal implications of stealing a company’s trademark, these products are in most cases not legitimate. They count on consumers seeing a brand they recognize and thinking it looks cool to sell plain gummies with nothing in them, or vastly misrepresented potencies.

Next time you hear someone asking “what is HHC?”, now you’ll have the answer! Always be careful when buying any sort of “cannabis products” from a non-licensed retailer.

In several state where cannabis is already legal medically, recreationally or both, THC analogs like Delta 8 THC have already been banned. Other states have chose to regulate them like Delta 9 THC and make them available only through licensed retailers.

First Connecticut cannabis cultivation license goes to…a Massachusetts company?

First Connecticut cannabis cultivation license goes to…a Massachusetts company?

Connecticut cannabis cultivation license

Insa, a Massachusetts based cannabis company, has received the first provisional cultivator license for recreational cannabis in Connecticut. The company, with operations in three states currently, was able to obtain the license through a social equity process.

The Connecticut Department of Consumer Protection which issued the license confirmed that the company passed the required background checks and paid $3 million in fees to receive the license. The 14-month provisional license gives the company time to hire employees, establish a business plan and build out their cultivation facility.

Insa currently operates three recreational cannabis dispensaries just over the border in Springfield, Massachusetts. If their final license is approved, Insa will have the ability to operate over 15,000 square feet of cultivation space.

16 social equity applications were approved overall out of 41 total applicants. This process was not held under the lottery format of other non-social equity licenses.

Connecticut’s cannabis law defines a disproportionately impacted area (i.e. social equity applicant area) as a U.S. census tract in Connecticut that has a higher historical conviction rate for drug-related offenses, or an unemployment rate greater than 10%.

Of the 16 approved applicants: two live in Bridgeport; five in Hartford; one in Manchester; one in Middletown; three in New Britain; one in Southington; one in Stamford; and two in Waterbury. However these applicants must still undergo their background checks before they receive provisional licenses like Insa.

Illinois implemented a similar social equity platform when the state legalized cannabis in 2020. It has led to a slew of issues regarding insider connections and big players coming in to beat out local businesses.

What is the Cannabis Administration and Opportunity Act?

What is the Cannabis Administration and Opportunity Act?

Cannabis Administration and Opportunity Act introduced

Senators Cory Booker, Chuck Schumer and Ron Wyden have introduced a bill that would legalize and regulate cannabis at the federal level.

The Cannabis Administration and Opportunity Act (CAOA) is a comprehensive legislation that would end federal cannabis prohibition by removing cannabis from the Controlled Substances Act. The CAOA  would also empower states to create their own cannabis laws; ensure federal regulation protects public health and safety; and prioritize restorative and economic justice.

The bill was initially introduced as a discussion draft in 2021, and after receiving over 1,800 comments, the senators made adjustments and additions to the bill before introducing it this to the chamber this week.

The restorative justice aspect of the bill would help undo the decades of harm caused by the failed War on Drugs, ends discrimination in the provision of federal benefits on the basis of cannabis use, provides major investments for cannabis research, and strengthens worker protections. By decriminalizing cannabis at the federal level, the CAOA also ensures that state-legal cannabis businesses or those in adjacent industries will no longer be denied access to bank accounts or financial services simply because of their ties to cannabis.

“As more states legalize cannabis and work towards reversing the many injustices the failed War on Drugs levied against Black, Brown, and low-income people, the federal government continues to lag woefully behind,” said Sen. Booker. “With strong restorative justice provisions for communities impacted by the drug war, support for small cannabis businesses, and expungement of federal cannabis offenses, this bill reflects long overdue, common sense drug policy. I am proud to have partnered with Senators Schumer and Wyden to introduce this critical legislation. The support that we have received from committee chairs and outside groups underscores the historic nature of this bill and the urgent need for Congress to pass it.”

The Cannabis Administration and Opportunity Act has several goals, including protecting public health and safety, and prioritizing restorative and economic justice. This would be done by implementing safeguards like track-and-trace and purchase limits on retail cannabis for the former. Expunging federal cannabis convictions and encouraging states to do the same would be an initial step for the latter objectives.

It would be made easier for more individuals to get involved in the legal cannabis industry by expanding access to loans and capital for entrepreneurs, especially those impacted by the war on drugs.

The regulation and taxation of cannabis would be implemented by transferring jurisdiction over cannabis from the Drug Enforcement Agency (DEA) to the Alcohol and Tobacco Tax and Trade Bureau (TTB). The regulatory framework would be similar to alcohol and tobacco while supposedly recognizing the unique nature of cannabis products.

By default, federal banks would now be permitted to freely do business with legal cannabis businesses without fear of prosecution from the government. Further, cannabis businesses would actually be allowed to claim tax deductions for business expenses, which currently isn’t an option in most states.

One of the last main objectives of the Cannabis Administration and Opportunity Act is to encourage cannabis research which has been severely lacking for decades. The CAOA would require more federal research into the impacts of cannabis on health and public safety.

The bill would also establish clinical trials through the VA to study the effects of medical cannabis on the health outcomes of veterans, compile industry-related data and trends, and establish grants for cannabis research.

For employees, federal drug testing for cannabis would be removed as well as random testing for cannabis. However certain “sensitive categories” of federal employees could still be drug tested. This includes those working in national security, law enforcement and commercial transportation.

Regular industry employees would also get worker protections.

There is no current timeline on when the bill we be held to a vote in the Senate. The SAFE Banking Act which aimed to only allow legal cannabis businesses in states access to federal banking, has been shot down in the Senate several times.

New York Announces Conditional Adult-use Cannabis Retail Dispensary Licenses

New York Announces Conditional Adult-use Cannabis Retail Dispensary Licenses

new york adult use cannabis licenses for retailers

In March of this year the New York Cannabis Control Board (CCB), which oversees the Office of Cannabis Management (OCM), proposed a regulatory framework to create and oversee Conditional Adult-Use Retail Dispensary Licenses.

These licenses will be the first allowing retailers to sell recreational cannabis in New York, outside of tribal lands. However only certain individuals meeting a “justice-involved” standard will be eligible to apply.

OCM officials have said that the state will issue between 100 and 200 Conditional Adult-Use Retail Dispensary Licenses. Plans to release the licenses are currently slated for late 2022 or early 2023.

An “Eligible Applicant” is:

  1. An applicant that has:

    • a) a significant presence in New York State, either individually or by having a principal corporate location in the state;

    • b) is incorporated or otherwise organized in the state; or

    • c) a majority of the owners are residents by being physically present in the state no less than 180 calendar days during the current year or 540 calendar days over the course of 3 years;

  2. An individual, or an entity with one or more individuals, where at least one individual:

    • a) Is “Justice-Involved,” meanings individuals who were; or had a parent, legal guardian, child, spouse, or dependent who was; or were a dependent of an individual who was convicted of a marijuana-related offense in New York before March 31, 2021;

    • b) Provides evidence of the primary residence of the Justice-Involved individual at the time of said individual’s arrest or conviction; and

    • c) The Justice-Involved individual holds or held for at least two years at least 10% ownership and control of a business that had net profits for at least 2 years, or a qualifying nonprofit.

  3. A nonprofit that is: recognized as an entity pursuant to section 501(c)(3) of the Internal Revenue Code; intentionally serves Justice-Involved individuals and communities with historically high rates of arrest, conviction, incarceration or other indicators of law enforcement activity for marijuana-related offenses; operates and manages a social enterprise that had at least two years of positive net assets or profit; has a history of creating vocational opportunity for Justice-Involved individuals; has board members or officers who are Justice-Involved; has at least five full-time employees.

Additional requirements include 51% ownership in aggregate by one or more individuals who meets the requirements of (1) and (2). 30% ownership by at least one individual who satisfies (1) and (2) whom exercises sole control of the applicant or licensee.

As for the license itself, the conditional period for which the Conditional Adult-use Cannabis Retail Dispensary Licenses applies will last four years from when the license is issued. An applicant that receives a license must begin operations within 12 months of it being granted.

Cannabis products can only be acquired from authorized entities, and can only be distributed within the state.

The licensee “shall enter into and comply with all terms and conditions of any agreement with any fund approved by the [CCB] and made available by [OCM], including, but not limited to, accepting a dispensary location identified by the fund or office, any loan agreement with such fund, any lease or sublease agreement with the State of New York or its agents, or any other such agreements into which the licensee enters.”

After the Conditional Period, licensees may apply to transition to an adult-use retail dispensary license.

California Cannabis Tax to be Lifted to Aid Cultivators

California Cannabis Tax to be Lifted to Aid Cultivators

California cannabis cultivation tax to be lifted

In an effort to aid cannabis cultivators that have been hanging on by a thread the past several years, California is completely overhauling its cannabis tax codes to try and help.

The changes, which were adopted last week as part of a broader state budget agreement, will also create tax credits for some cannabis businesses, expand labor rights within the industry and switch collection of a state excise tax from distributors to retailers. That tax will pause at 15% for three years, after which regulators could raise the rate to recoup lost revenue from discontinuing the cultivation tax.

Advocates believe the new tax plan will aid the struggling small businesses operating in the legal cannabis industry in California. With exorbitant application fees, license costs and strict regulatory oversight set by local jurisdictions, it has become untenable to run a small-scale cannabis operation in the state.

While this may just be a band aid over the larger issues plaguing California’s legal cannabis industry, it should at least help cultivators stand a better chance of staying afloat in the competitive industry.

Prior to the removal of the tax, cannabis cultivators had to pay a tax of over $10 per ounce of flower. With 16 ounces in a pound, and the price of a pound of cannabis flower tanking as low as $500 in the last year, growers were potentially paying nearly half of their profit just into taxes for cultivation.

Additionally wholesale prices have dropped by as much as 50% over the past year, particularly squeezing farmers whose outdoor crops sell for less and forcing many smaller operations to close down.

Even the trimmings of cannabis plants were taxed at $3 per ounce, making a byproduct of the cultivation process that can be used to create ointments, creams or extracts just as untenable.

And of course, all of the increased costs levied on growers is then transferred to distributors, then retailers, and finally passed on to the consumer. Officials and advocates are hoping the move will lower cannabis prices overall for consumers while making it more profitable for cultivators.

However the state has yet to take any action on retail sales taxes. Business owners and advocates claim that California will never be able to compete with illicit market cannabis which is just as large in the state due to current taxes.

For comparison, alcohol in the state is only taxed at the state sales tax of 6%, with an additional charge of $3.30 per gallon. Cannabis on the other hand, in addition to state and local sales tax, is levied a 15% additional sales tax.

In other words, a customer who thinks they may be getting a deal on a $100 ounce, could actually be paying over $120 for the same product after taxes. Exorbitant sales tax on cannabis is extremely common in legal cannabis industries across the country. Medical cannabis sales in most states have no additional tax at all.

Lastly, the latest removal of the taxes is set to last only 3 years. While this gives advocates time to fight for more ground and lower additional taxes, reform licensing and equity access to the industry, the fight is not nearly over for cultivators and business owners in California’s cannabis industry.

Pennsylvania Cannabis Banking Bill Headed to Governor’s Desk

Pennsylvania Cannabis Banking Bill Headed to Governor’s Desk

Pennsylvania cannabis banking bill

A Pennsylvania cannabis banking bill that would protect state banking and financial institutions from prosecution is on its way to Governor Tom Wolfe’s desk after passing the House last week.

The legislation is nearly identical to a standalone bill that passed through the legislature earlier this session. The new measure passed with a 173-27 vote.

Sen. John DiSanto (R), the chief sponsor of the bill, had initially introduced the measure as a standalone piece of legislation. But after passing the Senate earlier this year and clearing the House committee, DiSanto filed it as an amendment to the already-passed HB 311. That bill deals with authorizing certain financial institutions to conduct savings promotion programs.

The amendment won’t give financial institutions complete immunity however, as it only applies on the state level. As cannabis is still a Schedule 1 controlled substance according to the federal government, banks and financial institutions can still be prosecuted for working with legal cannabis businesses, even if they are operating in a legal state.

However the amendment represents a step in the right direction for an industry that has been plagued with financial burdens due to federal laws. The fed has been stalling the passage of the SAFE Banking Act which would give federal banks protection in dealing with legal cannabis businesses.

The federal government isn’t necessarily cracking down on any banks doing business with legal cannabis businesses currently. But the implication that they could be punished has prevented almost every federal financial institution from working with legal cannabis businesses.

Now state institutions at least will not have to worry about being prosecuted on the state level. With the federal government more or less looking the other way in regards to state legal cannabis industry operations, more banks and financial institutions can feel safer in working with cannabis businesses.

The text of the amendment officially states that a “financial institution authorized to engage in business in this Commonwealth may provide financial services to or for the benefit of a legitimate cannabis-related business and the business associates of a legitimate cannabis-related business.”

The same protections will also be afforded to insurers. However the amendment also specifies that banks or insurers will not be required to provide services to legal cannabis businesses.

Further, the legislation says the state government cannot “prohibit, penalize or otherwise discourage a financial institution or insurer from providing financial or insurance services to a legitimate cannabis-related business or the business associates of a legitimate cannabis-related business.”

Agencies will be prohibited from “recommending, incentivizing or encouraging a financial institution or insurer” to not provide services just because a business is associated with cannabis.

Banking has been the largest issue impacting legal cannabis industries across the country since Colorado first legalized in 2012. With lack of access to federal banking, and few state institutions willing to take the risk, cannabis business owners are at the whim of whatever institution will take them.

This typically results in higher than average interest rates, stricter monitoring of account activity and even account removal without notice. Credit Unions and smaller local banks will even impose exorbitant deposit fees since they know cannabis businesses will deposit larger amounts of cash compared to other businesses.

Additionally as most credit card companies operate in cooperation with federal institutions, the majority of cannabis businesses are cash only. Robbery and theft is extremely common in the cannabis industry as businesses owners must carry bags of cash sometimes containing hundreds of thousands of dollars since they can’t accept credit from customers.

The Secure and Fair Enforcement (SAFE) Banking Act that has passed the House in some form six times at this point, only to stall in the Senate. It is currently the only federal bill focused on solving the banking issues plaguing the legal cannabis industry.