cannabis law Archives - The Real Dirt with Chip Baker

First Standalone Cannabis Bill Headed to Biden’s Desk

by Travis C | Nov 17, 2022 | 420 News, Blog, Cannabis Law, Cannabis Law and Compliance, Cannabis News, Industry News, Legalization, Marijuana, Medical Marijuana, Politics, Science & Technology

cannabis legislation passed through congress

The first ever standalone cannabis bill to pass through the House of Representatives and the Senate is now headed to President Joe Biden’s desk. The Medical Marijuana and Cannabidiol Research Expansion Act passed through the House in July of this year, and was unanimously passed in the Senate on November 17.

The bill’s passing is the first time a standalone cannabis bill has been passed through Congress.

Under the bill should it pass, researchers would be able to obtain cannabis samples from sources besides the University of Mississippi. The university is currently the only federally approved source for cannabis specifically for research purposes.

Cannabis itself is not fully legal medically or recreationally in Mississippi, with CBD usage permitted for medical purposes. Recreational cannabis possession still carries civil penalties including fines and potential jail time.

Additionally the bill would require the Drug Enforcement Agency (DEA) to assess the availability of cannabis for research and allow doctors to discuss the potential benefits and risks of medical cannabis with patients. The Department of Health and Human Services (DHHS) will also be required to study the benefits and harms of cannabis.

The passing of this bill could be seen as convenient timing following President Biden’s recent announcement of expunging and releasing roughly 6,500 individuals in federal prison for cannabis possession. In that same announcement, Biden encouraged the DHHS to review the current scheduling of cannabis for potential adjustment.

As it stands, cannabis is listed as a Schedule 1 substance under federal law which means it has no accepted medical value, is at high risk of causing addiction, and is on par with other substances like heroin, bath salts and MDMA.

Should Biden sign the bill into the law, which seems likely, it would become even easier for the DHHS to review the potential benefits of cannabis which can influence their decision to reschedule or even de-schedule the plant altogether.

California Cannabis Tax to be Lifted to Aid Cultivators

by Travis C | Jul 7, 2022 | Blog, Business, Cannabis Business, Cannabis Law, Cannabis Law and Compliance, Cannabis News, Growing, Industry News, Legalization, Marijuana

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

by Travis C | Jul 6, 2022 | Blog, Business, Cannabis Business, Cannabis Law, Cannabis Law and Compliance, Cannabis News, Legalization, Marijuana, Medical Marijuana

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.

Mississippi medical cannabis industry to launch July 1

by Travis C | Jun 28, 2022 | Blog, Cannabis Law, Cannabis Law and Compliance, Cannabis News, Legalization, Marijuana, Medical Marijuana, Politics

Mississippi medical cannabis legalization

After months of lengthy legal battles, legislation effectively legalizing cannabis for medicinal use in Mississippi will become law on July 1, 2022. The Mississippi Department of Revenue will be running the licensing process.

The agency has said that it will begin accepting applications for dispensaries starting July 5. Patients and medical practitioners will be able to begin applying for applications and registrations on July 1, along with some cannabis production licenses. These licenses specifically will be handled by the Mississippi Department of Health (MSDOH).

Both agencies’ responsibilities stem from the Mississippi Medical Cannabis Act (MMCA), which was passed in February of this year. Medical cannabis legalization was delayed by nearly a year in the state after a voter initiative to legalize, Initiative 65, was overturned by the Mississippi Supreme Court in May of 2021.

Now patients with conditions covered under the MMCA can go to their physician and complete a medical certification from the MSDOH. If approved, patients will be able to apply to join the medical cannabis program. Once accepted they will receive patient ID they can use to purchase cannabis from a licensed dispensary.

While patients may be accepted as early as next month, plants won’t go in the ground in Mississippi until the bill is officially law, i.e. July 1. With dispensary applications being accepted starting July 5, it will certainly be several months before we see any dispensaries open with cannabis product on their shelves.

Estimates claim that purchasing could begin by December this year, or January 2023.

For those seeking a license, the state plans to hand them out within 30 days of receiving a completed application, meaning dispensary construction could begin within the next two months. The state is also accepting applications for a variety of other medical cannabis industry licenses:

Cultivator/Grower
Processor/Wholesaler
Transporter (local freight)
Transporter (long distance)
Testing Facility
Waste Disposal

North Carolina Medical Cannabis Bill Passes Senate

by Travis C | Jun 6, 2022 | 420 News, Blog, Cannabis Law, Cannabis Law and Compliance, Cannabis News, Legalization, Marijuana, Medical Marijuana, Politics

North Carolina medical cannabis legalization

A North Carolina medical cannabis bill was passed by the state Senate last week following its clearing of a key Senate committee just one day prior. The legislation passed the full chamber with a 35-10 vote.

Sponsor of the bill, Sen. Bill Rabon (R) is hopeful that the bill will help those seeking relief toward the end of their life.

“This bill is going to, in my opinion, help a lot of people at the end of their life at a time that they need some compassion,” Rabon said on the floor ahead of the vote.

Rabon is a cancer survivor himself. He believes that medical cannabis can help people “at a time that what few days, or what little time they have left, should be as comfortable and as easy as they can be.”

“I think it is our duty as lawmakers to pass legislation that helps people who need our help,” Rabon said.

However the medical cannabis bill is not in the clear yet. It still must pass through one final vote on the third reading of the bill. If it passes again it will then move on to the House of Representatives.

The NC Compassionate Care Act in its current state would enact a highly restricted medical cannabis program. Those that qualify for the program must have a condition such as cancer, epilepsy, HIV/AIDS, Parkinson’s, multiple sclerosis and PTSD to be eligible.

Patients would be permitted to possess up to one and half ounces of cannabis, but home growing would not be allowed. Edibles or “cannabis-infused” products would be allowed in various forms, and smoking and vaping would be permitted.

However the consumption method must be prescribed by a doctor for specific delivery and dosages. Patient eligibility would be reconsidered on an annual basis.

The bill would permit just 10 medical cannabis suppliers who would control the cultivation and sale of cannabis. Each operator would be permitted four dispensaries for 40 total across the state.

Under the current revision, a Compassionate Use Advisory Board would be established. This board would have the ability to add more qualifying conditions for the program that could make access easier for more patients in the future.

Additionally a Medical Cannabis Production Commission would be created to ensure that supply does not run out for patients. The Commission would also oversee licensing and generate revenue to regulate the medical cannabis program.

Lastly the bill will provide protections for patients. Employees and agents of the state would be required to treat possession of cannabis for qualified patients the same as any other prescribed controlled substance.

There are still additional amendments under consideration that may impact the third reading of the bill. Over 80% of North Carolina voters support medical cannabis, with 60% supporting full recreational legalization.