by Travis C | Oct 10, 2022 | 420 News, Blog, Cannabis Law, Cannabis Law and Compliance, Cannabis News, Editorial, Industry News, Legalization, Marijuana, Medical Marijuana, Politics
Biden’s cannabis executive order is making waves across the industry and culture, but what does it really mean?
Last week, President Joe Biden signed an executive order that will release those convicted of federal cannabis crimes from prison. There is no doubt that the move is a major step for this administration and the country as a whole.
Many were quick to jump on the excitement of the announcement. Many were under the impression that this order would impact thousands of people wrongfully convicted of minor cannabis crimes. In one sense this is true.
Upon further inspection, however, some are beginning to question the impact that Biden’s cannabis executive order will truly have.
The Biden Cannabis Pardon
Biden’s cannabis executive order will pardon nearly 6,500 people who were convicted of cannabis possession at the federal level. The key word here is “federal”.
For reference, there are over 40,000 individuals currently in prison for cannabis-related crimes across the US. Another comparison would be Colorado, where Governor Jared Polis has pardoned over 4,000 individuals for possession of two ounces or less.
Illinois has cleared nearly 500,000 conviction records for cannabis related crimes since 2019, with over 20,000 individual pardons in the same time period.
In other words, compared to what individual states are already doing, Biden’s cannabis pardon looks relatively minimal. But let’s go back to the word “federal”.
The reason Biden’s cannabis pardon executive order is so huge is actually because it’s only impacting federal cannabis prisoners. This marks the first time that a mass pardon for cannabis-related crime has been announced at the federal level.
Biden’s cannabis pardon, while only applying to a select group of individuals, shows a great step forward toward this administration following through on its campaign promises.
On the campaign trail, Biden supported reclassifying cannabis under the Controlled Substances Act, from Schedule 1 to Schedule 2. In addition to the announcement regarding cannabis pardons, he also asked the Department of Health and Human Services and the Justice Department to review how marijuana is scheduled, or classified, under federal law.
Biden also urged states to consider pardoning individuals for cannabis crimes at the state level.
Biden Cannabis Executive Order Leaves Many Out
Due to the selective nature of Biden’s cannabis pardon executive order, there will still be an additional 3,000 people who have been convicted of higher level federal cannabis crimes who do not get out. And as said earlier, the 40,000+ in state prisons for similar crimes are unaffected by the order.
While Biden encouraged state governors to take action and pardon individuals in their state, some states like Texas have already said that they will not be pardoning anybody.
Switching cannabis from Schedule 1 to Schedule 2 may also not be the positive change many are hoping will move us closer to legalization. Schedule I drugs (where cannabis currently sites) are defined as drugs with no currently accepted medical use and a high potential for abuse.
Schedule II drugs (where cannabis may move) are defined as drugs with a high potential for abuse, with use potentially leading to severe psychological or physical dependence. These drugs are still considered dangerous according to the Drug Enforcement Agency (DEA).
Drugs listed as Schedule II include vicodin, oxycodone (OxyContin), fentanyl, Adderall, and Ritalin. In other words, if the drug is not typically supplied via prescription from a doctor, possession is still illegal.
Cannabis moving to Schedule II may look like a good deal, especially for medical cannabis patients. However the implications that such a move could have on recreational cannabis industries are debated.
The federal government has thus far respected state’s choices to legalize cannabis recreationally, so it is to be expected that it would maintain that discretion even with the changing of federal law. I.e. the federal government will potentially recognize medical cannabis as legal should the scheduling change, while allowing states to keep recreational laws if they so choose.
When the government federally legalized hemp in 2018 under The Farm Bill, states still had the option to set their own laws regarding hemp. Some chose to still ban its production outright, while others made additional restrictions on top of the federal government’s actions.
What Comes Next
Overall the action by President Biden should be viewed positively. While it is not impacting as many people as we would all like, it is a major step for the federal government to acknowledge that simple possession of cannabis should not be a federal crime.
The action marks a step in the right direction for a government that has fought legal access to cannabis for nearly a century. Nobody should expect federally licensed medical cannabis dispensaries in their town anytime soon, however.
Now we wait on the Department of Health and Human Services and Department of Justice to review the scheduling. There has not been any timeline given on how long it may take.
by Travis C | Aug 16, 2022 | Blog, Cannabis Business, Cannabis Law, Cannabis Law and Compliance, Cannabis News, Industry News, Legalization, Marijuana, Politics
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.
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.
by Travis C | Jun 28, 2022 | Blog, Cannabis Law, Cannabis Law and Compliance, Cannabis News, Legalization, Marijuana, Medical Marijuana, Politics
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:
by Travis C | Jun 23, 2022 | Blog, Business, Cannabis Business, Cannabis News, Culture, Hemp, Industry News, Legalization, Marijuana, Medical Marijuana
When states began legalizing cannabis for recreational use following Colorado in 2012, the trend looked promising. Multiple states followed suit in the years to come, and as of 2022, 19 states and the District of Columbia have legalized cannabis for recreational use.
In addition to adult-use cannabis, the majority of the country now has some form of medical cannabis laws on the books. The rapid growth of the industry has turned initial predictions for the industry’s revenue on their heads.
In 2017, those with insights into the industry and a pulse on the growth of the legal cannabis market predicted that the industry could bring in as much as $25 billion in revenue by 2025. A recent analysis by MarketsandMarkets found that cannabis industry revenue surpassed $20 billion in 2020. It also predicts that legal cannabis markets could be worth over $90 billion by 2026.
In other words, the industry has triple the growth potential as originally thought. This is a positive sign for those wanting to see the industry grow. It also shows the increasing acceptance of cannabis as a recreational product, and the changing perceptions surrounding cannabis consumers.
Concentrates are the main product sector that is seeing the most growth since 2020, and has the most projected growth through 2026. This includes edibles, tinctures, vape pens, cannabis extracts and other concentrated products.
What may come as a surprise is the finding that medical cannabis dominated the majority of cannabis revenue since 2020. However it does appear that the conductors of the analysis included CBD as a medical cannabis product.
CBD has exploded in popularity as a legal “health supplement” after the 2018 Farm Bill legalized hemp, i.e. cannabis with a THC percentage below .3%. Opposed to medical cannabis which requires a patient’s license and purchasing from a licensed dispensary, CBD can be obtained from a smoke shop or gas station in some cases.
Not to take away from the success of medical cannabis states, Oklahoma was the highest grossing cannabis market in the country in 2021, despite only having a medical cannabis program.
Overall, future growth of cannabis markets will be mostly seen in North America as Canadian and US markets continue to grow. Other factors such as an increase in recognition of medical benefits of cannabis and growing consumer demand for cannabis in disease management and treatment due to high health care costs are expected to drive the growth in the North American region.
As for hemp markets, the industry is projected to hit roughly $25 billion by 2025. The hemp industry was worth over $4.5 billion in 2019, just one year after hemp was federally legalized.