A new bill in the California Legislature would classify unlicensed cannabis cultivation as a felony, rolling back part of the state’s 2016 voter-approved initiative that legalized adult-use and made growing any number of plants without a license a misdemeanor, according to a Forbes report.
Under A.B. 1725, filed by Rep. Thurston Smith (R-Apple Valley), growing more than six plants without a permit would be reclassified as a felony offense, punishable by up to three years in jail.
To go to Gov. Gavin Newsom’s desk, the legislation requires a two-thirds majority in the Legislature, since it amends a voter-approved initiative.
Thurston’s bill aims to “combat illegal marijuana grows that have been proliferating throughout the rural High Desert communities,” according to a press release from his office.
“These illicit growers have been operating with impunity, knowing that the law allows them to grow with barely a hindrance,” Thurston said in a public statement. “For far too long, Sacramento has been soft on crime, and the illicit market has exploded with massive unlicensed grows popping up all around the state."
One of Verano's Zen Leaf dispensaries in Illinois.
Photo courtesy of Verano
Verano to Acquire Goodness Growth for $413 Million
The multistate operator will enter the New York, Minnesota and New Mexico markets, and expand in Arizona and Maryland, through the proposed deal.
Upon consummation of the acquisition, Verano’s footprint will span 18 states, with active operations in 15, including 17 cultivation facilities totaling 1.3 million square feet of cultivation capacity and 111 active dispensaries
Verano will obtain one of only 10 vertically integrated licenses in New York, which includes one cultivation license, four active dispensaries and four additional dispensaries planned in high-traffic locations
Verano will acquire one of only two vertically integrated licenses in Minnesota, which includes one cultivation license and eight active dispensaries
In New York, the company will gain delivery service across the New York City area via a dispensary on Queens Boulevard centrally located next to the Long Island Expressway, Citi Field and LaGuardia Airport; along with three high-traffic dispensaries—in a busy shopping district in White Plains; in Albany adjacent to the University of Albany campus and Colonie Center Mall; and in Johnson City across from the Oakdale Mall
In Minnesota, Verano will obtain eight dispensaries, including one in the heart of downtown Minneapolis and four more across the Minneapolis-St. Paul metro area; in locations covering the cities of Duluth and Rochester; and in Moorehead, which is situated in the Fargo, N.D., metro area
Between 2022 and 2026, these net new markets are expected to generate combined revenue of more than $13.8 billion, according to BDSA data
CHICAGO, Feb. 1, 2022 – PRESS RELEASE –Verano Holdings Corp. and Goodness Growth Holdings Inc. have entered into a definitive arrangement agreement (the “arrangement agreement”) pursuant to which Verano will acquire all of the issued and outstanding shares of Goodness in an all-share transaction valued at approximately $413 million on a fully diluted basis.
Photo courtesy of Verano
Verano's Sonny G cultivar
Under the terms of the arrangement agreement, it is expected that each holder of Goodness subordinate voting shares will receive 0.22652 of a Verano Class A subordinate voting share for each Goodness subordinate voting share held and each holder of Goodness multiple voting shares and Goodness super voting shares will receive 22.652 Verano shares for each Goodness multiple voting share and Goodness super voting share held, respectively.
Goodness’ active operations include 18 dispensaries; five cultivation and processing facilities; a research and development facility; and the Vireo, 1937, LiteBud, Kings & Queens, Hi-Color, and Amplifi product brands. The acquisition of Goodness is expected to expand Verano’s operational footprint with the addition of the New York, Minnesota and New Mexico markets, strategically increasing the company’s presence in the Northeast, Midwest and Southwest, while adding a suite of established cannabis brands to the company’s portfolio.
Management Commentary
“We have always viewed New York as a strategic market to solidify our existing East Coast presence, particularly ahead of the state’s adult-use rollout, as we further expand the Verano platform and exceed a milestone of operating more than 100 dispensaries across the country,” Verano founder and CEO George Archos said. “Adding the New York, Minnesota and New Mexico markets to our portfolio, with full vertical integration, provides Verano with a solid foundation for future growth. We’re excited to welcome new colleagues to the Verano family and look forward to serving patients and consumers in communities across these great states.”
“After an extensive evaluation process, George and the Verano team are unquestionably the ideal partners to take our business to the next level,” said Goodness Chairman and CEO Kyle Kingsley, M.D. “Evidenced by their strong leadership team, sound operating principles, core values and sustained growth, Verano continues to reach new heights as one of the top multistate cannabis operators. We are confident in Verano’s ability to foster future growth opportunities for our employees and deliver an exceptional experience for our patients and consumers.”
Transaction Highlights
The transaction includes 18 active dispensaries; five cultivation and processing facilities; a research and development facility; and the Vireo, 1937, LiteBud, Kings & Queens, Hi-Color, and Amplifi product brands.
New York
Goodness currently holds one of 10 vertically-integrated licenses to grow and dispense medical cannabis products in the state of New York. It operates four medical dispensaries under the Vireo Health brand in Albany, Johnson City, Queens and White Plains. Goodness is also entitled to open an additional four dispensaries in advance of the commencement of the state’s recently approved adult-use program, which allows for three of its eight dispensaries to sell recreational-use products.
Goodness also operates a home-delivery service across New York City and all its boroughs, as well as in Westchester, Rockland, Nassau and Suffolk counties. Its home-delivery business currently accounts for more than half of its total medical cannabis sales in the state.
Goodness currently grows and manufactures its products in a 64,204-square-foot greenhouse cultivation and processing facility in Johnstown, and is in the process of expanding this facility with the construction of 324,000 square feet of indoor warehouse, 170,000 square feet of which has been approved for indoor cultivation and processing.
Minnesota
Goodness currently holds one of two vertically integrated licenses to grow and dispense medical cannabis products in the state of Minnesota. It operates eight dispensaries in the state under the Green Goods name in Blaine, Bloomington, Burnsville, Duluth / Hermantown, Minneapolis, Moorhead, Rochester and Woodbury.
Products are manufactured at Goodness’s 87,232-square-foot greenhouse cultivation facility in Otsego, where Goodness has the potential to expand onto an adjacent 20-acre parcel in the future. The state of Minnesota has recently approved the sale of smokable flower within its medical program, with flower sales expected to begin by the end of March 2022, followed by the introduction of certain edible products this coming summer.
New Mexico
Goodness operates a 18,650-square-foot cultivation facility in Gallup, as well as four medical dispensaries under the Green Goods name in Albuquerque, Gallup, Las Cruces and Santa Fe. Goodness has also identified several locations for projected store expansion in the near-term future. The state of New Mexico’s cannabis program is expected to commence adult-use sales in April 2022, at which point all of the Green Goods dispensaries in New Mexico will be eligible to sell recreational-use products.
Maryland
Goodness currently operates two medical dispensaries in Maryland under the Green Goods name in Baltimore and Frederick. It also currently operates a 143,500-square-foot greenhouse in the town of Massey. Goodness also operates a separate 22,500-square-foot manufacturing and processing facility in the town of Hurlock.
Arizona
Goodness operates an active 18-acre outdoor cultivation facility in Amado.
More Details
Additional information about the terms of the transaction, approvals and recommendation, and advisers, can be viewed here.
Schwazze Adds Key Hires to Senior Leadership Team
The company ramps up for growth, expanding its manufacturing, information technology and cultivation expertise.
DENVER, Feb. 1, 2022 /CNW/ - PRESS RELEASE - Schwazze, has announced the addition of key roles to support the company's significant expansion within manufacturing, cultivation, and information technology.
As Vice President of Manufacturing and Supply Chain, David Kaufman joined the leadership team from Carlex Glass where he was responsible for global operations. Kaufman is a seasoned executive with experience identifying and yielding multimillion-dollar improvements in operations and supply chain through LEAN manufacturing, procurement, and distribution strategies. He had full P&L responsibility for the European business segment where he led a significant turnaround in operating performance and financial improvement. Kaufman holds a distinguished certificate in general management from the Darden School of Business at the University of Virginia, MBA from the University of St. Francis, and BS in Chemistry from Purdue University.
Steven Liedtke joins Schwazze as Vice President, Information Services. Liedtke is an experienced Information Technology Executive with more than 25 years of leadership experience across industry sectors such as: CPG, Food & Beverage, Retail, and High Technology industries, including The Hain Celestial Group, The Whitewave Foods Company and Maines Group. Technology is a key pillar in Schwazze's growth strategy to help drive digital transformation, operational efficiencies, and synergies. With his M&A systems integration experience, Liedtke brings the expertise Schwazze needs in this period of significant organic and new acquisition growth.
The third key addition to the leadership team is in cannabis cultivation. Robert Piziali joins Schwazze as Vice President, Cultivation, overseeing its grow operations. Piziali was formerly the President of FarmPerfect, a cannabis farm management company based in Mendocino County, Calif. He has 20 years of experience in operations management and, prior to cannabis, comes from the wine industry where he was involved in all aspects – from the vineyard to the cellar, to tasting rooms and retail operations. He was also the co-founder and president of FLO Wine, which he launched nationally in chains including Wal-Mart, Costco, Target, Jewel-Osco, and Albertsons. Piziali has an MBA from University of North Carolina, Chapel Hill and a BA in Psychology from Rollins College.
"We are excited about the key additions to our operational leadership team. Kaufman, Piziali and Liedtke bring a wealth of knowledge and experience in their respective areas which are both critical to Schwazze's growth strategy in manufacturing, grow operations, distribution and digital commerce," said Nirup Krishnamurthy, chief operating officer. "We continue to be proud of what we've built in Colorado since 2019 and look forward to our continued expansion."
Cannabis Conference 2022 Registration Now Open
Lowest pricing is available today through March 15, 2022, for the industry’s most important event for plant-touching businesses.
LAS VEGAS (Feb. 1, 2022) – Registration has officially opened for Cannabis Conference, the cannabis industry’s leading conference for cannabis cultivators, retailers, extraction professionals and hemp growers.
Cannabis Conference 2022, which will return to the Paris Las Vegas Hotel & Casino from Aug. 23-25, 2022, is presented by award-winning media brands Cannabis Business Times, Cannabis Dispensary and Hemp Grower. The industry event will bring together 4,000 current and prospective cannabis business operators, university professors, consultants, and technology and solutions providers from across the U.S. and around the globe for three dynamic days of education and expo.
Cannabis Conference’s education program will address the most pressing issues plant-touching businesses face, as well offer tangible solutions operators can implement into their own businesses. Sessions are being crafted with the assistance of Cannabis Conference Advisory Board members, who come from some of the most successful and innovative companies and organizations in the space, such as Cresco Labs, Flower One, Green Rush Consulting, Sherbinskis, the Minority Cannabis Business Association, Curaleaf, Merida Capital, Papa & Barkley, and many more.
Cannabis Conference will also feature 240-plus solutions providers in its 85,000-square-foot exhibit hall, including experts in: horticultural lighting, nutrients, growing media, pest control, structures, drying and storage, IT services, marketing solutions, facility design, accounting and finance, POS software, packaging and labeling, and much more.
“The global legal cannabis market continues to grow and evolve at breakneck speed,” Cannabis Conference Executive Director Jim Gilbride said. “With new markets emerging, new challenges arising, and new solutions coming to the forefront in 2022, it’s more important than ever for cannabis businesses to connect and discover ways to build and strengthen competitive, compliant, and profitable businesses.”
Registration rates range from $99 (Expo Only) to $399 (All-Access Pass). Detailed pricing and registration information can be found at www.cannabisconference.com/page/prices.
Virginia Republicans Consider Changes to State’s Adult-Use Cannabis Law
Lawmakers have said that while they will not seek to overturn the law, they do want to tweak the statute that passed last year to legalize cannabis possession and sales.
Republican lawmakers in Virginia are considering changes to the state’s adult-use cannabis law, according to an AP News report.
Legislators have said that while they will not seek to overturn the law, they do want to tweak the statute that passed last year to legalize cannabis possession and sales.
Changes might include launching retail sales earlier and eliminating a provision that would give licensing preference to people with past cannabis-related convictions, AP News reported.
Former Virginia Gov. Ralph Northam signed the state’s adult-use legalization bill into law last spring after the Legislature approved last-minute amendments to expedite the cannabis possession and home grow measures to take effect July 1, 2021. The legislation called for sales to launch in 2024, but also included a reenactment clause that requires the Legislature to reauthorize the bill before it can take effect.
When the legislation passed last year, Democrats controlled both chambers of the Legislature, but Republicans have since taken control of the House in the November election and incoming Republican Gov. Glenn Youngkin has replaced Northam, a Democrat.
Republican lawmakers have filed at least eight bills that call for amendments to the original law, according to AP News, including changes that remove some of the social equity provisions aimed to support those who have been negatively impacted by the war on drugs.
Legislation sponsored by Republican Del. Michael Webert would redirect the 30% of adult-use cannabis sales tax revenues that were earmarked for a Cannabis Equity Reinvestment Fund to rebuilding school buildings in the state, AP News reported. The bill would also scrap a provision that provides special licensing consideration to social equity applicants, although it leaves intact provisions that would give licensing preference to those in economically disadvantaged areas and those who attended one of Virginia’s historically black colleges or universities (HBCUs).
“We are trying to ensure that the money goes to where it’s most needed,” Webert told the news outlet. “To be in a good school environment, to provide a good, safe school building and an atmosphere in which a child can learn will be a great asset for that person’s future.”
Webert’s legislation would also cut the tax rate on adult-use cannabis sales from 21% to 10% in an attempt to squash the illicit market, AP News reported.
“The overriding top-tier concern is that we have to have a regulatory structure in place for retail sales that does not encourage the black market,” Garren Shipley, a spokesperson for House Speaker Todd Gilbert, told the news outlet.
Other Republican-sponsored bills propose launching adult-use sales in 2023 instead of 2024 by allowing Virginia’s existing medical cannabis businesses to serve the broader market, according to the news outlet. Additional pieces of pending legislation would give licensing preference to farmers operating in Virginia’s hemp market, or those in economically disadvantaged areas.
Macaulay Porter, a spokesperson for Youngkin’s office, told AP news that the governor has concerns about certain aspects of the bill lawmakers passed last year to create a commercial adult-use market.
“It includes forced unionization, is concerning to law enforcement, and establishes an unstable market that includes anti-competitive business provisions that set Virginia up to fail,” Porter told the news outlet. “He’s ready to work in good faith to address these and other issues in concert with the General Assembly."
Legislative Map
Cannabis Business Times’ interactive legislative map is another tool to help cultivators quickly navigate state cannabis laws and find news relevant to their markets. View More
Melissa Schiller
Posted by Tony Lange
