For those who still have feedback to give the U.S. Department of Agriculture (USDA) for its interim final rule (IFR) on hemp, today is the last day to do so.
In a notice on the USDA’s website, the agency noted it is seeking comments on:
Measurement of uncertainty for sampling
Liquid chromatography factor, 0.877
Disposal and remediation of non-compliant plants
Negligence
Interstate commerce
15-day harvest window
Hemp seedlings, microgreens, and clones
Hemp breeding and research
Sampling methodology – flower vs. whole plant
Sampling methodology – homogeneous composition, frequency and volume
Sampling agents
U.S. Drug Enforcement Agency (DEA) laboratory registration
The reopened docket had garnered 925 comments by the beginning of the day Oct. 8. That’s in addition to the nearly 4,700 comments received during the initial comment period.
Many comments have proposed amendments to what the agency said it was seeking feedback on, including upping the tetrahydrocannabinol (THC) negligent threshold from 0.5%, increasing the harvest window to 30 days, exempting hemp seedlings and clones from testing requirements and removing the DEA testing lab requirement.
Many have also suggested increasing the 0.3% THC limit to 1%--an amendment that would require the approval of Congress to change.
One heavily requested change that is close to coming to fruition is delaying implementation of the IFR until 2021 and allowing states to continue operating under their pilot programs for one more year. While the IFR is supposed to take effect at the end of this month, Congress has approved an extension of hemp pilot programs through September of 2021. The bill now awaits final approval from the president.
BOCA RATON, Fla., Oct. 08, 2020 (GLOBE NEWSWIRE) -- PRESS RELEASE -- Jushi Holdings Inc., a globally-focused, multi-state cannabis and hemp operator, announced it will enter California, the world’s largest cannabis market, with the opening of its 11th retail location nationally: BEYOND / HELLO Santa Barbara. Earlier this year, Jushi acquired GSG SBCA, Inc., a licensed cannabis dispensary in Santa Barbara, and concurrently signed a $3.2 million sale-leaseback agreement with a financing partner related to the real estate previously purchased in connection with the acquisition of GSG SBCA, Inc.
BEYOND / HELLO Santa Barbara, which is conveniently located near Loreto Plaza in the heart of Santa Barbara at 3516 State Street, will begin serving customers on Oct. 14 at 10 a.m. BEYOND / HELLO Santa Barbara customers can shop for medical and adult-use cannabis products in-store and through its online shopping experience at www.beyond-hello.com, which enables consumers to view real-time pricing and product availability, and then reserve products for convenient in-store pickup. In the near future, BEYOND / HELLO Santa Barbara will also be adding delivery services as permitted by the City of Santa Barbara.
“With sales that far surpass any other U.S. state, California represents a significant growth opportunity for Jushi,” said Jim Cacioppo, chief executive officer, chairman and founder of Jushi. “Our new flagship store is strategically located in Santa Barbara, a limited license market that currently only allows for three dispensaries to operate in the city. We’re excited to be a part of this active, engaged community and look forward to welcoming local residents to experience the BEYOND / HELLO customer-first approach and state-of-the-art dispensary. We will also continue to pursue additional M&A opportunities in California, particularly in jurisdictions with high barriers to entry, limited market participants, and strong growth opportunities.”
BEYOND / HELLO Santa Barbara carries flower, extracts, edibles, vapes, topicals, tinctures/sublinguals and merchandise. Its expertly trained staff is also available during normal store hours to help customers identify and select the best cannabis products to meet their various needs and desires. The licensed storefront is ADA accessible, LGBTQ+ friendly and offers a standing 10% discount to seniors and veterans and active military servicepeople with identification. For more information, visit https://www.jushico.com/ or BEYOND / HELLO on Instagram and Facebook.
Vermont Becomes Eleventh State to Legalize Adult-Use Marijuana Sales
But realistically, regulators will not begin licensing cannabis-related businesses and activities until the spring of 2022.
Montpelier, VT, PRESS RELEASE: Republican Governor Phil Scott today announced that he would permit legislation, Senate Bill 54, to become law establishing rules and regulations overseeing the commercial production and retail sale of marijuana to adults. The measure will become law absent the Governor’s signature.
Vermont lawmakers depenalized the possession and cultivation of small quantities of marijuana by adults in 2018, but that law did not legalize any commercial activities involving either cannabis production or sales. Ten states currently regulate adult-use marijuana sales.
NORML State Policies Coordinator Carly Wolf said: “Ten of the eleven states that have legalized adult-use marijuana possession have also wisely regulated the retail cannabis market; until today, Vermont had been the sole exception.
“This comprehensive legislation was debated and amended over a period of several months by members of both chambers, and it is supported by a majority of Vermont voters. Senate Bill 54 represents an opportunity to bring common-sense controls to the adult-use marijuana marketplace, which is currently unregulated, unlicensed, and untaxed. While the law, as written, is not perfect, we are confident that lawmakers will continue to further amend these proposed rules and regulations accordingly in a manner that both prioritizes public safety as well as the needs of entrepreneurs looking to enter into this space. This is a victory for those who wish to disrupt the illicit marketplace and move forward with an above-ground, regulated cannabis marketplace.”
Senate Bill 54 establishes rules and taxation rates governing the licensed commercial production and sale of cannabis and cannabis products to adults. Under the plan, retail products would be subject to a 14 percent excise tax, in addition to the state’s six percent general sales tax. The potency of herbal cannabis products will be capped at 30 percent THC while concentrates will be limited to no more than 60 percent THC. Products cannot be packaged in a manner that appears appealing to children. Prior to the operation of any licensed cannabis facility, a municipality will need to hold a vote to in favor of permitting commercial activities within their locality.
The new law takes effect on October 1, 2020. However, regulators will not begin licensing cannabis-related businesses and activities until the spring of 2022.
It has also been reported that the Governor signed separate legislation today, Senate Bill 234, which facilitates the automatic review and expungement of low-level marijuana convictions. That law takes effect on January 1, 2021. The measure is expected to result in the expungement of the criminal records of over 10,000 people convicted of possessing two ounces or less of marijuana. Separate provisions in the bill reduce the penalties for offenses involving the possession of more than one ounce but less than two ounces of marijuana and/or the cultivation of three plants to a civil fine.
Redbud Roots' Muskegon Provisioning Center
Photo courtesy of Redbud Roots
Following End of Caregiver Sourcing to Michigan Cannabis Businesses, Redbud Roots Works to Address Supply Issues
New facilities, automation and a high-THC cultivar keep cannabis product on the move.
For some people in the Midwest, the close of September signaled not only the changing of the leaves and an increase in pumpkin-flavored and -scented product availability, but the end of an era for cannabis. Michigan’s caregivers are no longer sourcing dispensaries with product.
“There is a massive shortage on distillate in the state of Michigan, particularly in light of the phaseout of caregivers,” said Alex Leonowicz, COO and general counsel of Redbud Roots, a vertically integrated cannabis company based in Buchanan, Mich. “There have been rumors of distillate pricing reaching as high as [$25,000 to $30,000] for a liter. Likewise, vape cartridge demand has skyrocketed.”
During the March through September phase-out of caregiver sourcing for medical dispensaries, Leonowicz said, dispensaries and customers had already been feeling the effects. (In April, the Michigan Marijuana Regulatory Agency cut off caregiver sourcing for adult-use dispensaries.)
Past experiences foreshadowed growing pains that would come with phasing the model out. Redbud, established in 2017, was one of the first several commercial growers and manufacturers to supply cannabis product into the retail market alongside caregivers, Leonowicz said.
“We couldn't even come close to supplying all the stores,” he said, explaining that the state had previously warned of a phaseout. “So, guys rise up, and they're like, ‘Wait, I can't buy it from my caregiver; you [the state] are shutting those guys down. Yet, your new model isn't ramped up enough. So, you're leaving people that utilize the plant for truly medicinal purposes without medicine.’ That's what allowed them to continue to supply into the commercial model for so long.”
Now, in a caregiver-less climate, Redbud is working to help fill the supply void.
“Being forward-thinking, we’ve ramped up both our production capacity and the cultivation,” Leonowicz said. “We added a new grow facility. We also automated all of our cartridges, edibles and prerolls.
“For us, we looked at it like, ‘Hey, there’s obviously a huge wave of shortage coming here. How can you meet that?’ Automation seems to be a huge answer to that because you can only make so many prerolls [by hand]. You're sitting there pouring it in and then packing it in, versus a machine that can do 5,000 of them in two days.”
This automation is taking place in a new 15,000-square-foot processing and packaging facility that Redbud opened in Buchanan in late September. Located “a few parcels down” from the company’s three cultivation facilities in Buchanan, Leonowicz said the facility will increase the company’s output by five times and serve as a distribution hub.
Serving the Michigan Market in Other Ways
Leonowicz recently shared some other business developments with Cannabis Business Times and Cannabis Dispensary.
Photo courtesy of Redbud Roots
The astronaut sculpture at Redbud Roots' Muskegon location
On the cultivation side, Redbud has grown its SFV #4 cultivar to produce more than 32% THC. (It is not an original cut from the plant.) First grown under LED lights, the company launched its SFV #4 in its own retail locations and have since begun to wholesale it to dispensaries. Redbud is now growing the cultivar under HID lights and expects that product to have a strong THC percentage and yield.
To accommodate retail needs, Redbud opened a medical and adult-use dispensary in Muskegon, Mich., more than 100 miles north of Buchanan, in July. A 12-foot-tall red astronaut sculpture welcomes patrons and passersby; the company had it specially made by Innovative Sculpture Design to garner some attention.
That’s just the start of Muskegon customers’ retail experiences. The company hired employees from around Muskegon to provide customers and patients with a sense of familiarity.
Photo courtesy of Redbud Roots
The Redbud Roots Muskegon Provisioning Center is currently only offering curbside pickup.
“A lot of shops set [locations] up, and they all look and feel the same. It’s kind of like a Walgreens or CVS—you know where to go, you know how to navigate it,” Leonowicz said. “And that's fine. We’re, I guess, trying to cater to the feel and the soul of each little city.”
The Redbud Roots Muskegon Provisioning Center sees about 85% adult-use customers and 15% medical patients, Leonowicz said. In a typical week, to both markets, he said it sells 12 to 13 pounds of flower, 900 to 1,100 cartridges and 800 to 1,000 prerolls.
The storefront is one of three competing dispensaries that have opened in Muskegon so far. The city created a “marijuana overlay district” to dictate where plant-touching businesses can operate, according to ABC affiliate WZZM.
Leonowicz applauds the city’s decision to welcome new businesses to an area that has historically had vacant buildings and low traffic flow.
“You build awareness of this whole area of the city who lives over here,” he said. “I thought it was pretty smart to bunch them together. Obviously, it stinks from a competition standpoint because you’ve got a guy right down the street from you. But that’s why we brought the astronaut in.”
New Africa | Adobe Stock
Disqualified Social Equity Applicants Sue IDFPR
The applicants, many of them veterans, are also asking Illinois’ Cook County Circuit Court to subpoena accounting firm KPMG to share details of its scoring process.
A group of social equity license applicants in Illinois have filed a lawsuit in Cook County Circuit Court against the Illinois Department of Financial and Professional Regulation (IDFPR) and Bret Bender, the deputy director of its Cannabis Control Section, for disqualifying their applications and not providing them the opportunity to participate in a process through which certain applicants can amend their applications and challenge their scores.
“We deserve to know why they failed to score our applications,” said Eva Hernandez, a veteran and social equity applicant, in a prepared statement from the release. “We put in the work, paid the fees, and responded to their requests for information. We deserve the same consideration and the same opportunity as everyone else.”
The complaint in the lawsuit was filed Oct. 5, the same day another lawsuit was filed in the Illinois Supreme Court. (That one was brought forth by finalists in Illinois’ license lottery who claimed Gov. J.B. Pritzker could not offer previously disqualified applicants a second chance.)
On Oct. 6, the plaintiffs in the circuit court lawsuit also petitioned for a “temporary restraining order, motion for preliminary injunction and motion for expedited discovery,” according to court records. They requested that the court subpoena KPMG, the Big Four accounting firm that scored the applications, to answer questions and provide insight into the scoring process. The plaintiffs asked about, among other things, the “basis of disqualification” for each of them, a description of “the process for issuing deficiency notices” (which they asserted in the complaint were “flawed and inconsistent”) and an identification of each person who knows how KPMG’s portal for applications works.
“IDFPR has acknowledged that there were problems with the review and scoring process,” Claudette Miller, an attorney for the plaintiffs, said in the press release. “These plaintiffs did respond on time to deficiency notices, so that cannot be the reason they were disqualified. The Department is committed to remedying scoring mistakes, but applicants who never even got a chance to be scored are being left behind. All we are asking for is an equal opportunity for everyone who followed the rules.”
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