Tag: legalized marijuana

If California’s Marijuana Tax Hike Takes Effect Next Month, Consumers And Businesses Will Suffer—But There’s A Solution

A critical inflection point threatening the world’s largest legal cannabis market currently looms over California’s industry: A scheduled excise tax raise from the current rate of 15 percent to an unprecedented rate of 19 percent is set to take effect on July 1.

When California voters approved adult-use cannabis in 2016, they envisioned a thriving—and equitable—regulated industry. Unfortunately, the reality is that licensed operators are being strangled by regulations that push consumers straight to the illicit market. And despite the legal market generating approximately $7 billion in tax revenue since 2018, this hike would be a devastating blow.

The Reality of California’s Cannabis Market

On the ground in California, the illicit market continues to dominate cannabis sales. According to recent data from the Department of Cannabis Control (DCC), approximately 63 percent of the 3.8 million pounds of cannabis consumed by Californians in 2024 came from unlicensed production—unsurprising when considering the price differential consumers face.

When a consumer purchases cannabis from a licensed retailer, they’re not just paying for the product. They’re paying layers of taxes that can increase the final price by nearly 44 percent in some jurisdictions.

The California Department of Tax and Fee Administration’s (CDTFA) own example shows how a $35 purchase quickly balloons to over $50 due to combined taxes—and that’s before this tax increase. With the planned hike, that same purchase would approach $60.

Not only will consumers feel this increase in each purchase, many small businesses—particularly social equity operators and independent retailers already operating on razor-thin margins—simply won’t survive another tax increase of this magnitude.

Meanwhile, states like Michigan and Missouri are demonstrating steady sales growth thanks to lower taxes and fewer barriers to entry, and they are already exceeding the average per capita cannabis sales of California.

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Minnesota Tribe Opens State’s First Recreational Marijuana Store Off Reservation Lands, As Cities Plan Government-Run Dispensaries

A Native American tribe over the weekend opened Minnesota’s first-ever legal recreational marijuana store outside of a reservation. The new shop, in Moorhead, will be followed next month by another location in St. Cloud that will also be operated by the White Earth Nation.

Meanwhile, as Minnesota’s adult-use cannabis market gets up and running, more than a dozen cities and counties are seeking to open their own, government-run stores.

“This has never been done before, being the first to be able to open an off-reservation dispensary, let alone just the first dispensary in the state,” Zach Wilson, CEO of White Earth Nation’s cannabis business, Waabigwan Mashkiki, told Minnesota Public Radio (MPR) about the Moorhead store.

The launch of the new shop comes after Gov. Tim Walz (DFL) signed of a landmark agreement earlier this month to allow the tribe to operate up to eight retail marijuana stores across the state.

Everything the store sells “is all completely vertical, seed to sale,” with products grown, processed and packaged by Waabigwan Mashkiki—which means flower medicine in Ojibway—Wilson said. “The only thing we don’t manufacture is our beverages, but everything else absolutely, completely in house.”

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Congressional Bill Aimed At Protecting Kids Online Could Cause Headaches For Marijuana Businesses

A newly filed bill in Congress aimed at protecting children online could create headaches for advertisers trying to promote legal marijuana and other regulated substances.

Titled the Kids Online Safety Act (KOSA), the bipartisan proposal—from Sens. Marsha Blackburn (R-TN) and Richard Blumenthal (D-CT) as well as Senate Majority Leader John Thune (R-SD) and Senate Minority Leader Chuck Schumer (D-NY)—would create a “duty of care” for online platforms such as social media and streaming video services, requiring them to take steps to prevent access to potentially sensitive content by minors.

That includes advertisements for cannabis products and certain other drugs and services.

A factsheet from Blackburn’s office says the duty of care “requires social media companies to prevent and mitigate certain harms that they know their platforms and products are causing to young users.”

The sponsors say the legislation is necessary to protect children from pernicious practices that keep “kids glued to their screens” for hours a day, alleging that “Big Tech is trying every method possible to keep them scrolling, clicking ads, and sharing every detail of their life.”

The 63-page bill “targets the harms that online platforms cause through their own product and business decisions,” the factsheet says, “like how they design their products and applications to keep kids online for as long as possible, train their algorithms to exploit vulnerabilities, and target children with advertising.”

Much of the proposal is aimed at limiting content that fuels behavioral health disorders. Platforms would need to “exercise reasonable care in the creation and implementation of any design feature to prevent and mitigate the following harms to minors,” it says, listing eating and drug use disorders, suicidal ideation, violence and harassment, sexual exploitation, financial harm and others.

As for controlled substances, online platforms would be prohibited from facilitating the “advertising of narcotic drugs, cannabis products, tobacco products, gambling, or alcohol to an individual that the covered platform knows is a minor.”

The provision around drug use lists the “distribution, sale, or use of narcotic drugs, tobacco products, cannabis products, gambling, or alcohol” as risks that platforms would need to actively guard minors against.

Video streaming platforms meanwhile, would be required “to employ measures that safeguard against serving advertising for narcotic drugs, cannabis products, tobacco products, gambling, or alcohol directly to the account or profile of an individual that the service knows is a minor.”

“Big Tech platforms have shown time and time again they will always prioritize their bottom line over the safety of our children, and I’ve heard too many heartbreaking stories to count from parents who have lost a child because these companies have refused to make their platforms safer by default,” Blackburn said in a press release about the legislation.

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New York Marijuana Officials Launch Interactive ‘Buy Legal’ Map To Help Consumers Find Licensed Dispensaries

New York officials have launched a new online map that’s meant to help adults locate licensed marijuana retailers—one of their latest efforts to encourage consumers to buy their cannabis from the regulated market.

After a rocky rollout of the state’s legalization law opened the door to a proliferation of illicit marijuana shops, the governor and Office of Cannabis Management (OCM) have prioritized educating the public about the need to purchase their products from licensed dispensaries as a health and safety imperative.

To that end, Gov. Kathy Hochul (D) started a “Buy Legal” campaign in 2023. And the latest iteration of that campaign is a “new, consumer-friendly tool that helps New Yorkers locate licensed, open dispensaries across the state,” OCM announced on Wednesday.

“Whether you’re looking for adult-use or medical cannabis, delivery services, or equity-owned businesses, the Buy Legal map makes it easier than ever to shop safer, legal, and local,” it said, adding that people can “search by location, name, or filters like delivery” and also view “operating hours, website links, and real-time directions.”

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Minnesota Signs First-Of-Its-Kind Agreement Allowing Indian Tribe To Sell Legal Marijuana Outside Reservation

Minnesota Gov. Tim Walz (DFL) has signed a landmark agreement with the White Earth Nation that will allow the tribe to operate up to eight retail marijuana stores across the state. Already the tribe is preparing to open storefronts in Moorhead and St. Cloud.

Walz signed the new compact on Tuesday, making White Earth Nation—also known as the White Earth Band of the Minnesota Chippewa Tribe—the first tribal entity in the state to reach an agreement with the state on selling legal cannabis outside of tribal land.

Notably, Minnesota’s 2023 cannabis legalization law allows tribes within the state to open marijuana businesses before state licensing of businesses begins. Following the law’s enactment, a number of tribal governments, including White Earth Nation, the Red Lake Band of Chippewa Indians and the Leech Lake Band of Ojibwe, made early moves to enter the market.

Minnesota officials said the next compact with another tribe could be signed within a few weeks.

The new agreement with White Earth will allow the storefronts to be located off tribal land but still be regulated by tribal authorities. It also requires at least some distance between the storefronts, with the tribe limited to no more than one retail location per city and three per county.

Under the compact, White Earth will also be able to open marijuana cultivation and manufacturing facilities off of tribal land and engage in wholesale transactions, transportation and delivery of cannabis.

The interim director of the Minnesota’s Office of Cannabis Management (OCM), Eric Taubel, described the state’s new deal with White Earth Nation to local reporters as a “nation-leading approach to cannabis compacting.”

“We’ll be the first state where not only are tribes operating cannabis businesses off tribal land, but they’re also doing so under tribal regulatory authority,” he told The Minnesota Star-Tribune, adding that Minnesota cannabis regulators will still be permitted to conduct an annual facility inspection and can take further steps if they believe stores are selling risky products.

Taubel also said that while the White Earth compact allows up to eight dispensary locations, he doubts that any of the 11 recognized tribal nations in Minnesota will actually open that many.

“Candidly, I don’t suspect any tribe will get past about three to four stores for the next two years just because of the actual cost in setting up these stores,” Taubel said.

Zach Wilson, CEO of Waabigwan Mashkiki—White Earth Nation’s cannabis business—told the Star-Tribune that the first off-reservation store could open as soon as this weekend.

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Federal Judge Blocks Voter-Approved Oregon Law Requiring Marijuana Businesses To Have Labor Peace Agreements With Workers

A federal judge has struck down a voter-approved Oregon law that required licensed marijuana businesses enter into labor peace agreements with workers and mandated that employers remain neutral in discussions around unionization.

About three months after two marijuana businesses—Bubble’s Hash and Ascend Dispensary—filed a lawsuit in the U.S. District Court for the District of Oregon challenging the implementation of Measure 119, Judge Michael Simon on Tuesday ruled in favor of the plaintiffs, agreeing that the law unconstitutionally restricts free speech and violates the federal National Labor Relations Act (NLRA).

Under the now defunct law, a marijuana businesses that was unable to provide proof of a labor peace agreement could have been subject a denial or revocation of their license.

The lawsuit named Gov. Tina Kotek (D), Attorney General Dan Rayfield (D) and Oregon Liquor and Cannabis Commission’s (OLCC) Dennis Doherty and Craig Prins as defendants.

In the order on Tuesday, the judge walked through various components of the legal arguments from both sides and ultimately agreed that the Oregon law is preempted by the NLRA, which is meant to provide protections for workers who want to unionize—but specifically preserves the right for “uninhibited, robust, and wide-open debate in labor disputes.”

By mandating neutrality from employers in labor discussions, that constitutes a violation of the NLRA, the judge ruled.

“Measure 119 does not distinguish between permissible employer speech and threatening or coercive speech,” Simon said. “Measure 119 is not limited to restricting only threatening, coercive, false, or misleading speech, but instead prohibits all speech by employers that is not ‘neutral’ toward unionization.”

On the question of whether the law violates First Amendment protections under the U.S. Constitution, the cannabis companies argued that “Measure 119 is a content-based restriction on speech that is subject to strict scrutiny, and that Defendants fail to provide a compelling government interest requiring this restriction.”

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New York Officials Take Steps To Expand Marijuana Farmers Market Program

New York marijuana regulators are moving forward with new proposed regulations around the state’s so-called “cannabis showcase” program, which allows licensed businesses to sell to consumers at pop-up, farmers market-like events.

Members of the Cannabis Control Board (CCB), which oversees the state’s Office of Cannabis Management (OCM), voted without opposition at a meeting on Tuesday to advance the 23-page showcase expansion plan, which next proceeds to a public comment stage.

The new rules follow the enactment of legislation signed by Gov. Kathy Hochul (D) in March that built on the existing showcase program, which was first created in 2023.

In a presentation to the board on Tuesday, John Kagia, OCM’s director of policy, said the program has “proved to be a particularly compelling way for the new, fast-growing, regulated cannabis market to get out in the community, to build relationships with consumers and to begin the process of normalizing cannabis in the state of New York.”

Between summer 2023 and the end of that year, he noted, New York saw over 60 showcase events that together brought in more than $10 million in revenue for participating businesses.

“It really established that there was real interest, both from the licensees and from the communities where these events were being hosted, to allow cannabis to exist out of the four walls of our retail dispensaries,” Kagia said.

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Montana Governor Signs Bill Directing Marijuana Tax Revenue Toward Environmental Conservation And Wildlife

Montana Gov. Greg Gianforte (R) announced on Friday that he had recently signed House Bill 932, a proposal that would expand uses for the conservation-dedicated tax revenues the state collects on recreational marijuana sales.

Under HB 932, the scope of wildlife habitat protection and improvement supported with marijuana taxes will broaden to include projects implemented on private land. The law is slated to take effect July 1.

Before the latest legislative reform, Habitat Montana was the sole beneficiary of the roughly $10 million of habitat-conservation-dedicated funding that marijuana revenues support. In recent years, Montana Fish, Wildlife and Parks (FWP) has used Habitat Montana to purchase new Wildlife Management Areas and secure both perpetual conservation easements and 40-year conservation leases.

With HB 932 in play this summer, that $10 million of conservation funding will all go into a new account: the “habitat legacy account.”

From there, it will be further divided into three separate funding buckets.

Most of the money, 75 percent, will support Habitat Montana and state water projects. Roughly 20 percent of the remainder will be funneled into an existing program called the Wildlife Habitat Improvement Program, or WHIP, and 5 percent will be directed toward the newly established wildlife crossings account that seeks to reduce the wildlife-vehicle collisions that plague the state’s highways and interstates.

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Maryland Governor Signs Marijuana Bills To Legalize Homemade Concentrates, Set Consumption Lounge Rules And Shield Conviction Records

The governor of Maryland has signed a series of cannabis bills, including one that will require state officials to automatically shield records for low-level marijuana convictions that have been pardoned from public access, and to more broadly expand expungement eligibility for certain other offenses.

Gov. Wes Moore (D) on Tuesday also gave final approval to a separate bill meant to clear up policies around on-site marijuana consumption businesses, lay out the plan for a second cannabis licensing lottery round and allow business owners to sell their companies to employees ahead of a current five-year waiting period.

And he further signed off on legislation that will allow adults to manufacture marijuana edibles and concentrates for personal use.

“Marylanders who have served their time and turned their lives around are being unfairly blocked from jobs, housing and opportunity—and that doesn’t just hurt them, it hurts all of us,” Moore said ahead of the expungement bill signing.

“I want to be very clear: This is not about letting criminals or repeat offenders off the hook. It’s about common sense,” he said. “The people who will be helped out by this reform are our neighbors and our parents, even people in our congregation. They’re people who just want to move forward but keep hitting a wall made of paperwork.”

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Alcohol Retailers Say Only They Should Be Able To Legally Sell Marijuana Products

A new policy memo from an American alcohol retail industry group argues that marijuana should be regulated more like booze—including by requiring that intoxicating cannabis products be sold only by businesses licensed to sell alcohol.

“States should restrict the sale of intoxicating THC products to businesses licensed to sell beverage alcohol and that are regularly inspected for compliance with laws aimed at preventing sales to individuals under 21,” says the memo, published this month by the American Beverage Licensees (ABL) trade association.

The group contends that alcohol retailers, “with many decades of proven compliance, are best positioned to sell these products.”

Regulators should also treat cannabis similar to alcohol, the two-page policy memo says, such as by establishing licensing requirements, clear labeling standards and restrictions on advertising. “It may also include limits on potency per serving,” the alcohol trade group asserted.

THC products should also be lab tested for safety, purity and potency, the paper says. “Testing should verify the absence of harmful contaminants including but not limited to heavy metals, pesticides, mold and residual solvents, and confirm THC potency to prevent unintentional harmful effects.”

ABL, which represents on-premise sellers of beer, wine and spirits such as bars, taverns, restaurants and casinos, as well as off-premise retailers like package stores, is further calling for a “fair and transparent” tax structure for THC products, with production and retail tax rates “similar to those for beverage alcohol in the state.”

To ensure a working system, the memo also urges enforcement of laws and regulations. “This includes penalties for selling to underage individuals, failure to comply with testing and labeling requirements, and operating without a license,” the document says.

It also advises that states “should work with financial institutions, insurance providers, and regulatory authorities” to ensure that marijuana retailers have access to insurance and financial services.

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