Colorado is launching a new social equity program for cannabis business licenses in 2020. The new licenses will be reserved for low-income demographics and are meant to increase diversity in the cannabis industry, while also providing opportunity for businesses that may not have access to traditional funding and training.
The program is part of an overhaul of the state’s medical and recreational marijuana regulations under Senate Bill 224, which was signed into law earlier this year. Known as micro licenses, the new permits will be limited to applicants from low-income areas identified by the Colorado Office of Economic Development and International Trade.
New businesses granted one of these micro licenses would be required to use the facilities of established marijuana companies as they research and manufacture their own cannabis products. Licensees would be allowed to cultivate, extract, and manufacture infused products, but would not be able to operate dispensaries.
The Marijuana Enforcement Division (MED) met earlier this month to establish the criteria for applicants.
“People from around the world look to us as an example on how to do things right,” MED director Jim Burack said. “What exactly is this relationship between endorser and accelerator? How do we ensure this business relationship is mutually beneficial?”
While the program is meant to increase diversity in the cannabis industry, marijuana lobbyist Shawn Coleman, who helped write define the new licenses explained, “If you’re white and you grew up in a trailer and your dad went to jail for ten years for selling meth, I can see why you’d think you’d be fit for this. This isn’t exclusive to any certain group.”
Getting established cannabis companies to participate is part of the challenge of the new social equity program. While the details are still being finalized, some of the potential incentives include reduced licensing fees, excise-tax credits, and giving priority designation for licensing transfers and updates.
Senate Majority Leader Mitch McConnell and other members of Congress are urging the Food and Drug Administration (FDA) to speed up its guidance on hemp-derived CBD products. Specifically, Congress wants the FDA to issue formal “enforcement discretion” regarding CBD.
Hemp was legalized last year thanks to the 2018 Farm Bill, which made CBD legal as well. However, without guidance from the FDA, hemp and CBD are in a regulatory gray area. Lawmakers say that the FDA’s current approach to CBD has “created significant regulatory and legal uncertainty for participants in this quickly evolving industry.”
Currently, the FDA prohibits adding CBD to food or drinks marketed beyond a single state or to be added to food as a dietary supplement. Because of the regulatory confusion, some local governments have insisted that CBD is illegal in their state.
“Given the widespread availability of CBD products, growing consumer demand, and the expected surge in the hemp farming in the near future, it’s critical that FDA act quickly to provide legal and regulatory clarity to support this new economic opportunity,” lawmakers wrote.
The FDA has said it could take years to finalize CBD regulations. Congress isn’t waiting, and the US Senate Appropriations Subcommittee on Agriculture is working on guidelines to submit to the FDA. According to U.S. Hemp Rountable, Congress is working on rules that would require the FDA to:
Within 90 days, provide Congress a report outlining its efforts to develop an enforcement discretion policy on hemp CBD;
Within 120 days, issue its formal enforcement discretion policy on hemp CBD;
Keep the enforcement discretion policy in effect until the agency has implemented its final regulatory process; and
Ensure that going forward, CBD manufacturers would be able share safety data through existing FDA notification procedures to be fully compliant with federal law and policy.
Lawmakers wrote that they appreciate that the FDA has pursued “enforcement actions against the worst offenders,” but that “it can do so while eliminating regulatory uncertainty for farmers, retailers, and consumers.”
“Without a formal enforcement discretion policy, anyone participating in the growing marketplace for legal hemp-derived products will continue to face significant legal and regulatory uncertainty.”
McConnell, who has been supportive of the hemp industry, does not support ending marijuana prohibition. Asked to comment of legalizing hemp but not cannabis, McConnell said that hemp is “a different plant. It has an illicit cousin which I choose not to embrace.”
Learn how the cannabis industry has changed over the last ten years in this Q&A with Chad Tribble and John Garrison. Chad and John founded Mountain High Suckers 2009, and as pioneers of CBD-infused cannabis edibles, they have a unique perspective on where the industry has been and where it’s going.
How Did You Get Started?
Chad and John both moved to Colorado in 1996 to pursue an outdoor lifestyle. They met while working for a painting contractor and bonded over rock climbing and other outdoor activities.
John was the first to develop an interest in cannabis. He started growing and registered as a caregiver, providing cannabis to some of the first medical marijuana dispensaries in Colorado.
“One day John had me over to his house, and I hadn’t been over there in a while,” Chad explains. “John had a room dedicated to [growing]. He had all the patient names on the wall.”
The idea of providing for patients and growing cannabis appealed to Chad, so he started growing cannabis as a caregiver, too. While visiting dispensaries to sell his flower, Chad would see patients come in with cookie trays. They didn’t know how strong the cookies were, but they would trade the cookies for flower from the dispensary.
It clicked for Chad that there was more to cannabis than smoking flower, and he saw the potential for a whole range of cannabis products for patients. He went to the bookstore and bought a book on candy-making.
“Hard candy was stuck in my mind. I saw this picture of this really clear sucker, and I said, ‘How do you get an extraction or something into this sucker and have it still be a sucker?’
From there, Chad started learning more about the ethanol extraction process. “I learned it in my backyard like a lot of guys did, and we’ve taken it to a different level now. We know the science behind making a great extraction for what we’d like to keep in it versus what we’d like to remove…we try to keep it all whole plant and all together.”
What has been the key to your success after ten years in the cannabis business?
Mountain High Suckers has 34 flavors, each of which we worked on and perfected before they went anywhere near store shelves. The quality and consistency of our suckers is something that patients and consumers can count on.
More than anything, say John and Chad, “We’re a caring company.”
How has the industry changed from when you started vs. now?
“When we first started, there was no CBD on the market at all,” says John. “We were the very first company in America to have a THC-, CBD-infused product. Getting the word out was a little difficult.”
John explains how they used to try to educate doctors who were licensed to prescribe medical marijuana. “It was trying in the beginning. It took a couple of years to catch on. Now, of course, CBD is everything, everywhere.”
In the beginning, John says, “We were wondering if the FBI was going to be hitting us on the shoulder…to [now] having a bright future for our company.”
Rules and regulations have changed a lot in the last ten years, and it’s affected how cannabis companies like Mountain High Suckers interact with dispensaries and budtenders.
“In the beginning, it was a lot easier to get samples to people,” Chad says. “We do appreciate regulation, but obviously, there are pluses and minuses about how you can get things streamlined to people. It was a lot more fun back in the day. We could go to a dispensary with a delivery, ask how many employees were on staff that were brand new…and give samples out the same day and get a lot more response. It’s hard to get samples into places these days.”
What do you think is next for the future of cannabis?
“When it’s descheduled, big pharma is gonna come in and break it all apart and figure out what [cannabinoid] helps with each disorder,” John predicts. “On the rec side, I see a very fruitful, awesome future all around the world.” Medical and recreational cannabis are “always going to be separated, in my opinion.”
Chad says, “The future is bright. I feel the information that’s being provided to people today is very helpful. Back in the day, there was a lot of misunderstood information being put out there about cannabis. Back then, you wouldn’t have heard about its benefits. You’d only hear the negative propaganda.
“We’ve come so far: 10 years under our belt in Colorado, and that’s without true trials, but the testimonials and the data we’ve collected prove cannabis to be more beneficial than it is negative. I feel like that’s why the world is really starting to rally around cannabis.”
What’s next for Mountain High Suckers?
“We’re continuing to grow. Our footprint isn’t just Colorado anymore. We’ll be in a few different countries. We’ll be in a multitude of states and have larger brand exposure. The plan is to continue to make great products and expand around the globe.”
“I see next year being a big turning point for Mountain High Suckers,” says John. “HB-1090 just passed, allowing outside corporate money to come into the state to start buying up dispensaries and grows and whatever they want, so there’s going to be a significant consolidation and acquisitions.”
Have questions or comments? We’d love to hear from you for our next video sesh!
Come see Mountain High Suckers at one of our next events and ask for us by name at your dispensary!
Mexico’s supreme court orders regulation of medical marijuana
After two years of delay from the health ministry, Mexico’s supreme court has ruled that the agency must issue medical marijuana regulations within six months. Medical marijuana was legalized in Mexico in 2017, but there’s been no movement on regulations, leaving patients’ access to medical marijuana in limbo.
The ruling was in response to a suit brought on behalf of a child with epilepsy who needs medication derived from cannabis to treat her condition.
President Andres Manuel Lopez Obrador, known in Mexico as AMLO, campaigned on marijuana reform and has proposed legislation for both medical and recreational marijuana. One proposal put forward by AMLO’s Interior Minister Olga Sánchez Cordero would establish the Mexican Institute of Regulation and Control of Cannabis, which would handle cannabis licensing and regulation. The plan would ban marijuana advertising but would allow individuals to grow up to 20 cannabis plants, as well as allow groups to create cannabis cooperatives of up to 150 members.
This isn’t the first time that Mexico’s supreme court has ruled in favor of cannabis. Last year, they ruled that marijuana prohibition infringes on an individual’s right to develop their personality and gave legislators until October 2019 to pass legislation to regulate both medical and recreational marijuana.
2020 could be the year New Zealand legalizes marijuana
New Zealand will hold a referendum on legalizing and regulating cannabis in 2020. Ending cannabis prohibition has been gaining momentum in the country, with even former prime minister Helen Clark urging voters to legalize marijuana.
New Zealand may have a reputation as a laid-back country, but their cannabis laws are definitely not chill. Under the country’s Misuse of Drugs Act, cultivating or supplying cannabis is punishable by up to 14 years in prison, and possession can land you a sentence of up to three months behind bars.
Even medical marijuana is highly regulated, with only Sativex approved for the use of treatment of multiple sclerosis. All other medical cannabis is banned without ministerial approval.
This week, the Helen Clark Foundation released a report with recommendations on cannabis legalization that would include limits on advertising, age limits, and expunging minor cannabis offenses.
“Our solution would be to be much more regulated than places like Colorado because of our experiences with tobacco and alcohol,” Clark said. “You don’t want to create another big tobacco and big alcohol [industry] that’s going to promote things that obviously have some potential for harm.”
