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How to Apply for Cannabis & Hemp Industry Funding

ways, applying for cannabis and hemp industry funding doesn’t differ much from the process that businesses in other industries follow. Unfortunately, most banks refuse to work with companies in the cannabis and hemp industry because they worry about breaking federal laws.

Many banks won’t even let cannabis and hemp businesses use services for checking and savings accounts. Even as states encourage banks and other financial institutions to work with companies in the cannabis and hemp sectors, banks know they must follow federal laws. If the federal government decided to crack down on banks working with “criminal” organizations, it could target any bank that does business with cannabis and hemp companies.

Until laws change at the federal level, this situation will not likely improve in any meaningful way.

Private Funding Fills a Critical Role in the Cannabis and Hemp Industry

Private funders and investors might feel some pressure from the federal government. However, the growing opportunities to generate profits from cannabis and hemp make it nearly impossible for private funding to avoid the industry’s growth.

When investors and lenders look at the industry, they see opportunity. In 2019, the legal cannabis market generated about $13.6 billion in sales. As more states adopt medical and recreational cannabis laws, the legal market should keep going. Estimates show that the industry could reach $85 billion in sales by 2030.

Increased adoption of CBD, delta-8 THC, and other cannabinoids will only add to the industry’s growth with increased sales and high profits.

Cannabis and Hemp Funders Take Business Seriously

No one running a cannabis and hemp business or wanting to enter the industry should believe that cannabis and hemp funders take their jobs less seriously than funders in other industries.

The potential negatives of working in a semi-legal industry often mean that funders must scrutinize these opportunities in great detail.

Anyone interested in applying for cannabis and hemp industry funding will need to take every step of the process seriously. One mistake could mean losing access to funds.

Understand Personal and Business Credit History

Entrepreneurs who want to expand their reach in the cannabis and hemp business will probably need to prove they know how to handle their personal and business finances. Before pursuing funding, cannabis and hemp business owners should request copies of their credit reports. Everyone needs to take this part seriously because one in five credit reports contains inaccurate information that could damage a business owner’s chance of securing funds.

Disputing errors and getting them removed from credit reports can take months, so it makes sense to start this process long before applying for cannabis and hemp business funds.

Write a Detailed Business Plan

All existing and potential companies need business plans that show how they plan to operate and generate profits. The U.S. Small Business Association (SBA) has an excellent resource that can help entrepreneurs write effective business plans.

While there are different types of business plans, a traditional format should include the following.

Executive Summary

An executive summary briefly describes the business and provides a high-level overview of its plan for growth.

Company Description

A company description offers specific information about how the business will solve consumer problems and how it will create a competitive advantage over similar companies in the area.

Market Analysis

A market analysis describes the industry and target market while providing information about industry trends. It also discusses how successful businesses in the industry operate and how the new business will compete with existing ones.

Organization and Management

The organization and management section describes the business structure and lists who will fill essential roles. An organizational chart can make it easier for readers to understand who manages each area of the business and why that person has the right qualifications for the job.

Product Line

The product line should include all information about products the business expects to sell. If the business has filed intellectual property documents, such as copyrights for cannabis strain names, those documents should have prominent mention here and also appear in the addendum. (More on the addendum below.)

Marketing and Sales

The marketing and sales section describes how the business plans to connect with and retain customers. This section should take a detailed look at marketing plans because the costs will factor into the funding request and financial projection sections.

Funding Request

The funding request details how much money a business will need over the next five years and how it will spend that money. The request should include information about purchasing equipment, paying salaries, and covering bills.

Financial Projection

Financial projections need to convince potential funders to provide money, loans, grants, or other funding options to the business. Existing cannabis and hemp businesses can provide information showing that they already generate profits. New businesses may need to include estimated expenses for the business, any collateral that can offset risk, and a five-year plan for becoming profitable.

Appendix

An appendix or addendum includes any helpful documents or information, such as credit histories, product pictures, licenses, permits, contracts, and letters of reference.

Improve the Approach With Help From an Organization Like SCORE and SBA

Companies in all industries often experience challenges when seeking funding sources. New and existing businesses can improve their chances of success by using the services of organizations like SCORE.

SCORE provides training and mentorships that can make businesses more successful. Most cities have nearby SCORE locations where entrepreneurs can learn about subjects like:

  • Successfully starting new businesses.
  • Improving business plans so they appeal to potential funders.
  • Finding the right business structure for businesses in the cannabis and hemp industry.
  • Taking smart approaches to marketing new businesses.
  • Understanding the differences between funding options.

SCORE isn’t the only resource available to new businesses. The Small Business Association (SBA) could also provide support for new and growing companies. Considering that the SBA is part of the federal administration, it will not help cannabis and hemp businesses secure funding. SBA offices may, however, work with cannabis and hemp businesses to improve business plans and compare funding options.

Understand Funding Options

Funding options in the cannabis and hemp industry look similar to those available in other industries. 

Real Estate Loans

Cannabis and hemp real estate loans can help pay for storefronts, processing facilities, warehouses, and farmland. 

Business Capital, Credit, Equity, and Loans

  • AR and PO financing for cannabis and hemp businesses.
  • Lines of business credit for covering short-term expenses.
  • Asset-based and collateralized loans that often have lower interest rates than loans unsecured by collateral.
  • Short-term working capital loans.
  • Working capital loans.

Cannabis and Hemp Equipment Loans

Equipment loans handle leasing and financing for items like closed-loop extraction systems used to make concentrates. Many cannabis and hemp businesses find they can expand their product lines by getting equipment loans that help them make items like oils, tinctures, and edibles.

Comparing Cannabis and Hemp Business Funding Options

Interest rates and terms (equaling the length of time borrowers have to repay their loans) significantly affect how much money businesses need to repay.

A $50,000 business loan with a two-year repayment schedule and an 8 percent interest rate will cost the business about $4,272 in interest. The same loan paid over three years will cost the borrower about $6,400 in interest.

Small changes in interest rates will also dramatically influence how much money borrowers repay. A three-year loan with an 8 percent interest rate will cost the borrower about $6,400 in interest. Increasing the interest rate to 10 percent brings the overall interest payments to about $8,080.

Comparing funding options can take a lot of time and effort, but it helps businesses save money.

Secure Cannabis and Hemp Industry Funding From Canna Business Resources

Get the best terms and interest rates for cannabis and hemp industry funding by applying through Canna Business Resources. Canna Business Resources works with a network of lenders and financiers with experience in the cannabis and hemp industry. When entrepreneurs apply through Canna Business Resources, they can connect with the right cannabis financing option for new business or business expansion.

Instead of applying with multiple funders, turn to Canna Business Resources to get competitive terms that help ensure business success.

October 14, 2022Comments Off
Cannabis Use at an All-Time High Among Young Adults

New research recently published in the Monitoring the Future Panel Study Annual Report shows increased cannabis use among young Americans. The demographic includes everyone in the United States, ages 19 to 30. It does not include teenagers under 19.

Monitoring the Future started collecting data about adult substance use in 1988. The new release shows the highest cannabis use on record. The report shows that:

  • 42.6% of young adults used marijuana at least once in 2021.
  • 28.5% of young adults used marijuana at least once within the past 30 days.
  • 10.8% of young adults say that they use marijuana daily (although daily is defined as at least 20 times within the last 30 days).

Outlets report that vaping marijuana declined at the beginning of the pandemic. The activity has now returned to its pre-pandemic level. Approximately 12% of young adults vaped cannabis in 2021.

Alcohol remains the most popular drug used by young adults in the U.S. 81.1% said they had used alcohol at least once within the last year. 66.3% said they had consumed alcohol within the last 30 days.

Where Do Young People Purchase Cannabis Products?

Unfortunately, these numbers likely mean that the U.S. still has a thriving black market that sells cannabis to underage consumers. The legal market has proven its ability to exclusively serve adults 21 and over.

In California, no legal cannabis dispensary served an underage consumer in 2021. Medical and recreational dispensaries have robust systems in place that prevent underage people from entering the premises or purchasing products. For example, most stores have a waiting room where customers can relax while employees verify their IDs. Once verified, the customers can enter the retail room, where a trained representative helps them choose products that match their needs. Customers do not reclaim their IDs until they leave the stores.

These systems ensure that all customers are of legal age. They also help prevent theft and burglary by minimizing the number of people in the retail space.

For comparison, a recent report shows that alcohol companies earned about $17.5 billion from underage drinkers in 2016. Some experts predict that underage consumers can successfully purchase alcohol 30% of the time. Several factors probably affect this, including poor security and lax standards at liquor stores. Cannabis dispensaries, however, have shown that they take the law much more seriously.

If adults under 21 are using cannabis products, they either purchase them from black market dealers or have older friends purchase them legally from a dispensary.

Is It a Problem When Young People Use Cannabis?

Some research shows that using cannabis before the brain is fully developed can lead to cognitive impairments. The same is true of other drugs, including alcohol.

Unfortunately, the human brain doesn’t finish developing until about 25 years old (although the exact age varies from person to person). Therefore, it isn’t ideal for 19-year-old consumers to use cannabis or other mind-altering substances.

The potential risks are reduced as people move closer toward full brain development. This makes it important for all retailers to follow the law and ensure that they only sell products to legal adults.

September 2, 2022Comments Off
Arizona Medical Marijuana Market Struggles To Remain Robust

Arizona took a huge step forward in 2020 when voters decided to legalize recreational cannabis for adults 21 and over. Now, medical and recreational stores operate throughout the state. An odd thing has happened, though: even as recreational cannabis retains its earlier sales, the medical market has slipped.

Medical marijuana has been legal in Arizona since 2010 when voters passed the Arizona Medical Marijuana Act.

Medical Cannabis Sales in Arizona

Arizona’s medical cannabis sector has struggled, especially since the state let retailers start selling recreational cannabis products.

In May of 2022, medical marijuana sales dropped by $45 million. It was only the second time medical sales dropped below $50 million. Even the number of medical marijuana cardholders has fallen. In January, the Arizona Department of Health Services (ADHS) reported that the state had 256,676 medical marijuana cardholders. In July, it reported 158,154. That’s a striking drop that has confused many experts.

Perhaps even more bewilderingly, fewer people are participating in the medical cannabis cultivation program. ADHS reported approving 2,982 cultivation permits in its January report. It only reported 1,844 in July.

Granted, you would expect to see some variation from month to month. These changes seem surprisingly large, though. They also seem like an ongoing trend that might have started after recreational sales began.

Recreational Cannabis Sales Hold Strong

Unfortunately, lower medical marijuana sales mean that the state collects less tax. The good news is that the state’s recreational cannabis industry holds strong.

Although Arizona legalized recreational cannabis sales in 2020, stores couldn’t make transactions until January 2021. That was around the time that medical sales started to fall. Still, monthly recreational sales have exceeded $70 million five times. In April, dispensaries sold approximately $81.2 million of recreational cannabis products, breaking the previous record of $80.4 million.

What Does This Mean for Arizona?

Right now, it means that the state isn’t collecting as much tax from medical cannabis as expected. That could hurt a variety of essential services. The state’s program dedicates:

  • 33% to community colleges
  • 31% to public safety, which includes police, fire departments, and first responders
  • 25% to the Arizona Highway User Revenue Fund
  • 10% to the justice reinvestment fund, which seeks to promote social justice in communities damaged by the War on Drugs and similar anti-drug initiatives

Perhaps these are just short-term concerns, though. If the taxes from recreational cannabis can cover the gap, Arizona doesn’t need to worry. It’s also worth considering that recreational tax revenues are new for the state. They didn’t even exist until 2021.

Why Have Medical Marijuana Sales Dropped in Arizona?

No one has published information showing why medical marijuana sales are dropping in Arizona. A few possible explanations come to mind, though:

  • Adults no longer see the need to seek a prescription when they can simply buy recreational products.
  • Public and private health insurance plans do not cover medical marijuana, so patients might choose other prescription drugs to save money.
  • High inflation has forced patients to live without the benefits of medical marijuana.
  • Legal cannabis seemed novel for a while, but now people have gotten used to it and purchase products less often.

How Will Arizona Respond to These Changes?

At the moment, the state probably will not do anything to influence cannabis buyers. Instead, they will likely keep an eye on tax revenues to determine whether they need to make adjustments. The state will find itself in a challenging situation, though, if medical marijuana sales keep falling and recreational sales do not replace them.

The state could respond in several ways, such as:

  • Lowering the tax rate on medical marijuana to help patients afford their medicine.
  • Increase the tax rate on recreational marijuana to encourage patients to use the medical program.
  • Giving marijuana companies more tax breaks so they can charge lower prices.
  • Adding medical marijuana to the list of medications covered by public health insurance policies. (This might seem unrealistic, but New York is pursuing a similar plan.)

Regardless, Arizona officials need to pay close attention to how these trends evolve over the next several years.

September 2, 2022Comments Off
Americans Evolving Views of Cannabis and Alcohol

Adults in 19 U.S. states and Washington, D.C. can legally purchase cannabis for recreational use. However, all 50 states let adults purchase alcohol. A growing number of individuals and states believe that more states should let adults possess and consume recreational cannabis. Unfortunately, headlines don’t always accurately reflect how Americans feel about cannabis and alcohol.

Two recent surveys from Gallup show what people really think about using these substances.

Americans and Alcohol

When asked about the effects of alcohol on society, 75% of Americans surveyed say that the substance has a “very negative” or “somewhat negative” effect. Only 21% say that alcohol’s effect on society is “somewhat positive.” Only 2% think alcohol has a “very positive” effect.

Not surprisingly, non-drinkers had a more dire perspective. 85% of non-drinkers say that alcohol has a “somewhat negative” or “very negative” effect on society.

Drinkers don’t have a favorable outlook on alcohol either, although it’s notably less pronounced than the attitudes of non-drinkers. 65% of drinkers say that alcohol is “very negative” or “somewhat negative.” 26% of drinkers think alcohol has a “somewhat positive” influence. Even drinkers balk at the idea that alcohol is “very positive.” Only 2% of non-drinkers and drinkers give that response.

As a side note, the percentage of American imbibers hasn’t changed much over the decades. In 1939, 58% of American adults consumed alcohol. Use peaked at 71% in the late 1970s. Currently, about 67% of people say that they drink, at least occasionally.

Americans Have a More Favorable View of Cannabis

When asked about the effects of marijuana on society, Americans are evenly split: 50% think it’s negative and 49% think it’s positive.

Interestingly, a person’s experience with cannabis has a significant influence on their perspective. 66% of Americans who have tried marijuana say it has a somewhat or very positive effect on society. Only 27% of people who have never tried marijuana say it has a positive effect.

What about those who think cannabis has a negative effect on society? Seventy-two percent of people who have never tried marijuana say that its effect is somewhat or very negative. Only 35% of people who have used marijuana think it has a negative effect on society.

Given the correlation of trying cannabis and believing in its positive effects, these numbers will likely shift even further in favor of marijuana. In 1969, only 4% of Americans said that they had tried marijuana. The percentage stayed around 34% from 1985 to 2013. In 2022, 48% of Americans said that they had tried marijuana. Sixteen percent say that they currently smoke marijuana.

If the percentage of people who have tried marijuana keeps climbing, more people will probably have a favorable view of the plant’s influence on society.

Additionally, 60% of Americans say cannabis should be legal for medical and recreational use. Thirty-one percent want legal marijuana only for medical use. Just 8% of Americans don’t believe marijuana should be legal in any form.

Laws and Media Don’t Represent American Views

When you look at these two surveys, it’s clear that the average person thinks alcohol is more harmful than cannabis. Despite that, the majority of states do not allow recreational cannabis sales, while every state allows alcohol sales. The laws are out of sync with Americans.

The media also misrepresents the truth frequently. Even the Gallup titles make alcohol and cannabis sound equally negative. One is titled, “Most in U.S. Say Alcohol Adversely Affects Drinkers, Society.” The other is titled “Americans Not Convinced Marijuana Benefits Society.” These statements aren’t lies, but they also lack the surveys’ nuances.

Someone glancing at the headline would think that most Americans suspect that cannabis harms society. In reality, about half think cannabis is positive and the vast majority think it should be legal.

September 2, 2022Comments Off
Agrify Follows Through With Financial Modification, Positions for Long-Term Growth

The legal cannabis industry promises to generate significant returns for investors and owners. However, anyone looking for short-term returns will find themselves disappointed. The industry still has a lot of work to do. In the meantime, companies must dedicate massive amounts of money to developing products, opening stores, starting efficient grow operations, and swaying political opinions.

Creating a new industry requires a lot of money, and that cuts into profits. If you just glance at cannabis stocks, you might wonder why anyone buys them. Many of them have tons of debt!

In reality, most companies across industries take on lots of debt. They have just enough revenue to cover the payments and still profit a little. That’s not nearly as easy to accomplish when you operate a small business in a new industry.

However, Agrify is committed to showing that it’s possible to grow an industry while repaying debt.

Agrify Commits To Repaying Debt

Inflation and other barriers have made it difficult for Agrify to meet many of its financial goals. The company managed to increase its year-over-year second-quarter revenue by 63.5% in 2022. Unfortunately, it earned 26% less than during the year’s first quarter.

This small stumble didn’t distract Agrify from an earlier commitment to repaying its debts, so it could focus on turning revenues into profits.

The company restructured its finances so it could move closer to this goal. The new agreement:

  • Repays a significant portion of the current, outstanding loan.
  • Exchanges the remaining debt to a new note with a lower principal balance.
  • Does not require amortization payments on the principal for three years.
  • Gives the company an opportunity to repay the loan early with minor financial consequences.

According to Raymond Chang, Chairman and CEO of Agrify, “Modifying our credit facility has been a top priority for us, and we are pleased to be able to move forward with additional flexibility to manage our business, conserve cash, and pursue a variety of compelling growth opportunities with fewer restrictions.

Can Other Cannabis Companies Follow Agrify’s Lead?

Agrify’s leaders and major investors believe that the new strategy will help them build a more dynamic company capable of making decisions based on opportunity instead of financial necessity. It’s much easier to develop a new product when you don’t need to worry about repaying high-interest loans. Agrify believes this is the way forward for them.

But can other cannabis companies follow its lead?

Agrify’s Role in the Cannabis Industry

Ideally, they can do similar things. Then again, Agrify’s section of the cannabis industry faces fewer pressures from regulations and consumer opinion than other companies.

Agrify develops and manufactures equipment that helps other companies succeed. Some of Agrify’s biggest sellers include cultivation and extraction equipment. It also provides professional facility design and engineering services. If you need someone to train your grow op’s employees or sell you distillation equipment, you go to Agrify.

This unique role as a manufacturer, designer, and trainer means Agrify spends money differently than growers and storefronts. It absolutely needs to invest massive amounts of cash into researching and developing reliable vertical grow solutions that work better than those built by competitors. However, it doesn’t need to think about purchasing other businesses to grow its brand authority and reach. If you own a large cannabis company that grows or buys products for consumers, you probably dedicate a lot of money to acquiring other businesses.

This significant difference could convince other cannabis companies that they cannot follow Agrify’s lead.

The Future of Financial Success in Cannabis

Companies certainly have unique concerns in the cannabis industry. What works for Agrify might not necessarily work for a retailer or grower. However, all companies need to start thinking about how they can spend less money without damaging long-term growth. That might mean restructuring current debts, seeking more investors, or entering partnerships instead of acquiring smaller businesses. If corporations do acquire smaller businesses, they might need to keep immediate and future financials in mind.

September 2, 2022Comments Off
Massachusetts’s Legal Cannabis Market Now Above $3 Billion

Massachusetts started letting retail stores sell recreational cannabis products to adults in 2018. Over the last few years, the state has built a successful industry that recently celebrated more than $3 billion in sales.

Cannabis Sales in Massachusetts

The Cannabis Control Commission (CCC) uses a seed-to-sale system to track all transactions. It even has an Open Data Platform that lets anyone browse or download datasets. The approach makes it relatively easy for Massachusetts to calculate the financial benefits of cannabis legalization.

CCC announced the achievement on May 18, 2022, via its official Twitter account.

Records show that retailers in the state sold over $5.9 million of cannabis and cannabis products on April 20, an official holiday for marijuana enthusiasts.

In 2021, Massachusetts cannabis stores sold more than $1 billion within a single year, a first for the state.

More States Celebrate Milestones

Massachusetts isn’t the only state celebrating financial milestones since legalizing recreational cannabis sales.

In April, Illinois stores sold $132 million in legal, adult-use cannabis products, setting a new record for monthly sales in the state. Arizona achieved a similar record in March. In April, Michigan had its highest per-month gross sales (almost $200 million).

States legalize recreational cannabis for various reasons. Not surprisingly, many governments point to the benefits of collecting cannabis sales taxes. According to the Marijuana Policy Project, states with legal, adult-use cannabis generated more than $3.7 billion in taxes, a 34% increase from 2020. States have collected about $11.2 billion in taxes since Colorado and Washington started allowing adult-use sales in 2014.

June 7, 2022Comments Off
California Cannabis Retailers Check 100% of IDs, According to Study

Concern about minors having easier access to cannabis has been one of the tallest barriers to its legalization. A new study adds to the ample evidence suggesting that states with legal cannabis do not have higher use rates among minors. Some evidence even shows that recreational cannabis laws might curb underage use.

California’s Cannabis Stores Take Regulations Seriously

The latest study shows that 100% of cannabis retailers comply with state ID policies designed to prevent underage consumers from buying products. The study’s authors express some surprise regarding the perfect consistency throughout the state. However, they acknowledge that research shows dispensaries in Washington and Colorado also comply.

Preventing Underage Patrons From Purchasing Cannabis Products

At least two factors likely influence the success of ID policies. First, retailers face hefty fines and possible jail time for failing to follow strict laws about who can buy cannabis products. In California, a first violation can result in a $500 fine and up to 30 days in jail. The state uses decoys to test the system, and any store that doesn’t comply can lose its license.

Second, companies have designed retail stores to make it nearly impossible for underage shoppers to enter. Typically, the stores have waiting rooms where patrons can sit while employees check their IDs. Once cleared, they can enter the retail area of the store. This approach makes it easier for cannabis retailers to control who enters their stores and limits the number of people within the retail space, which likely prevents theft.

States With Recreational Cannabis Have Lower Underage Use

Somewhat surprisingly, legalizing recreational cannabis seems to reduce the amount of underage use within a state. States with recreational cannabis laws show a 9% decrease in frequent use by teenagers.

Researchers speculate that legalizing recreational cannabis could actually make it harder for underage users to access marijuana products. It’s possible that law-abiding stores make it harder for drug dealers to earn money. More local product goes to the licensed distributor instead of someone selling illegally. Also, more adults who consume cannabis will choose retail stores that provide a wider range of products that have been tested for safety.

States that have not adopted recreational marijuana laws should consider whether prohibition truly benefits public health. The evidence suggests otherwise.

June 7, 2022Comments Off
New York Public Insurance Plans Might Need To Cover Medical Cannabis

New York has taken a significant step toward treating medical cannabis as a legitimate medication. Senate Bill S8837 passed a floor vote with 54 Ayes and nine Nays.

SB S8837 has attracted national attention because it would force public insurance plans to treat medical cannabis like other prescription drugs. However, private insurers would not need to follow the regulation. The law would also make it possible for private insurers to cover medical marijuana if they choose to do so.

Making Medical Cannabis More Affordable for Patients

The bill’s justification states that “cost is the primary barrier to patient access in New York’s medical marijuana program.” Currently, no health insurance plans in the state help patients pay for medical cannabis. Some patients in New York start treatment but soon quit using their medications because they can’t afford to pay out of pocket.

If passed into law, SB S8837 would impact New York’s publicly funded programs, including Medicaid, workers’ compensation, Child Health Plus, and EPIC (Elderly Pharmaceutical Insurance Coverage).

The Next Steps Toward Adding Cannabis to Health Insurance

The bill still has two hurdles to clear before it becomes law. It awaits a vote from the State Assembly, but they will likely approve the bill. In the Senate, every Democrat and more than half of Republicans voted to mandate cannabis coverage. Democrats have an overwhelming majority in the Assembly.

If the Assembly votes in favor of the bill, it will go to Governor Hochul, who can veto or sign it into law. Although the governor has shown support for expanding cannabis access, she has not made it clear whether she plans to approve the bill.

If Gov. Hochul vetoes the bill, it will go back to the state legislature, where members could override the decision and force it into law.

June 7, 2022Comments Off
Connecticut Will No Longer Limit Number of Cannabis Stores in Municipalities

Connecticut legislators recently passed a bill that removes an earlier restriction on how many cannabis stores and micro-grows can be in the state’s towns and cities. The new law also clarifies some industry regulations.

Connecticut Prepares for Recreational Cannabis Sales

Connecticut legalized recreational cannabis in 2021. Currently, adults 21 and older can possess up to 1.5 ounces of cannabis for medical or recreational use. Over the last year, the state has been working on rules that would regulate the new industry. So far, Connecticut hasn’t issued licenses for recreational cannabis sales. The state expects to finish setting guidelines by the end of 2022.

An early version of proposed regulations mandated that municipalities could only have one cannabis retail location per 25,000 residents. According to that rule, a town like New London, which has a population of about 28,000 people, could only have one retail cannabis store. New Haven, which has about 130,000 residents, could have up to five stores.

The new law removes that restriction, giving more control to local governments. Kaitlyn Krasselt, the Connecticut Department of Consumer Protection’s communications director, tells The Norwich Bulletin, “it’s up to towns to decide how many businesses are appropriate for their town.”

The state could reverse the decision in 2024, but that seems unlikely.

New Law Establishes Regulations for the Upcoming Cannabis Industry

The bill, which Governor Lamont signed into law on May 24, also clarifies some regulations ahead of the state sending licenses to recreational cannabis stores and cultivators.

A summary of the law states that it will:

  • Ban billboard advertisements.
  • Impose additional penalties for those who sell or trade cannabis outside of the legal limits.
  • Define the financial and licensing responsibilities of dispensary and cultivation facilities.

Other changes will make it easier for certain applicants to take advantage of social equity programs. Accordingly, the state’s Social Equity Council (SEC) has grown its staff and started planning an accelerator program that teaches applicants how to operate successful businesses. The SEC also has access to a $10 million fund it can use to help qualified applicants start cannabis businesses.

June 7, 2022Comments Off
Ohio Moves Cannabis Vote to 2023

Ohio cannabis advocates have been working hard to convince state legislators to vote on a law that would make the plant and related products legal. Currently, Ohio allows patients with prescriptions to purchase cannabis to treat medical conditions. While recreational possession and use is illegal, it has largely been decriminalized for personal use, defined as less than 3.5 ounces.

The Coalition to Regulate Marijuana Like Alcohol has now reached an agreement with lawmakers after suing the state for ignoring its petition.

Cannabis Advocates Collected More Than 140,000 Signatures

The advocacy group needed to collect 132,887 signatures to get the Ohio legislature to vote on its proposal. It turned in more than 200,000 signatures. Earlier this year, the Secretary of State Frank LaRose announced that only 120,000 of the signatures came from registered voters, putting the petition below the required number. The group responded by collecting 30,000 more signatures. After combining the two reams of signatures, the secretary of state said that the group had met the requirement.

Despite meeting the requirement, state legislators did not take action. State law says the legislature has four months to act, putting them beyond the deadline. Now, an agreement has been reached that the signatures will remain valid and the vote will move to 2023.

What Could the Initiative Accomplish?

The current version of the initiative establishes several goals, including:

  • Legalization for up to 2.5 ounces of recreational cannabis for adults over 21.
  • Legalization for up to 15 grams of cannabis concentrates for adults over 21.
  • Allowing adults 21 and over to grow up to 12 plants per household.
  • Creating a 10 percent sales tax that would benefit cities that choose to host dispensaries.
  • Creating an additional tax to fund substance abuse programs.

The advocacy group says that a clear path has been established to legalize recreational cannabis in Ohio. If passed, it will put cannabis products on the same legal footing as alcohol.

May 18, 2022Comments Off
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