Marijuana businesses are increasingly bringing on former national and state politicians and regulators to help them navigate the ever-changing landscape surrounding cannabis legislation and related lobbying efforts as they look to move the industry forward.
Earlier this month, for example, Maryland-based Green Leaf Medical announced it hired Joy Strand, a former executive director of the state’s Medical Cannabis Commission, to coordinate the company’s government relations in several states.
It was the latest such hire involving a top cannabis regulator.
This revolving door is a sign of maturation for the marijuana sector since mainstream companies such as financial services, energy and health-care firms have long relied on former politicians and government officials to provide the political expertise and insider connections to shape the legislative and regulatory policies that affect them.
One of the most notable cannabis companies involved in this trend is New York-based Acreage Holdings, which trades on the Canadian Securities Exchange as ACRG.U and on the over-the-counter markets as ACRGF.
Acreage is one of the nation’s largest cannabis operators and has former U.S. House Speaker John Boehner and former Massachusetts Gov. Bill Weld on its board as well as Brian Mulroney, a former prime minister of Canada.
Boehner, who opposed legalization during his time in the U.S. Congress, said he became educated on the medicinal benefits of cannabis and the need for research as the opioid epidemic escalated.
That was the turning point, according to Acreage CEO and Chair Kevin Murphy, when discussions of an open board seat for the firm became serious.
“The path ahead for our company and the broader industry is so heavily influenced by legislative reform,” Murphy told Marijuana Business Daily.
“We made a conscious decision early on to build a board that could deliver political connectivity as well as deep business experience in highly regulated industries.”
Process and policy expertise
Another example of a former politician who is involved in marijuana lobbying is Dean Grafilo, who left public life to join Sacramento, California, firm Capitol Advocacy, which coveted his close ties to the state’s politicians and 20-year history in legislative process and policy.
Capitol Advocacy’s marijuana clients include:
- Parallel, an Atlanta-based vertically integrated producer and seller of cannabis products.
- Crosstown California Holdings, which operates the NFuzed brand of marijuana inhalers and edibles.
Parallel spent $120,000 in 2019 for Capitol Advocacy services, according to state filings.
In late 2017, Grafilo was instrumental in creating the Bureau of Cannabis Control (BCC), which licenses California cannabis companies such as dispensaries, distributors and testing labs.
Before moving to consumer affairs, he was chief of staff for State Assembly Member Rob Bonta, a Democrat from Alameda, California. Bonta is the lead architect of the Medical Marijuana Regulation and Safety Act, which established licensing, labeling and tracking systems for regulating MMJ cannabis sales in California.
Max Mikalonis, another Bonta top aide, left his State Assembly position in early 2017 for Sacramento-based K Street Consulting, which lobbied last year on behalf of Mendocino County-based marijuana distributor Flow Kana for a bill to allow marijuana product samples to be shared free of charge between licensed companies and employees but not to the public.
“I was interested in finding somebody who was smarter on the regulations than I was,” Michael Wheeler, Flow Kana’s vice president of policy initiatives, said about hiring K Street and, specifically, Mikalonis.
“His ability to cite code from memory is very convenient, and he understands the background on the most vexing challenges this industry has.”
Flow Kana spent $112,000 last year for K Street services, according to state filings.
Other K Street cannabis clients include Los Angeles Delivery Alliance and Palomar Craft Cannabis.
‘Figuring out the details’
HdL Cos., which is stacked with experts in marijuana tax policy, law enforcement, legislation and compliance, is among the most influential cannabis consultancies in the nation, and particularly in California, where it’s shaping the world’s largest recreational marketplace county-by-county, city-by-city.
Demand at the Orange County-based company, which counts more than 60 local governments as cannabis consulting clients, has boomed since California voters approved recreational use via Proposition 64 in 2016, primarily because marijuana businesses need city or county approval before seeking state permits.
“The state left a lot of work for local governments to do, in terms of figuring out the details,” said Mark Lovelace, who started working at HdL in 2017 after running his own consultancy.
While serving as Humboldt County Board supervisor from 2009 to 2016, Lovelace developed the framework for regulating cannabis in one of the nation’s most fertile cultivation regions and implemented a voter-approved tax on commercial cultivation as well as a track-and-trace pilot program.
“We have lots of cities and counties around the state that are still trying to figure out how to move forward,” said Lovelace, HdL’s only former elected official.
Chris Casacchia is a freelance writer based in Long Beach, California. He can be reached at email@example.com