Cannabis Industry Daily News

Indiana approves CBD for all, ending months of retailer confusion

Indiana’s long-simmering CBD confusion ended with the state’s governor signing a law clarifying that all CBD products are legal as long as they come from hemp and contain low amounts of THC.

The new law specifies that anyone can sell or possess CBD products containing less than 0.3% THC and derived from hemp.

Advertisement

Gov. Eric Holcomb’s signature this week halted months of confusion about CBD’s legal status in Indiana, the Indianapolis Star reported.

Indiana will require CBD products to have a QR code on the label linking to information about the batch, such as ingredients and the company that manufactured the ingredients.

Indiana’s CBD confusion started in April 2017, when Indiana passed a law allowing children with certain kinds of epilepsy to possess CBD.

That CBD law had the unintended consequence of law enforcement taking CBD products off shelves in stores that had been selling them for years.

Some police interpreted the law to mean CBD is illegal for anyone else, regardless of where the CBD came from or if it was legally produced.

Indiana’s attorney general said in November that CBD possession is illegal except by epilepsy patients covered by the 2017 law.

To sign up for our weekly hemp business newsletter, click here

Pennsylvania to add medical cannabis business licenses in Phase 2 rollout

One of the hottest new U.S. medical marijuana markets just opened up to more businesses.

Pennsylvania’s Department of Health announced Thursday it will begin accepting new applications for dispensaries and growers on April 5 and will award 13 new cultivation permits and 23 new dispensary licenses, Triblive.com reported.

Advertisement

The move may seem like a windfall to observers, but it’s really the department living up to the original 2016 law, which allowed for up to 50 dispensary licensees and 25 growers.

The industry was to be rolled out in two phases. In Phase 1, the department issued permits for just 27 dispensaries and 12 growers.

Each dispensary license holder, however, is allowed to operate up to three storefronts, meaning the state could have as many as 150 dispensaries once the Pennsylvania market is fully operational.

Applications for the Phase 2 licensing round must be postmarked by May 17, Triblive.com reported.

Hopeful cultivation licensees will have to pay a nonrefundable $10,000 to submit applications along with a refundable $200,000 permit fee. Applicants must also provide proof of $2 million in liquid capital, $500,000 of which must be already deposited in a financial institution.

Those interested in dispensary licenses will have to pay a $5,000 nonrefundable application fee and a $30,000 refundable permit fee and also submit proof of at least $150,000 in liquid capital.

Maine’s largest hemp grower eyes blueberry plant for processing site

The largest hemp cultivator in Maine has identified a former blueberry processing plant as its future extraction site.

Future Farm Maine – a subsidiary of Vancouver, British Columbia-based Future Farm Technologies – has signed a two-year lease for 12,960 square feet of the 60,000-square-foot building in Belfast, a coastal town about 100 miles north of Portland.

The Republican Journal reports that the processing facility could be up and running by this summer.

Advertisement

Future Farm has applied to the city for a change-of-use permit to allow the company to propagate and process industrial hemp in the building, which was last home to a frozen-blueberry processor.

Future Farm Technologies specializes in indoor marijuana production but plans to grow and process hemp in the United States.

Its subsidiary, Future Farm Maine, plans to propagate 250,000 seeds for planting on its hemp farms in Amity and Hersey.

The plant will also process dried flower from the farms into CBD oil and isolate.

Future Farm’s plans to grow hemp on 120 acres in Maine this year will dramatically increase the state’s hemp production.

The state reported just 30 acres in hemp production last year.

To sign up for our weekly hemp business newsletter, click here. To sign up for our weekly Canada marijuana business newsletter, click here.

New federal budget bill includes medical marijuana protections

By John Schroyer , Senior Reporter

A key federal law that prohibits the Department of Justice from using federal funds to prosecute medical marijuana companies looks likely to remain in place under a new federal budget deal reportedly reached Wednesday among Congressional leaders.

Language from the Rohrabacher-Blumenauer Amendment is included on page 240 of the 2,243-page budget bill, which was posted online by Republican leaders.

However, the spending deal has yet to be passed by Congress, which has a Friday deadline before the federal government shuts down.

The Washington Post reported that the deal is “uncertain.”

Even if it is approved, the deal would last only through September.

Advertisement

The amendment, which was first passed by Congress more than three years ago as the Rohrabacher-Farr Amendment, blocks the DOJ and therefore the Drug Enforcement Administration from using federal funds to prevent states and territories “from implementing their own laws” on MMJ.

The law specifically protects medical marijuana laws – and, by extension, MMJ businesses – in 46 states, the District of Columbia and the U.S. territories of Guam and Puerto Rico.

The only four states that aren’t protected are Idaho, Kansas, Nebraska and South Dakota – none of which have yet approved any functional MMJ industries. (There are several states that allow for possession of CBD but don’t permit production or sales.)

Although it’s been law since December 2014, the Rohrabacher-Blumenauer Amendment has had to be renewed repeatedly by Congress, since it’s technically only an amendment to the budget, which is supposed to be rewritten annually.

So far, the amendment has been renewed eight times. If the budget deal goes through before the Friday deadline, it will be the amendment’s ninth renewal.

The amendment does not protect recreational marijuana laws or businesses, which could be targeted by U.S. Attorney General Jeff Sessions or his U.S. attorneys at any time.

John Schroyer can be reached at johns@mjbizdaily.com

Feds revoke cannabis business owner’s airport security clearance

An established cannabis attorney in Southern California recently lost his preferred airport security clearance for being a marijuana business owner.

According to The Orange County Register, Aaron Herzberg was traveling from Los Angeles to Sacramento when the U.S. Customs and Border Protection agency informed him he could no longer participate in the Department of Homeland Security’s Global Entry Program.

Advertisement

While checking in at Los Angeles International Airport, the newspaper reported, Herzberg received the following written notice from U.S. Customs and Border Protection:

“We have a very strict ‘Zero tolerance for drugs’ policy and he is a partner with CalCan (sic) holdings which owns medical Marijuana businesses.”

Herzberg co-owns two dispensaries in Santa Ana and is also involved in other aspects of the industry with his company CalCann Holdings.

His clearance had included the Transportation Security Administration’s Precheck program, which fast-tracks approved travelers through TSA screening lines, the Register reported.

The clearance also allowed him to skip face-to-face reviews with customs agents during international travel and instead use kiosks to scan his passport and fingerprints upon re-entering the United States.

Herzberg told the Register he plans to ask the authorities to rethink the revocation.

Arkansas judge tosses medical marijuana growing licensing process

An Arkansas judge on Wednesday struck down the state’s decision to issue its first licenses to grow medical marijuana, ruling that the process for awarding the permits and the rankings of applicants were unconstitutional.

Pulaski County Circuit Judge Wendell Griffen granted a preliminary injunction preventing the state Medical Marijuana Commission from awarding cultivation licenses.

Griffen last week issued a restraining order preventing the state from awarding licenses to five companies.

Advertisement

In his ruling Wednesday, Griffen said the process for awarding the licenses violated a state constitutional amendment voters approved in 2016 legalizing MMJ for patients with certain conditions.

He ruled the commission’s rankings of the 95 applicants for the cultivation licenses were null and void.

Griffen sided with an unsuccessful applicant that had sued the state over claims the process for awarding the licenses was flawed.

In his ruling, Griffen said he “takes no joy” in blocking the state from issuing the licenses.

The attorney general’s office said it was reviewing Griffen’s ruling and discussing it with state officials.

There was no word on whether an appeal to the state Supreme Court was planned.

Naturalis Health, the applicant that sued over the process, has said it wants an independent evaluator to rescore the applications for the cultivation facilities.

Associated Press

Regulatory switch will cost Washington state marijuana edibles producers $895

Cannabis businesses in Washington state will need to pay an annual fee of $895 to produce cannabis-infused edibles starting next month.

Advertisement

The new charge stems from a special license endorsement that will be required of edibles makers starting April 1, when the state’s Department of Agriculture begins regulating infused product makers, according to a news release.

The fee will go toward enforcing the state’s sanitary processing requirements.

Here’s what you need to know:

  • Edibles makers will have a 30-day grace period to apply for the endorsement.
  • Application will be accepted through the state’s Department of Revenue Business Licensing Service beginning March 29.
  • Businesses should expect to see an increase in inspections under the new system.
  • Although the state’s ag department will enforce sanitary standards, the Washington Liquor and Control Board will continue to regulate and license marijuana processors and edibles makers.

Marijuana employment company raises $2.5 million

A cannabis industry-focused job recruitment firm has raised $2.5 million in seed funding.

Denver-based Vangst will use the capital to expand its online jobs marketplace and improve recruiting technology and internal infrastructure, according to a company news release.

Advertisement

The funding round was led by Lerer Hippeau, a New York-based venture capital firm with worldwide investments.

Casa Verde Capital, a venture capital firm founded by rapper Snoop Dogg, also invested in Vangst.

It’s the second investment this week by Casa Verde Capital, which closed a $45 million capital raise a week ago.

According to the release, Vangst has brought together roughly 300 companies with 5,000-plus workers and hopes to “add 10,000 employees to the cannabis sector over the next two years.”

Vangst, founded in 2014, also has an office in Los Angeles.

Snoop Dogg’s venture capital firm leads CA$4.3M raise for Canadian cannabis company

It didn’t take long for Snoop Dogg’s venture capital firm to invest some newly raised capital.

Only a week after closing a $45 million funding, the rapper’s Casa Verde Capital on Monday led a 4.3 million Canadian dollar ($3.3 million) seed investment in Green Tank Technologies, a Toronto-based vaporization hardware developer.

Advertisement

According to a news release, California-based Casa Verde Capital co-led the raise with Green Acre Capital, a Toronto-based investment fund. Alan and Lorne Gertner, founders of retail-focused, craft cannabis producer Hiku Brands (formerly Tokyo Smoke), also invested.

Green Tank Technologies is owned by Weekend Holdings, a recently started holding company in Toronto.

Green Tank plans to spend the money on product development and market expansion, according to the release.

An undisclosed amount of Green Tank’s raise will go to a sister company, WeCannect, which the release described as a “business-to-business discovery and networking platform” for the marijuana sector.

Casa Verde, which invests in ancillary marijuana companies, last week announced the completion of its inaugural fund, believed to be one of the larger raises in the cannabis industry.

California cannabis grower gets $1 million insurance settlement for fire damage

A cannabis grower in Carpinteria, California, has received a $1 million payout from an insurance company after his crop was destroyed by ashes from a wildfire.

Advertisement

According to the Santa Barbara Independent, Florida-based Brown & Brown Insurance secured the payout for the unidentified grower after the Thomas Fire sent tiny ash particles into greenhouses with retractable roofs and damaged thousands of plants.

The insurance, a rarity in the cannabis industry, was put in place months before the fire and included a provision for “change in atmospheric conditions,” the newspaper reported.

Here’s what you need to know:

  • The cannabis that was damaged by the ash tested positive for lead, asbestos, arsenic and magnesium.
  • California was hit hard by wildfires, particularly in the northern region, last year, and the majority of the growers in that area were uninsured.
  • Most insurance companies won’t cover marijuana operations because it’s illegal on a federal basis.
  • Brown & Brown insured about 20 cannabis clients near Carpinteria and Lompoc, according to the Independent, and expects to deliver about $8 million in payments for those businesses.
  • The growers were paying $30,000 in premiums for the insurance with a $25,000 deductible.
  • The large payout prompted Brown & Brown to drop cannabis growers from its coverage, the newspaper reported. Brown & Brown has a global reach, with offices in the United States, Bermuda, Ontario, Canada and the United Kingdom.

Humboldt County may reopen licensing for local cannabis businesses

(This story has been updated from an earlier version to clarify that the board is considering a cap of 1,250 acres for the whole county, not per farm.)

One of the most well-known marijuana counties in the United States might soon be restarting its permitting system for local cannabis growers and other businesses that want to enter the legal market.

The board of supervisors in Humboldt County began discussion Monday about whether to reopen the licensing process for MJ companies, the Eureka Times-Standard reported.

Advertisement

Humboldt County, part of Northern California’s famed Emerald Triangle cannabis-growing region, stopped accepting license applications in December 2016.

No decision was expected immediately, according to a Times-Standard tweet, but the move could provide a path to licensure for thousands of growers.

And that, in turn, could have a major impact on the state’s cannabis supply chain.

The board of supervisors is also considering limiting the number of licenses to about 5,000, as well as an MJ cultivation cap of 1,250 acres for the entire county.

Although nothing has been finalized, the state Department of Fish and Wildlife recommended that the county cap the number of licensed marijuana farms at 4,792, though there are thousands more growers estimated to be already operating in Humboldt.

 

CBD manufacturing facility under construction in Kentucky

A Chinese hemp company and a California-based CBD company are building a new plant to manufacture CBD isolate in western Kentucky.

The plant from HMI Group of Beijing and Kings Royal Biotech of Capistrano Beach, California, is expected to employ more than 100 people on nine acres in Bardwell, near the Mississippi River and just east of Missouri.

Construction on the plant began last week, The Paducah Sun reported.

Advertisement

Kings Royal has contracted with Kentucky farmers to raise 2,300 acres of hemp for CBD production this year.

The 75,000-square-foot facility will focus on CBD extraction and will make pharmaceutical-grade isolate, Kings Royal COO Keith Taylor told the newspaper.

Taylor said the plant could be operational by September and that overall investment in the area could approach $40 million.

The Bardwell plant is getting an enthusiastic welcome from local officials who see hemp manufacturing as a needed boost in rural western Kentucky, according to the Sun.

Democrat Julian Carroll, a former Kentucky governor who now serves in the state senate, called the project a “momentous occasion” for the region.

“I know you need advancements such as this hemp plant and the jobs you can get,” he told the Sun.

To sign up for our weekly hemp business newsletter, click here.