By Dede Perkins

If you’re a licensed cannabis operator and you don’t make peace with state and local inspectors visiting your facility, clipboard or tablet in hand, you’re in for a long and likely bumpy road. All kinds of authorities will want to inspect your cannabis operation and facility. There will be state regulatory inspections, inspections driven by insurance and banking partners, local code officials, OSHA, EPA, and more. On average, cannabis operators are visited one to two times each year for state inspections, one time for insurance purposes, and one time for banking purposes. Depending on the reason for the visit, cannabis operators can expect inspectors to be onsite for varying amounts of time — an hour if the inspection concerns insurance, banking, or local codes (electrical, mechanical, plumbing, fire suppression and alarm systems); depending on the license type, two to four hours for a preoperational inspection, and four hours when OSHA comes to call. If an inspector shows up unannounced in response to a complaint or possible violation, be prepared for a four- to eight-hour stay.

In this article, we will focus on how to prepare for the three types of state regulatory inspections: pre-operational, unannounced, and renewal. However, the basics of preparing for a state regulatory inspection apply to all inspections. To begin, let’s define the reason behind each type of state regulatory inspection and highlight the most common items you’ll need to provide/show the inspector.

Pre-operational

Every licensed operator must pass a state pre-operational inspection before opening for business. In most states, the regulator assigned to the licensee will provide instructions on what to expect and the requirements to pass the inspection. Preparing ahead of time and showing the inspector that you and your staff take compliance and safety seriously will go a long way toward making the inspection speedier and smoother, which of course means you can start making money sooner.

At a minimum, to pass your pre-operational inspection, you need to have an organized binder or software program with all required documentation. Depending on your state, you will likely need:

Floor plans
Training plans
Standard operating procedures (SOPs) to:
- Track inventory to prevent diversion and inversion
- Store and display inventory
- Control access to areas where cannabis is displayed or stored
- Check IDs to prevent underage purchases
- Maintain a safe and sanitary facility
- Handle all facility operations
- Handle adverse events
Security systems
- Alarms, surveillance cameras
- Safe and timely storage of video recordings
- Equipment maintenance procedures
MSDS sheets for chemicals used during operations, if applicable
Administrative requirements such as insurance policies, surety bonds, corporate documentation, management and other legal contracts

In addition to reviewing required documentation, the inspector will tour your facility to ensure submitted floor plans are accurate and the building, security equipment and controls, signage, lighting, and access control are all compliant, and your license is displayed in a readily visible location.

Surprise/Unannounced Inspection

If an inspector shows up unannounced to your cannabis facility, it’s likely in response to a tip of non-compliance or complaint(s) from a customer or neighboring business.

To prepare for the unexpected, it’s best to be organized. Set up compliant systems to manage your operations before you have a problem. Have an organized binder or software program with all required documentation to prove you are proactive and your operations are compliant.

Set up a system to track the following:

Sales and inventory records
Employee onboarding; training documentation
Security equipment and system maintenance
Opening and closing procedures
Sanitation and safety for people and products
Environmental impacts, odor mitigation
Advertising, marketing campaigns
Packaging and labeling procedures and protocols
Mandatory testing results, product certificate of analysis (COAs)
Chain of custody documentation
Access control for employees, visitors, and to ensure underage individuals are not able to purchase cannabis or cannabis products
Administrative requirements

Ask your regulatory representative if there is a checklist you can use to ensure your operations are compliant, so you’ll always be prepared — even for a surprise inspection.

Renewal Inspection

The purpose of a renewal inspection is threefold. They are designed to ensure:

You’re doing what you said you’d do in your original license application.
Your procedures remain compliant, and your recordkeeping is in order.
You haven’t changed your facility or operations without first obtaining state approval.

License renewal applications are often time-consuming and challenging, especially if you haven’t set up a compliance system with an organized binder or software portal where information is readily available. To prepare for your renewal inspection, you’ll need everything listed in the pre-operational and surprise inspections as well as required annual reports such as your company’s diversity, community, and environmental impacts.

How to Prepare for All State Inspections

There are a few best practices that will help you impress your state inspector and ultimately avoid deficiency notices and fines. With a little preparation, you will feel confident and be able to greet your cannabis inspector with a smile and welcoming demeanor, which will set the tone for a pain-free inspection.

The first thing to do is to set up easily accessible and accurate recordkeeping systems as early in your business lifecycle as possible. Make sure facility managers or shift leads know where to find and how to share state-required documentation.

Ed Windbigler, Director of Internal Operations at Fawn River Cultivation Company in Michigan said, “I normally have all the administrative requirements pre-printed — visitor logs, color photos from 30 days earlier, background checks, SOPs, etc., all ready for the state inspector.”

The second is to maintain a clean and safe facility. Regularly walk through your facility and ensure that it, and all equipment in it, is clean, and that product is correctly displayed and stored. Ensure your license is displayed in a prominent location.

The third is to talk with your staff and let them know you prioritize compliance and an inspection is not a reason to panic. Appoint one person (or one in each area of the facility if your facility is large) to show the inspector around and respond to any questions or requests for information. Let your staff know what to expect. Make sure they know the regulations that apply to their position, where to find their department’s standard operating procedures, how to alert management if they witness a non-compliant activity or part of the facility, how to respond to a threat such as theft (co-worker or customer), altercation or aggressive behavior, fire, or natural disaster. Consider role-playing so employees can get comfortable with the types of questions an inspector may ask.

When asked how he prepares employees for an inspection, Windbigler, who has implemented a regular system of internal audits said, “We really don’t have our employees do anything differently. Our internal audits normally catch any issues early on.”

Fourth, walk through your facility with an eye toward security. Andy Shelley, former Oregon cannabis inspector and founder/CEO of CannXperts, a cannabis compliance consulting firm, suggests having an employee walk through the site while another monitors the surveillance. Adjust cameras or install additional cameras to cover blind spots. Check that surveillance recordings are stored in a manner that complies with state requirements. Ensure areas of the facility that contain cannabis or cannabis products are properly access-controlled. Check that facility visitor logs are complete and compliant with the regulations.

“I would say, consistently, the state inspectors will focus more attention on surveillance and security above everything else. You want to make sure those systems are rock solid. We train one or two onsite employees to check the systems daily and weekly and then we perform a complete compliance inspection on those systems during our audits,” said Shelley.

Jacob Lawson, Compliance Specialist, and Sarah Stalker, Director of Compliance at JARS in Arizona, said, “We focus equally on all aspects of compliance including but not limited to security, inventory, safety, and sanitation. We expect the state to always look at all aspects of compliance.”

And fifth, regularly audit your facility, staff, and operations to identify areas of weakness or non-compliance. Some states publish checklists that inspectors use when visiting a facility; if yours does, use it! Consultants and operational platforms often have their own checklists based on state rules and regulations. If you have an existing relationship, see if they have a resource you can use to prepare for your inspection.

Shelley advises, “Check everything, then double-check everything and then check it all again. There is no better way to test your compliance systems than having fresh eyes inspecting you a couple of times a year. We rotate our inspectors, so they aren’t going to the same facility twice in a row; so even we are putting fresh eyes on a client’s operations each time. Complacency can destroy an otherwise healthy company.”

Here’s to compliant cannabis facilities, and safe, life-changing cannabis and cannabis products. You’ve got this!

March 20, 2024

The Guardians of Consumer Safety: The Role of GMPs in Cannabis and Hemp

By David Vaillencourt, Bethany Moore

No Comments

Over the past century, numerous pivotal concepts have emerged, shaping the course of society and enhancing our collective well-being. Among these, Good Manufacturing Practices (GMPs) stand out as a beacon of assurance for product safety and consumer protection. Prior to the establishment of GMPs, industries such as pharmaceuticals operated in a murky landscape where products were peddled from wheeled carts as “miracle elixirs,” often containing undisclosed and potentially harmful ingredients. Labeling requirements were lax, production methods were shrouded in mystery, side effects were unknown, and the true efficacy of these concoctions was questioned.

Here in the United States, because of a previous lack of GMPs, there have been several major incidents over the years which have had catastrophic consequences. Poor controls for safety in the production of food, pharmaceuticals, supplements, medical devices, and more resulted in thousands of deaths and/or other medical issues. In 1938, three decades after the Pure Drug Act, Congress passed the Federal Food, Drug, and Cosmetic Act (FDCA), which formally established the FDAs authority to protect public health.

Take ‘snake oil’ for instance, a term evoking deceptive practices or fraudulent schemes. The original Chinese concoction was made using the oil from Chinese Water Snakes which helped relieve sore muscles and inflammation. When American salesmen got ahold of the recipe, they attempted to use rattlesnake oil, which does not have the same properties as the Chinese Water Snake. By the time the recipe was tested, it was shown to contain alcohol and opium, but no real snake oil. This illustrates the dangers of unregulated products and the importance of standards like GMPs in ensuring product integrity and consumer safety. Without proper oversight, consumers are vulnerable to misleading claims and potentially harmful substances, underscoring the necessity of stringent manufacturing practices in all industries, including cannabis.

In reviewing several examples in history where tragedies resulted, we can go back as far as 1906 when tainted and misbranded food and drugs led to widespread illness and death until basic standards were established for product safety and labeling. Speaking of the turn of the century, if you haven’t read “The Jungle” by Upton Sinclair, put it on your reading list. It is one of the most influential books in American history, as it details the unsanitary conditions of the meat industry before GMPs and is directly responsible for Congress passing some of the first food safety laws.

Safety standards — Chairlift safety standards in the 1960s.

Some of you may be old enough to remember back in 1982 when seven people died after ingesting cyanide-laced Tylenol capsules. This led to the introduction of new industry standards, including tamper-evident packaging and heightened safety measures for over-the-counter medications.

Even in modern times, recalls of contaminated meats and produce serve as stark reminders of the ongoing importance of stringent safety measures. These recalled food products not only pose serious health risks but also incur significant financial losses and damage to the brand reputation of the companies involved. To further underscore the importance of these safety measures, in 1994 Congress authorized the FDA to implement GMP guidelines for dietary supplements through DSHEA (Dietary Supplement Health and Education Act). However, GMP guidance for dietary supplements was not released until 2007.

“There are a lot of examples where failure to implement GMPs creates safety problems. Many food recalls and FDA warning letters report problems with pest control, worker sanitation, cleaning and sanitation, employee practices, and other GMPs,” says Steve Gendel, Ph.D., an expert on food safety and consultant at The GMP Collective. (Gendel also serves as the Technical Contact for the cannabis GMP standard that was recently balloted at ASTM.) “One example of the problems caused by inadequate GMPs is the recent announcement that Family Dollar Stores pleaded guilty to a federal felony and must pay a $41 million fine for failure to control rodents in a warehouse. This follows a massive recall of hundreds of products that passed through that warehouse.”

In addition to criminal liability and hefty fines, a brand that fails to maintain the standard levels of safety and sanitation is not posing risks to customers and employees alike; it can also suffer long-term damage to reputation in the public eye, creating a public relations nightmare. In a blog by Rootwurks in August 2023 titled “It’s All About The Consumer,” Dr. Kathy Knutson, another food safety expert and consultant at The GMP Collective, states, “There can be brand damage through consumer litigation if any harm is caused. There can be regulatory action including fines and recalls. In the food industry, the average cost of a recall is $10 million.” For cannabis products, the most common types of recalls involve contamination of products containing Aspergillus, Salmonella, mold, heavy metals, and certain pesticides.

The cannabis industry, once relegated to the shadows of illegality, is now emerging into a legitimate marketplace. However, as it gains momentum, it faces numerous challenges, including the imperative of ensuring product safety, consistency, and regulatory compliance. Adopting and adhering to GMPs will be essential for the industry to establish marketplace trust, safeguard consumer health, and thrive in a competitive landscape. “The California Cannabis Commission lists 13 recalls for cannabis products from January 2022 through February 2024. Of these, nine were related to problems that could have been controlled by GMPs and/or good cultivation practices,” added Gendel.

Today, while there is no national requirement for Good Manufacturing Practices in the cannabis industry, over a dozen states currently require some form of GMP for cannabis operators — and for good reason. When implemented effectively, GMPs are good for businesses and good for consumers. They reduce the risk of costly product failures and recalls. They provide employees with the tools and guidance needed to carry out their duties — safely and efficiently. Whether it is preventing mold and pests through effective sanitation programs or verifying that equipment purchased works as intended, day in and day out GMPs truly are simply Good Practices and the absolute bare minimum that any business owner and consumer alike should demand of their operation.

The potential risks to human health aren’t limited to cannabis products alone. Vaporizers and other related devices represent a crucial aspect of safety to consider. As the cannabis industry transitions from illegality to legitimacy, ensuring product safety, consistency, and regulatory compliance becomes paramount. GMP adoption is crucial for establishing marketplace trust, safeguarding consumer health, and thriving in a competitive landscape.

Whether it’s the spices and herbs in your kitchen, medicines in your medicine cabinet, or the food in your refrigerator, GMPs have been recognized as the global minimum best practices that have helped our planet feed, nourish, and protect the nearly 8 billion people on our planet. In conclusion, the importance of GMPs spans all industries, safeguarding consumers and businesses alike. The cannabis industry’s embrace of GMPs signals a commitment to excellence and underscores the vital role these practices play in fostering a safe and reputable marketplace now and in the future.

February 29, 2024

Navigating the Future: A Glimpse into ASTM Committee Week and the Blueprint for Cannabis and Hemp Standards

By Bethany Moore

No Comments

In mid-January, against the backdrop of Kentucky’s renowned reputation for fast horses and whiskey, dozens of experts, advocates, operators, and regulators dove headfirst into the heartbeat of innovation and regulation at the ASTM Committee Week. It was my very first time attending, and I waded right into the deep end of the pool.

For those unfamiliar, ASTM International (formerly known as American Society for Testing and Materials) was originally established in 1898 and is one of three major standards development organizations (along with ANSI and ISO) and has been developing and publishing voluntary consensus technical standards in just about every category of materials, products, systems, and services you can think of. One of the oldest ASTM standards literally keeps the trains running on time – a standard for guiding steel rails. And as of just a few years ago in 2017, cannabis, the new kid on the block, joined the party.

I was also a new kid at the ASTM Committee Week conference, however the ASTM International organization provided training in advance with plenty of resources to understand the process, including online training, videos, and a warm welcome at the new member orientation meeting.

At first, the concept of developing standards through consensus seemed daunting, but soon was all demystified as the knowledgeable and helpful ASTM staff members explained the process with full transparency. Much like getting a bill passed on Capitol Hill, it can be a long process that includes debate, clarification, negotiation, and revision before finally becoming a published standard.

Instead of this process being ushered along by elected members of Congress, ASTM Committee members are volunteers from various stakeholder parties including major universities, state and federal government agencies, and public health organizations, as well as for-profit companies including multi-state operators and testing labs.

The atmosphere was charged with the collective determination to shape the future of the cannabis and hemp industries. While the legality remains an intricate puzzle in the United States, the global committee has members from over 30 countries, and the strides made during this event are monumental steps towards international standards that will chart the course for a thriving and harmonized industry.

Alena Rodriguez, co-founder of the non-profit S3 Collective, has been immersed in the world of ASTM standards for several years. Rodriguez states, “As an active member and the Chair of the Laboratory Subcommittee of ASTM’s D37 Committee on Cannabis, I am driven by the belief that standards are foundational to improving the world. Engaging in the development of global consensus standards for the cannabis and hemp industry offers an unparalleled chance for stakeholders like myself to ensure our voices are heard. I believe D37 is the most accessible standards development organization and provides individuals with a significant opportunity to influence our industry’s future. By sitting together at the table with industry operators, ancillary operators, scientists, consumers, and regulators from nearly 40 countries, we are collaboratively establishing the minimum practices necessary for safety and quality assurance. Our goal is for ASTM D37 standards to be referenced or adopted in regulations worldwide. Considering there are already over 6,000 references to ASTM standards within the U.S. Code of Federal Regulations alone for other industries, it seems within reach. Developing standards is ultimately about safeguarding our communities while ensuring the integrity of our marketplace, and I am proud to contribute to this vital effort.”

At the heart of this endeavor lies a profound understanding – the work we’re doing today isn’t just about compliance or even best practices; it’s about crafting the language of future legalization and regulation that can stand the test of time and can often streamline complex industry issues while creating a safer marketplace. Take, for instance, the International Intoxicating Cannabinoid Product Symbol (IICPS), identifying consumer products that contain intoxicating cannabinoids. In the past, each state conjured its own symbol, leading to a chaotic landscape for consumers and operators alike. The ASTM Committee, however, is rewriting this narrative. It instills order, creating a universal symbol that transcends state boundaries and eases the burden on operators adjusting to non-standardized symbols.

Darwin Millard, also known as the Spock of Cannabis, is another active member of the ASTM D37 Committee and is the chair of D37.08 (Personal/Household-Use Cannabis Devices and Appliances) and co-chair of D37.04 (Processing and Handling). ”ASTM International’s technical committee D37 on Cannabis is one of the only true unbiased forums where stakeholders of all types from around the world can participate in shaping the marketplace in which they partake. Through an established 125-year-old accredited process, the volunteer members of ASTM D37 work to create technically accurate market-relevant consensus standards. Much like a participatory democracy, the ASTM process can take time, but it builds a more robust and usable document. The D37’s committee week is an excellent opportunity to see all this in action, and witness firsthand how competing interests can come together to produce something that will benefit everyone, not just a few,” Millard shares.

During my immersion into the ASTM Committee Week, I found myself navigating a labyrinth of subcommittee meetings, each a melting pot of ideas and insights. The Strategic Planning and Government Liaison Task Group unfolded an ever expanding strategy, showcasing the intricate dance between planning and government collaboration. I also sat in on the Security and Transportation Subcommittee, where members explored the nuances of cannabis delivery services, addressing concerns for driver safety and product security.

The ASTM Committee space offers a unique opportunity for the government, whose goals include protecting public health, and the industry, to speak freely about issues of importance to both sides.

Equally captivating was the Terminology Subcommittee, a lexicon for the cannabis and hemp industry. Its mission: to establish a shared language, a Rosetta Stone for common terms. Even days later, I find myself tethered to the 5-page glossary it produced – a testament to its utility.

The symphony of subcommittee meetings included a crescendo of topics: Devices and Appliances, Sustainability, Quality Management Systems, Industrial Hemp, and a harmonious collaboration in the Joint Initiative Group on Vaporizer Product. The process, adhering to Robert’s Rules of Order, is deliberate, ensuring every voice is heard as documents move through the ASTM balloting process. It’s a meticulous journey, but one that ensures the standards being crafted are thorough and considerate of all perspectives.

David Vaillencourt, Vice Chair of the D37 Committee on Cannabis, has been rolling up his sleeves with this work since its formation in 2017: “I will never forget attending D37’s first Committee meeting over 6 years ago and witnessing the caliber of discussion taking place between heads of trade organizations, government officials, and technical experts from industry. For over a century, ASTM has proven that its process fosters collaboration between stakeholders that are typically in opposition publicly, because of the shared goal – to create a functioning marketplace that adequately protects consumers without impeding innovation and trade. As I enter my 2nd elected term as Vice-Chair, the time invested as a volunteer continues to pay dividends in the knowledge, relationships, and strategic insight. The members of ASTM D37 have quickly become my second family. Whether it’s a heated debate on the floor or talking about our kids or pets and our hobbies, at the end of the day, I know that we are all connected by our shared vision to make the world a better place through creating a minimum safety and performance standards for all things cannabis.”

To my fellow colleagues in the cannabis and hemp industry, I extend an invitation. Consider joining ASTM, become a part of the D37 Committee on Cannabis, and claim your seat at the table where these crucial standards for our industry’s future are being forged. This isn’t merely about compliance; it’s about piloting the plane while it’s already in the air. This is our chance to occupy the pilot’s seat and guide the trajectory of an industry we hold dear.

Let’s seize this opportunity to lead the way forward together.

October 26, 2023

Making the Cannabis Industry SAFER for America

By Melissa Kuipers Blake, Osiris Morel

No Comments

After nearly a decade of conversation and education on the Hill, the Senate Banking, Housing and Urban Affairs Committee finally held a markup on the Secure and Fair Regulation (SAFER) Banking Act. Previously known as the SAFE Banking Act, the “R” was included to account for Sen. Jack Reed’s (D-RI) concerns with Section 10. The senator shared his concerns publicly on May 11 during the “Examining Cannabis Banking Challenges of Small Businesses and Workers” hearing. Sen. Reed said that Section 10’s language “would make it more difficult for federal regulators to raise the alarm about relationships with any customer that presents significant risks to the bank” and shared that such a provision is “not limited to the marijuana industry or the cannabis industry,” but that it “could allow pyramid schemes or all sorts of other interesting activity to go on without an effective response by the regulator.” Since then, he and a group of bipartisan members, including Majority Leader Chuck Schumer (D-NY), Senate Banking Committee Chair Sherrod Brown (D-OH), and Sens. Steve Daines (R-MT), Cynthia Lummis (R-WY), Kevin Cramer (R-ND) and Kyrsten Sinema (I-AZ), have worked endlessly to develop language to resolve such concerns while maintaining GOP support, leading to the SAFER Banking Act.

Number of Depository Institutions Actively Banking
Cannabis-Related Businesses in the United States
(Reported in SARS)

The difference between the SAFE Banking Act and the SAFER Banking Act can mainly be found in Section 10. Changes focus on and determines:

How regulators terminate bank accounts;
How the Federal Deposit Insurance Corporation (FDIC) develops guidance for financial institutions serving state-licensed cannabis businesses;
How income derived from state-legal cannabis business activity is managed;
That personal and political beliefs cannot impact a financial regulator’s decision making;
That federal banking regulators and state banking supervisors and their secretaries of Commerce and Treasury would create rules to increase access to deposit accounts and how such individuals would enhance customer relationships with rural, low- and moderate-income, unbanked and tribal communities; and
How the FDIC would conduct a biennial survey and report on barriers for small- and medium-sized businesses.

During the markup on Wednesday, members introduced and discussed a range of amendments related to criminal justice reform, the racial wealth gap, federal regulators and their processes, rescheduling and the opioid epidemic. In total, there were six amendments, one by Chairman Brown, as well as Sens. Mike Crapo (R-ID), Bill Hagerty (R-TN), Mike Rounds (R-SD) and two by Sen. Raphael Warnock (D-GA). Sen. Brown’s amendment, which would make technical changes to the bill, was the only amendment to prevail on a 17-6 vote.

To begin the markup, Chair Brown said that propelling this legislation is a critical step in reversing the damage done by the war on drugs and clarified that the SAFER Banking Act would create a better financial system for small and medium-sized cannabis businesses that lack access to such traditional banking services. Sen. Daines, who served as the committee ranking member in place of Sen. Tim Scott (R-SC), who was in California preparing for the Republican presidential debate, shared that although he opposes legalization or decriminalization, he agreed to sponsor and support the SAFER Banking Act because it would fix the current banking system for cannabis businesses nationwide. After hearing remarks from Sens. Lummis, Catherine Cortez Masto (D-NV) and Sinema, the committee voted on the bill, and approved its passage to the Senate floor on a 14-9 vote. Senators voting in favor of the bill were Brown, Tester, Warren, Reed, Menendez (by proxy), Smith (by proxy), Warner, Fetterman, Cortez-Masto, Sinema, Van Hollen, Lummis, Cramer and Daines, and voting against the measure were Sens. Warnock, Scott (by proxy), Crapo, Tillis, Kennedy, Haggerty, Vance and Britt.

After the vote, Sen. Jeff Merkley (D-OR) thanked Sen. Rand Paul (R-KY) and former Republican Sen. Cory Gardner (CO) for their early efforts and for bringing the legislation and issue to the chamber’s attention and concluded that he hopes to have a robust discussion with the full Senate chamber.

With the bill out of committee, it heads to the Senate floor for additional input, discussion and potentially a vote. Majority Leader Schumer has said he intends to bring the SAFER Banking Act to the floor “with all due speed” and noted that he is committed to attaching Rep. Dave Joyce’s (R-OH) Harnessing Opportunities by Pursuing Expungement (HOPE) Act and Rep. Brian Mast’s (R-FL) Gun Rights and Marijuana (GRAM) Act to the final legislation. Sen. Schumer also shared that such provisions would address the war on drugs, bolster social equity and criminal justice reform and protect Second Amendment rights for medical cannabis patients.

When the SAFER Banking Act will receive floor time remains unclear, but Leader Schumer has made numerous representations that he would like to see it done this year.

October 13, 2023

Sustainability in Cannabis Packaging: Balancing Preservation and Environmental Impact

By Jack Grover

No Comments

Even a cursory review of cannabis reveals that the market has been notoriously wasteful, polluting the environment with chemical fertilizers, misused pesticides, contaminated plants, and—perhaps most problematically—thoughtlessly excessive packaging.

The industry is in dire need of sustainable practices, and the easiest way to start an impactful new trend is from the outside in: a.k.a., adjusting how you’re parceling your products.

Honing in on sustainable packaging isn’t just a good move for the environment. It’s also more cost-effective, less labor-intensive and allows you to provide consumers with the best possible version of your flower—no matter how far through the supply chain it’s had to travel before hitting retail shelves.

Cannabis has progressed: It’s time for its packaging to do the same

By the time legalization began sweeping the nation, the industry already had several decades of experience operating underground. With that discretion came a lot of built-in habits around not attracting attention, and for packaging, the focus was solely on not looking like a cannabis product.

An overabundance of plastic isn’t cutting it anymore—not only when it comes to environmental friendliness, but for the integrity of the product itself.

Today, increased legalization grants operators the freedom to expand without the fear of being seen, and as a result, there’s no longer any excuse for wasteful packaging to be the industry’s norm. Glass jars, Ziplocks and an overabundance of plastic isn’t cutting it anymore—not only when it comes to environmental friendliness, but for the integrity of the product itself.

“I’ve been designing packaging in the cannabis industry since 2013, and a lot of trends have come and gone. We used to put flower in plastic Rx jars and paper envelopes. In general, there was a lot of waste: excess boxes and jars that all get thrown away,” says Legacy’s Chief Cannabis Officer Ryan Hedrick. “And when consumers pull the products out of those containers, your marketing doesn’t remain intact. The box gets thrown away, and now they’re just carrying around a labelless jar. Not only is it bad for the environment, but it isn’t helping you promote your brand at all.”

How sustainable storage optimizes curing and shelf life of flower

As for the curing process, Hedrick used to use airtight buckets, which both took up a lot of room and wasn’t at all effective for maintaining cannabis’s ideal humidity levels. He’s since switched to passive atmospheric packaging, which utilizes increasingly popular technology to keep humidity—and sustainability—in mind. “The buckets weren’t letting any moisture out. On top of that, you can imagine how much room 165 five-gallon buckets takes up in a grow space,” Hedrick says.

The same goes for long-term storage. With humidity-controlled bags, operators can rest assured that their product will maintain its efficacy, because as soon as that pack is sealed, the humidity level is guaranteed to stay the same.

Cannabis brand Lava Leaf Organics relies on passive atmospheric packaging for efficient storage—mainly because of the reduction in carbon footprint and increase in terpene preservation.

“When we think about the energy involved in packaging and shipping large amounts of heavy glass jars compared to TerpLoc bags, it was an easy decision for us,” said Lava Leaf Organics CEO Tony Martinez.

“The bags are recyclable, and compared to glass jars with child-resistant lids, they’re much better at preserving terpenes. Using sustainable packaging allows us to put our best foot forward and to better control our customer’s brand experience.”

Tips for making sustainable storage work for you

Sustainable storage is an environmentally-responsible move for the cannabis industry to make, but when weighing the pros and cons of a big switch like this, operators should also keep in mind how positively it will impact their end product, consumer’s experience, and, subsequently, their industry-wide reputation.

Placing your products in eco-friendly bags is just the start. There are definitely more tips and tricks operators can take advantage of to prolong the use of sustainable materials and ensure they’re leaving as small a footprint as possible. For example, Hedrick’s team reuses their passive atmospheric packaging for maximum efficiency—especially when it comes to bulk storage or curing.

“We mark all of our storage bags with the original strain, so we can reuse that bag for the same strain as long as it passes testing along the way. When I do so, I take a mixture of SaniDate and water to make sure everything is sanitized and clean,” Hedrick said. “That allows me to reuse them for about 3-4 months’ worth of curing and storage. You can reuse a bucket in that same way, but when it’s time to replace it, you’re still spending another $15-$17.”

Sustainable, humidity-controlled packaging is also ideal for testing consistency. If you send in five buckets of the same strain to be tested, you run the risk of them all sitting at wildly different humidity levels, which means some might pass, and others might be rendered trash.

All of the environmental benefits aside, using sustainable packaging just makes cents—literally. “Essentially, I’m saving a minimum of half a million in packaging every year. That’s my entire staff’s salary for two months. That’s incredible, impactful, significant savings that can make a huge difference for a business trying to expand.”

October 4, 2023

Cannabis in Texas: A Look Ahead to Legalization and Beyond

By Abraham Finberg, Rachel Wright, Simon Menkes

No Comments

A Uniquely Texas Approach to Cannabis

The last few decades have seen the United States move forward state-by-state with the legalization of cannabis. Every state is charting its own unique path, and nowhere is this truer than with the state of Texas.

The Lone Star State has made its way from being staunchly anti-cannabis to expressing its own blend of temperance and careful action, combined with a medical cannabis program that’s expanding.

Any predictions regarding the future of cannabis in Texas must take into consideration both the state’s past and its values. In the end, it’s clear that Texas will embrace cannabis in its own individual way and at its own pace, but with a timeframe that appears to be arriving sooner rather than later.

The Debate Continues

108 years after Texas first banned cannabis and the debate continues. Even though Texas has a medical cannabis program, cannabis is still illegal in the state, with possession of less than two ounces a misdemeanor. Possession of more than four ounces is a felony punishable by a $10,000 fine and from 2-99 years in jail.

Texas’s 2015 Compassionate Use Act created the state’s medicinal cannabis program, which now makes treatment available only in the form of low-THC oil of a maximum strength of 1%, and only to a small list of serious conditions: epilepsy, terminal cancer, autism, multiple sclerosis, amyotrophic lateral sclerosis (ALS), seizure disorders, incurable neurological disorders such as Alzheimer’s, Parkinson’s, Huntington’s Disease and PTSD.

Support for a Stronger Medicinal Cannabis Program Comes from Prominent Politicians

Texas Department of Agriculture Commissioner Sid Miller, a leader in Texas politics and one of the architects of Texas’s burgeoning hemp industry, has encouraged Texas legislators to create a more complete medical cannabis program.

“I am for medical use,” Miller said in an August 2023 interview. “We have so much good science now. And we know what diseases it can treat, yet our legislature picks winners [and] losers. If you’ve got this disease, you can get treated, but if you’ve got this disease and cannabis will help you, you can’t get treated. We need to let the doctor-patient relationship make those medical decisions and not some bureaucrat or some politician … I’m not a supporter of recreational marijuana, but if someone has a condition that this chemical will help, they should be able to use it.”

Texas Representative Joe Moody from El Paso has worked for many years to promote adult-use cannabis. He recently co-authored two pro-cannabis bills, HB 1805, which would have expanded covered medical conditions and defined a per-doze THC limit instead of a percentage limit on cannabis products, and HB 218, which would have decriminalized cannabis.

Although both bills passed the House of Representatives, they were stopped in the Senate. The next session of the state legislature, which happens every two years, won’t begin until January 2025, so that is the earliest any change in cannabis statutes could take place.

The Future of Medicinal Cannabis

There are currently only three dispensaries in Texas. They appear to be servicing the state’s 268,000 square miles through a series of weekly drop-offs to satellite “partner locations,” which are open an average of only two days per week. This is not exactly a corner-CVS type of arrangement, and the need for new dispensaries for the state’s 61,000 registered patients is high.

The Texas Department of Public Safety took applications for new medical dispensary licenses between January and April 2023. Tony Gallo, managing partner of Sapphire Risk Advisory Group, which helped twelve licensees prepare their applications during this round, anticipates around ten new dispensaries being approved.

All licensees must be vertically integrated – product must go from seed-to-sale under one license – and each applicant paid $7,356 to apply. If approved, the applicants will owe another $488,520.00 for a two-year period.

Many knowledgeable Texans, including Agriculture Commissioner Sid Miller, predict a fully-functioning medicinal cannabis market is just a few years away. “If you can get it to the floor, probably 70% or 80% of the legislative body will vote in favor of it because we have such good science on it. [Originally] we thought, ‘Well, that’ll lead to recreational use or more drug use,’ but it’s not. It’s a plant derivative. Medical marijuana is not nearly as addictive as some of the prescription drugs we use now.”

The Push is On for Adult-Use

Representative Joe Moody believes that adult-use is not too far away in Texas’s future either, and that the way to speed its arrival is through education. He recently sponsored HB 3652, the Texas Regulation & Taxation of Cannabis Act, in order to start a dialogue on what a retail cannabis market will look like in Texas.

On April 26, 2023, Moody and his bill received a public hearing in the House Committee for Licensing and Administrative Procedures in which many points about setting up a retail market in Texas were discussed. A 10% cannabis tax was proposed by Moody, to be split evenly between the state and local government. Licenses would be required for those growing, selling, transporting or testing cannabis, although individuals would be allowed to grow or possess it in small amounts for personal use. Legal sale and consumption would be limited to adults 21 years of age and older, like alcohol. And of course, cannabis possession would be decriminalized.

How Strong is the Market Potential for Cannabis?

One indication of how strong even a fully-open medical cannabis market might be in Texas came during Moody’s hearing from the testimony of Estella Castro. Castro owns two medical dispensaries in Oklahoma just across the state line from Texas and suspects most her buyers are from Texas. “They have a Texas plate and they come in and buy $500 to $600 worth of product,” she said. Her two shops generated $158,000 in taxes to Oklahoma, most of which she believes should have gone to Texas.

New Mexico recently legalized adult-use cannabis, and the small towns along the Texas-New Mexico border are seeing a lot of traffic from Texas. In the first week of adult-use sales, the New Mexico did adult-use sales totaling $6 million. Of those sales, $1.5 million came from dispensaries in 5 small border towns.

Florida and California Suggest the Scope of a Mature Cannabis Market in Texas

The potential for a fully developed medical cannabis market can be gleaned by studying the next smaller state, Florida, which has an open, mature, medical cannabis market. Florida, with 20 million people, is about two-thirds the size of Texas, which has 30 million inhabitants. Right now, Florida boasts 700,000 cannabis patients whereas Texas only has 61,000. Simple math suggests a fully open, mature, medical cannabis market in Texas could see over a million patients gain relief.

California is the nation’s most populous state with 39 million inhabitants, and its cannabis revenue gives some perspective as to the size of a Texas adult-use market. 2024 estimates of California’s cannabis revenue suggest the Golden State will see $7.2 billion legal cannabis sales while the illegal market will generate another $6.4 billion for a total of $13.6 billion. With a reduction for Texas’s smaller size, these numbers suggest a fully-mature Texas adult-use cannabis market could generate close to $10 billion in annual revenue.

Large adult-use states like California and New York are notorious for having an illicit market that threatens to derail their legal, tax-paying cannabis license holders. Texas’s strong business-friendly focus should help deter such an illicit marketplace from gaining too significant a foothold.

The Back-Door Cannabis Industry

Meanwhile, an extensive “back door” cannabis industry is in full swing in Texas. CBD shops now sell delta-9 (fully psychoactive) THC/CBD gummies and tinctures made from the hemp plant, which is the low THC-version of the cannabis plant. These THC/CBD products adhere to the 0.3% definition of hemp as required by the federal 2018 Farm Bill and are legal and available for over-the-counter or online purchase in Texas’s CBD stores.

Current estimates are that there are over 5,000 hemp, CBD and cannabinoid retailers, manufacturers and distributors in Texas that employ more than 50,000 workers and generate more than $8 billion in annual revenue. With these numbers, the 1,100+ licensed Texas hemp growers are sitting well where they are and are poised to take advantage of a legal adult-use market if and when Texas decides it is ready to go down that path.

Next Steps for Texas’s Cannabis Market

People familiar with Texas’s cannabis market believe that adult-use is a ways down the road for the Lone Star State, and that the near-term focus needs to be on decriminalization and achieving an unincumbered medical cannabis system. Tony Gallo of Sapphire Risk Advisory Group advises the Texas cannabis community to concentrate on “increasing what conditions are allowed for medicinal use” and “increasing what areas of the state it’s allowed to be sold.”

There is a groundswell of public support for decriminalizing cannabis as well as for allowing adult-use. A December 2022 poll showed 55% of Texans support legalizing at least small amounts of cannabis for recreational purposes, and another 28% said it should be legal for medicinal purposes.

A February 2023 poll by the University of Houston found that 82% of Texans support the Legislature passing a bill that would allow people to use marijuana for a wide range of medical purposes with a prescription. The belief that cannabis is a “gateway drug” that would make people more likely to use other illegal drugs is losing traction as well – 70% said it would make people less likely to do so or would have no impact.

Final Thoughts

The demand for cannabis in the Lone Star State is strong. With the likelihood of a fully-functioning medical cannabis market coming soon, and the possibility of decriminalization not too far behind, it’s clear that the future of cannabis is bright in Texas.

While the legalities around adult-use will take longer to work out, and the place of hallucinogenic hemp in the mix needs to be examined and clarified, one fact is certain. The path forward that Texas cannabis takes will certainly be a unique one, as unique and as individual as the Texan people themselves.

October 3, 2023

Employee Management & Human Resources: An Often-Overlooked Part of Building a Business

By Cannabis Industry Journal Staff

No Comments

Well before cannabis businesses win a license application, they need to have traditional business plans outlining how they’ll run the company. While this obviously includes things like the property, the building, products and inventory, it also includes a lot of things that are often overlooked: things like payroll, human resources and employee management.

Before a cannabis company should even hire their first employee, they need to have a few thing squared away. The timeframe and order of operations will differ for every business and every state, but there are a number of things to consider like workers comp, employee training, handbooks and of course, everyone’s favorite topic: insurance. There’s crop insurance, general liability insurance, unemployment insurance, workers comp insurance and more. Working with the right brokers, not breaking the bank and understanding what you need and when can be crucial to keeping the doors open.

Ahead of the Cannabis Quality Conference, we sit down with Nick Murer, the founder of WECO, to ask him some questions about what businesses need to know and when. Nick will be available at the event in New Jersey this October 17 and 18 during our “Ask the Expert Roundtables” to answer these questions and much more.

Cannabis Industry Journal: Does a company need to have workers comp and unemployment insurance before they’re licensed?

Nick Murer: They don’t need to have it figured out before they’re licensed, but they should want to have a strategy in place as they’re going through the process, knowing what they need to accomplish. There are some cases where states may require insurance upfront in the licensing process, but not always. It is however required before a business opens their doors, and absolutely necessary to have insurance before staffing and their first employees comes on board.

CIJ: What types of insurance should companies look into as they’re submitting our license application?

Nick: As you’re submitting your license application, you should have it figured out or at least speak with a broker about your options. You probably don’t have it yet, since you’re not an entity, but you’ll need general liability insurance, and if you’re a grower, you should have crop insurance too. Prior to opening, you should have your workers comp insurance, unemployment insurance, FICA, SUTA and FUTA figured out with the state. Prior to licensing, you need to make sure you are working with the right insurance broker and managing the cost aspect. We can help with that; we work with a couple of great brokers that are industry-specific. As folks go through the licensing process, it’s important to work with people like us that have the right resources and the right tools to provide that necessary support.

Nick Murer will be available at the CQC in New Jersey, October 16-18 to answer questions and provide a resource for new and existing businessesDuring the application process, you need to be aware of insurance and the options that are available, as well as what’s required, but you might not need to have all of those in place. It’s different for every state.

CIJ: What important parts of human resources and employee management should companies have figured out before they get licensed?

Nick: I think the first area they need to start with is making sure they have their workers comp set up, their GL [general liability insurance] set up, I think they should have their employee handbook figured out, their onboarding procedures, their strategies for discontinuing employment figured out prior to bringing them on. Where we come in and assist with that is making sure that these businesses are properly set up with the state to handle workers comp, unemployment insurance, their FICA, FUTA and SUTA, social security taxes, healthcare benefits and being able to deploy all of that within thirty days properly. We work with a lot of clients making sure they have their onboarding programs fully figured out before they take that leap.

CIJ: As cannabis companies get licensed and begin operating, what are some often overlooked HR functions?

Nick: I think the number one area they need to understand in their hiring process prior to bringing people on is really having a thorough, compliant handbook that they’ve also participated in, and have worked towards creating a better document so when these employees come on they know the expectations and the standards that need to be met in order to be a successful member of the team. I think their employment onboarding practices need to be dialed in where they understand what is going on between the onboarding, timing, the documentation needed all before effective start date to stay in compliance. Understanding labor compliance and being able to understand how you properly onboard and offboard an employee is a really critical part. Where we like to come in and assist our clients is helping train managers and being their resource. Everyone works with humans and there are always unforeseen problems that arise We’re in the people business and there will be people problems and mitigating those should be everyone’s number one priority. The more we can help protect cannabis businesses, the less risk they bring to their own company, people and the industry.

September 26, 2023

Texas Takes Advantage of the 2018 Farm Bill

By Abraham Finberg, Rachel Wright, Simon Menkes

No Comments

When Texas Governor Greg Abbott signed Senate Bill 339, also known as the Texas Compassionate Use Act, into law in 2015, many Texans expressed frustration. The purpose of the act was to allow the THC treatment of illness via prescription, opening up the state’s medicinal cannabis market. However, the act authorized only low-THC cannabis oil (maximum strength 0.5% THC) and only for epilepsy. Many Texans with other medical conditions that would have benefited from cannabis were unable to access it, and the dosage was seen as weak and minimally effective.

In addition, those residents hoping the Lone Star State would take a significant step forward towards legalizing adult-use cannabis experienced a rude awakening. A long road was still left to travel before recreational cannabis sales would be allowed to take place.

The Texas Department of Public Safety, which oversees the Compassionate Use Program, did a study of other state’s compassionate use programs and determined that three licenses were the minimum needed to supply the state’s epilepsy population. They updated Health and Safety Code to require a minimum of three licenses, and only three licenses were issued in 2017. This, for a state with a population of 29 million.

Then, the following year, a quiet revolution began. It started with the passage of the federal 2018 Farm Bill, signed into law by President Donald Trump as the Agriculture Improvement Act of 2018. Among its many provisions were several sections dealing with the production of hemp. Because the hemp plant and the cannabis plant are the same plant, the Farm Bill defined hemp as “the plant Cannabis sativa L. and any part of that plant, including the seeds thereof and all derivatives, extracts, cannabinoids, isomers, acids, salts, and salts of isomers, whether growing or not, with a delta-9 tetrahydrocannabinol (THC) concentration of not more than 0.3 per-cent.”

The Farm Bill also removed hemp from the Drug Enforcement Administration’s schedule of Controlled Substances and authorized states to submit plans to administer hemp programs, making sure to keep the THC of plants and products under 0.3%.

The Texas Department of Agriculture, led by its enthusiastic three-term commissioner, Sid Miller, was instrumental in promoting the hemp section of the 2018 Farm Bill. Upon the bill’s passage, Miller backed Texas House Bill 1325 which authorized the production, manufacture, retail sale and inspection of industrial hemp crops and products. HB 1325 passed unanimously in June 2019, and the Texas Department of Agriculture opened the online hemp licensing and permit application process on March 16, 2020. The cost to be licensed by the Department of State Health Services is a yearly fee of $258; a licensee either purchases a license to grow, manufacture and sell hemp products wholesale or a license to sell hemp products retail in-store and online.

The hemp is tested before harvesting to make sure the THC level stays below 0.3%; otherwise, it must be destroyed. (The type of THC being measured is delta-9 THC, the same THC used in cannabis flower, gummies and other products being sold in fully legal states.)

That being said, what the hemp farmers realized was that, by keeping the delta-9 THC content of their hemp and hemp oil to 0.3%, they could still make CBD gummies with strong psychoactive properties. A typical 4-gram gummy would support 10mg of THC and a 6-gram gummy would support THC of 15mg, while still maintaining the 0.3% legal hemp concentration. This is a similar number of milligrams of THC found in cannabis gummies sold in cannabis shops in states such as California.

The Texas state list of approved hemp varietals reads like the list of cannabis flower sold in a dispensary: names like Hemp Kush, Bubba Kush and Blu Haze abound. Additionally, because it is still hemp by the 0.3% strength definition, there is no age limit to purchases and products may be purchased online by anyone and mailed anywhere.

There were 1,123 licensed hemp growers in Texas in 2021. “We started out growing hemp for CBD oil,” commented Agriculture Commissioner Miller recently. “Typical farmers saw a lot of profit in doing that.”

A 2023 study revealed that the Texas hemp industry currently employs more than 50,000 workers and generates more the $8 billion in annual revenue. Also, between $19.1 and $22.4 billion in economic activity is generated by the 5,033 hemp, CBD and cannabinoid retailers, manufacturers and distributors in Texas.

“It is vital that Texas continues to support the hemp industry, which has become a key component of the state’s overall economy,” said Cynthia Cabrera, chair of the cannabinoids council of the Hemp Industries Association and chief strategy officer at Austin-based Hometown Hero CBD. “The results of this study demonstrate the positive economic and social impact of hemp in Texas, and that its small businesses and farmers need to be protected to continue to thrive, providing jobs and tax revenue.”

In 2020, smokable hemp, including vapes, was banned in Texas, a ban that was upheld by the Texas Supreme Court. The only allowed consumable hemp products are oil-based products, like tinctures and gummies.

The only allowed consumable hemp products are oil-based products, like tinctures and gummies.

Agriculture Commissioner Miller lobbied against the ban and feels it puts Texas hemp farmers in an uncompetitive position compared to other state’s hemp farmers. “After three years of administering our hemp program, it’s clear the legislature’s effort to ban smokable hemp products has reduced our competitiveness to other states and harmed our farmers,” he said earlier this year. “The ban on smokable hemp products has confused and discouraged licensed growers and forced out processing facilities on which those growers depend.”

Meanwhile, the medicinal cannabis industry has expanded, at least in terms of the conditions for writing a medical prescription and the allowable THC strength. Terminal cancer, autism, multiple sclerosis, amyotrophic lateral sclerosis (ALS), seizure disorders, and incurable neurological disorders such as Alzheimer’s, Parkinson’s, and Huntington’s Disease were approved in 2019, and in 2021, House Bill 1535 raised the THC concentration from 0.5% to 1.0% and added PTSD to the list of approved medical conditions.

From January to April 2023, Texas Department of Public Safety took applications to open more dispensaries at an applicant cost of $7,356 for each application. All licensees must be vertically integrated – product must go from seed-to-sale under one license. If approved, the applicants will owe another $488,520.00 for a two-year period. This will allow them the opportunity to serve almost 61,000 registered patients who are supported by 747 physicians approved by the Regulatory Services Division to prescribe low-THC cannabis through the Compassionate Use Program.

Tony Gallo, managing partner of Sapphire Risk Advisory Group, helped twelve of the recent license applicants prepare their applications. In addition, his firm has been assisting cannabis companies in Texas since 2017. 420CPA reached out to Tony for an “in-the-trenches” view of cannabis in Texas. Gallo believes an adult-use market is a long way away.

“Concerning growth in the Texas cannabis industry,” Gallo says, “two factors come into play — increasing what conditions are allowed for medicinal use, and increasing what areas of the state it’s allowed to be sold.”

420CPA co-founder Abraham Finberg CPA suggests hemp companies position themselves to enter the cannabis market should state legislators and the people of Texas have a change of heart and decriminalize cannabis and authorize an adult-use market. “Hemp entrepreneurs can start with CBD products as they’re doing now and expand their offerings as the laws change,” Finberg says.

September 25, 2023

Cannabis Lab Testing Problems Continue Nationwide

By Cannabis Industry Journal Staff

No Comments

In Maine, a laboratory released a study they conducted, finding a 17% failure rate of dangerous pesticides in cannabis samples tested. The state requires testing for adult use cannabis, but not for medical cannabis. Just under 4% of adult use samples failed a pesticide screening, while over 20% of all medical samples they tested failed the same screening. Nova Analytic Labs conducted the study and found piperonyl butoxide, bifenthrin, spinosad, imidacloprid and pyrethrins in both adult use and medical cannabis samples.

Also in the Northeast, a NY Cannabis Insider investigation found labs breaking rules for reporting pesticides and other contaminants as well as companies misreporting numbers and selling cannabis that has failed tests. New York only allows outdoor cultivation to encourage environmental sustainability, but some say that rule is what is behind high microbial test failure rates. To ease the burden, New York simply removed mandatory microbial testing.

Now, Oregon is doing the same: removing microbial testing burdens because too many businesses are failing them. Back in March of this year, Oregon started to require tests for aspergillus contamination, but a legal challenge halted that rule in late August and state regulators complied, doing away with the testing requirement for now. Stakeholders in many cannabis markets, including New York and Oregon, still debate just how much of a public health risk microbial contamination in cannabis truly is.

Meanwhile in California, regulators have sent warning letters to labs threatening stiff penalties if inaccurate test results are found. While these warning letters highlight THC potency inflation and laboratory shopping, a rising concern in markets across the country, they also mention falsifying scientific data, which has been known to occur in pesticide testing results as well.

The common theme across these markets is lab testing policy at the state level and an inability of an entire industry to come to any agreement. In lieu of any federal guidelines on a national level, disjointed state policies and preventable lab testing problems like these continue.

September 14, 2023

Lone Star Cannabis: What’s Holding Texas Back?

By Abraham Finberg, Rachel Wright, Simon Menkes

2 Comments

Adult-use cannabis has gained steam across the nation as more and more states jump on the legalization train. As of the writing of this article, 23 states have legalized adult-use while another 15 have allowed the sale of cannabis for medicinal purposes, for a total of 38 green states.

Meanwhile, Texas still has stiff penalties for possession. Two ounces or less is a misdemeanor with a maximum fine of $2,000 to $4,000 if one has between two and four ounces. Possession of more than four ounces is a felony punishable by a $10,000 fine and between 2-99 years in jail. And that’s just for possession.

Quasi-medicinal use was approved with the 2015 Texas Compassionate Use Act, and just for epilepsy, to be only treated by low-THC cannabis oil with a maximum strength of 0.5%. Since then, the number of conditions approved for low-THC treatment has been opened up to terminal cancer, autism, multiple sclerosis, amyotrophic lateral sclerosis (ALS), seizure disorders, incurable neurological disorders such as Alzheimer’s, Parkinson’s, Huntington’s Disease and PTSD. At the same time, the allowable strength of cannabis oil has been increased to a still-minimal 1.0%.

So, what’s holding back the Lone Star State? And what can be done to obtain full legalization for both medicinal and adult-use cannabis? The answers lie within the Texan psyche which has a strong streak of self-reliance in it that has made the state go its own way before. Legalize cannabis just because 75% of the other states have already done so? If your friends jumped off a cliff, would you jump off a cliff too?

Texas is the only state to have been its own country. When its leaders declared independence from Mexico in 1836 and General Sam Houston defeated Mexican General Santa Anna later that year, Texas became the Republic of Texas. While many Texans wanted their country to join the United States, the push within the new republic to remain a separate country was strong. It took nine years of heated debates before Texas entered the Union.

Fast forward 178 years to 2023, and many of the heated debates taking place in Texas today revolve around cannabis. Some Texans see the push to legalize adult-use cannabis as a moral issue, and that it is the responsibility of state government to hold the line against what they view as a gateway drug. Others argue cannabis can be beneficial by providing a safe alternative to opioids for pain relief, and that it is already easy to access on the black market.

Several recent cannabis bills: HB 1805, which would have expanded covered medical conditions and defined a per-dose THC limit instead of a percentage limit, and HB 218, which would have decriminalized cannabis, both passed the state House of Representatives in April 2023 but died in the Senate when Lt. Gov. Dan Patrick, who presides over the chamber, refused to refer the bills to a state Senate committee for review.

“We’re always listening on the health issues, but we’re not going to turn this into California,” Patrick said in 2021, “where anybody can get a slip from the doctor and go down to some retail store and say, ‘You know, I got a headache today so I need marijuana,’ because that’s just a veil for legalizing it for recreational use.”

The Texas legislature only meets every two years, and the next session is scheduled to begin in January 2025. Since Texas does not have a statewide ballot initiative process, statewide decriminalization and possible passage of adult-use legislation will only be possible then.

Law enforcement has a stronger voice in public policy in Texas than in many other states, and law enforcement organizations have expressed serious reservations about decriminalizing cannabis in Texas. In a joint statement in 2019, the Texas Police Chiefs Association and the Sheriffs’ Association of Texas expressed concerns that legalization would bring increased crime, entice a dangerous black market and lead to increased use of other, more addictive drugs. They also opposed expanding the state’s restrictive medical program until “validated, peer-reviewed medical research shows a proven medical benefit.”

Despite these setbacks, there is a growing groundswell of public support for decriminalizing cannabis as well as for allowing adult-use. A December 2022 poll showed 55% of Texans support legalizing at least small amounts of cannabis for recreational purposes, and another 28% said it should be legal for medicinal purposes.

A February 2023 poll by the University of Houston found that 82% of Texans support the Legislature passing a bill that would allow people to use cannabis for a wide range of medical purposes with a prescription. The belief that cannabis is a “gateway drug” that would make people more likely to use other illegal drugs is losing traction as well – 70% said it would make people less likely to do so or would have no impact.

Voters in some cities passed local ordinances in 2022 decriminalizing cannabis although not all of these ordinances have been implemented by their mayors and city councils. One large city, Austin, passed such a law and is no longer arresting or citing anyone for misdemeanor possession. Other cities, including Dallas, have gone as far as to implement cite-and-release policies, which directs police to ticket someone with less than four ounces of cannabis. Though this policy keeps cannabis possessors from being arrested and detained, they still must appear in court and face the same fines and possible jail time.

These individual city and county efforts to decriminalize cannabis are helping build momentum for eventual statewide decriminalization when the state legislature returns in 2025.

The keys to achieving the goals of state-wide decriminalization and adult-use lie in implementing a multi-pronged approach of changing the public perception of cannabis through education coupled with promoting the economic benefits to the state of increased jobs and tax revenue.

Representative Joe Moody has taken a unique approach to educate lawmakers and Texas citizens. He recently sponsored HB 3652, the Texas Regulation & Taxation of Cannabis Act, in order to start a dialogue on what a retail cannabis market would look like in Texas. Moody received a public hearing in the House Committee for Licensing and Administrative Procedures on April 26, 2023 in which many points about setting up a retail market in Texas were discussed, including a 10% cannabis tax.

Moody didn’t expect the bill to move forward and, in the end, no vote was taken. But that wasn’t his goal. “No cannabis retail market bill has ever gotten a hearing like this in the Texas Legislature,” he told the committee. “The time is coming where this will be the law of the land, and so we might as well get in front of that.”

Many Texans in favor of legalization and the establishment of an adult-use market are optimistic. Recently, 420CPA’s Tara O’Connor attended a meeting of cannabis executives in Dallas. The Texas Cannabis Roundup, billed as “one of the largest gatherings of cannabis business professionals in the South”, was packed with close to 200 people, all there for an evening of good food and drink and to hear speeches on the progress of legalization in the Lone Star State. The mood was upbeat. “People here are really hopeful and energized,” commented Tara afterward. “They really want recreational cannabis to come to Texas.”

In the last analysis, Texans are an independent lot, and they do things their own way. Decriminalization will happen when the people of the Lone Star State are ready to allow it. And whether it’s a fully functioning medicinal cannabis program with an adequate number of dispensaries and a strong enough cannabis product to bring relief to all who need it, or if, in the end, Texas approves adult-use cannabis for its citizens, one thing is for certain: such progress will happen in a time-frame that is right for Texas and in a uniquely Texan way.