As Congress scrambles to reach a consensus on how to help Americans caught in the financial fallout of COVID-19, a coalition of marijuana industry trade groups is urging federal lawmakers not to forget about the hundreds of thousands of workers in state-legal cannabis industries.
Legal marijuana now employs an estimated 240,000 people in the U.S. but, because cannabis remains federally illegal, marijuana businesses remain cut off from nearly all benefits at the federal level, including emergency relief funds.
In a letter sent Friday to leaders of the House and Senate, major cannabis industry associations called on lawmakers to remove those restriction and ensure that state-legal cannabis businesses can qualify for assistance.
“Our members follow strict regulations, create jobs, generate billions of dollars in tax revenue—including federal corporate tax revenue—and act as good corporate citizens,” the groups said. “Yet it appears as if these businesses will not be eligible for the same loans available to other businesses in this country at risk due to the global pandemic.”
The letter was sent jointly by the National Cannabis Industry Association, National Cannabis Roundtable, Minority Cannabis Business Association, Global Alliance for Cannabis Commerce and Cannabis Trade Federation.
“The ineligibility of cannabis businesses for disaster assistance loans is especially inequitable given that these same cannabis businesses are required to comply with other coronavirus-related measures, such as paid sick leave coverage,” the organizations wrote. “We are not seeking special treatment for state-legal cannabis businesses. We only seek to have them treated on an equal level as all other job-generating, tax-paying companies in this country.”
In a separate announcement on Friday, the nonprofit group NORML said in a blog post that the organization has been reaching out “to our numerous allies on Capitol Hill” to ensure that “discriminatory practices do not apply to those in the industry seeking unemployment benefits [for cannabis workers] during these uncertain times.”
“Given the tremendous amount of uncertainty in the broader economy,” NORML Political Director Justin Strekal said in a statement, “the hundreds of thousands of American workers who are employed by the state-legal marijuana industry must be respected and protected by the emergency actions being taken by elected officials.”
Cannabis Workers, Unemployment Insurance, and the Small Business Administration: What You Need to Know https://t.co/Tt2y2ovVHg
— NORML (@NORML) March 20, 2020
Programs already in place should extend at least some benefits to marijuana workers, NORML said in the post. In addition to workers qualifying for state-level unemployment benefits, the cannabis industry could see help from the congressional Families First Coronavirus Response Act.
The act, signed into law this week, directs federal funds to state governments to help with COVID-19 efforts. NORML said that after conferring with experts, it believes the act “provides the individual states with the authority to decide for themselves which industries are legally eligible to receive benefits.”
But unless lawmakers amend current rules, state-legal cannabis companies won’t receive a dime of disaster relief aid provided by the federal government to other small businesses. The federal Small Business Administration (SBA) is prohibited from providing financial assistance to industries that are illegal under federal law.
NORML said that it “will continue to work with our federal allies to call for an end for such discriminatory practices against the cannabis industry and those whose livelihoods depend upon it.”
One way to address the issue, NORML said, would be to pass pending legislation introduced last year by Rep. Nydia Velázquez (D-NY), who chairs the House Small Business Committee. The bill, H.R. 3540, would remove cannabis from the Controlled Substances Act and prohibit SBA from denying services to marijuana-related businesses.
That legislation was introduced just days after federal lawmakers heard about challenges facing small cannabis businesses at a hearing. Language from the bill was later included in the Marijuana Opportunity, Reinvestment, and Expungement (MORE) Act, which was approved by the House Judiciary Committee last year.
“Now is not the time for Congress to think small,” Strekal, of NORML, urged as lawmakers continued debating how to best address the crisis. “Including Chairwoman Velazquez’s proposal to have the SBA support small cannabis businesses would protect both American jobs and the consumers that they serve.”
Meanwhile, the coronavirus pandemic is also impacting drug policy reform efforts across the country. Lawmakers in New York have said in recent days that the effort to legalize marijuana for adults may be delayed due to coronavirus. Ballot initiative campaigns in California and Washington, D.C., have asked local officials for permission to gather signatures online. And in Nebraska, activists pushing to legalize medical marijuana in the state have announced they’ve temporarily suspended their signature gathering campaign.
“We look forward to the opportunity to get back out there to help Nebraskans create meaningful change for each other,” Nebraskans for Medical Marijuana posted to Facebook on Thursday, “and we wish you and your loved ones health and peace of mind.”
Read the cannabis industry letter to congressional leaders below:
MedMen Temporarily Closes All Locations And Condemns Looting In Internal Memo
The national marijuana dispensary chain MedMen has temporarily closed down all of its stores after several of its Los Angeles-based locations were looted over the weekend. While the company strongly condemned the looting, it said it recognizes the tragedies that led up to the incidents and is offering to support its black employees during this time.
Businesses in cities across the country have been impacted by outrage over recent police killings of black Americans. That includes George Floyd, whose death at the hands of a Minneapolis police officer ignited mass protests, some of which have been followed by looting.
In an internal memo to MedMen employees that was obtained by Marijuana Moment, the company said that its locations in downtown Los Angeles, West Hollywood and Beverly Hills “were heavily damaged, as were a number of other businesses, including those in the cannabis community.”
— inVerse, inc (@junbangu) May 31, 2020
“Effective immediately, we are temporarily closing all stores and the corporate office to protect the safety of our employees,” the memo states. “The safety of everyone in the MedMen family is the most important thing right now, and we are grateful to report that while our stores were damaged, our employees and security guards were unharmed.”
“Our assumption is that all of you know this, but we want to take the time to make it very clear there is a bright line between the peaceful protests yesterday and the criminal activity that followed,” it continues. “We do not know what goes through the mind of those that would promote violence or destruction immediately on the heels of a peaceful protest designed to bring us all closer together.”
But while that language largely contrasts with that of some other impacted marijuana businesses that have more clearly sympathized with people expressing outrage in the face of police killings, MedMen also extended a hand to its black workers and said it appreciates the circumstances that contributed to the situation.
“Regarding the events of the last week, we are heartbroken, outraged and horrified by the tragic events in our country and the continued violence and injustice perpetrated against the Black community. To our Black colleagues, if there is any way we can show up for you during this time, we would encourage you to email [the CEO’s office],” the company said. “In the meantime, we offer our deepest empathy, we are here to listen, we are here to help and we are here to stand with you as a MedMen family in any way we can.”
“To those fighting for social justice, MedMen stands with you. The horrifying treatment of our black colleagues and community must end,” MedMen added in a statement to Marijuana Moment. “Systematic oppression and inequality must end. We are committed to using our platform to help. We will rebuild and come back stronger in a way that makes our communities proud and advances justice and equality.”
A spokesperson said that the company is actively assessing its plan moving forward. While the representative initially suggested to Marijuana Moment that employees would continue to be paid during the temporary shutdown, he later said that the company “will take care of our employees as demonstrated by our response to COVID-19” but could not get into specifics about ongoing financial decisions.
All nationwide MedMen locations are currently closed. We apologize for the inconvenience. Please continue to check our website for updates.
— MedMen (@medmen) June 1, 2020
Meanwhile, the rapper Berner, who owns the popular Los Angeles dispensary Cookies, said after his shop was looted that ensuring justice and addressing the problems underlying the protests is more important than the loss of merchandise.
“It’s extremely unfortunate what happened to our store tonight on Melrose. But as a human living in the world we’re living in today, I cannot expect anything less until justice is served,” he said. “We can rebuild our store, but you cannot bring someone back to life.”
Debby Goldsberry, the executive director of the dispensary Magnolia Wellness Oakland, struck a similar tone in a Facebook post about their experience being looted. She said that while the property loss was extensive and will hit the small retailer hard financially, this “story is not about Magnolia Wellness. It’s about this nation, blistering in pain. It’s bubbled up, and can’t be stopped, no matter how much salve we put on it.”
“Our shop can be rebuilt, but the black lives taken by the police, again and again, are gone forever. Simply put, the police are murdering people right before our eyes, and the anger has boiled over. We saw it on camera, watching these men rampage through our space,” she wrote.
“Anger like this is based in injustice. Anger like this is based in facts. Anger like this is based in hundreds of years of oppression, and in never, ever getting a fair shot, no matter what, because the system is set up in a systematic manner that assures you never will,” the post continues. “George Floyd’s horrible death is just one of so many by now that it’s become impossible to track.”
Kris Krane, president of 4Front Ventures, said one of the company’s Mission dispensaries in Chicago was also raided over the weekend.
“Despite the sadness and destruction, my support for the protests and the underlying goal of ending police brutality, systemic law enforcement reform, and societal recognition of the fundamental humanity of people of color in this country remains undeterred,” he said. “I stand with those protesting for human rights and justice, and understand why some feel so disempowered that they have no recourse but rage and violence.”
Cannabis shops from California to Oregon have impacted by looting in recent days.
This story has been updated to include additional commentary on future plans from a MedMen spokesperson
Photo courtesy of WeedPornDaily.
Rapper Who Owns Looted Marijuana Dispensary Says Justice Is More Important Than Business
One marijuana dispensary owner whose business was caught in the chaos stemming from the reaction to rampant police violence over the weekend says he values life and justice over his stolen cannabis merchandise.
Cookies, a well-known dispensary in Los Angeles, was looted during Saturday’s massive protests sparked by the killing of George Floyd. But the brand’s creator and store’s part-owner, the famous rapper-turned-cannabis-entrepreneur Berner, says he is more concerned about the underlying injustices being highlighted by protestors than the damage to his storefront.
A video on Instagram shows the Cookies location on Melrose being broken into, with people jumping the fence, entering the store and stealing products. Police are seen driving by in the clip, but no one appears to have been arrested.
Berner, whose real name is Gilbert Anthony Milam Jr., released a statement shortly after the incident.
The rapper doesn’t condemn the people who broke into the store. Instead, he argues that human life is more valuable than any building.
“It’s extremely unfortunate what happened to our store tonight on Melrose. But as a human living in the world we’re living in today, I cannot expect anything less until justice is served,” Berner said in the video posted to his 1.3 million Instagram followers. “We can rebuild our store, but you cannot bring someone back to life.”
“With that being said, we stand with what is going right now in the world. A statement needed to be made. All I say is, I pray everyone stays safe and protects their family in a time like this,” the rapper said. “How can I worry about a store when there is so much more going on in the world right now? So much hate, so much anger, so much pain, and a lack of justice. Please take care of your families and stay safe.”
There were six armed security guards at the storefront, Berner said, but he told them not to be violent towards protesters. “I don’t want to see anyone die!! I told everyone to stand down,” he posted. “I’m not allowing anyone to die on my watch… all life matters. And money comes and goes…”
Instagram commenters were quick to suggest that insurance money stemming from the theft would be advantageous to Berner. One commenter, Elijah71p, wrote: “Plus that insurance money won’t hurt.”
But Berner said he wasn’t counting on it, replying: “We sell weed. I’m not sure that insurance will honor our business, I haven’t even thought about it. I was focused on preserving life and instructing the armed guards to stand down and not to shoot.”
Another commenter wrote on the post: “Someone had good insurance, lol other wise I’m sure this would sound different.”
“Nah man, the world is a fucked up place,” replied Berner. “This is from the heart homie.”
Cannabis companies have historically had a hard time accessing coverage for things like lost employee wages, property damage and more due to marijuana’s federal classification as a schedule I substance.
Berner started Cookies as a clothing and cannabis brand in the San Francisco Bay Area in 2016. The company has held itself up as an equity success story, opening the Cookies Haight Street location with CEO Shawn Richard under San Francisco’s first social equity license. While some have raised questions about the involvement of white investors and people with political pull helping to win the dispensary’s approval, Berner has maintained that the company is holding true to authentic cannabis culture—one that represents and speaks up for black, indigenous and people of color.
The Cookies brand, well-known for its bright blue packaging, is on sale in eight medical and adult-use markets across the country, including in Its dispensary storefronts in Los Angeles, Santa Ana, San Francisco and Denver.
Cookies isn’t the only dispensary to have been impacted by looting over the weekend. Photos of a ransacked MedMen location in downtown Los Angeles have surfaced, for example.
medmen got cleaned out of cannabis last night in downtown los angeles pic.twitter.com/zlw9RjDOtS
— Zeus Tipado (@tipado) May 31, 2020
The company has not issued a statement at the time of publication.
Oregon Marijuana Sales Spike During Pandemic, But Officials Expect Market To ‘Mellow’
Amid one of the sharpest economic downturns in state history, Oregon marijuana sales continue to roll along at a healthier-than-normal pace. State budget officials say that shelter-in-place policies and economic stimulus programs have kept marijuana sales “quite strong” during the pandemic so far.
Since March 1, the sales of adult-use marijuana products are up 60 percent compared to a year ago, the state Office of Economic Analysis said in its latest quarterly budget forecast published last week.
“These increases are not only related to the stockpiling consumers did after the sheltering in place policies were enacted,” the report says, “but have continued through April and early May.”
In April alone, consumers bought $89 million worth of legal cannabis products—a record amount—thanks in part to what officials described as a “4/20 bump.” While the boost in sales figures are due in part to rising prices, state budget analysts said that “underlying demand is up as well.”
“The increase in sales for other marijuana products, like concentrates, edibles and the like, are due to significant gains in consumer demand as prices are flat or down,” analysts reasoned.
The June 2020 budget forecast estimates that the current increase in marijuana sales will yield an extra $9 million in state tax revenue during the 2019-2021 budget period. It’s a rare bright spot in the overall budget report, which state analysts described as “the largest downward revision to the quarterly forecast that our office has ever had to make.”
But even the marijuana sector’s boost may be time limited.
“Expectations are that some of these increases are due to temporary factors like the one-time household recovery rebates, expanded unemployment insurance benefits, and the shelter in place style policies,” the report says. “As the impact of these programs fade in the months ahead, and bars and restaurants reopen to a larger degree, marijuana sales are expected to mellow.”
Demand for marijuana is also expected to fall in coming years due to a lower overall economic outlook, which is projected to reduce Oregon’s population and cut average incomes. “A relatively smaller population indicates fewer potential customers,” the report notes, “and lower total personal income than previously assumed indicates less consumer demand.”
The projected slowdown in sales isn’t expected to make an impact until the next budget period, beginning in 2021. At that point, the forecast says, sales will begin trending down by 5 percent relative to the current period “due to the lower economic outlook” associated with COVID-19.
The pandemic has also changed how Oregonians are making marijuana purchases, the report found, though perhaps not as much as one might expect. The share of sales completed by delivery services more than doubled in recent months, but it remained relatively small, making up just 1.4 percent of total sales. As the Office of Economic Analysis observed, “Consumers still prefer to shop in store.”
Oregon is one of a handful of states looking to legal cannabis sales to help buoy tax revenues. A report published last month by cannabis regulators in Michigan, where legal sales to adults began this past December, forecasts annual marijuana sales in that state to top $3 billion as the market matures. That would mean another 13,500 jobs and roughly $500 million per year in taxes to state coffers. Factoring in the effects on peripheral businesses, the state found, the “total economic impact is estimated to be $7.85 billion with a total impact on employment of 23,700.”
Although tax revenue from cannabis sales will help pad budgets in many legal states, the Oregon report doesn’t mince words: The pandemic’s hit to the state’s economy will be drastic. Oregon’s current recession is “the deepest on record with data going back to 1939,” according to state analysts, and it hit with virtually no warning. “The path looks more like what happens to economic activity during a labor strike or in the aftermath of a natural disaster.”
For its part, Oregon’s Office of Economic Analysis predicts a relatively swift recovery. “While this recession is extremely severe, it is expected to be shorter in duration than the Great Recession,” analysts wrote. “The economy should return to health by mid-decade.”