Week in Review: Cannabis Industry Extinction Events, Lead Contamination, Equity Programs and USDA Hemp Regulation Feedback Session

cannabis cultivation
Photo Credit: NomadiCam – http://www.nomadicam.com

Here’s a quick rundown of state, local and federal actions that we’re following this week.

Cannabis Extinction Events

Is California’s cannabis industry in danger of not one, but two “extinction events” in 2019? – Two weeks ago, the Senate Committee on Business, Professions and Economic Development heard a bill that would extend temporary cannabis licenses in California until December 31, 2019. Supporters of the bill argued that if Senate Bill 67 is not passed, thousands of cultivators, manufacturers, distributors and retailers will go out of business in the coming months. The bill passed the committee on a unanimous 8-0 vote and is now in the Senate Appropriations Committee.

In addition to the expiration of thousands of temporary cannabis licenses, testing of disposable e-cigarette devices, known as “vaporizer cartridges” or “vape carts” have revealed dangerous amounts of lead contamination. This has level of contamination has caused California regulators to reject a higher number of vape cartridges and has left many manufacturers scrambling to find compliant devices.

Equity Programs

On Monday, members of the Minority Cannabis Business Association (MCBA) unveiled a model ordinance package to be used by local and state governments that are seeking to create cannabis equity programs. With cities across the country exploring the creation of an equity program in their own jurisdictions, this ordinance can serve as a resource to help maximize the ability for communities of color that were disproportionately impacted by cannabis prohibition to benefit from the new industry as owners, investors, managers and employees.

On the equity front, the San Diego city council member Chris Ward announced that he plans to propose an equity program later this spring. Ward made the announcement as the council considers loosening city regulations and expanding the number of dispensaries within city limits. If San Diego creates an equity program, they will the 5th city in the state to do so – following Los Angeles, Oakland, Sacramento and San Francisco.

Local Public Interest Banks

California legislators introduce a bill that would allow local governments to create a public bank – Assembly Members Miguel Santiago and David Chiu recently announced a bill that would allow local governments to charter their own public banks. In introducing Assembly Bill 857, the authors of the bill hope that a local public interest bank would better serve the interest of low- and moderate-income households. Last year, former State Treasurer John Chiang floated the idea of creating a state-owned bank to provide basic banking services to the cannabis industry. Under AB 857, could local governments serve the cannabis industry? Would a local jurisdiction that offered banking services attract more economic activity if they offered these services?

USDA Seeks Comment on Hemp Regulations

On Wednesday, March 13, the United States Department of Agriculture hold a stakeholder meeting to receive comments and feedback on the regulations of domestic hemp production. To register for the online webinar, click this link.


If you have any questions regarding the topics discussed above, please contact Ashley Martinez at ashley@ampublicaffairs.com