As we get closer to the holiday season, the nostalgia for baking and gift-giving sets in. Recently a member of my Well With Cannabis Community asked if anyone planned on giving infused gifts this season, and the answer was a resounding YES! What better way than to share the fruits of your harvest or your labor of love in the kitchen than by making a delicious recipe and sharing it with your favorite friends and…
Labor unions are ramping up their recruiting efforts in two key Midwest markets: Illinois and Missouri.
The International Brotherhood of Teamsters announced a victory in Illinois on Tuesday, with Chicago-area Local 777 notching a victory at Zen Leaf in the Rogers Park neighborhood. Workers voted “overwhelmingly” to join the Teamsters, according to a press release from the union.
Zen Leaf is a subsidiary of multistate operator Verano Holdings, which is based in Chicago.
This is the third Illinois Zen Leaf shop to unionize with the Teamsters, following worker approval in Pilsen and Schaumburg.
Peter Finn, Teamsters Western Region International Vice President and Director of the Food Processing Division, added that the union is nowhere near done recruiting marijuana industry workers to its ranks.
“If past is prologue, next year is going to be a big year for Teamsters in the Chicago cannabis industry,” Finn said.
In neighboring Missouri, meanwhile, the United Food and Commercial Workers Union has been pounding the pavement, trying to persuade more cannabis shop and cultivation facility employees that labor’s the way to go.
UFCW Local 655 is trying to ride a wave of momentum following a $145,000 settlement that the union won in a fight with retail chain Shangri-La, KCUR reported. Organizers aimed to speak with workers in 100 cannabis shops in the eastern half of the state, but they have encountered pushback as some managers warned their employees against unionizing.
Still, Local 655 already has won worker unionization votes at about 20 dispensaries, KCUR reported, including Hi-Pointe Cannabis, High Profile Cannabis, and Bloom Medicinal Dispensary.
Yet other shops – including Homestate Dispensary and Root 66 Dispensary – have voted to unionize with the Teamsters Local 955.
UFCW organizer Sean Shannon said the cannabis trade is almost ideal for recruiting new union members.
“This is a tight knit community that takes care of each other. They’re already learning that … having a union backing you up, it’s the only way to truly make a difference,” Shannon told KCUR. “I’ve been telling people, ‘Wait till you feel that contract high.’”
Legal cannabis sales kicked off a year ago in Rhode Island, twelve months on, business is booming. Local news outlet WPRI reported last week that the state’s Office of Cannabis Regulation says that recreational marijuana sales “have steadily increased almost monthly over the past year, and the
While compliance can be onerous compared to banking for most businesses, the report published on Monday by the Cannabis Industry Financial Group (CFIG) says it’s nevertheless possible for the marijuana industry to obtain above-board, reliable financial services without waiting for passage of the Secure and Fair Enforcement Regulation (SAFER) Banking Act.
“While conflicts between federal and state cannabis policies remain, some financial institutions have chosen to offer banking services to state-legal cannabis related businesses (CRBs),” the guidance says. “If done properly, in a highly compliant manner in accordance with Financial Crimes Enforcement Network (FINCEN) guidance and in open cooperation with financial regulators, financial institutions can permissibly serve the state legal cannabis industry without adverse action and enforcement.”
This resource aims to provide the insight needed to help those in the state-legal cannabis industry better navigate a successful and compliant banking relationship that protects their accounts & livelihoods.
“Given the continued growth of state legal cannabis operations and the importance of CRBs having access to banking services for safety and soundness,” the new report says, “this document seeks to help CRBs understand the requirements financial institutions have in place if servicing businesses and businesses involved, either directly or indirectly, in the state legal cannabis industry.”
First, the guide says, potential cannabis clients should understand that onboarding marijuana businesses can be daunting for banks, which are required to engage in so-called Know Your Customers procedures, follow anti-money laundering requirements and file suspicious activity reports (SARs) around cannabis-related transactions.
“Although FINCEN guidance exists relating to the filing of SARs, the guidance does not prevent prosecution for violations of federal law,” it notes.
The bulk of the new guide is about ensuring businesses ask the right questions when seeking financial services—and ensuring institutions are asking the right questions of potential clients.
It advises operators to ensure that institutions service their particular type of business, specifically with regard to what it calls Tier 1, Tier 2 and Tier 3 business. As the CFIG report describes, Tier 1 businesses are plant-touching, while Tier 2 and Tier 3 businesses derive more or less than 50 percent, respectively, of their revenue from plant-touching companies. It adds that institutions “typically also differentiate between the type of Tier 1 business (i.e., cultivation vs. retail).”
The document also encourages would-be clients to ask how long the institution’s marijuana banking program has been in place—assuming one is in place at all. “The onboarding process for cannabis banking is time intensive due to the need for enhanced due diligence,” it says, “and if a bank does not yet have an established program with compliance mechanisms and staff in place, this can create a longer timeline for onboarding.”
“Furthermore,” the guide continues, “if an FI [financial institution] does move forward with a client before compliance mechanisms are in place, the client is at risk of their funds not being appropriately handled that could threaten their operations, licenses, and ultimately, legality. Without proper programs in place, banks run the risk of commingling funds, opening them up to potential implications of money laundering and asset forfeiture.”
The guide also advises potential clients to ask whether the institution has “gone through a regulatory exam” and what the outcome was. “Just as the FI wants to know your house is in order before engaging with your business,” it says, “a successful exam demonstrates that the FI has their house in order.”
And, of course, ask what banking services the institution can provide—including to workers at marijuana businesses. “Make sure your FI relationship also extends to your employees and that they will also have access to financial resources,” the report says, “from payroll to checking accounts to personal loans that are too often denied to workers that receive a paycheck tied to cannabis.”
In terms of what businesses should expect to be asked by a financial institution, CFIG says banks should ask for a state-issued cannabis license; business documentation, such as tax ID and registration; financial documentation, like balance sheets and income statements; and operational information, such as an organizational chart, statement of ownership, payroll list and other details.
“CRBs should not enter into a banking relationship with an FI that does not engage in such due diligence,” the advisory says, “as that program is most likely not on the up-and-up – exposing you and your business to serious risks.”
After enrolling as a client, CFIG said, it’s also important to maintain the business relationship by monitoring to ensure the bank is transparent and stays on top of regulatory issues.
The guide notes that it’s not intended to be legal advice and should not be relied upon as such. “None of the recommendations in this document can protect one from potential federal enforcement actions due to the contradiction between federal and state cannabis laws,” a disclaimer says, “but are rather intended to help those with direct or indirect ties to state legal cannabis operations to be better informed in choosing a financial institution.”
Meanwhile, legislation is pending at the federal level that would remove major banking restrictions for the cannabis industry.
Senate Majority Leader Chuck Schumer (D-NY) said last month that bringing the Secure and Fair Enforcement Regulation (SAFER) Banking Act to the floor is a now matter of securing more GOP votes. Schumer said that task is made more difficult by the fact that some lawmakers are afraid that their constituents, “particularly the older ones,” don’t want them to embrace reform despite overall majority voter support.
“It’s bipartisan. It has support in the House. We could make it law soon,” Schumer said, without giving a specific timeline for floor consideration in his chamber.
That perspective appears to depart from that of the lead GOP sponsor of the SAFER Banking Act, Sen. Steve Daines (R-MT), who has maintained that enough of his Republican colleagues in the Senate are already prepared to advance the bill on the floor.
The key question at this stage, Daines has suggested, is whether the measure has enough support to pass the House. He said last month that senators are working with their House counterparts “to get alignment between both of the chambers.”
The governors of six U.S. states—Colorado, Illinois, New York, New Jersey, Maryland and Louisiana—sent a letter to President Joe Biden (D) on Tuesday urging the administration to reschedule marijuana to Schedule III of the Controlled Substances Act by the end of this year.
“Nearly 88 percent of Americans are in favor of legalization for medical and recreational use,” says a press release from the office of Colorado Gov. Jared Polis (D), who led the group. “This action would rectify this outdated designation, which risks small businesses and public safety.”
In their letter to the president, the governors said the HHS recommendation “comes on the heels of 38 states creating their own state markets” and regulatory systems.
“In some cases, these state regimes have thrived for more than a decade,” it says, calling the rescheduling recommendation “a signal that FDA and the Department of Health and Human Services have faith in state regulators and the regulations that they have promulgated to keep citizens safe.”
Demand for marijuana in the United States isn’t going away anytime soon, the governors told Biden, arguing that regulated products are far safer than those sold on illicit markets.
“There is, and will continue to be, a significant consumer demand for cannabis. That fact will not change regardless of the policy choices we make,” the letter says. “It seems obvious and sensible to us to make cannabis as safe as it can be for adult consumers while simultaneously protecting our children. The state-regulated marketplace does just that.”
“If the state-legal marketplace doesn’t survive,” the governors added, “then we will see unsafe products on every street corner.”
Polis’s office also noted the potential economic impacts of rescheduling, pointing out that the change “would allow cannabis-related businesses to take ordinary tax deduction, like any other business.”
“Rescheduling cannabis will not only alleviate the financial and safety concerns for businesses,” the Colorado governor’s office said, “but allow a thriving industry to play a full role in the American business environment.”
One of the first state officials to react to the HHS rescheduling recommendation, Polis told Biden in a letter in September that while he expects DEA will “expeditiously” complete its review and move marijuana to Schedule III, the policy change must be coupled with further administrative and congressional action to promote health, safety and economic growth.
The government has since released HHS’s rescheduling letter to DEA—in response to a public records request—in highly redacted form. The redacted portions include virtually the entire substance of the message, such as the scheduling recommendation itself, as well as the scientific review portion that was attached to the letter.
The document, sent to DEA Administrator Anne Milgram, says that the HHS recommendation was based on “the eight factors determinative of control of a substance under 21 U.S.C. 81 1 (c).”
Meanwhile, six former DEA heads and five former White House drug czars sent a letter to the attorney general and current DEA administrator voicing opposition to the top federal health agency’s recommendation to reschedule marijuana. They also made a questionable claim about the relationship between drug schedules and criminal penalties in a way that could exaggerate the potential impact of the incremental reform.
Signatories include DEA and Office of National Drug Control Policy heads under multiple administrations led by presidents of both major parties.
