Clark County Commission honors Strategies 64 with proclamation and key to the Las Vegas Strip
Clark County Commission Chairman Tick Segerblom presented Strategies 64 with a proclamation and key to the Las Vegas Strip during the Second Annual Cannabis Policy Institute Symposium at the University of Nevada, Las Vegas on December 3.
The commission honored S64 and our late partner Steve Fox for the key role we played in the historic 2016 Nevada legalization campaign, as well as our ongoing efforts to advance sensible cannabis policy and the legal cannabis market in Nevada and across the U.S. It also recognized the work we are doing with the Cannabis Policy Institute at UNLV, both with the symposium and on various research projects and policy briefs.
Strategies 64 co-hosts Second Annual Cannabis Policy Institute Symposium
Strategies 64 and the Cannabis Policy Institute at UNLV co-hosted the Second Annual Cannabis Policy Institute Symposium at the University of Nevada, Las Vegas on December 3. The invitational event was attended by thought leaders and high-profile professionals from across the cannabis space, including policymakers, current and former regulators, organization and business leaders, and policy experts. S64 was also honored with a proclamation and key to the Las Vegas Strip by Clark County Commission Chairman Tick Segerblom.
The daylong program kicked off with remarks from Nevada Cannabis Compliance Board Executive Director James Humm and U.S. Rep. Dina Titus, and it featured panel discussions and presentations on critical cannabis policy issues facing policymakers, regulators, and businesses.
PANEL – The One-plant Solution: Advancing a National Unified Cannabis Regulatory Framework
Norman Birenbaum, Former State Cannabis Regulator, New York/Rhode Island
Mike Hennesy, Vice President of Innovation, Wana Brands
Moderator: Jordan Wellington, Managing Partner, Strategies 64
The panel focused largely on Strategies 64’s new white paper, The One-plant Solution: Recommendations for advancing a national unified cannabis policy and federal regulatory framework. The paper provides policymakers and other officials with a roadmap for ending federal prohibition and the bifurcation of cannabis policy based on separate definitions for “marijuana” and “hemp.” It also proposes a new federal regulatory framework that was informed by an intensive stakeholder interview process involving dozens of current and former regulators, federal officials, business leaders, trade associations, advocacy groups, and policy experts, among others.
Read more about this panel
The proposed federal regulatory framework is built upon two key pillars. First, cannabis should be descheduled and all cannabis products should be regulated by product type—food, cosmetic, dietary supplement, pharmaceutical—with a new category, “adult-restricted cannabis products,” to allow for intoxicating products and other products that cannot be regulated through existing federal consumable product safety standards. Second, the federal government should adopt its traditional regulatory role as a standard setter and enforcement buttress, while leaving most policy decisions and day-to-day enforcement to states.
States can and should retain autonomy when it comes to most aspects of cannabis regulation. Research shows that, despite significant differences in state regulatory models, public health and economic outcomes trend in the same direction. Most notably, youth consumption rates have remained stable or declined; adult consumption increased slightly but leveled off; the size of the illicit market decreases; and more tax revenue is collected than is spent on regulation.
There are four critical areas where federal action is needed to guide or supplement state regulatory models:
Marketing and advertising – e.g., prohibiting copycat products, defining “attractive to children”
Taxation and product authentication – e.g., tax rates, federal registration, detecting diversion/inversion
Conclusions: While state regulatory designs matter, their overall impacts are only moderate. What matters most for public health and safety is that cannabis is legalized. The one-plant framework presents a viable avenue to operationalize this pursuit of federal legalization within the confines of existing federal regulatory structures
PANEL – The Future of Federal Cannabis Policy Reform: What, When, How, and Why?
John Sullivan, Executive Vice President, Cresco Labs
Moderator: Jordan Wellington, Managing Partner, Strategies 64
This panel followed the one on S64’s white paper and focused on what needs to be done to advance legalization and one-plant regulation at the federal level. It featured an impressive lineup of advocacy and business leaders who are at the forefront of such efforts. There was general agreement among the panelists that stakeholders must come together to present a unified front in support of a federal reform, and everyone agreed the recent congressional action on hemp provides a timely and unique opportunity for broader cannabis policy reform.
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Panelists agreed there is a decent chance the Trump administration will move forward with rescheduling, but there is also a possibility it could go the other direction and crack down on state adult-use laws. In either case, the decision will likely be based on political calculations and not policy or public safety. Lawmakers do not prioritize cannabis policy, so they need a proposed solution that is neatly packaged, widely supported, and makes them comfortable supporting and spending time on it.
The faces of cannabis users have changed over time, thanks in part to the widespread availability of hemp products. This could help the industry build a new, broader coalition to leverage for policy change. It was noted that lawmakers, law enforcement, and others have begun to embrace cannabis products as a substitute for alcohol and opioids.
Recent pushes around cannabis banking and tax reform have led to some ground being lost on the legalization movement’s traditional core argument that prohibition is dangerous for youth and communities. The ballot measure to repeal adult-use marijuana sales in Massachusetts is likely to qualify for the ballot, in which case it would present an opportunity for legalization supporters to return to these messages.
Conclusions: The cannabis movement has been divided since the federal government bifurcated the cannabis plant into “marijuana” and “hemp.” It created confusion and damaged the industry’s ability to achieve key policy objectives. The redefinition of hemp opens a pivotal one-year window for the industry to engage in intensive lobbying efforts on Capitol Hill with a unified voice.
PANEL – Defining “Attractive to Children”: Challenges and Solutions
Moderator: Jordan Wellington, Managing Partner, Strategies 64
Defining what is attractive to children is incredibly complicated and creates enforcement challenges for regulators and compliance challenges for businesses. Absent federal standards, state legislators kick the issue to regulators, but there is no consensus on best practices and regulators often lack the necessary subject matter expertise, resulting in extremely varied state policies. The cannabis industry has a responsibility to mitigate accidental cannabis ingestion by children and to avoid appealing to teens, so getting this right is critical.
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When it comes to marketing that is attractive to children, we “know it when we see it,” but such observations are hard to operationalize in law and regulations, and it often leads to significant confusion (e.g., what is considered a “neon” color, whether an orange circle is a fruit, etc.).
Legislators typically create statutes with lists of what not to do, but they do not provide details on what businesses can or should do. One potential solution is to allow voluntary pre-clearance, in which businesses submit their packaging and/or labeling to confirm it is allowable prior to applying it.
The federal government should use its subject matter expertise to serve its traditional role as a national standard setter. States can have some flexibility in deciding what is appropriate for their constituents and circumstances, but the federal government could help with creating guidelines and certain specific standards (e.g., the “universal” symbol that indicates products contain cannabis/THC).
Conclusions: The cannabis industry has a chance to lead on this issue in ways the tobacco and alcohol industries did not. Being this leader, though, will require filling in the dearth of research on cannabis marketing and what specific features attract children. Such research will help affirm adopted policies and build legitimacy for the cannabis industry for federal legalization. Policy homogeneity on this issue will not occur without federal legalization providing minimum acceptable standards for marketing practices.
PANEL – Cannabis in Indian Country: Foundations, Frameworks, and the Future
There are 574 distinct tribal entities in the country, and approximately 26% of these tribes are involved with cannabis. Cannabis can be the next frontier of economic development for tribes, and there are some economic advantages that tribal entities have over state-licensed businesses. Tribal entities have some advantages over state-licensed cannabis businesses, but challenges also exist.
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Congress retains the right to regulate commerce on tribal lands, but it has never given states such authorization. There are two paths for tribal entities to enter the legal cannabis space: a completely sovereign market independent of the state market (e.g., California) or retaining sovereignty while working with the state market (e.g., Minnesota).
Tribal entities retain a distinct advantage over state-licensed businesses because they are not impacted by 280E and, in some cases, not subject to burdensome state taxes. As a result, they can be more profitable while engaging in the same activities. Tribes also may potentially have the only model to trade over state lines because they have longstanding pre-existing trade routes and, ultimately, state boundaries are irrelevant for tribal sovereignty. The major factor that has dissuaded tribes in engaging in such activity is risk.
Challenges do exist. For example, without integration in the state market, tribal communities must be vertically-integrated which is expensive. Additionally, rural tribes will struggle to sell enough cannabis to fund these costly operations. Tribes that decide to regulate cannabis could face collateral attacks on other compacts they have with state governments, such as tobacco tax compacts, in non-cannabis friendly states. This recently occurred in Nebraska.
Some state-licensed businesses are engaging in licensing agreements with tribal entities, which recently occurred in New York.
New industry groups are hosting sovereignty summits to bring together many tribes across the country to build a more united coalition on cannabis policy.
The event also featured presentations of research papers supported and/or produced by CPI. Click on the presentation titles to read more information about them.
The 1,500 Foot Wall: Barriers Between Gaming and Cannabis in Nevada
Dr. Goldstein authored this paper with Strategies 64 for the Cannabis Policy Institute at UNLV.
Three barriers between cannabis and gaming in Nevada cost over $500 million annually in lost retail sales.
Restriction against delivery to private residences, including delivery to hotels and casinos on the Las Vegas Strip.
Results in annual losses of approximately $210 million in retail sales, $80 million in wholesale revenue, and $30 million in state tax revenue.
Prohibition of licensed cannabis businesses within 1,500 feet of any licensed gaming business. This applies to counties with at least 100,000 residents, which make up the vast majority of the state.
Results in annual losses of approximately $330 million in retail sales, $130 million in wholesale revenue, and $50 million in state tax revenue.
Strict separation between gaming and cannabis ownership, including leasing agreements.
While the financial losses of this policy cannot be quantified, changing this guidance is a necessity to realize the economic gains associated with lifting the delivery prohibition and the 1,500-foot rule.
Morocco: A Model for Examining Barriers to Global Cannabis Market Entry
The paper uses Morocco as a case study to highlights three phases in developing new international cannabis markets:
Creating a regulatory system where illicit operators can get licensed
Eliminating barriers to market access
Eliminating asymmetry between the domestic market and other countries
Problems with market accessibility in Morrocco are based in the government, which wanted to set wholesale pricing and prohibited product from leaving the country.
Validated Cannabis Measurement Tools for Observational Research
With the event taking place in Las Vegas, much of the conversation focused on Nevada’s preparedness to participate in a future interstate cannabis market.
“Nevada has a foundation with lots of great cannabis businesses here that is primed to be built on, primed for growth, in the sense that there’s a much bigger market here that is servable,” said panel moderator Jordan Wellington, a partner at a consulting firm focused on cannabis.
It also touched on the issue of social consumption and how cannabis will (or will not) be integrated into popular social environments.
Part of breaking through is getting past the current image people associate with current marijuana consumption lounges and normalizing its use in other places, panelists said.
“It turns out you can smoke it on the street. You can eat an edible before you go out. No one’s interested in that. What people are interested in is socialization,” Wellington said, adding that there is a need for activities alongside consumption.
Goldstein said the same, joking that Allegiant Stadium wasn’t referred to as an “alcohol consumption lounge.”
“When you look at entertainment and hospitality, it’s not about what the product is that’s being consumed there. It’s about the entertainment experience,” he said. “Until (marijuana is) just viewed as a complementary part of other experiences, and it’s not a single-purpose establishment, I think it’s always going to be limited in its growth.”
Jordan Wellington to discuss regulation of high-concentrate THC products at Cannabis Regulators Association event
The panel, which will be moderated by New Jersey Cannabis Regulatory Commission Chief of Staff Jesus Alcazar, will also feature Carnegie Mellon University Professor Jonathan Caulkins, NORML Political Director Morgan Fox, and Henny Lasley of One Chance to Grow Up.
CANNRA holds the annual stakeholder meeting to “bring together a diverse array of national and international stakeholders in cannabis and cannabinoid policy, representing a range of perspectives and opinions, to engage in discussions with its member regulators and other attendees on cannabis and cannabinoid regulatory and policy topics.”
Strategies 64 leaders to speak at AICPA & CIMA Cannabis Industry Conference
Join Strategies 64 partners Christian Sederberg and Jordan Wellington at the AICPA & CIMA Cannabis Industry Conference August 12–14 in Denver and Aurora, Colorado (along with the option to participate online). Christian and Jordan will be featured on a panel titled, “High Stakes: Accounting for the Shifting Cannabis Landscape,” where they will discuss regulatory issues in states with emerging and mature cannabis markets.
The conference will address a variety of issues with implications for accounting professionals serving legal cannabis businesses, including 280E litigation and the potential impact of DEA rescheduling. Senior IRS Counsel will also be on hand to discuss tax challenges for cannabis businesses.
The Association for International Certified Professional Accountants (AICPA) and the Chartered Institute of Management Accountants (CIMA) have helped shape the accounting profession for over a century. They came together as AICPA & CIMA to forge a powerful international alliance that promotes accounting and finance in every corner of the world, according to their website.
Registration for the conference is now open online.
Save the date for the 2024 Cannabis Policy Institute Symposium
Strategies 64 is proud to partner with the Cannabis Policy Institute to co-host its inaugural symposium at the University of Nevada Las Vegas on December 5, 2024 (coinciding with MJBizCon).
Join policymakers, regulators, policy and government affairs professionals, and other thought leaders to explore key issues impacting the regulated cannabis industry. Tentative topics for the event, which are subject to change, include intoxicating hemp, the post-election (and possibly post-rescheduling) federal landscape, and the next frontier of the legal cannabis industry: social use.
Sign up now to request an invitation and receive more details when they become available.
