For anyone involved in the Cannabis Industry, particularly those on the business side, the New Year started out with some worrisome announcements, namely Attorney General Jeff Sessions’ rescindment of Obama era Cole memo. For those not familiar with it, the Cole memo was put in place by previous Attorney General James Cole, and it outlined a set of rules that all states who had, or planned to, legalize cannabis needed to follow in order to keep their business legal. The goal of the rules was entirely focused on keeping the general public safe, while providing guidelines to make it clear what “safe” meant. With Sessions’ declaration to rescind this memo, many people were, and still are, worried about the effects on the growing Cannabis industry, from legislative support to financial/funding problems and more.
Although the initial days after the announcement seemed bleak, particularly around the lack of federal rules and support affecting newer business and investors, key individuals in the marijuana industry, from cultivation to production to distribution, quickly united in the same message: that the Cannabis Industry would continue their work and expansion, with or without the Cole memo in place. This unity and commitment to continue to deliver safe and reliable cannabis products, to both the medical and recreational markets, was met with a huge sigh of relief on all sides and provided a needed hopeful outlook for the industry.
This is particularly true for the states who recently rolled out recreational programs, such as Nevada (mid 2017) and California (early 2018). One of the main worries that faced businesses in these states, as well as many others, was dealing with an even more limited landscape of where they could place their money. The announcement to rescind the memo effectively “put a freeze on bank activates, leaving businesses and the financial institutions that look to support them in an even murkier state of affairs” (Chloe Aeillo, cnbc.com). For companies on the cusp of having cash rolling in by the thousands, this created a huge dilemma, and one that would possibly lead to closures.
Potential closures due to the lack of financial institution involvement would not only hurt dispensaries, but the community as a whole, and in some cases, the individuals who need cannabis for medical reasons. Much of the support for dispensaries stems from the fact that they provide a huge potential boost to the local economy, from such things as providing local employment opportunities and funding made available through taxes collected on all sales. These funds can be huge, in the millions in some states, and are used to better states’ economies and infrastructure, both county and state wide.
While 2018 has already brought one state rolling out their recreational marijuana program (California), and has many more states in the discussion of legalization for medical or recreational marijuana, there remains much opposition to face, in addition to Sessions’ “war against marijuana” (Sean Williams, The Motley Fool). Some of the oppositions include: changing public perception, the legislative fees and legwork required to obtain a business/growing license, hiccups in rollouts, and getting bills approved for legalizing cannabis.
Some might feel that the hardships are greater than the rewards, but as many states have proven, the successful rollout of programs has seen nothing but extreme success. And, in an industry that is ever comingling and globalizing – with Canadian companies buying stake in California, Italy looking to join forces with some United States companies, etc. – the future of business for the Cannabis industry in 2018 and beyond is not only thriving, but exciting. Companies are leading the way and becoming true pioneers, and we are watching with keen interest to see what business insights this industry provides, along with the benefit tax dollars will bring to states, and the country as a whole.
Jeff Sessions War on Marijuana is just the Beginning | Sean Williams
Jeff Sessions just made it even harder for California’s legal marijuana businesses to find a place to put their cash | Chloe Aiello
Marijuana Business Daily
Maywood officials celebrate revenue potential as recreational pot shop opens | Sarah Parvini
The Outlook for Marijuana is still Hazy | Simi Valley Acorn
Murphy’s call for legalizing weed meets opposition from fellow Dems in Senate | Claude Brodesser-Akner – NJ.com
Trump Administration targets Recreational Pot, placing thousands of marijuana businesses in California at risk | EVAN HALPER, JOSEPH TANFANI and PATRICK MCGREEVY