The Conundrum of Encouraging the Growth of Hemp and Marijuana, While Avoiding Cross-Contamination

Mjbizdaily.com reported earlier this week that the State of Washington has eliminated a law requiring a 4-mile buffer between outdoor marijuana and hemp farms. This requirement was a substantial barrier to the state’s hemp industry, and its elimination will open significant tracts to potential hemp farming in Washington. But the whole point of this buffer, originally, was to prevent cross-pollination. Imagine that your outdoor marijuana grow is suddenly pollinated by hemp seeds from next door. This causes logistical issues and legal issues, and could also significantly devalue your crop. 

This controversy highlights the balancing act that every state is dealing with. Too much marijuana grow can lead to oversupply, which can cause the price per pound to fall precipitously. Cross-pollination with hemp farms can also decrease the value of a marijuana crop. And cross-pollination in the other direction can result in inadvertent illegal grows. But a lot of states (including Maine) also see potential in the hemp industry, and don’t want to discourage it. The State of Maine even seems to be taking steps to prop up our hemp industry by requiring that Maine hemp be used to create CBD for foods. So where’s the balance between preventing cross-pollination while encouraging hemp growers? 

As may be too often the case, I’m gonna stop with that question for now. Definitely send me a note though if you have any thoughts on this dilemma.

Maine Takes Another Step Toward Becoming a Marijuana Tourism Destination—But Are We Moving Fast Enough?

Maine’s cannabis tourism program might be hitting its stride. The Office of Marijuana Policy has reached “instant reciprocity” arrangements with 23 states which allow medical cannabis patients from those states to also use their patient cards in Maine. Here’s the announcement from the OMP. Consistent with state law, the visiting qualifying patient can purchase up to 2.5 oz of medical marijuana and marijuana products every 15 days while visiting Maine. 

Adult use tourism will obviously be of a different cloth, since the hope is that it will attract consumers who can’t legally purchase marijuana products in their home state. There is some evidence that Massachusetts’ rec program is attracting New Yorkers, and the hope is that Maine’s program will bring folks from New Hampshire and New York, etc. Of course, in an industry where there’s a massive "first mover" advantage, it’s not clear that Maine will really open the floodgates to adult use marijuana in time to reap many of the benefits that earlier states are seeing.

Is This the Beginning of Another Maine Crackdown on CBD?

Maine regulators are going after CBD food products again, it appears. Inspectors from the Department of Agriculture, Conservation and Forestry have been handing out the letter pasted below to retailers and others in Maine over the past week. According to these "guidelines," the State is interpreting LD 630 to require that any CBD edibles contain CBD derived from Maine-grown hemp. Given the language in LD 630, this approach seems like it could cause more problems than it prevents, and could be putting the state on the fast track to litigation. Especially since the State is promising to begin enforcing this new policy on August 1, less than three weeks from now.

Congress Takes Another Step Toward Reforming U.S. Cannabis Laws. A Good Sign for the SAFE Banking Act?

Yesterday the U.S. House of Representatives, Committee on the Judiciary held a first-ever hearing which, essentially, advocated for significant reforms of our nation’s marijuana laws. The hearing was titled "Marijuana Laws in America: Racial Justice and the Need for Reform," and you can watch it on YouTube here, if that’s the sort of thing you’re into. 

At least a majority of the committee seemed to start from the premise that marijuana should not be a Schedule I controlled substance. Even the Republican minority offered a witness who supports significant marijuana reforms, including passage of the STATES Act which, for those who may have forgotten, would protect state-legal cannabis businesses from federal prosecution. 

Hopefully, this hearing is also a positive sign for the future of the SAFE Banking Act, which would further open the door to federally chartered banks working with cannabis businesses (our previous posts on this Act are available here). The SAFE Banking Act is still waiting for a vote on the House floor, after being approved by the House Financial Services Committee last March. 

These federal reforms, even the discrete ones, really will matter to New England’s marijuana industry. Even if Congress acts piecemeal, a little bit of reform here and little bit there could quickly give a massive boost to the industry by opening the door to things like banking and credit card processing, and eliminating the constant looming threat of federal enforcement against state-legal businesses.

CBD Largely Banned in NYC

New York City is nine days into a CBD prohibition. Straight from the NYC Health Department website: “As of July 1, 2019, the Health Department is embargoing food and drink products that contain CBD – the products will have to be returned to the supplier or discarded.” And beginning October 1, 2019, NYC will begin fining retailers and food service establishments that sell CBD products.

With this ban, New York joins a number of other large cities, including Los Angeles, Portland (Oregon), San Diego, and Seattle. Each of these cities is relying on the hardline position of the FDA that CBD as a food additive is illegal, period.

It should be noted that the July 1 CBD ban is the latest iteration of a months-long process in NYC where the City has taken an increasingly hardline approach to CBD. As early as last February, the City announced it was banning the sale of CBD in food service establishments. But enforcement has been lax – this newest policy promises to strengthen enforcement and expands the ban to include retailers. We will have to watch and see if this increasingly restrictive approach to CBD in NYC (and other major cities) creates a template for other jurisdictions.

Rulemaking for manufacturing facilities is ongoing, and this has us looking forward to long-awaited testing rules

Many of you have probably seen the Proposed Rules:  Marijuana Manufacturing Facilities from the Office of Marijuana Policy.  In case you missed it, the public hearing is next Monday, July 8 at 8am in Augusta. And the comment deadline for these rules is July 18. 

The rules are fairly technical, and I’m guessing that any comments will be fewer and less impassioned than the comments to the adult use rules.  But it is interesting to note that these rules are replete with referencing to required testing, which begs the question, when will we see the OMP’s proposed testing rules?  It’s pretty much common knowledge at this point that testing is going to be the (or a) great bottleneck in Maine’s adult use industry, so many of us are waiting and waiting and waiting with baited breath for the OMP to drop these rules, and get that process started.

Circling back to manufacturing, there don’t seem to be any great surprises hidden in these rules, though I’ll be interested to hear and read the comments and see what sticks out to different industry folks.