U.S. House lawmakers passed federal legislation to remove cannabis from the Controlled Substances Act on April 1, marking the second time broad reform has received majority support in the chamber.

In addition to ending the federal prohibition of cannabis, the Marijuana Opportunity Reinvestment and Expungement (MORE) Act would provide expungements for those with cannabis offenses and impose a federal tax on cannabis to fund programs for those adversely affected by the drug war.

House members voted, 220-204, almost entirely along party lines, to pass the bill.

Sponsored by U.S. House Judiciary Committee Chairman Jerry Nadler, D-N.Y., the legislation, House Bill 3617, was first introduced in July 2019 and was passed by the full lower chamber via a 228-164 vote in December 2020. 

In his opening remarks Friday on the House floor, Nadler said legislation to reverse decades of failed federal policies based on the criminalization of cannabis is long overdue. He also pointed out that 37 states have legalized medical cannabis, while 18 states and Washington, D.C., have legalized adult-use cannabis.

“It is long past time for the federal government to recognize that legalization has been a resounding success, that the conflict with federal law has become untenable,” he said. “Criminal penalties for marijuana offenses and the resulting collateral consequences are unjust and harmful to our society. The MORE Act comprehensively addresses these injustices.”

Several companies have been claiming that their CBD products can cure, treat, or prevent COVID-19, but the U.S. Food and Drug Administration (FDA) says they are wrong.

Seven companies—Cureganics, Heaven’s Organics LLC, Functional Remedies LLC, Greenway Herbal Products LLC, CBD Social, UPSY LLC and Nature’s Highway—received warning letters from the FDA in conjunction with the Federal Trade Commission (FTC) on March 28, according to a Miami Herald report.

The FDA and FTC are issuing warning letters to businesses that they say are “selling fraudulent products with claims to prevent, treat, mitigate, diagnose, or cure coronavirus disease 2019 (COVID-19),” according to the FDA’s website.

For example, in its letter to CBD Social, the FDA claims it “has observed that your website offers cannabidiol (CBD) products for sale in the United States and that these products are intended to mitigate, prevent, treat, diagnose, or cure COVID-19 in people. Based on our review, these products are unapproved new drugs sold in violation of section 505(a) of the Federal Food, Drug, and Cosmetic Act (FD&C Act), 21 U.S.C. § 355(a). Furthermore, these products are misbranded drugs under section 502 of the FD&C Act, 21 U.S.C. § 352. The introduction or delivery for introduction of these products into interstate commerce is prohibited under sections 301(a) and (d) of the FD&C Act, 21 U.S.C. § 331(a) and (d).”

The warning letter says that CBD Social cited studies on its website to “misleadingly represent” its products “as safe and/or effective for the treatment or prevention of COVID-19,” including a 2021 National Institute of Health (NIH) study, a 2022 University of Chicago study, and a 2022 study from the American Chemical Society and American Society of Pharmacognosy.

A South Carolina House committee plans to hold a public hearing April 4 on legislation to legalize medical cannabis.

A small group of House members made changes to the bill March 31, according to the Associated Press, and more discussion is expected next week at the full Medical, Military, Public and Municipal Affairs Committee hearing.

RELATED: South Carolina Medical Cannabis Bill Scheduled for First House Hearing After Senate Approval

S. 150, titled the SC Compassionate Care Act, is sponsored by Sen. Tom Davis, R-Beaufort, who has been advocating for medical cannabis policy reform in South Carolina for years.

The legislation outlines 13 qualifying conditions, including cancer, multiple sclerosis, post-traumatic stress disorder, chronic medical conditions causing serious muscle spasms, and any chronic or debilitating condition for which an opioid is prescribed.

Nearly seven years ago, Bruce Dietzen had an idea: attempting to make a lighter, stronger car using hemp. 

Tennessee lawmakers debated a dual measure March 30 that would ban the sale or possession of hemp-derived products containing more than 0.3% THC on a dry-weight basis.

During a subcommittee hearing Wednesday, the bill’s sponsor, Rep. William Lamberth, said regulation for these products needs to be clear-cut, News Channel 9 reported.

“I am not banning delta-8 THC or any other type of THC in this bill. We’re just setting an upper limit of 0.3% [THC],” William said.

But Sam O’Sullivan, with the Tennessee Health Alternatives Association, disagreed. “If this bill were to pass, I know it just says it’s 0.3 percent, but that is a ban,” O’Sullivan said.

Opponents of the bill also argue that the measure would significantly impact businesses selling such products and hinder individuals who use these products for medicinal benefits.

“Nobody is dying from delta-8,” Ted Terry, a delta-8 user, told News Channel 9. “People are dying from alcoholism every day.”

As the federal push to provide safe banking to the cannabis industry has repeatedly stalled in Washington, D.C., some state lawmakers are now trying to take the matter upon themselves.

Most recently, Pennsylvania legislation that aims to authorize financial institutions and insurers to provide services to the state’s medical cannabis business found unanimous support in the Senate Banking and Insurance Committee March 30.

The legislation, Senate Bill 1167, is sponsored by Republican Sen. John DiSanto and has 13 bipartisan co-sponsors. DiSanto serves as the chair of the Banking and Insurance Committee.

“Access to financial and insurance services is essential for operating any business and it is against the public interest to relegate a multibillion-dollar industry to deal in piles of cash,” DiSanto said in a press release. “Banking this cash safely in Pennsylvania provides certainty for businesses, is a huge opportunity to grow our economy, and should ultimately lower costs for medical cannabis consumers.”

Pennsylvania is one of 37 states to legalize medical cannabis, while 18 states and Washington, D.C., have legalized adult-use cannabis.

While some cannabis businesses utilize local and regional banking in the U.S., options are limited with the plant still illegal under federal law. By and large, the cannabis industry operates in cash without federal clarity providing safe harbor to financial institutions servicing cannabis clients.

A Minnesota lawmaker wants to double the number of licensed medical cannabis operators in the state.

Sen. Mark Koran, R-North Branch, introduced legislation March 29 that would allow the Minnesota Department of Health to license at least two more vertically integrated companies in the state, according to a 5 Eyewitness News report.

Currently, Minnesota has two licensed cannabis operators: LeafLine Labs and Vireo Health, which does business as Green Goods in the state.

Koran told 5 Eyewitness News that his proposal could help increase medical cannabis production, promote more competition and drive prices down for patients.

“There could be a lot of benefits to adding two more medical cannabis producers by 2024,” Koran said. “More competition can lead to better prices for patients and then we have to ask ourselves, ‘What does success look like?’ so that we are careful to not dilute the market.”

Dubbing it one of the “most significant transactions for a women-owned business in cannabis history,” Etain Health, one of 10 cannabis companies that operates in New York’s medical market, announced March 30 it had penned an agreement with RIV Capital, which will be assuming ownership and control of the family-owned, vertically integrated business.

The $247 million deal is still pending regulatory approvals from the New York Cannabis Control Board and the New York State Office of Cannabis Management, according to a press release by RIV Capital, an investment firm that is the Hawthorne Collective’s, a ScottsMiracle-Gro subsidiary, “preferred vehicle for cannabis-related investments.” The Hawthorne Collective will advance an additional $25 million to RIV Capital concurrently with the transaction, according to the announcement.

The payment terms include $212 million in cash and $35 million in Class A common shares in RIV Capital, according to RIV’s press release. Etain CEO Amy Peckham will join RIV Capital’s Board of Directors, and Peckham, along with her daughters Hillary Peckham, COO, and Keeley Peckham, chief horticultural officer, will “be integrated into RIV Capital as core leaders in the future of the Etain brand,” Etain noted in its announcement. The mother-daughter team established the company, the only non-multistate operator in New York, in 2015.

RELATED: Q&A With Etain’s COO Hillary Peckham on Adult-Use Legalization in New York

Mark Sims, former SVP of Strategy and M&A for ScottsMiracle-Gro, was also named CEO and president of RIV Capital, and will lead the company’s efforts in New York as the state continues to build its framework for adult-use cannabis sales.

In addition to its Chestertown cultivation and manufacturing facility, where expansion is underway, Etain operates four dispensaries in the state, including its flagship location in Manhattan and stores in Kingston, Syracuse, and Yonkers. RIV Capital noted its plans to expand operations in New York, investing “additional capital and resources into four new dispensaries, and to support the construction of a new, state-of-the-art flagship indoor cultivation facility.”

Federal legislation to end cannabis prohibition is expected to advance to the House floor April 1 after Rules Committee members voted 9-4 in favor of attaching four amendments to the bill on Wednesday evening.

Overall, the committee entertained 22 amendments to the Marijuana Opportunity Reinvestment and Expungement (MORE) Act, which aims to remove cannabis from the Controlled Substances Act, provide expungements for cannabis offenses and impose a federal tax on cannabis that would help fund programs for those adversely affected by the drug war.

Sponsored by U.S. House Judiciary Committee Chairman Jerry Nadler, D-N.Y., the legislation, House Bill 3617, was first introduced in July 2019 and was passed by the full lower chamber via a 228-164 vote in December 2020. That marked the first time a full body of Congress voted on a broad cannabis decriminalization bill.

RELATED: U.S. House Passes MORE Act

“I was proud to introduce this long overdue legislation to reverse decades of failed federal policies based on the criminalization of marijuana,” Nadler said during his opening remarks before the Rules Committee on Wednesday.

“It would also take steps to address the heavy toll these policies have taken across the country, particularly among communities of color,” he said. “Last time, the House voted on a bipartisan basis to address this issue. Unfortunately, the Senate failed to act, so I’m pleased that we’re moving forward again.”

MIAMI BEACH, Florida, March 31, 2022 - PRESS RELEASE - IND HEMP and Hempitecture announced the coordinated supply chain partnership to produce and manufacture natural hemp fibers for Hempitecture's nonwoven Hempwool insulation in the western United States. IND HEMP coordinates genetics, agronomy, and contracting production acres of industrial hemp fiber in Montana, Oregon, Washington, and now Idaho.  

"Hempitecture's partnership with IND HEMP represents more than just a critical supply chain solution. It represents the restoration of American manufacturing, the empowerment of rural economies, and forward-thinking innovation in sustainable materials. We look forward to innovating the building products of the future with IND HEMP's processed hemp fiber," shares Hempitecture Co-Founder and CEO Mattie Mead.

The two companies share values and a strong commitment to sustainability and doing better for the planet. The companies are aligned and working together with other stakeholders to present industrial hemp and its use in products to compete in the XPRIZE Carbon Removal Challenge. The Elon Musk Foundation funds the challenge with $100 Million in prize rewards to spur innovation in technologies and products to remove and sequester CO² from the atmosphere, with modeled plans to scale to a gigaton of CO² removed annually.

"IND HEMP is dedicated to supporting rural economies and providing sustainable solutions to industry. We are excited about Hempitecture's products and [the] use of natural fiber in construction materials. This continues to showcase how IND HEMP's products and sustainability benefits can be adopted successfully across a wide range of applications," said Trey Riddle, IND HEMP chief strategy officer.

 

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TORONTO and DETROIT, March 31, 2022 (GLOBE NEWSWIRE) -- PRESS RELEASE -- Red White & Bloom Brands Inc., a multi-state cannabis operator and house of premium brands, and its RWB Michigan, LLC wholly owned subsidiary, announce the debut of Platinum Vape (PV) Live Resin in Michigan. Previously only available in California and Oklahoma, PV Live Resin will soon be in the nearly 400 Michigan dispensaries that now carry Platinum products. PV Live Resin offers consumers a compact product with multiple consumption options that packs all the benefits of flower and the 80+ cannabinoids that work in synergy to bring the plant’s unique therapeutic qualities to life.

“As promised, the Red White & Bloom team is introducing a steady stream of new products and consumption options to satisfy consumer demand in the rapidly growing Michigan cannabis market,” stated Brad Rogers, Red White & Bloom's chairman and CEO. “In the U.S., live resin sales grew 86% since 2020, as reported by Greentank. We believe this is just the tip of the iceberg for the live resin opportunity, since so many new cannabis consumers are totally unfamiliar with live resin and migrate to it once they learn more about cannabis and discover live resins’ many advantages.”

PV Live Resin captures and preserves the trichomes and terpenes of RWB’s premium cannabis strains to deliver a lush flavor profile and high potency experience for maximum enjoyment. RWB anticipates PV Live Resin will be extremely popular with customers because they know and trust the PV brand and can appreciate that PV now offers a new convenient and economical way to enjoy its pure, high quality cannabis’ full entourage effect.

Rogers added, “With our newly acquired cultivation, manufacturing and distribution centers in Michigan, we are streamlining our entire seed to sale processes and expediting the development and go-to-market timelines for new products. We’ve already begun expanding distribution of our PV branded products, including the new Live Resin line. Our PV line is now carried in nearly 400 of Michigan’s 460+ dispensaries.”

Although most frequently recognized as a leading, award-winning vape brand, RWB’s expanded Platinum Vape portfolio includes live resin, gummies, chocolates and premium cannabis flower that have proven to be very popular in California and other areas. The PV brand is extremely strong in Michigan, with ArcView/Greentank's 2021 Q3 Industry Vape Report naming Platinum Vape as the No. 1 brand vape cartridge in Michigan, LeafLink naming it a Biggest Brand in Michigan, and winning a Thrillist “Best of 2020” Edible Award for its Baked Apple Pie Gummies and a Farmer’s Cup 2nd place for its Raspberry Cheesecake Chocolate Bar.

Eighteen states have legalized adult-use cannabis to date, providing 18 different examples of how to establish a licensed and regulated market.

NORML announced March 29 the release of a new report, “Marijuana Policies in Legal States: A Comprehensive Review of Adult-Use Marijuana Rules and Regulations,” which examines various aspects of the regulated adult-use cannabis programs in the 18 states that have legalized.

The report is meant “to educate decision-makers at the state and federal level on the common features of states’ adult-use marijuana legalization laws and regulations so that they can make informed decisions on cannabis policy and better understand how existing state-licensed programs are successfully being implemented in jurisdictions throughout the country,” according to NORML’s announcement.

“Despite the continued expansion of regulated adult-use cannabis markets and overwhelming public support for ending cannabis prohibition, many elected officials are still relatively unfamiliar with the specific policies that states have implemented over the last decade or with the lessons they have learned,” NORML Political Director Morgan Fox said in a public statement. “We are releasing this report in anticipation of a vote on the Marijuana Opportunity, Reinvestment, and Expungement (MORE) Act in the U.S. House of Representatives and ahead of the impending introduction of the Cannabis Administration and Opportunity Act in the Senate, which will put a spotlight on cannabis policy reform and jumpstart conversations at all levels of government on how to best regulate this substance to ensure justice, efficacy, and public safety.”

The MORE Act, House Bill 3617, is sponsored by House Judiciary Committee Chairman Jerry Nadler, D-N.Y. The legislation, which aims to remove cannabis from the U.S. Controlled Substances Act, was first introduced in July 2019 and was passed by the full lower chamber in December 2020.

South Dakotans affected by one of 28 qualification conditions have been eligible to receive medical cannabis cards since November but gaining access to the newly regulated market may be more of a challenge than expected.

As of March 29, the state’s Department of Health (DOH) had only approved 90 doctors to recommend medical cannabis to their patients, CBS-affiliate KELOLAND News reported.

That has left patient and business participation crawling along.

Those 90 doctors are currently the gatekeepers to the program, as prospective patients need to have an in-person visit with a physician whom they have “bona fide” relationship with as part of a five-step process to be issued a medical cannabis card. 

After that in-person visit, the physician determines whether the patient would benefit from the “therapeutic or palliative use” of medical cannabis for one of the qualifying conditions. That physician must then create an account with the DOH for each patient before the patient can apply for a medical card.

When announcing the issuance of the state’s first medical cannabis patient cards in November, medical cannabis program administrator Geno Adams said, “Today marks the culmination of months of hard work in preparation for the kickoff of a responsive and efficient medical cannabis program for eligible South Dakotans. In the months ahead, we will continue to ensure that patients and their caregivers can continue to obtain medical cannabis permits in accordance with their written certifications.”

The South Dakota Aberdeen City Council approved four medical cannabis dispensary licenses March 28.

According to the meeting agenda, the four licenses were approved for the following businesses:

Genesis Farms LLC, to operate dispensaries at 1812 Sixth Ave. S.E., 10 Railroad Ave. S.W. and 428 N. U.S. Highway 281, Suite 1; andDakota Herb LLC, to operate a dispensary at 3307 Seventh Ave. S.E., Suite 10.

According to the “Issues/Alternatives to Consider” section within the applications, the current population of Aberdeen is 28,495. The number of cannabis dispensaries was limited to one per every 5,000 people; however, that has changed to six dispensaries based on the population. 

RELATED: South Dakota Governor Signs Medical Cannabis Bills

Joe Gaa, Aberdeen city manager, said the council is currently processing a fifth medical cannabis license application, and a sixth one was submitted last week, Aberdeen News reported.

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New Jersey’s Cannabis Regulatory Commission (CRC) has repeatedly delayed the launch of the state’s commercial adult-use cannabis market, and now, Senate President Nicholas Scutari, D-Linden, wants to know why.

Scutari announced March 29 that a special bipartisan legislative committee will be formed to investigate the delays, according to the New Jersey Globe.

“These delays are totally unacceptable,” Scutari said in a statement to the news outlet. “We need to get the legal marijuana market up and running in New Jersey. This has become a failure to follow through on the public mandate and to meet the expectations for new businesses and consumers.”

Scutari has long been a proponent of cannabis legalization, which became a reality in New Jersey in the November 2020 election, when voters approved an adult-use legalization measure.

Gov. Phil Murphy, who also supports cannabis policy reform and campaigned on adult-use legalization in 2017, then signed legislation into law in February 2021 to implement the program.

TALLAHASSEE, Fla., March 30, 2022 – PRESS RELEASE – Trulieve Cannabis Corp., a leading and top-performing cannabis company in the U.S., announced its results for the quarter and full year ended Dec. 31, 2021. Results are reported in U.S. dollars unless otherwise indicated.  

2021 Full Year Financial and Operational Highlights*

Revenue increased 80% year-over-year to $938.4 million in 2021.Gross profit of $566.1 million and gross margin of 60.3% in 2021 compared to gross profit of $386.4 million and gross margin of 74.1% in 2020.Adjusted gross profit of $621.4 million and adjusted gross margin of 66.2% in 2021 compared to adjusted gross profit of $389.9 million and adjusted gross margin of 74.8% in 2020.* The decline in adjusted gross margin is primarily attributable to strategic diversification into new lower margin markets and channels.Net income of $18 million and adjusted net income of $123.4 million*, which excludes $105.4 million of non-recurring compensation, fair value of inventory step up, and transaction, acquisition and integration charges primarily associated with the Harvest Health & Recreation Inc. ("Harvest") acquisition.Adjusted EBITDA of $384.6 million, or 41% of revenue in 2021 compared to adjusted EBITDA of $260.1 million, or 49.9% of revenue in 2020.*Cash at year end of $234 million.Raised $227 million in equity and $350 million in five year senior secured notes at 8% interest, representing industry leading terms for U.S. plant touching cannabis operators.Welcomed two new members to the Board of Directors, which now includes four women representing half of the board.Closed seven total acquisitions valued at approximately $1.5 billion in 2021 including Harvest and Keystone Shops. The Harvest acquisition closed in less than five months from the announcement, accelerating integration and optimization activities.Added 84 dispensaries in 2021, increasing retail footprint by 112% to 159 retail locations nationwide at year end.Added approximately 1.6 million square feet of cultivation and processing capacity through organic growth and acquisitions in 2021, increasing capacity by 89% to over 3.5 million square feet at year end.Commenced cultivation and retail operations in Massachusetts and West Virginia and received a notice of intent to award a Class 1 production license in Georgia.Exited 2021 with operations in 11 states, with 30% of our retail locations outside of the state of Florida.

*See "Non-GAAP Financial Measures" in the full press release for additional information and a reconciliation to GAAP for all Non-GAAP metrics.

Q4 2021 Financial and Operational Highlights*

Revenue increased 81% in the fourth quarter compared to the fourth quarter of 2020 and 36% sequentially to $305.3 million.Gross profit of $132.4 million and gross margin of 43.4% in the fourth quarter of 2021 compared to gross profit of $119.9 million and gross margin of 71.2% in the fourth quarter of 2020.Adjusted gross profit of $180.6 million and adjusted gross margin of 59.1% in the fourth quarter of 2021 compared to adjusted gross profit of $121.7 million and adjusted gross margin of 72.2% in the fourth quarter of 2020.*Net loss of $71.5 million and adjusted net income of $1.8 million*, which excludes $73.3 million of non-recurring fair value of inventory step up, and transaction, acquisition and integration charges primarily associated with the Harvest acquisition.Adjusted EBITDA of $100.9 million, or 33% of revenue in the fourth quarter of 2021 compared to adjusted EBITDA of $81.4 million or 48.3% of revenue in the same period of the prior year.Added 58 dispensaries in the fourth quarter including 49 acquired through Harvest and Purplemed, nine opened in Florida, Pennsylvania, and West Virginia, and completed the relocation of two dispensaries in Florida.Rebranded and reopened 14 legacy Harvest dispensaries in Florida during October as required following the Harvest acquisition.Released our inaugural ESG report, building upon the work done in our Sustainability Report in 2020.

*See "Non-GAAP Financial Measures" in the full press release for additional information and a reconciliation to GAAP for all Non-GAAP metrics.

Recent Events

Location is key to capitalizing on cannabis markets throughout the U.S., and elected officials from one small city in New Mexico know it.

Sunland Park, a city of roughly 17,000 people in southern New Mexico, is nestled on the border with El Paso, Texas, to the east, and Ciudad Juárez, Mexico, to the south. Those two cities provide a metro population of more than 2.5 million potential retail customers.

Specifically in Texas, only low-THC medical cannabis that’s capped at 1% is available to qualifying patients, while adult-use cannabis is not legal.

With New Mexico set to launch commercial sales of adult-use cannabis April 1, Sunland Park Mayor Javier Perea said he plans to take full advantage of welcoming the city’s cross-border neighbors to the new retail market, NBC-affiliate KOB reported.

“That’s the market that we’re going to try to capitalize on with the marijuana industry coming in,” Perea said. “That has opened up an opportunity that didn’t exist before.” 

Referring to Sunland Park as a “bedroom community,” Perea said many of the city’s residents work and spend money in El Paso, but he thinks the retail script will flip with New Mexico’s forthcoming cannabis market, he told KOB. He expects a $7-million boost to nearly double the city’s current revenue.

Over the past couple years, many states across the country have seen a drop in the number of licensed hemp producers as oversupply stifles production and hurts prices.

But one state where interest has held steady is Minnesota. In 2019, the state licensed 353 hemp growers and 214 processors.

By 2021, the number of growers remained nearly the same at 348, while the number of processors jumped to 247.

That interest has translated to acreage. In 2021, Minnesota farmers harvested the third-most amount of hemp–2,300 acres–than producers anywhere else in the country.

RELATED: Colorado and Montana Top Lists of Most Hemp Acres Planted and Harvested in 2021

Katy Mutschler, the hemp program coordinator with the Minnesota Department of Agriculture (MDA), attributes much of the interest in hemp to the state’s natural resources. “I just think Minnesota has really great farmland,” Mutschler says.

WAKEFIELD, Mass., March 30, 2022 /PRNewswire/ -- PRESS RELEASE -- Curaleaf Holdings, Inc., an international provider of consumer products in cannabis, has been named on the second annual TIME100 Most Influential Companies list – an extension of the annual TIME100 list of the world's most influential people – that highlights 100 companies making an extraordinary impact around the world.

To assemble the list, TIME solicited nominations from every sector – ranging from health care and entertainment to transportation and technology – from its editors and correspondents around the world, as well as from industry experts. TIME editors then evaluated each one on key factors including relevance, impact, innovation, leadership and success.

Curaleaf's inclusion on the TIME100 Most Influential Companies list is an acknowledgment of the company's vision to advance the cannabis industry and lead the world in cannabis education, accessibility, and customer satisfaction with high-quality products backed by science. The award comes at an inflection point for the industry as proposed cannabis legislation reform once again makes its way through Washington this week, and states like New York and New Jersey move toward opening the adult use market as a result of voter demand.

"Being recognized as one of the world's most influential companies by TIME is further confirmation that our work is breaking down the stigma of the plant, building an equitable and exciting industry, launching innovative new products for a wide consumer base and tangibly supporting the communities that we serve," said Joe Bayern, CEO of Curaleaf US. "We are humbled and honored to be included alongside change-making companies that are revolutionizing their industries as well. As the only cannabis company included on this list, we hold a unique responsibility in shaping and leading our industry for continued success in the future."

For the complete TIME100 Most Influential Companies list, please visit www.time.com/100companies.

Zoning parameters for cannabis dispensaries, such as restrictions on operating near schools, churches and residential neighborhoods, often create an added hurdle for aspiring entrepreneurs in the space.

For those who plan on opening a retail facility in Tucson, Ariz., following the state’s April 8 lottery to issue 26 social equity retail licenses, special zoning rules for the winners could take six months.

But elected officials in the state’s second largest city said establishing exceptions for real estate locations is part of a plan to help ensure those who are supposed to benefit from Arizona’s social equity provisions in the state’s adult-use cannabis program are the ones who actually benefit, the Arizona Daily Star reported.

Tuscon Mayor Regina Romero and city council members voted unanimously last week to direct zoning department officials to begin drafting a special exception process that would impose certain conditions on adult-use facilities in the city limits, according to the news outlet.

While the Arizona Department of Health Services’ (ADHS) intent in issuing 26 social equity licenses is to uphold provisions in the state’s voter-approved Proposition 207 from the November 2020 election, Romero wrote in a memo that several people who were disproportionately impacted by prohibition were excluded entirely from applying for one of the licenses because a $4,000 application fee imposed by ADHS caused a barrier to entry for low-income residents.

ADHS officials said the department received more than 1,500 applications for the social equity licenses. Leaving leeway in the regulatory groundwork, Prop. 207 established that the 26 licenses be awarded to applicants impacted by prohibition.