MjLink Cannabis Business News and Press

South Dakota lawmakers advanced an adult-use cannabis legalization proposal Oct. 19 as the state’s Supreme Court continues to consider whether Constitutional Amendment A, which voters approved in the 2020 election, is valid.

 Amendment A passed with a 54.2% majority, but has been challenged in a lawsuit alleging that the measure violates South Dakota’s one-subject rule and does not simply amend the state constitution, but instead revises it. The revision, therefore, would require a constitutional convention to be called for by a three-fourths vote of members from both chambers of the South Dakota Legislature.

The voter-approved measure was previously ruled unconstitutional by a circuit judge before the case headed to the Supreme Court.

While the case remains pending, the Adult-Use Marijuana Study Subcommittee has been studying adult-use legalization in South Dakota since June, according to an AP News report. The subcommittee voted Oct. 19 to recommend a bill that would allow adults 21 and older to purchase up to 1 ounce of cannabis for personal use.

The legislation would also eliminate criminal charges for the possession of up to 4 ounces, but would ban public cannabis consumption, AP news reported.

Last month, President Joe Biden announced sweeping new COVID-19 vaccination requirements that will impact countless businesses and employees across the country, and the cannabis industry is no exception.

Biden said Sept. 9 that all employers with more than 100 employees must require their workers to be vaccinated or undergo COVID-19 testing weekly, as reported by AP News. The administration’s mandate also requires all executive branch employees and contractors who work with the federal government to be vaccinated, with no option for regular tests.

The Occupational Safety and Health Administration (OSHA) is expected to issue a rule in the coming weeks to implement the requirement for larger companies to mandate vaccinations or weekly COVID-19 testing.

“OSHA is going to draft that rule, and it’s what they call an ETS, an emergency temporary standard,” Ruth Rauls, partner at Saul Ewing Arnstein & Lehr, tells Cannabis Business Times and Cannabis Dispensary. “It allows them to put it into place without having a review and comment period, which is usually what happens. That ETS is going to come out sometime in the next couple of weeks, so there’s been a lot of speculation as to what that’s actually going to mean and all the questions that come along with it.”

OSHA sent a draft rule to the White House last week for review, Rauls says, but it is unclear when the rule will be approved and implemented. Once a formal regulation is issued, employers will have more guidance on what they need to do moving forward, and Rauls said cannabis companies are no different from businesses in other industries when it comes to compliance.

OTTAWA, Oct. 20, 2021 (GLOBE NEWSWIRE) -- HEXO Corp. has announced Scott Cooper as HEXO's new president and CEO, effective immediately. Cooper joins HEXO from Truss Beverage Co., a joint venture between Molson-Coors Canada and HEXO, where he served as president and CEO.

"It's my great pleasure to welcome Scott as our new president and CEO,” said Dr. Michael Munzar, chairman of HEXO's Board of Directors. “Scott's two decades of experience in consumer-packaged goods, his success in launching and growing Truss' innovative portfolio to be the Canadian market leader in cannabis beverages, and experience working in the United States position him well to defend HEXO's position as a market leader in Canada and secure our place as a top-three global cannabis products company."

Scott's strong experience with Truss, Molson-Coors, and several other publicly traded consumer packaged goods companies, makes him exceptionally well-positioned to integrate HEXO's recent acquisitions and leverage solid brands, robust product offering and its lean production capabilities, to lead the company through its next phase of its strategic evolution.

"Without question, HEXO presents one of the most exciting opportunities in the cannabis industry. I look forward to working with the team to build upon the strong foundation already built, particularly through the company's recent acquisitions and to drive growth and profitability through the efficient commercialization of cannabis consumer packaged goods," said Cooper. "I want to thank outgoing CEO Sebastien St-Louis for his tremendous effort in establishing growth and delivering a solid position from which the company can move forward."

For an interim period not to exceed 6 months, Cooper will continue simultaneously in his current role as CEO of Truss Beverages to ensure a smooth transition for the business.

The inadequacies of the “indica” and “sativa” labels have long been discussed and debated in the cannabis market. With the advent of a booming legal industry, those terms are more scrutinized than ever before—and yet they are still widely used for marketing purposes. Indica strains leave the user feeling relaxed and sleepy, as the lore has it, has sativa strains provide the user a refreshing burst of energy and creativity.

It sounds enticing as a roadmap for cannabis experiences. But it falls short of reality.

Dr. Sean Myles and his co-authors confirmed as much with their research paper, published in Nature Plants, which examines whether that indica-sativa dichotomy matches what users might experience with different chemovars. 

After analyzing 297 samples provided by Bedrocan International in the Netherlands, Myles and the Dalhousie University team determined that “Sativa- and Indica-labelled samples were genetically indistinct on a genome-wide scale.” The flower samples were tagged with labels along a five-point scale, such as one might see in a licensed dispensary: indica, indica-dominant, hybrid, sativa-dominant, sativa. 

Genetic testing revealed that those terms don’t correlate in any meaningful way with the effect of the plant’s chemistry.

“All we're doing in our study is demonstrating the degree to which these labels are good predictors of what's in your package.,” Myles said in a phone interview. “What are you actually getting? The answer is they're terrible predictors. It is not uncommon to get one sativa one week, and the next week you go to get [a] sativa [strain] because you liked it, but it's chemically and genetically more similar to things labeled indica.”

BOCA RATON, Florida, October 18, 2021 - PRESS RELEASE - Jushi Holdings Inc., a vertically integrated multi-state cannabis operator, announced the appointment of Edward (Ed) Kremer as the company's chief financial officer (CFO). Kremer brings over 20 years of financial leadership experience across various industries, including technology, fashion, manufacturing, wholesale distribution, licensing and retail.

Kremer most recently served as chief operating and restructuring officer of Le Tote and Lord & Taylor, overseeing the organization's M&A and restructuring efforts. Before his time at Le Tote and Lord & Taylor, he held several executive leadership and finance roles with public and private equity-backed leading consumer products companies, most notably Oakley, Oliver Peoples, Beats Electronics (Beats by Dr. Dre), Noon Home and 360fly.

In his new role, Kremer will report to Jushi's CEO, chairman and founder, Jim Cacioppo. He will be responsible for overseeing the company's accounting and finance departments, while leading financial strategies and acting as a key business partner to the senior leadership team. Jushi will seek regulatory approval, as necessary, to effectuate Kremer's role and responsibilities in the various jurisdictions where Jushi is, or will become, licensed as a cannabis operator.

"I am pleased to welcome Mr. Kremer to our leadership team," Cacioppo said. "As we continue to position Jushi for the future, his passion for the cannabis industry, strong leadership, and extensive experience in driving financial and operational improvements is expected to have an immediate positive impact on our company. I am confident Ed will be an excellent addition to our team as we continue to organically grow and strategically target inorganic opportunities."

"I am thrilled to join the Jushi team at such a critical time of growth for the company," Kremer said. "As we continue to execute on Jushi's vision, strategies and financial priorities, I look forward to partnering with the entire team to build on the company's strong momentum and bring added value to our shareholders and customers."

Jushi also announced that Kimberly Bambach has stepped down from her role as CFO effective immediately. Ms. Bambach will remain with the company in a support role through Dec. 1 2021, and as a consultant to the company for an additional four months to ensure a continued smooth transition.

The American Society of Heating, Refrigerating and Air-Conditioning Engineers (ASHRAE) has proposed new lighting efficiency standards for greenhouse and indoor controlled environment agriculture (CEA), updating Standard 90.1, the original energy-efficient requirements submitted in 2019.

According to a media advisory from the ASHRAE, the proposed regulations are similar to California’s recently adopted energy codes, which will go into effect for select cannabis operations beginning Jan. 1, 2023.

RELATED: California Proposes New Greenhouse Energy Codes

If the updated requirements are adopted by ASHRAE, they will only apply to newly constructed greenhouses or CEA facilities, additions to greenhouses or CEA facilities, and lighting alterations that replace 10% or more of horticultural luminaries in an enclosed space—only the newly installed lights must meet the updated requirements; lamp replacements are not considered an alteration, the advisory states.

The proposed code requirements are listed in the advisory as follows:

Horticultural Lighting Minimum Efficacy (indoor CEA lighting):

SANTA CRUZ, California, October 19, 2021 -- PRESS RELEASE -- Cultivation Warehouse (CW), an agrotechnology solutions provider, is launching a program, along with AMCON Green, an MEP and building design firm, to reward social equity programs across the country with up to $1.25 million in products and services necessary to launch or optimize a regulated commercial cannabis cultivation operation.

CW has pledged up to $1 million, and AMCON will provide up to $250,000 in professional services at no cost.

To be eligible for consideration, projects need to be verified or in the process of being verified as a "social equity" business by their governing jurisdiction, have secured a site and provide a written plan that can be implemented within 12 months.

To apply or for more details, click here.

Selected new or existing social equity cannabis cultivation projects will receive awards ranging from a minimum of $25,000 up to $250,000 worth of a wide range of services, including site design with detailed mechanical, electrical and plumbing schematics and equipment specs, regulatory compliance consulting, procurement, installation, and other assistance for all types and sizes of commercial cannabis operations in the U.S.

In making the announcement, Cultivation Warehouse principals Eric Paulin and Eric Shedlarski said, "We owe our success to the partnerships we've developed with many of the pioneers in cannabis cultivation. We've witnessed the harm caused by cannabis prohibition, and we're hopeful that this commitment of resources will help mitigate some of that and expand diversity within the cannabis industry."

The Alabama Medical Cannabis Commission is scrapping a plan that could have allowed medical cannabis business licensing—and sales—to begin as early as next year.

The commission said last month that it was considering asking lawmakers to allow for cultivation to begin at an earlier date than is outlined in Alabama’s medical cannabis law. The current statute requires the state to begin accepting business license applications by Sept. 1, 2022, but commissioners were reportedly in discussions with legislators to allow cultivators to be licensed sooner, in early 2022.

Now, commissioners have decided not to push for an earlier date, according to a Montgomery Advertiser report.

“At this point in time, we decided not to ask the Legislature to go back into digging up a legislative bill and opening it back up,” Alabama Medical Cannabis Commission Vice Chair Rex Vaughn told the news outlet. “We could lose what we’ve got.”

Instead, the commission will focus on rulemaking and physician training, Vaughn said.

The Oklahoma Medical Marijuana Authority (OMMA) has issued a patient advisory after a medical cannabis product tested positive for THC-O-acetate.

The OMMA said its lab, Metis, detected the compound in a concentrate called Platinum OG, according to a local KFOR report.

State officials said THC-O-acetate has been shown to be harmful when added to other THC-containing products, and that the combination could lead to side effects such as seizures, difficulty speaking and vomiting, the news outlet reported.

RELATED: THC-O Acetate Q&A with Dr. Ethan Russo: ‘Don’t Go There'

In a follow-up report, KFOR said OMMA is now looking into how the compound got into the batch of medical cannabis, as well as how many batches may be affected.

After a failed attempt to delay South Dakota’s voter-approved medical cannabis program, Gov. Kristi Noem used taxpayer dollars to advertise that she’s “100 percent committed” to the program.

The 60-second advertisement, which ran June through September, featured the Republican governor in a public-service announcement setting.

Noem, who campaigned against the voter-approved ballot measure last year, and then unsuccessfully advocated for the South Dakota Legislature to amend and delay implementing the program, offered a different tone in the taxpayer-funded advertisement.

“The medical cannabis program is on schedule,” she said. “And we’re working to implement a responsible program that follows the direction given by the voters. … I’ve heard from people who are hurting and are hopeful for relief. I can assure them that we are working hard to streamline the process to get medical cards out to people. And my team is 100 percent committed to starting this program as quickly and as responsibly as possible for South Dakota.”

The ad was funded through $322,500 of amendments to the state Department of Health’s contract with Imagine Agency LLC, of Rapid City, as first reported by KELOLAND Media Group.

The one-year contract that was issued June 1, 2021, was originally for Imagine Agency to design, plan and execute South Dakota’s Opioid Abuse and Misuse Prevention Plan communications and marketing for $375,000, which was funded through a federal grant.

Once regarded as a fringe technology, light-emitting diodes (LEDs) have supplanted high-pressure sodium (HPS) and metal halide (MH) lighting fixtures as the most popular in the commercial cannabis cultivation industry, according to new data from Cannabis Business Times’ “State of the Cannabis Lighting Market” report.

Produced with support from Fluence by OSRAM, the 2021 “State of the Cannabis Lighting Market” study found that the majority of commercial cannabis cultivators growing under mixed or artificial lighting have LED fixtures in propagation, vegetation and flowering rooms. HPS lights, which in 2016 were the most commonly used fixtures (adopted by 62% of growers), are now in use with just over one-third (37%) of growers.

“LED adoption is expected to continue to rise as growers strive for further efficiencies, whether to maximize profitability, comply with state energy use regulations, or both,” according to the report. “Of the research participants who currently do not leverage LED fixtures in flowering, 63% indicated they are planning to use or are considering using LEDs in the flower cycle within the next 12 months.”

Industry groups advocating for sustainable cannabis production and resource use, such as the Resource Innovation Institute (RII), say market conditions are ripe for LED growth to continue.

“A combination of factors is creating a perfect storm to motivating cultivation operations to adopt LEDs: energy efficiency, productivity, choice, pricing, utility programs, regulations, and transparency,” said Gretchen Schimelpfenig, Technical Director for RII, in a statement to CBT.

Data collected by RII through its Cannabis PowerScore platform, a free resource-benchmarking tool, “shows how facilities using LED for any stage of plant growth can achieve 19% better electric energy efficiency while also getting 53% higher yields per unit of electricity,” Schimelpfenig added.

U.S. growth capital provider Measure 8 Venture Partners is lead investorCuraleaf Executive Chairman Boris Jordan joins boardInvestment ushers in new era of “natural based medicine“Showcases Germany as the leading European market for medical cannabis

FRANKFURT, Germany, Oct. 18, 2021 – PRESS RELEASE – Bloomwell Group has successfully closed a seed funding round of over $10 million dollars—the highest publicly known seed investment for a European cannabis company to date. The lead investor is U.S. growth capital provider Measure 8 Venture Partners, specialists in cannabis industry investments. Among other investors, business angel Dr. Reinhard Meier is investing again through his Venture Capital Investors fund; and Philipp Weber of FPS acted as legal adviser to Bloomwell.

Concurrent with the announcement, Bloomwell Group, which includes Algea Care, Europe's leading telemedicine company for medical cannabis in terms of patient numbers, is repositioning itself as a holding company, allowing it to build, invest or acquire cannabis companies.

"With Bloomwell, we are revolutionizing health care through digitalization and the potential of medical cannabis as well as other natural medicines,” Bloomwell co-founder and CEO Niklas Kouparanis said. “Our portfolio companies will radically focus on a consumer-centric approach along the entire value chain of medical cannabis, with the exception of cultivation. The era of natural-based medicine begins now and Bloomwell is taking the lead."

Within a year, Bloomwell Group has grown to 160 employees, with projected revenues of 5 million euros in 2021. In addition to Kouparanis, CEO, entreprenuer and cannabis pioneer, the board is strengthened by telemedicine veteran Meier, who as founder, led Teleclinic to an exit, co-founder Samuel Menghistu and Boris Jordan, founding partner of Measure 8 Venture Partners. 

The accomplished board covers facets in medicine, digitalization, cannabis, investment and brand building across various market sectors.

COLUMBUS, Ohio, October 18, 2021 -- PRESS RELEASE -- Worthington Industries announced the launch of its newest product family brand, Highpoint by Worthington Industries. Highpoint products are designed with the extraction community in mind to support clean, safe solutions for the cannabis industry.

For too long, the legalized cannabis extraction industry has depended on equipment from other sectors to make extraction possible. As the industry matures and new legal states come online, first-class extraction facilities realize the importance of implementing and using products and equipment designed with the industry in mind.

Bulk hydrocarbon tanks and hydrocarbon gases are an essential part of the extraction process. Highpoint products represent an industry shift with high-quality, clean and safe stainless steel tanks. Extractors know that in a rapidly-growing industry with a thirst for constant innovation, their processes must be purpose-built from start to finish.

"With Highpoint, we're excited to support the rapidly growing cannabis market by fulfilling an unmet need for storage solutions tailored to this industry," said Bobby Weinberg, product director. "Backed by decades of safety, regulatory and manufacturing expertise, we are elevating the process and setting a new standard together with our customers."

OTTAWA, Oct. 18, 2021 – PRESS RELEASE – HEXO Corp. announced the departure of Sébastien St-Louis, co-founder and CEO, effective immediately, as the company completes a strategic reorganization.

"On behalf of the entire organization, I would like to thank Sébastien for his tremendous impact on the Canadian cannabis industry. Through his years of dedication, he has helped build HEXO into a market leader in Canada," said Dr. Michael Munzar, chair of the board. “The board has established a Special Committee for Succession to identify a new CEO with the experience to defend HEXO's position as a market leader in Canada and secure our place as a top-three global cannabis company."

The company's next leader will be well-positioned to integrate HEXO's recent transformative acquisitions and leverage the company's lean production capabilities, solid brands and robust product offering to lead HEXO through its next phase of strategic evolution.

"Building HEXO from the ground up to become No. 1 in Canada has been the highlight of my career," St-Louis said. "Without question, HEXO's future is bright—I am so proud of the team we established, the brands we launched and the loyalty our customers have shown us. As a significant shareholder I look forward to the company’s next exciting stage of growth."

The board’s Special Committee for Succession is in advanced discussions with a preferred CEO candidate and expects to make an announcement in the coming days.

The New Jersey Cannabis Regulatory Commission (CRC) issued 14 long-awaited new medical cannabis business licenses Oct. 15.

Nearly 200 entrepreneurs applied for the licenses when the process launched two years ago, according to an NJ.com report, and the CRC ultimately awarded 10 cultivation licenses and four vertically integrated licenses on Friday.

The cultivation licenses went to Hillview Med INC., CYOURN LLC, GSCC Management LLC, NJ Nectar Ventures LLC, Noble Valley Harvest Company, Green Medicine NJ LLC, ZY Labs LLC, the NAR Group Inc., Bloom Medicinals of PA LLC and Garden State Releaf LLC.

The vertically integrated licenses, which allow businesses to grow, manufacture and sell medical cannabis, went to Etain NJ LLC, Atlus New Jersey LLC, Holistic NJ LLC and Greenhouse Wellness NJ LLC.

All 14 licenses were awarded to minority- or women-owned businesses, NJ.com reported.

SOMERSET, Mass., Oct. 13, 2021 – PRESS RELEASE – United Food and Commercial Workers (UFCW) Local Union 328, which represents 11,000 workers in a variety of industries in Massachusetts and Rhode Island, announced that the hardworking team of budtenders employed at Solar Therapeutics in Somerset, Mass., won their union election after voting, 10-4, to join UFCW Local 328. The workers formed their union with a focus on gaining full-time opportunities, improving benefits and securing important workplace protections.

Erin Bosse, a budtender at the Somerset location, stated after the win, “I am so proud of my co-workers for sticking together. We love our jobs and know that by forming our union, we will be able to build a better future for all of us here at Solar. Cannabis jobs can and should be careers and we know that when we stand together, we can make positive changes not only at our workplace but across the industry.”

Jared Botelho, another budtender at the location, stated, “We are absolutely amazed to see all of the wonderful support from our fellow budtenders and are happy to say we have won our union election. We are looking forward to seeing a more bright and equitable future within the Solar Cannabis Co. community in pair with UFCW 328.

Botelho added, “This industry has the potential to provide meaningful and middle-class jobs to thousands of cannabis workers across the country. This goes beyond us and our own dispensary. We hope other dispensaries continue the precedent to establish equity and contracts for their workers. We hold our company in the highest regards and look forward to our negotiations. Destigmatize, legitimize and unionize!”

Sam Marvin, Director of Organizing at UFCW Local 328, said, “We are proud of the amazing team at Solar for sticking together throughout this election process. We look forward to taking the next steps towards negotiating a first contract that rewards the hard work and dedication they bring to the job each day.”

The workers at Solar Therapeutics join a growing movement both locally and across the country of cannabis workers coming together to ensure that workers have a collective voice in this new industry.  

BACKGROUND:

Walker, Michigan – October 18, 2021 – PRESS RELEASE – Pipp Horticulture (a division of Pipp Mobile Storage Systems, Inc.), a provider of space‐saving, multi‐level mobile cultivation systems, announced today that it has acquired the GGS Group of Companies (GGS). Based in Vineland, Ontario, GGS is one of the most recognized names in the horticulture industry. It has been the leading manufacturer of greenhouses and turnkey greenhouse growing solutions including traditional rolling benches, heating and ventilation systems, and curtain systems.

“We are thrilled to welcome the entire GGS team to the Pipp family of companies," said Craig Umans, Pipp president and CEO. "GGS has decades of experience manufacturing greenhouse structures and has become a leading supplier to the horticulture industry. The company has consistently impressed us with its ability to deliver value to its customers, and we look forward to our next phase of growth.”

“We are pleased to partner with PIPP as we build an even more expansive platform to serve our customers.” said Leigh Coulter, president and owner of GGS. “Our expertise in designing, manufacturing and installing commercial greenhouse structures, combined with Pipp's state-of-the-art vertical farming and space optimization solutions, will allow us to offer North American growers a complete and efficient solution.”

“We are delighted to see two such complementary companies come together today. This acquisition is another step in Pipp's strategy to become the leading supplier of turnkey solutions to all segments of horticulture globally." said Marc Paiement, senior partner at Novacap. "We look forward to continuing to work with them throughout this process, providing support and expertise to help them achieve their goal."

For the past several years, Pipp Horticulture’s mission has been to help cultivators across the globe save time and money by creating a more efficient grow facility and help streamline operations. Pipp has not only developed a product line that was purposefully designed to serve the cultivation market, but it has strategically acquired companies like GGS and Vertical Air Solutions, the leading provider of air circulation systems for indoor vertical farming, to be able to offer the industry a turnkey cultivation solution, continuously improving upon its services, and developing products that positively affect canopy output and facility operations.

With the wide array of cultivars available, cultivators need to diversify their genetic portfolios to maintain consumer-based interest. While selecting a few fast-growing, high-yielding, potent strains will meet inventory demands, medicinal and adult-use consumers alike seek out specific traits and novel experiences.

Offering a well-balanced menu of sativa, hybrid, and indica genetics is a great place to start, but going above and beyond will set you apart from the competition.

There are also numerous other valuable traits to consider when it comes to selecting that next winning cultivar.

Beyond achieving an elevated THC content, cultivators should consider novel characteristics, such as specific cannabinoid production (THCV, CBN, CBG, etc.) and the ratios in which they occur; unique terpene synthesis (nerolidol, guaiol, bisabolol, etc.) that create distinct aromatic and flavor profiles; and appealing bud structure with a focus on stacking density, color composition, and trichome abundance. Additional considerations include growth and developmental traits, namely genetic stability, the time needed to complete the vegetative and flower cycle, and consistency in growth patterns and flower production.

Read more: 5 Tips for Cultivar Selection at Scale 

TORONTO, Oct. 15, 2021 /CNW/ - PRESS RELEASE - Bullrider, a cannabis brand with a storied history in the Canadian cannabis landscape, is welcoming Aubrey Drake Graham (Drake), a Grammy-award winning rapper, singer-songwriter and producer as the brand's new partner and strategic advisor.

Under this partnership, Drake joins OVO co-founder and producer, Noah "40" Shebib as an investor, partner and advisor. 40's involvement with the brand was spurred by the brand's namesake strain, Afghani Bullrider, which he credits as a life-changing product that has helped manage symptoms related to his decades long journey with multiple sclerosis. Drake now joins Bullrider, a subsidiary of Robes Inc., as co-owners alongside industry veterans 40, Maxim Zavet and Lorne Greenberg. The brand's offerings have expanded to multiple high-grade strains, merchandise, retail and premium cannabis products.

Encouraged by 40's tenacity and knowledge of the recreational cannabis space, Drake will play a role in advising and helping with strategy as part of the brands mission to bring an unmatched cannabis experience to the North American market. "I've always viewed 40 as the expert when it comes to cannabis so I'm very excited to invest, partner and contribute to setting a new standard for a premium cannabis experience," said Drake.

"My involvement with Bullrider stems from the urge to help consumers access high-grade strains with the same recreational therapeutic benefits that I've been able to enjoy," said 40. "It's not just another cannabis brand. Bullrider has a deep reverence for quality cannabis and its medicinal properties which I've always been extremely passionate about."

"At the heart of Bullrider is the convergence of street art, hip-hop and limited premium Cannabis product drops," said CEO Maxim Zavet. "We're honored to create a space for Drake and 40 to continue their iconic partnership in lending their innovation and drive to sharing our products with the world."

Bullrider is set to open their unique farm-gate flagship store in Brampton, Ontario offering a one-of-a-kind cannabis production and retail experience in October 2021.

LAS VEGAS – PRESS RELEASE – Nevada’s legal cannabis industry reached a major milestone as sales exceeded $1 billion in fiscal year 2021. A total of $159 million generated through cannabis industry tax revenue and fees went into the state’s Distributive School Account, which funds K-12 education across Nevada.  

Cannabis sales for the fiscal year ending on June 30, 2021 were up more than $300 million from the prior year’s total of $684 million. Sales had decreased in the spring of 2020 as COVID-19 restrictions forced stores to shut down and then reopen with reduced capacity. Nevada retailers were able to pivot their operations to expand home delivery and curbside pickup, enabling them to safely serve customers and to keep the industry’s 10,000 workers in their jobs during the pandemic.

“The record-breaking amount of tax revenue generated by the cannabis industry for education is really something to celebrate,” said Layke Martin, executive director of the Nevada Dispensary Association. “Retailers, cultivators, producers, and businesses up and down the supply chain, as well as the thousands of employees in the industry, should all be proud of the hard work and innovation that helped the industry bounce back from a challenging year.”

Unlike other businesses, the cannabis industry was not eligible to receive CARES Act or other federal relief because cannabis is still federally illegal. Additionally, Section 280E of the IRS Tax Code prevents legal cannabis businesses from deducting normal business expenses such as rent and payroll, because cannabis is classified as a Schedule 1 drug. As a result, cannabis businesses pay an effective tax rate of more than 60%.

In spite of these challenges, Nevada’s legal cannabis industry has grown steadily since recreational sales began on July 1, 2017.  Nevada is among 19 states that have legalized recreational cannabis sales, with 86 dispensaries open statewide.