How To Overcome Cannabis-Regulation Challenges

How do you regulate an emerging industry with a product that was once illegal

 How does government regulate an emerging industry, especially if the industry deals in a product that was once illegal? At the North Bay Business Journal’s first North Coast Cannabis Industry Conference in Santa Rosa on May 9, one panel focused on how to create processes and issue permits for cannabis. The participants were Cassia Furman, an attorney with Vicente Sederberg; Tawnie Logan, executive director, Sonoma County Growers Alliance; David McPherson, cannabis compliance director of HDL Companies; Tennis Wick, director, Sonoma County permit department; and Rebecca Stamey-White, partner with Hinman & Carmichael. Here are some of the highlights:

Cassia Furman

“We’re a national cannabis-specific law firm in operation since 2010. We promote regulation and legalization throughout the world, as well as helping cannabis-business owners obtain licenses. We consulted with Santa Rosa on its ordinances and zoning interpretation. The city has put a good deal of effort into understanding the industry, considering economic development and public health and safety. There are currently two operating dispensaries in the city. It’s a land-use and compliance game.”

Tawnie Logan

“We were founded two years ago in preparation for regulation. We now have MCRSA and Prop. 64. Sonoma County and the city of Santa Rosa are moving forward in permitting. The most prominent issue that operators face today is constant change, with some 200 bills in Washington (affecting cannabis). The protocol used to be, burn all records at the end of harvest, and you have PTSD. Your documents can be used against you in court. There are a lot of hurdles. Access to affordable financing is an issue, and where to store money without banking. A lot of cultivators don’t know how to value their companies. There’s competition for access to the retail (cannabis) market. Prices are nose-diving. Sonoma County is a great example for the rest of the state, and Santa Rosa, as early adopters. Read the regulations. For an operator to come into compliance, a minimum of $20,000.”

David McPherson

“Our company has been around for 30 years helping local government. We are working with 75 cities on local regulations. We have examined over 700 applicants for local agencies. Quality of submissions is very important. It’s about businesses being partners with communities. Financial plans are critical for business sustainability, long-term growth with the cost of regulations and employees. Security plans are critical for control. Include background information on partners. Plan ahead to make sure you have Social Security cards. Make sure your location is compatible with local ordinances. Have good employee policies. Make sure leaders are qualified to run the business. If you’re building a big facility, deal with power and energy. Be realistic about getting product to market.”

Tennis Wick

“As this sector of our economy comes into the daylight, I am focused on the mechanics of putting together a successful application. This is a complicated regulatory field. Make it easy for staff members to review your application. Put your narrative in one report. Include a project description (including specialists such as hydrologist, archaeologist). Have a location plan, maps, floor plan, elevations for structures. Have an architect or civil engineer coordinate drawings. We will accept applications on July 1.”

Rebecca Stamey-White

“We have represented the alcoholic-beverage industry for 35 years, cannabis for two years. We’re regulatory lawyers. We do industry-specific agreements and licensing. From a federal level, we are still dealing with an illegal substance. It has been a wild ride figuring out what the Trump administration is going to do. So far Attorney General (Jeff) Sessions doesn’t have a budget to prosecute cases. That does not provide a lot of comfort to operators who want to do medical as well as adult-use cannabis. The governor put forth a trailer bill to combine adult-use and medical (laws). Laws are still being worked out.”

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