After four years of exhaustive efforts, California leaders eliminated the cultivation tax along with other changes, providing some bit of respite for cultivators. But does the plan just move money around, and is it even close to enough to save struggling farmers?

California Governor Gavin Newsom released his 2022-2023 revised budget on May 13—most notably containing the much-needed tax cuts. On June 29, Assembly Bill No. 195 passed in the Senate by 34-0, and the California Assembly voted 66-0 in favor of the bill. The bill took effect immediately following the signature of Newsom, providing the legal cannabis industry some much-needed temporary tax relief, which began July 1.

The state’s cultivation tax at over $161 per pound was scrapped and money was reallocated: Cannabis excise rate will remain at 15% for three fiscal years—but may be increased after July 1, 2025. Equity licensees will be able to retain 20% of the excise taxes they collect to reinvest into their businesses. They will also be eligible for a $10,000 tax credit. It also includes $40 million in tax credits, of which $20 million will go towards tax credits for storefront retail and microbusinesses, and $20 million for cannabis equity operators. The bill allows qualified businesses to claim tax credits of up to $250,000 for qualified expenditures beginning in the 2023 taxable year. It also adds additional enforcement tools against the illicit cannabis market.

Hardly a Long-Term Solution

Doug Chloupek, CEO and founder of Juva Life, faced many of these tax woes as a manufacturing permit holder in California. When Newsom proposed his revised budget back in May, Chloupek said the cannabis cultivation tax cuts failed to fix several key problems. Keep an eye on those excise tax rates in the next three years, for instance.

“​​It’s slightly better than a three-card shuffle and a nice little pretty Band-Aid on its surface,” Chloupek tells High Times. “Those who are entrenched in the industry would think, ‘Wow, this is an amazing thing.’ But at the end of the day, it’s more generally a bandaid to stop the inevitable bleeding that can only be fixed by the elimination of IRS Tax Code 280E—which is systemic to federal issues, and leaving it to a state like California, which has some of the highest taxation on a commodity that’s lost 80% of its value is just intrinsically the wrong move for our industry as a whole.”

In recent years, California’s price per pound of cannabis plummeted, and some growers faced what Johnny Casali from Huckleberry Farms described as “an extinction event.” A pound of cannabis—once worth up to $1,500 or more for some farmers—plummeted as low as $300 per pound. And when you shave off the $161+ per pound cultivation tax, that gobbles up half its value. Part of this price drop has been blamed on the advent of light deprivation weed.

“A good portion of the cultivation tax—which was being passed down by distributor to distributor to distributor and lost in the supply chain,” Chloupek says. “So it was never being paid anyway. So in terms of a cultivator materializing, an extra $160 a pound in value to help bridge the gap of the intrinsically broken system that we fundamentally have. At its core, it’s going to do nothing to help us cultivators that are dropping like flies right now.”

Chloupek’s 12-year background in the legal market began when he says he became the first permit holder in the state of California for cannabis manufacturing. Juva Life received a license to operate a storefront in Redwood City, where during the application process Juva was the highest-scoring applicant. The retail store is already under construction, and planned to open in Q3. Juva Life is focusing on cannabis research to create longevity for their business, and recently closed $11.8 million in funding.

What Businesses Say

“It’s a fundamentally broken problem,” Chloupek adds. “And they’re just looking at the industry as a cash cow, which is designed to fail, which is following the repetitive steps of every big transitional industry from big AG and Monsanto to a handful of them that have their monopoly to alcohol, tobacco, to form a they it’s a it’s a control consolidation is what you’re seeing right now. And by squeezing the industry at such a point by design or by unintentional or by thinking, all that’s doing is [hurting the people] who built it for the last 30 years, and who are being squeezed out of the industry. And unless you’re an MSO with a half a billion dollar market cap with, you know—$100 million in the bank to weather the next two years of storm, or you’re vertically integrated and you can barely squeak by your chances of surviving the next 2 to 3 years are next to nil.”

Members of the California Cannabis Industry Association seemed to agree that more steps are needed if the state is actually going to save the cannabis industry.

“The survival of the regulated industry is vital to providing ongoing tax revenues for the State and the advancement of public health and safety. Eliminating the cultivation tax is just one step towards stabilizing our industry but it’s an important one,” relays Lindsay Robinson, CCIA Executive Director.

Others say the legislation doesn’t go far enough regarding social equity measures.

“CCIA has worked for the past four years to eliminate the cultivation tax and we’re extremely proud of this important first step,” Robinson added. “Stability of the cannabis supply chain brings jobs and much needed tax revenue to the state while also protecting public health and safety and keeping cannabis out of the hands of children.”

While dropping the cultivation tax was a step in the right direction, it’s hardly a fix for an industry that is still fundamentally flawed.

A group that is aiming to legalize medical cannabis in Nebraska submitted ballot petitions just under the wire on Thursday, ending a campaign that has been beset by tragedy and financial hurdles.

Nebraskans for Medical Marijuana said that it had turned in thousands of signatures to the secretary of state in the hopes of getting the medical cannabis proposal on the Cornhusker State ballot this November.

The group will now await word to see if the measure will qualify for the ballot.

“It’s official, we turned in 184,000+ signatures to put medical cannabis on the ballot,” said state Sen. Anna Wishart, a Democratic lawmaker who co-sponsored Nebraskans for Medical Marijuana. “We will know in the coming months if it was enough to qualify. Every signature represents a person who had the guts to go out and ask and a person who had the heart to sign. Thank you Nebraska.”

Nebraskans for Medical Marijuana has dealt with a series of setbacks throughout its petition drive. In March, the group’s outlook appeared dire after one of its top donors died in a plane crash, and another donor had been diagnosed with terminal cancer.

The pair of tragedies left Wishart and others affiliated with the group pleading for donations.

“I’d say devastating is an understatement,” said Crista Eggers, who also led the group’s petition campaign. “We’re pleading with you to help.”

“If what we needed was grit, and drive, and determination, we have that,” Eggers said. “Our campaign would be done and over if that’s what we needed. But unfortunately, the one thing our campaign doesn’t have – and has to have – is money.”

Eggers’ motivations are personal: her son, Colton, has epilepsy and is unable to receive medical cannabis treatment in Nebraska.

“We’ve received so much encouragement from individuals all across the state, who support the many patients like our son Colton, who desperately need access to this medicine. No matter what your political background is, we should all agree that criminalizing a medicine that has the potential to alleviate suffering, is both cruel and inhumane,” Eggers said in announcing the group’s petition campaign last fall. “The current policy doesn’t reflect our family values here in Nebraska, and we’re going to change that. We need everyone who believes in compassion for suffering individuals like my son to be part of this movement and help us win in 2022.”

On Thursday, Eggers marveled at the group’s resilience.

“These were people that cared about this issue and they continued stepping up you know one day after another and when things got tough, right, they kept going,” Eggers said, as quoted by local television station KETV.

“There was no choice to give up, right. Because of all of you. Because of all the people, the stories, who were relying on us to get this done,” Eggers added.

Nebraskans for Medical Marijuana turned in the signatures at the 11th hour, befitting the tumult that defined its petition drive. KETV reported that the group “used every second they could before they had to turn in their signed petitions in Lincoln,” with people “still signing the petition outside the Secretary of State’s Office less than an hour before the deadline.”

In a post to its Facebook page on Thursday afternoon, the group urged both individuals who wished to sign the petition and notaries to come to the secretary of state’s office.

Nebraskans for Medical Marijuana mounted a previous effort to get a proposal on the state ballot in 2020, but the Nebraska Supreme Court ruled it ineligible.

“As for what happens tomorrow, we’ll face that tomorrow,” Eggers said on Thursday, as quoted by KETV.

The University of British Columbia is set to be the first college in Canada to host a cannabis dispensary with the recent approval of a Burb retail store to open at the campus. The new location will be the eighth licensed cannabis retailer in British Columbia for Burb Cannabis Corp., bringing the company to the regulatory limit on the number of recreational dispensaries that can be operated in the province by one licensee.

Burb is an international cannabis brand with a stated mission of bringing British Columbia’s “BC Bud” culture to the world through a network of retail shops, cannabis products, apparel, and accessories. The company also owns and produces the podcast Light Culture hosted by David Hershkovits, the co-founder and former editor-in-chief of Paper Magazine.

Burb’s dispensary planned for the University of British Columbia, which actually sits just off campus, was approved by the Metro Vancouver Regional District (MVRD) Board of Directors, the local governing body for the area surrounding the university. The approval came despite vocal opposition from members of the local community, which included an online petition that garnered nearly 1,900 signatures.

“This was a big victory for us after a contentious debate around public safety and community fit,” John Kaye, CEO and co-founder at Burb, said in a statement from the company. “Despite concerns grounded in age-old stigma from nearby residents, many of whom were off-shore residential owners, the Board made an informed decision that aligned with the overwhelming voice of the student body as well as the tenets of legalization in our country. We’re beyond excited to bring Burb to campus and provide safe access to students and residents this fall.”

Neighbors Opposed Plan for Campus Dispensary

Neighbors opposed to locating the dispensary near the campus argued that the store would be too close to a nearby high school and two elementary schools and launched a campaign to oppose approval of the shop. An online petition posted by local resident Connie Chen suggested the store would attract people to the area for purposes “unrelated to the university,” according to a report from CBC News.

“By allowing cannabis retail to exist in this business plaza, we are putting vulnerable children at a high risk of exposure to substances they are too young for,” the petition stated.

The proposed cannabis shop was supported by the university’s Alma Mater Society (AMS)‚ the organization representing more than 56,000 students on campus. A competing online petition in favor of the dispensary posted online by Sean Safaei, who is with Burb, received more than 2,000 signatures.

“Since the AMS was in support of the project right from the beginning, it’s definitely good news for the students,” AMS president Eshana Bhangu said of the application approval.

“We just think the UBC student body really deserves to have a safe space nearby where purchasing cannabis is accessible and provided in a stress-free environment,” she added.

Bhangu noted that without the dispensary located nearby, students at the university would have to walk or take a bus more than 2.5 kilometers (slightly more than 1.5 miles) to the nearest cannabis retailer. The only other option would be to buy from illicit dealers.

“Locations like these really do reduce illegal activity and we don’t think that this is going to have any risk to families and underage youth,” said Bhangu.

Burb maintains the new dispensary will not only be the first to be located at a Canadian college campus, but the first in the world, as well. With the company reaching the maximum number of stores allowed in British Columbia, Burb is looking outside the province to continue its growth. A recent expansion to the United States marked the premiere of the British Columbia cannabis strains Beaver Tail, Butter Tarts, and Zyrup to the California market.

“We are west coast OG and breathe the rich history of BC Bud into all extensions of our brand,” said Kaye. “British Columbia has gained worldwide notoriety for breeding and cultivating premium, award-winning craft cannabis strains. We’re honored to bring this legacy, experience and passion to California through careful curation and proprietary innovation.”

Burb Expanding Into U.S. Markets

In May, the company announced its expansion in California’s competitive adult-use cannabis wholesale market, with Burb’s products gaining exposure on dispensary shelves at retailers including Cookies, Dr. Greenthumb, The Pottery, and Mainstage. The company also has plans to expand into Florida’s growing medical cannabis economy.

“We’re delighted to partner with TRP, the wholesale division of Cookies Retail Group, to bring our Los Angeles grown premium flower products to the state of California and look forward to launching in the state of Florida this fall exclusively through Cookies retail stores,” said Kaye.

The Burb brand is under license to TRP for both California and Florida and is working with Los Angeles-based cultivation partner Green Label, headed by Jason McKnight, to provide premium indoor flower supply for the brand.

“We’re innovating with Jason, working with amazing genetics providers and doing our best to bring the flavors we know and love to the California market,” said Kaye.

President Joe Biden and Vice President Kamala Harris spoke on Wednesday with Cherelle Griner, the wife of WNBA star and Olympic champion Brittney Griner, who has been held in a Russian prison on charges of bringing cannabis oil vape cartridges into the country since February. The telephone conversation between Biden, Harris, and Cherelle Griner came only days after the president received a hand-written letter from Brittney Griner pleading with him to intervene on her behalf and that of other Americans being held by foreign governments.

“The President called Cherelle to reassure her that he is working to secure Brittneys release as soon as possible, as well as the release of Paul Whelan and other US nationals who are wrongfully detained or held hostage in Russia and around the world,” the White House said in a statement published by CNN. “He also read her a draft of the letter the President is sending to Brittney Griner today.”

The statement from the White House added that Biden “offered his support to Cherelle and Brittney’s family, and he committed to ensuring they are provided with all possible assistance while his administration pursues every avenue to bring Brittney home.”

The White House also said that Biden had responded to the letter Griner sent from Russia last week, noting that the president had received the letter on Monday’s Independence Day holiday. The statement added that Biden shared his response with Cherelle Griner during their conversation.

Basketball Star Arrested in February

Griner is a seven-time WNBA All-Star center who has played for the Phoenix Mercury since the 2013 season, including the team’s 2014 league championship squad. She has also twice won the Olympic gold medal with the U.S. women’s basketball team.

Griner has played seven seasons of professional basketball in Russia during the WNBA’s off-season, a practice common among the league’s players. She earns about $1 million per season to play in Russia, about four times the salary Griner earns playing for the WNBA. On January 29, Griner played her latest game with her team UMMC Ekaterinburg before the Russian league took a break for the FIBA World Cup qualifying tournaments.

The Russian Customs Service reported on March 5 that an American women’s basketball player had been detained after cannabis vape cartridges were discovered in her luggage at the Sheremetyevo airport. The date of the arrest was not given and the name of the player was not included in the report. Russian authorities also released a video that appeared to show the star center with customs officials at an airport security checkpoint.

The Russian state news agency TASS later reported that the arrested player was Griner. Although the date of Griner’s arrest was not announced, media outlets reported that she has been in custody since February 17. Her detention continues in the midst of Russia’s invasion of Ukraine, which has been widely condemned by the international community.

On Friday, Griner’s trial on charges of possession of cannabis vape charges began in a courtroom outside Moscow. CNN reported that the “prosecution argues that Griner intended to import the drugs into Russia’s territory and put the prohibited substances into a backpack and a suitcase,” and that cannabis oil “is subject to control in Russia and is classified as a narcotic drug.”

Griner Sends Letter to Biden from Russian Prison

Last week, the WNBA star center sent a letter to Biden pleading for his help securing her release from prison.

“As I sit here in a Russian prison, alone with my thoughts and without the protection of my wife, family, friends, Olympic jersey, or any accomplishments, I’m terrified I might be here forever,” reads an excerpt of the letter obtained by CNN.

“I realize you are dealing with so much, but please don’t forget about me and the other American Detainees,” Griner continued humbly. “Please do all you can to bring us home. I voted for the first time in 2020 and I voted for you. I believe in you. I still have so much good to do with my freedom that you can help restore. I miss my wife! I miss my family! I miss my teammates! It kills me to know they are suffering so much right now. I am grateful for whatever you can do at this moment to get me home.”

Biden received the letter from Brittney Griner on the morning of July 4. The White House released three excerpts from the letter, noting that the rest of the correspondence would be kept private.

“On the 4th of July, our family normally honors the service of those who fought for our freedom, including my father who is a Vietnam War Veteran,” Griner wrote. “It hurts thinking about how I usually celebrate this day because freedom means something completely different to me this year.”

Griner faces up to 10 years in prison if convicted in the case. Her trial is scheduled to resume on Friday.

The California Department of Fish and Wildlife (CDFW), Department of Cannabis Control (DCC) and State Water Resource Board (SWRCB) announced in a press release on July 1 that it would be collectively authorizing enforcement teams for the 2022 cannabis growing season. This is an annual announcement, as the CDFW also announced its preparation for the 2021 growing season in July last year.

This effort is funded by Proposition 64 which enables these government agencies to focus on protecting “priority watersheds and areas with sensitive habitat and/or threatened or endangered species.” The agencies will work with local county, state, and federal groups to ensure enforcement is properly handled.

“The environmental impacts of illegal cannabis operations can last decades and cause irreparable harm to our natural resources,” said CDFW Deputy Director and Chief of the Law Enforcement Division David Bess. “Those not complying with state laws and disregarding the environmental impacts associated with illegal cultivation practices will be subject to enforcement actions.”

The water streams of California, and the wildlife that depends on them, suffer when illegal cannabis grow operations divert water. “Tributary streams are often critical in providing clear, cold water for larger waterways,” the press release states. “Many sensitive aquatic species such as southern torrent salamanders, coastal tailed frogs, steelhead and coho salmon rely on these tributaries in the late summer months to maintain water quality and temperatures necessary for survival.”

Furthermore, the health of these streams directly affects the “physical, biological, and chemical impact” of the entire local area, which is home to countless creatures whose habitat needs to be maintained.

The drought in California has hit a historic low once again, making it imperative to protect these waterways. “Complying with the state’s cannabis regulations is even more critical in drought conditions when limited water supply is available and water quality impacts are magnified,” said State Water Resources Control Board Office of Enforcement Director Yvonne West. “I am proud to work with so many individuals in the cannabis community dedicated to regulated and environmentally conscientious cultivation. The State Water Board is committed to taking enforcement action against those who harm our precious water resources.”

Santa Barbara County District Attorney Joyce Dudley also provided a statement, addressing the need for enforcement of illegal cannabis growing operations. “My office is committed to criminal and civil enforcement to protect the environment and public safety,” said Dudley. “Environmental harms from cannabis cultivation can be severe and long-term, including exposure to dangerous pesticides, water quality degradation, and wildlife injury. Moreover, cultivators who violate the law should not have an unfair competitive advantage over lawful cultivators who expend time and resources to stay in compliance. My office will continue to collaborate with our local and state agency partners to ensure compliance with the law.”

Other California counties, such as San Bernardino, are also supporting legislation aimed at both protecting groundwater as well as eliminating illegal grows. The County sponsored Assembly Bill 2728 and Senate Bill 1426, which would implement fines for violations. According to researchers, cannabis plants (depending on their stage of growth) could need up to six gallons of water per day during the growing season, which spans June through October.

At a press conference in May, Assemblymember Tom Lackey addressed illegal cannabis growers who are polluting local water reserves. “To any of those who are engaged in the illicit grows: I want you to know there’s a collective effort, and we’re coming after you,” said Lackey. “You come after a very sacred thing: our community. You come after our desert, and you’re stealing our water. You’re poisoning our land, and enough is enough.”

Outside of the growing season, Los Angeles County has also worked on targeting illegal grows. In July 2021, the Los Angeles County Sheriff’s Department made one of its largest seizures of illegal cannabis, which was valued at $1.2 billion.

Pennsylvania medical cannabis patients would receive some protection from being convicted for driving under the influence if a bill making its way through the state legislature is passed and signed into law by Governor Tom Wolf. The measure, Senate Bill 167, was approved last week by the Senate Transportation Committee with a vote of 13-0.

If approved, the legislation sponsored by state Senator Camera Bartolotta would eliminate Pennsylvania’s zero-tolerance policy for THC, which has been used without proof of impairment to penalize drivers who are registered medicinal cannabis patients.

“Senate Bill 167 is critically needed to protect the medical cannabis community as the penalties for a controlled substance significantly escalate,” Bartolotta told the Transportation Committee before last week’s vote.

Pennsylvania has more than 700,000 registered patients who have qualified to use medicinal cannabis since the medical marijuana program launched in 2018. However, the state’s zero-tolerance drug law puts patients at risk, whether they are under the influence of cannabis or not.

“Under current law, medical cannabis patients can be arrested, prosecuted, and convicted – even if they’re not impaired,” said Bartolotta. “SB167 will treat the medical cannabis patient similarly to one using a prescription narcotic by requiring proof that the motorist or patient is impaired and unable to safely operate a motor vehicle.”

Jailed for a Broken Taillight in Pennsylvania

State Senator Wayne Langerholc, the chair of the Senate Transportation Committee, said that under the state’s current DUI legislation, medicinal cannabis patients who are pulled over by police for something as innocuous as a broken taillight could be given a ticket simply because they have a medical marijuana identification card.

“I’ve read through a lot of different law review articles on this and … I think this kind of takes a novel approach, maybe a groundbreaking approach to address this,” Langerholc said.

Pittsburgh criminal defense lawyer Patrick Nightingale told lawmakers at a legislative hearing held in September that medical cannabis patients are in jeopardy of losing their driver’s license or being put behind bars simply by getting behind the wheel.

“We’re only three years into this [medical marijuana] program and these patients presumably are going to be using medical cannabis for the rest of their lives,” he said. “They’re going to have a number two DUI come up pretty soon and a number three DUI where they are looking at a year incarceration for using medication that the state said is 100% fine to use.”

Bartolotta noted that the state’s zero-tolerance policy is not typical around the country. She said that 33 states, including some that have not legalized access to medical cannabis, require proof of impairment for a DUI conviction. Only 12 states, including Pennsylvania, have zero-tolerance laws for specific substances including THC.

At the committee hearing, Bartolotta emphasized that the legislation does not “give patients a free pass to drive while impaired by medical cannabis. The impaired motorist or patient shall, if convicted, suffer the most serious consequences under our DUI laws.”

Langerholc, a former prosecutor, agreed, noting that “they will be held accountable the same way an individual that was using [cannabis] without any proper prescription would be.”

In a departure from the usual law enforcement stance on legislation to reform cannabis laws, the state police are not opposed to the bill being considered by lawmakers.

“The Pennsylvania State Police remains committed to removing impaired drivers from our commonwealth’s highways to reduce crashes, and the injuries and fatalities that they cause,” Maj. Robert J. Krol Jr., director of the PSP Bureau of Patrol, told the Transportation Committee. “That said, we believe from our review of SB167, that it generally does not have a negative impact on highway safety as it relates to providing an exception for medical marijuana.”

With last week’s approval by the Transportation Committee, the legislation now heads to the full Senate for consideration.