Categories
Cannabis Policy

Some Thoughts on Regulating Cannabis Sales at Live Events

I want to start a little ongoing series of thoughts about integrating cannabis products and cannabis sales into venues that host events like sports and concerts. I want to keep this more abstract for several concrete reasons:

  1. We are just starting to see licensed cannabis groups working their way with cannabis consumption in public venues. In Illinois this weekend, the “Miracle at Mundelein” is a prime example of an inaugural attempt– no cannabis sales in the consumption space, but you can purchase products at the dispensary across the street– but it’s a very hodgepodge affair. The state regulators aren’t deeply involved, and the on-site regulations and requirements are an ad-hoc mixture of local rules and state laws. Trying to speak concretely about “public cannabis sales” writ large is useless at this point, we’re only getting started, and each state is its own challenge.
  2. Almost every state’s laws and licensing schemes for cannabis are designed against sales of cannabis at public venues. The laws are designed to control the sales of cannabis– to limit the sales to licensed facilities and dispensaries, and prohibit all other cannabis sales to customers that take place outside of a licensed dispensary. This was done by legislators at the behest of many in the licensed cannabis industry, at least initially. License holders pay large amounts for their privilege, and are generally against the idea of creating more places to buy licensed products, which undercuts their own sales.
  3. Every state’s cannabis laws are different. Their own peculiar licenses, their own requirements for acquiring licenses, and their own landscape of regulatory requirements for licensed operators. There are of course similarities between states, but there is absolutely no uniformity or consistency across jurisdictions.

Given these facts, there’s no single strategy or set of changes that a person could recommend, it’s just too thorny and contingent on other circumstances.

I want to invert the framing of this challenge: rather than talk about all the things that need to be modified or changed from our current position in any state’s system, I want to focus on the destination, where we’re trying to get to. If we can start developing a consensus on what safe Public Cannabis Sales might look like, my hope is that we can more easily agree on what needs to change in each jurisdiction.

So for today, I want to highlight some principles or values that an effective Public Cannabis Sales system should enforce and support, and that all stakeholders (communities, regulatory agencies, licensed operators) should be able to rally behind:

  • Safe – Everyone should be interested in people using cannabis in a safe environment, and cannabis should only be permitted to be sold in a safe manner. There’s no need to grant the privilege of cannabis sales to a facility or operator that doesn’t take safety seriously– if someone’s so uncaring as to be unsafe, there’s always going to be another willing operator who can meet the requirements of public safety.
  • No Minor Use – Everyone should be interested in preventing underage cannabis use and sales, especially the cannabis industry. There’s already significant evidence that developing brains shouldn’t consume THC, and little room for the idea that it’s good or even non-harmful for young people to consume cannabis. Even if there are many people in the modern cannabis industry who don’t realize it, they have a long-term interest in preventing young people too: people who start smoking later in life tend to consume more than the people who started too early! Keeping young people from smoking or vaping weed is an effective way to preserve your future customer base.
  • Risk-Based – Rather than fear based regulations, or stigma-based laws, our system for Public Cannabis Sales should be both based on measurable evidence and on a forward-looking mindset of anticipating problems where they actually are occurring. The first decade of cannabis regulation has shown quite clearly that legislators are unable to fully anticipate the risks and challenges of a regulated industry, and have both over-legislated and under-legislated in particular areas. Public cannabis sales, if anything, are even more important to get right than licensed site sales. We need a system that is consistently compared against on-the-ground reality, and willing to be audited and updated to better address risks where we discover them. We also need a system that is willing to let go of old fears that have been proven to be low-risk.
  • Responsive and Agile – Public Cannabis Sales’ issues are not strictly limited to the site of an event and the holders of the license– there are surrounding communities and households that are just as much impacted by sales and customer behavior, as well as on-site employees and public transit workers servicing the event. A successful system for regulated public sales will need to have built into it a standard of responsiveness and adaptability, as well as public standards of being answerable to community-based input. Annual assessments by a third party would possibly be the pipe-dream for creating a responsive regulatory stance.
  • Positive – We are not trying to banish cannabis to the shadows anymore, and we should be aiming for cannabis’s inclusion to be as positive as we can make it, rather than deny its very existence or potential inclusion. This doesn’t mean pushing cannabis into places without consent, but it means allowing the market for public cannabis to grow towards a demand-based amount in public. Sales of cannabis shouldn’t be unlimited,of course, but instead only limited when informed by evidence of public risk. (See: Risk-Based, above). Having legislators set standards for public use based on their personal levels of taste/distaste for cannabis is an inconsistent plan, and a recipe for more head-aches. Not Positive!

I’m definitely going to have more thoughts on this later, but hopefully we can at least start getting more policy-minded folks involved with the question. This isn’t an issue that should be solved by a closed room of agency regulators, industry lobbyists, and public health partisans, and I think crafting an effective solution to public cannabis sales will have huge impacts to everyone, both inside and outside of the industry.

As a final thought: over the weekend I went to an outdoor concert featuring Run The Jewels, Wu-Tang Clan, and Deltron 3030 (rap nerd flex!). It was a great show, even if it’s always kinda funny to watch these poor sea-level rappers struggle to breathe. As you can imagine, there was a massive amount of weed smoked in this amphitheater, for hours straight. Also, given that these acts have fans from 30 years ago, the age range in the crowd was from teenagers to 60somethings. In terms of a strict reading of current regulations, this concert was an enforcement mess, and thousands of people congregated to break a clear legal requirement. And yet….outside of the usual concert injuries (people falling down the steps while drunk, a fight or two in the back between drunk people)… no one who attended that concert or was in the surrounding areas was harmed by the illegality. After the show, and after my mind cleared, I kept coming back to the idea of consent– how the context of consent mattered to determining the amount of social harm to be mitigated.

Does attending a Wu-Tang concert mean an implicit consent to be exposed to secondhand cannabis smoke? Obviously by the strict letter of the law, no, it doesn’t. But in the realer world of experience, I think it’s safe to say that there was an implicit consent. I know that for myself, there was a full-minded awareness that the show would include that environmental condition. Did the working staff and vendors of the amphitheater have the same level of consent? Obviously not. But rather than presume to speak for the employees, I will instead say: I would love some surveys and data about live event staff’s views and perspectives on working events that are all-but-assured to include secondhand cannabis smoke.

Once I figure out how to get comments working on this here dang blog, I’ll open them up below for your thoughts or feedback. In the meantime, don’t hesitate to ping me on Twitter (@wisetendersnob) or BlueSky (@snowdenst), I’d love to hear other perspectives, especially from folks with experience working as vendors and staff for cannabis-heavy events as they currently occur.

Categories
Cannabis Policy

Labor Peace Agreements for Minnesota Cannabis and Hemp Businesses

It’s an exciting time for Minnesota cannabis and hemp. Governor Walz’s signature to HF 100 set into a motion a multi-year process that will culminate in a licensed and regulated cannabis industry as well as preserve the unique lower potency hemp edible industry that the state has pioneered over the past year. Every state has peculiar qualities and landscapes to their cannabis industries, but one condition that Minnesota will share with several other licensed cannabis states is the requirement of labor peace agreements (LPAs) for most types of licensed cannabis and hemp operations.

What’s an LPA?

One of the provisions in the bill is related to “labor peace agreements”., This provision determines which types of cannabis and hemp businesses will be required to sign labor peace agreements (“LPAs”) as part of their license application. For the unfamiliar, the LPA in Minnesota’s bill is defined as:

  • an agreement
  • between a cannabis or hemp business and a bona fide labor organization, that
  • protects MN interests by prohibiting the labor organization from picketing, work stoppages, or boycotts against the cannabis and industry

The state defines a “bona fide labor organization” as “a labor union that represents or is actively seeking to represent cannabis workers,” and a determination of being bona fide is important—the problem of “company unions” and other fraudulent groups posing as legitimate groups representing workers is already an issue in other states with adult-use cannabis, like California.

In other words, an LPA is a signed agreement between cannabis businesses and a certified labor union, as determined under the provisions of the National Labor Relations Act. Most of the details of a particular LPA are not mandated, beyond the minimum agreement to prohibitions on certain picketing, work stoppages, and boycotts against the state’s cannabis industry.

What’s a Lower-Potency Hemp Edible (LPHE)?

In 2022, Minnesota became the only state in the US with an in-between system of permitting some non-cannabis operators to produce and sell products with delta-9 THC (that is derived from federal legal hemp). The formal definition of a “lower-potency hemp edible” is any product intended to be consumed as a beverage by humans that contains hemp concentrates or artificially derived cannabinoids. The single-serving limits on LPHEs are a maximum of 5mg of delta-9 THC, 25mg of CBD, 25mg of CBG, or any combination of those, within those limits (e.g., 5 mg THC and 25mg of CBD in a serving). LPHEs may not contain any artificially derived cannabinoid other than delta-9 THC, and they may not contain any cannabinoids derived from cannabis plants or cannabis flowers—only from federally legal hemp plants.

These low-potency hemp beverages might already be familiar to you in Minnesota, as the products have already developed a significant presence in the year since their creation. It’s worth reiterating, the particular arrangement — delta-9 THC, produced from hemp, and sold in retail locations alongside other products like alcohol – is unique in the nation, and could potentially mean that Minnesota is able to develop a THC beverage market unlike any other jurisdiction.

What kind of cannabis and hemp businesses are required to sign an LPA?

Minnesota’s new licensing and regulatory system for cannabis and hemp products includes 16 license types– 14 for cannabis and medical cannabis businesses, and two for lower potency hemp edibles. What do the new regulations say about each of those groups?

First, for cannabis and medical cannabis businesses, the requirements are clear:

“any application to obtain or renew a cannabis license shall include… an attestation signed by a bona fide labor organization that the applicant has entered into a labor peace agreement.” 

MN Statute 342.14 Subd. 1(a)(9)

In other words, for every initial application and for every license renewal application, cannabis businesses must submit a signed letter from a labor union that the relevant business is already in a binding LPA. And, while the new applications have not been created or released yet, the legislative language in 342.14 Subd. 1(d) makes clear that an applicant’s commitments in their application to maintaining an LPA will be an “ongoing material condition” of maintaining and renewing a cannabis license in Minnesota.

While that language sounds like all license types must submit an LPA with their applications, there is a cannabis license type that is exempted— microbusinesses. What is a cannabis microbusiness? In Minnesota, microbusinesses are a license type that allows its holder to conduct activities that range across the supply chain, from cultivation all the way to sales. The microbusiness is the smallest license, with some of the greatest restrictions on the size of its cultivation canopy; it is also limited to a single retail location. Per MN Statute 342.28 Subd. 4, cannabis microbusinesses (vertically integrated and small cannabis operators) are not required to submit a signed attestation from a labor union with any application.

Next, we look at the two LPHE licenses coming into effect: LPHE manufacturers and retailers. While the new bill makes clear that LPHE businesses are not presumed to be covered by all of the same requirements and rules as the cannabis license types, MN Statute 342.44 Subd. 1(d) does state that applicants for LPHE manufacturer licenses must submit a signed attestation from a labor union that the applicant has entered into an LPA with a labor union. The LPA requirement, however, is not mentioned as a condition of an LPHE retailer license application.

Do Other States Have LPAs as Part Of Their Cannabis Regulations?

In fact, several of them do, and several other states have movements in their legislatures to add LPA requirements as a condition of cannabis licensing. California’s requirement includes additional agreements from cannabis applicants, including agreeing to not disrupt efforts by labor organizations’ attempts to communicate and organize employees and agreeing to provide labor organizations access to work spaces to discuss workers’ rights and conditions of employment. In Illinois, preferential scoring is given to applicants that submit LPAs with their applications. Connecticut and New York also require LPAs as a condition of receiving final licensure for a cannabis business.

Summary

Out of the 16 total cannabis and hemp business licenses that Minnesota will be unveiling in the next year, only two license types are exempt from the two-fold requirement of (i) signing a labor peace agreement with a bona fide labor organization, and (ii) submitting a signed attestation from the labor union with every license application and every license renewal. Those two exempted licenses are cannabis microbusinesses and lower-potency hemp edible retailers. Per the statutes, if the Office of Cannabis Management receives an application that fails to include the required attestation, they will issue an initial notice of a deficiency to which the applicant has 10 business days to submit the additional necessary information. If the information is not provided, the OCM will reject the application.

Given the inevitable flood of applications to the office with a new licensing scheme, interested individuals and organizations do not want their first applications to suffer delays from foreseeable requirements and risk falling behind or out of the running for one of the earliest licensing windows.

The current regime of cannabis and hemp products in Minnesota is beginning to draw to a close, and the new rules will begin to dawn over the next 12-18 months. On July 1, the state began the complex process of developing its new agency, creating rules for licenses and applicants, and onboarding existing hemp edible retailers and producers. By March 2025 at the latest, all of the new licensed cannabis retailers and producers will be preparing to launch. Compiling an application for any cannabis or hemp license is a long and difficult process, and it will be important for groups and people to determine all of the new requirements for their business. Many of those requirements will be written and published over much of the rest of this year, but the Labor Peace Agreement requirement is one of few that has already been established, and savvy parties will avoid the easy mistakes and have that LPA ready for their first application.