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Cannabis Sales and Live Events, pt 2

In my last post, I laid out some broader visions for any successful system that permits cannabis sales at live events: Positive, Safe, No Minor Use, Responsive/Agile, and Risk-Based. In this post, I want to lay out a more concrete vision of what those values might look like for a successful sales environment at a venue. In a later post, I will begin to explain what rules need to change and what new rules need to be developed in order to create this vision, but for now, I think it’s still useful to brainstorm and imagine what the Promised Land should look like.

Safe – There’s loads more to be discussed about this, but: trying cannabis products for the first time is always a more tenuous affair– not because cannabis is “dangerous”, but because we still do not know very much about how every individual will react to cannabis and THC. For every public venue that is conducting sales, there needs to be plans to accommodate people that are experiencing unpleasant effects, both for their own sake and for others. Some ways that venue cannabis sales can be made safe include:

  • Tiers of potency – As we currently operate in most states, limits on potency are most-often treated as baselines/floors for potency. If a jurisdiction limits edibles/beverage consumption to 10mg THC per serving, most lines will release options that are exactly 10mg. For the purposes of public safety, however, I think it’s quite reasonable to require that a public venue offer a variety of potencies and options for people. 2mg, 5mg, and 10mg beverage options, or even better– offer types of cannabis products that have different ratios of THC to CBD, like 1:2 or even 1:5. Limited options with higher potency is a recipe for increased unpleasant experiences, and also a recipe for decreased sales.
  • Chill-out area/Sequestration – for some people, cannabis may cause anxiety or panic, especially in a public space. For the purposes of public safety and for ensuring maximum enjoyment for others, having a well-advertised and accessible “cool-down zone” will be a smart idea. This doesn’t need to be an extravagant accommodation– think something akin to a tobacco smoking section at a stadium, located somewhere outside the general flow of traffic and oftentimes outside the direct audience for a show.
  • Effective cross-fading prevention – “Cross-fading”, otherwise known as consuming cannabis and alcohol in the same session, is something that venues should look to effectively prevent. Although there are many people who claim to be able to handle both substances at the same time, public policy and safety would suggest that permitting cross-fading at a public venue is only a recipe for problems. How a venue ensures that people don’t consume cannabis and alcohol simultaneously is a question of protocols and practices. Perhaps the most straight-forward system would involve different colored bracelets for customers– the cannabis retail spots will give a green wristband to every person who purchases cannabis at the game, and alcohol retail can offer red wristbands. Employees of each space should be trained on the venue policy, and on ensuring that no one who has been served one substance is permitted to cross over and purchase the second substance at the same event.
  • CBD – A little preface: there is much to still be properly determined about CBD’s ability to address anxiety in individuals, and the most honest assessment of the field would say that there are way too many promises made about CBD. That said, there have been multiple studies that point towards CBD being a promising option for anxiety, and no evidence so far that CBD has potential for abuse or negative indicators of toxicity. Contrary to some beliefs, CBD does not “cancel out” the effects of THC, but it does seem to reduce anxiety. As a precautionary measure, venues should strongly consider also offering CBD-only products alongside the THC products (and I would suggest offering them at a discount to THC). Venue officials should also consider carrying CBD products in the cool-out area.

No Minor Use – This is pretty straightforward in theory, but will need some fleshing out.

  • Well-publicized zero tolerance policies – It’s simply not enough to presume that the public will know and abide by a venue’s policies, and its standards for removal. A venue should happily promote the cannabis products that they offer, but should also be consistent in communicating to people the seriousness with which the venue looks at under age use. Make clear to everyone that anyone found giving THC products to underage people will be asked to leave the venue, immediately, with no refund. Publicize the contact info for audience reporting. Repeat this info before, during, and after games and concerts. Thank the audience for participating in making sure that the entire audience has a good and safe time.
  • Effective Customer Identification as a Cultural Value – Much like alcohol, complying with laws around customer age verification will apply here. Also, much like alcohol compliance, cannabis compliance is the produce of a culture, rather than a moral challenge for each salesperson. From leadership down to the floor staff, a venue must communicate that preventing under-age sales is important and worth focusing on.
  • Potentially: a season ban on consuming cannabis products for anyone that is caught distributing cannabis to minors. Removal from the stadium or venue might be effective in some cases, but I’m also interested in the idea of a venue creating a Do Not Serve list for the rest of a year as a proper consequence for open violators.

Risk-Based – Rather than blanket policies that apply to all venues and arenas, live event sales should be effective and applicable to each space. Venue operators should be expected to continuously reevaluate their cannabis sales practices with an eye towards effectively addressing potential harms where they are found. What this looks like:

  • Recognizing the particular type of audience that a venue tends to attract – If you are a concert venue that often has all-ages or 18+ shows, you have different risk profiles and challenges than an art gallery that occasionally offers experimental art/music performances. If you are a venue that hosts both professional sports and large concerts, preventing minor use of cannabis will be different than a small indoor venue that focuses on jazz ensembles and private parties. Venues must be aware of how they serve products, where risks could occur, and address the risks as they are, not as a legislator might assume them to be.
  • Objective and data-driven policies – Hypotheticals can be helpful (heck, this blog post is based in hypotheticals!), but they can also create unintentional blind spots. As has been demonstrated often in the first decade of licensed cannabis sales, rulemakers and legislators can create onerous and ineffective regulations when they operate based off of gut logic, fears, or worries. Risk-based cannabis regulations take action based off of objective data, and are more effective for doing so. Venues should proactively survey their own practices, and work with local enforcement and regulators to ascertain what is actually happening, and take steps to address the actual harms where they occur.

Responsive/Agile – Cannabis sales at venues will take a wide variety of forms and designs, new risks will occur where no one anticipated them, and having a hard or fixed mentality will only cause further problems. Both venues and regulators must respond to harms where they arise, and be willing to adjust their practices to meet new problems. Perhaps most importantly, a responsive regulatory system will reward compliant/noble actors, and sanction hardened rule-breakers. If a venue is proactive in meeting concerns and conducting safe sales, regulators and legislators should be looking to promote and appreciate the behavior, and use the example as a method to encourage other actors to adopt similar practices. Regulators should be researching and promoting best practices for live event cannabis sales as the regulators encounter them. By framing the issue as one of agility and responsiveness, we can move past the old-fashioned antagonism between regulator and operator, and work towards everyone recognizing that successful cannabis sales are a team effort.

Positive – Incorporating cannabis sales into live events is, I believe, a positive step for society. But even if I didn’t believe that, it’s important for a regulatory system to act as if cannabis sales are a positive addition, and work hard to welcome it as such. Half-measures are a precursor to unsatisfied customers, sloppier compliance, and frustration with the venue experience. Positive cannabis regulations will be looking towards ways to improve operations, rather than restrain or cage cannabis into a smaller offering. Cannabis products should be offered alongside other venue fare, and consuming cannabis responsibly at a venue should be viewed as a great success, rather an unfortunate accommodation. I’m generally agnostic on the idea of in-venue cannabis advertisements– I think I’m fine with a prohibition on billboards or advertisements encouraging cannabis consumption in the public eye (or where young people in the audience may encounter them), and with understated signage and siting being used to make clear where cannabis can be purchased within the venue.

So, there’s a glimpse at some of the ways that live cannabis sales can be created to uphold pro-social values and behavior. I realize that there are many within the cannabis industry who would like an easier system that allowed a wider array of activities, and like any business owners, many in cannabis think that less regulations equates with better regulations. I politely disagree with these people – introducing licensed cannabis to our world is a challenge, and there are issues to address and regulate against. We desperately need cannabis to re-enter polite society, and demonstrate that cannabis isn’t synonymous with breaking rules and self-centered behavior– all of us have an interest in this stuff working well. This is why I ask so much of cannabis operators and activists, and expect to hold us to higher standard. I firmly believe we can meet that safe standard, but it takes a serious attempt and well-meaning folks to become involved.

Next time: an overview of the impediments to live event cannabis sales, and a sketch of some of the laws and regulations that will need to change in order to create this scenario.

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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.