Cannabis News

OSOYOOS, British Columbia, Dec. 08, 2020 (GLOBE NEWSWIRE) — via CannabisNewsWire — PRESS RELEASE — Way2Grow Nurseries, a privately owned biopharma company, has announced that it has received Health Canada’s approval for the standard cultivation, standard processing and sale for medical purposes under the Cannabis Regulations. The licenses are effective as of Nov. 20, 2020.

Licensing

The terms of the licenses include approval of a single-story production facility designed to support micropropagation tissue culture, organic cultivation, processing and medical sales requirements. Phase II plans include the expansion of the research laboratory, expansion of controlled cultivation rooms and the addition of a medical dispensary.

The W2G cultivation relies on a small, closed room approach to grow consistent organic medical cannabis. Each W2G cultivar starts with a consistent phyto-pharmaceutical feedstock growth plan through the use of tissue culture and molecular biology. Each cultivation room then operates specific to the cultivar’s growth plan and cultivar optimal conditions to create consistent medical quality.

Way2Grow has developed a new and strategic organic approach to the cannabis industry by combining its expertise in organic cultivation technology, an experienced genetic advancement team, innovative pharmaceutical research plans and IP development, coupled with the highest level of security and design using the W2G Design Standard. Way2Grow believes this unique combination will lead to the highest quality, safest, organic medical cannabis products and pharmaceuticals.

The licenses are valid for a three-year period until Nov. 20, 2023, and are subject to customary terms and conditions.

George Weiblen, a professor in the College of Biological Sciences at the University of Minnesota and the science director and curator of plants at the Bell Museum, has been working since 2002 to discover the genetic differences between hemp and marijuana.

He’s recently cracked a major component of the code.

A research team led by the Weiblen Lab has developed a genetic test that can predict whether cannabis will produce mostly cannabidiol (CBD) or tetrahydrocannabinol (THC), having broad implications for both cannabis and hemp industries.

The team’s findings were recently published in the American Journal of Botany.

While Weiblen acknowledges that other similar tests have been developed, the University of Minnesota’s research and test delve deeper into the biology and mechanisms behind why the test works. In other words, they’ve discovered on the molecular level why certain cannabis varieties produce more CBD and why others produce more THC.

“We are looking at the genes that are ultimately responsible for the pattern we see,” Weiblen tells Cannabis Business Times and Hemp Grower. “What we’ve done is proven our model across lots of different kinds of cannabis, from industrial hemp to medicinal cannabis to feral ditchweed [wild hemp].”

How it Works

Weiblen says across all types of cannabis, a small area of their chromosomes determines whether the plant will be one of three types: CBD-dominant, THC-dominant or intermediate with approximately equal levels of each.

The team found these consistencies by studying more than 350 different samples of cannabis. (The Weiblen Lab has a DEA research registration and obtained drug cannabis from the National Institute on Drug Abuse.)

The lab test developed by the research team homes in on one gene: the gene for CBD. This gene has two variations that result in it either producing CBD or failing to produce CBD, Weiblen says. Those variations are different sizes on the chromosome, so the test measures the length of the gene to determine which variation it is.

“Just like in humans, where we have two copies of each chromosome, so does cannabis,” Weiblen says. “As a plant, you can either have two working copies of the CBD gene, two faulty copies of the CBD gene, or one of each. How much CBD [the plant makes] depends on which of those three combinations you have.”

It’s much like hair types for humans. For example, if a mother has curly hair and a father has straight hair, their child’s hair could be either curly, straight or something in between.

Interestingly, Weiblen’s team also found the gene for THC is tied to the gene for CBD, and the two interplay to produce the three different types of cannabis.

A Surprising Discovery

During the team’s research, they studied feral hemp populations across Minnesota. And while a majority of those samples met the legal definition of hemp at 0.3% THC or less, others were more complex.

In an unexpected finding, Weiblen discovered that roughly one in 10 feral hemp plants in Minnesota had potential to exceed the legal definition of hemp at maturity. They found 11% of their samples were intermediate-type cannabis, while 1% was THC-type.  

“We found a marijuana needle in the hemp haystack,” Weiblen says.

It’s important to note that the amount of cannabinoids cannabis produces is a different story. Even if cannabis is THC-type, it could still potentially produce so few cannabinoids that it remains within compliance of the federal definition of hemp. While “the ratio of cannabinoids is entirely a genetic phenomenon,” Weiblen says, different environmental factors have been shown to dictate how much cannabinoid content cannabis actually produces.

Still, this finding raised questions for Weiblen, especially as many hemp growers and all cannabis growers are looking to not only produce cannabinoids, but also maximize them.

As such, the researchers have suggested changing the definitions of “hemp” and “marijuana” to align with their findings—instead of defining different cannabis varieties by the amount of cannabinoids they produce, which is reliant on outside factors and can vary wildly, the researchers propose defining them by their cannabinoid “types.”

“As a botanist, we don’t classify plants based on how people use them, but how they differ [genetically],” Weiblen says, adding that the definitions of hemp and marijuana carry both confusion and, in some case, negative connotations. “Now that we see public policy and public perceptions around cannabis really changing, we suggest maybe it’s time to define types of cannabis around their cannabinoid content rather than carry with us all the historical baggage.”

“We found a marijuana needle in the hemp haystack.” -George Weiblen, professor, University of Minnesota

Implications for the Hemp Industry

Beyond public policy implications, the research team’s findings could also make it easier for cannabinoid producers to choose their genetics—an improvement that is sorely needed in the nascent hemp industry especially.

Some hemp farmers are still having difficulty with hot crops that exceed the federal THC limit. This has been due, in part, to troubles sourcing reliable genetics.

Weiblen says this new test could be a good first step in preventing hot crops. Successful crops start with good genetics, and Weiblen envisions seed certification organizations using this test to help eliminate THC-type cannabis from ever reaching hemp growers’ hands.

“One advantage of our test if it’s applied is that it can give farmers some assurance of what is the predominant cannabinoid they’re going to see in their plants,” Weiblen says. “They don’t have to wait until end of growing season to learn that.”

According to a press release sent out last week, Kennebec Analytical Services (KAS) announced that they have acquired Cannabis Testing Laboratories (CTL), which was previously owned by Doane University. KAS is based in Lincoln, Nebraska and provides testing services for hemp and CBD producers in Nebraska.

CTL was a wholly-owned subsidiary of Doane University, renting space at the liberal arts college based in Crete, Nebraska. CTL gained ISO 17025 accreditation back in July of this year.

CTL operates independently of the university, but the lab is a resource for faculty and students. There are internship and experiential learning opportunities available at the lab for students. In addition to that, the lab also helps faculty that teach cannabis-related courses.

Last year, Doane University announced the launch of their Professional Cannabis Certificate Program. In June of this year, the university expanded their course offerings in cannabis, with seven courses available this fall semester.

Concetta DiRusso, Ph.D. is the CEO of KAS and says CTL has done provided testing for over 50% of Nebraska’s hemp market and provides hemp farmers with educational resources as the market gets off the ground. “Drs. Andrea Holmes, CTL founder, and Arin Sutlief, Laboratory Director, have done an outstanding job for Nebraska hemp farmers,” says Dr. DiRusso. “KAS is committed to continuing these valuable relationships and services for the hemp and CBD industries.”

George Weiblen, a professor in the College of Biological Sciences at the University of Minnesota and the science director and curator of plants at the Bell Museum, has been working since 2002 to discover the genetic differences between hemp and marijuana.

He’s recently cracked a major component of the code.

A research team led by the Weiblen Lab has developed a genetic test that can predict whether cannabis will produce mostly cannabidiol (CBD) or tetrahydrocannabinol (THC), having broad implications for both cannabis and hemp industries.

The team’s findings were recently published in the American Journal of Botany.

While Weiblen acknowledges that other similar tests have been developed, the University of Minnesota’s research and test delve deeper into the biology and mechanisms behind why the test works. In other words, they’ve discovered on the molecular level why certain cannabis varieties produce more CBD and why others produce more THC.

“We are looking at the genes that are ultimately responsible for the pattern we see,” Weiblen tells Cannabis Business Times and Hemp Grower. “What we’ve done is proven our model across lots of different kinds of cannabis, from industrial hemp to medicinal cannabis to feral ditchweed [wild hemp].”

How it Works

Weiblen says across all types of cannabis, a small area of their chromosomes determines whether the plant will be one of three types: CBD-dominant, THC-dominant or intermediate with approximately equal levels of each.

The team found these consistencies by studying more than 350 different samples of cannabis. (The Weiblen Lab has a DEA research registration and obtained drug cannabis from the National Institute on Drug Abuse.)

The lab test developed by the research team homes in on one gene: the gene for CBD. This gene has two variations that result in it either producing CBD or failing to produce CBD, Weiblen says. Those variations are different sizes on the chromosome, so the test measures the length of the gene to determine which variation it is.

“Just like in humans, where we have two copies of each chromosome, so does cannabis,” Weiblen says. “As a plant, you can either have two working copies of the CBD gene, two faulty copies of the CBD gene, or one of each. How much CBD [the plant makes] depends on which of those three combinations you have.”

It’s much like hair types for humans. For example, if a mother has curly hair and a father has straight hair, their child’s hair could be either curly, straight or something in between.

Interestingly, Weiblen’s team also found the gene for THC is tied to the gene for CBD, and the two interplay to produce the three different types of cannabis.

A Surprising Discovery

During the team’s research, they studied feral hemp populations across Minnesota. And while a majority of those samples met the legal definition of hemp at 0.3% THC or less, others were more complex.

In an unexpected finding, Weiblen discovered that roughly one in 10 feral hemp plants in Minnesota had potential to exceed the legal definition of hemp at maturity. They found 11% of their samples were intermediate-type cannabis, while 1% was THC-type.  

“We found a marijuana needle in the hemp haystack,” Weiblen says.

It’s important to note that the amount of cannabinoids cannabis produces is a different story. Even if cannabis is THC-type, it could still potentially produce so few cannabinoids that it remains within compliance of the federal definition of hemp. While “the ratio of cannabinoids is entirely a genetic phenomenon,” Weiblen says, different environmental factors have been shown to dictate how much cannabinoid content cannabis actually produces.

Still, this finding raised questions for Weiblen, especially as many hemp growers and all cannabis growers are looking to not only produce cannabinoids, but also maximize them.

As such, the researchers have suggested changing the definitions of “hemp” and “marijuana” to align with their findings—instead of defining different cannabis varieties by the amount of cannabinoids they produce, which is reliant on outside factors and can vary wildly, the researchers propose defining them by their cannabinoid “types.”

“As a botanist, we don’t classify plants based on how people use them, but how they differ [genetically],” Weiblen says, adding that the definitions of hemp and marijuana carry both confusion and, in some case, negative connotations. “Now that we see public policy and public perceptions around cannabis really changing, we suggest maybe it’s time to define types of cannabis around their cannabinoid content rather than carry with us all the historical baggage.”

“We found a marijuana needle in the hemp haystack.” -George Weiblen, professor, University of Minnesota

Implications for the Hemp Industry

Beyond public policy implications, the research team’s findings could also make it easier for cannabinoid producers to choose their genetics—an improvement that is sorely needed in the nascent hemp industry especially.

Some hemp farmers are still having difficulty with hot crops that exceed the federal THC limit. This has been due, in part, to troubles sourcing reliable genetics.

Weiblen says this new test could be a good first step in preventing hot crops. Successful crops start with good genetics, and Weiblen envisions seed certification organizations using this test to help eliminate THC-type cannabis from ever reaching hemp growers’ hands.

“One advantage of our test if it’s applied is that it can give farmers some assurance of what is the predominant cannabinoid they’re going to see in their plants,” Weiblen says. “They don’t have to wait until end of growing season to learn that.”

Editor’s Note: This article has been adapted from Chapter 10: Mistakes That Can Jeopardize Your Project from Getting Grow Rooms Right, written by Geoff Brown, Quest’s VP of Technical Solutions, and Dan Dettmers, Quest’s Applications Engineer.

Unlike many other subjects in the construction field, information is scarce when it comes to grow room designs and control practices. As a result, there are common mistakes that can be made by almost anyone—mistakes that hold the potential to limit your grow room project’s success. The consequences of these oversights vary, but in all cases, they could possibly damage your long-term viability by reducing your business effectiveness, increasing your operating expenses, reducing your crop output and quality or posing various other problems.

Here, we review some of the most serious errors and how you can avoid them in your cannabis grow room project.

1. Not Understanding and Articulating Your Desires

Many problems that can happen in a project trickle down from the fact that people involved in the project are not entirely clear on what kind of results the grower is seeking.

It’s very important that you nail down early in the project exactly what it is you’re looking for, why you’re looking for that, and communicate it clearly. Grower expectations can vary quite a bit depending on the type of facility and intended final use of the product. What is needed for fine bud may not be the same as what is required for oil extracts. As a result, key design factors such as the type and intensity of lighting and temperatures/humidity levels for each room must be agreed upon by all involved parties. These operating conditions form the basis for all other aspects of the design as well as the capital, operating and maintenance costs of equipment required to maintain desired conditions.

Considering different product purposes and grower expectations, clearly there is not a “one size fits all” formula for the “perfect” or even “standard” grow facility. Each project should be approached with a blank slate and designed with specific goals in mind.

Ensure that you have every aspect of the space conditions and related factors agreed upon before you move into the design phase, in what’s called a “design intent” document, created by the engineer. This is the only way to ensure that the project will meet grower expectations and stay within the allocated budget.

The first and single most important step in grow room design is for all parties to meet during the preliminary stages. By involving everyone from the start, you can clarify expectations for the project at the initial stage. This vital step ensures that everyone is on the same page and lays the foundation to keep the project on track. An initial meeting is both time and cost effective, plus it goes a long way in establishing a good working relationship with everybody involved in the project.

Do not use “expected” operating conditions from a generic table. Everyone should take the time to review the requirements of this specific grow room. It’s important to be aware that some facilities operate with temperatures and humidity requirements outside of what we would generally consider standard. It is essential to recognize that different grow rooms may call for different conditions either due to their strain, plant species or intended purpose.

When expectations have been expressed and are understood by everyone involved in the design process, it’s time to figure out which solutions can satisfy the requirements.

The operating budget needs to be considered in the planning stage. Every cost, from energy to water, materials to maintenance, should be factored in.

If for some reason the projected operating costs are higher than the available budget, you might have to go back to the drawing board and determine what you can adjust to bring costs back down. Remember that energy costs will be volatile over time and inflation will also have its impact. To play it safe, it’s advisable to make sure that the operating costs fall well within the budget and do not reach the upper end of what’s affordable. This is also why it’s very important to strive for energy-efficient equipment as it provides more predictability in the long term.

Once the operating conditions are agreed on by all involved parties, make sure to create a document regarding the exact conditions to serve as a reminder of what was agreed. If expectations are not firmly decided on and communicated, the grower could end up with the wrong solutions for their needs.

2. Misguided Value Engineering

Value engineering is a technique used in project management that seeks to decrease the purchase price of equipment. Ideally, it would result in a product that costs less but delivers the same performance as a more expensive option.

Value engineering is often used in a budget crunch to bring down the price of HVAC equipment in grow rooms through the elimination of several key functions that contribute to a good environment. The thinking is that, while these features are important, they are not technically required for the unit to operate. But this represents a profound misunderstanding of how these features work and the value of having them in place.

There is also a misunderstanding of the difference between first-cost and total cost of ownership. Often, in the bid and procurement process, there is a motivation to obtain equipment at the lowest possible first-cost. However, this analysis neglects the overall investment of buying equipment which, if done correctly, will pay dividends for many years in reduced costs for operating and maintaining the unit.

Selecting equipment for a grow room is an investment in the facility. Spending more allows you to get better equipment that offers more high-performance features that improve efficiency and longevity. Just like any other product, there are HVAC manufacturers that offer cheaper, but inferior, products. Avoiding this low-quality equipment is important if you’re aiming for a high-performing facility.

While value engineering is a legitimate technique to use when there is a limited capital budget in place, everybody involved in the project should understand the dangers of seeking only the lowest bid.

The optimal balance of capital-cost, installation costs, and maintenance and operating costs will deliver outstanding return-on-investment for the grower. First-cost is, simply, the initial cost to buy the equipment. It considers factors like whether there are any add-on features to the HVAC (like economizer cooling or heat recovery) and can vary depending on the brand and quality of equipment. First-cost can also be called capital cost and that is usually how it’s expressed in a budget line.

Installation carries its own costs that need to be carefully considered in the total purchase price. Total cost of ownership is everything that happens after first-cost, such as the cost of energy to run the unit, the effort required to maintain it, whether the grower will need expensive repairs, and how soon the unit will need replacement. Total cost of ownership can easily, over time, eclipse the first-cost of some equipment. Therefore, both of these costs must be estimated and considered before making any buying decisions. Spending more on the front-end (CAPEX) can avoid greater costs on the back-end (OPEX).

The grower should get involved in the procurement of their equipment because they will be saddled with the long-term costs associated with whatever is purchased. They need to understand what the cost breakdown is for all the equipment that’s being considered in order to decide what works best for their business objectives. The grower should ask many questions and make sure they are being told the reasons for certain equipment recommendations and existing alternatives.

There are some features for HVAC that are considered “optional” add-ons. These may include economizer cooling and heat recovery. These features may be eliminated to pare down the cost of equipment. But does it really result in the same performance? And is eliminating some of these features a smart investment?

Another important issue to consider that is easily forgotten is how much maintenance the selected equipment will require. Every piece of equipment needs some attention periodically. But cheaper equipment can require closer attention than those of a higher grade. By choosing higher-quality components that are more efficient and require less annual maintenance, facilities can realize greater profit over time.

3. Don’t Take a Piecemeal or Band-Aid Approach

Creating a grow facility needs to be a holistic process that considers all the systems as contributing to one environment.

The grower needs to have a plan for how they’re going to tackle every aspect in the near and long term. Most growers build their facilities in multiple stages, which is a smart way to go, but there needs to be come detailed central planning behind it. Know how you’re going to scale that first phase after it’s built.

It’s also important that everything be ready when it’s time to hit the “on” switch, figuratively speaking. If you try to get started, for example, with your HVAC equipment but the building management software is not yet operational, there could be serious problems that occur as a result of launching a half-baked system.

The same goes for relying on cheap band-aid solutions for problems entirely created by short-sighted decisions in the design process. An example of this are extra fans many growers have added to their grow rooms to increase air churn because the HVAC specifications are insufficient to provide the turnover a grow facility needs. While they do improve the churn, it comes at a cost of adding more heat into the space, something often not accounted for in the cooling load calculations.

4. Don’t Pick Vendors—Pick Partners

Picking someone who is looking to be a vendor to you, and not a partner, is a potential mistake for your business.

A partner in this sense means someone you work with who genuinely has your company’s best interests in mind. You should choose someone who is invested in working with you for the long haul to ensure your total success.

Partners understand your business, including all aspects, not just the particular area they deal with. Partners want to help solve your problems. They should also be willing to provide advice based on their experience, even if it means there may be no sale in the end. Partners are willing to make what they sell work for you, and keep it working for the long term.

When you have found one you trust, put that trust where it matters and collaborate with them on whatever solution they are providing. There is certain key information you need to provide to an HVAC partner to allow them to investigate the right equipment for your needs. Because of the proprietary nature of this business, most growers would only feel comfortable about discussing some of these details with someone they trust—a partner, not just any vendor.

Listen to your partner’s recommendations, particularly when it comes to installing their equipment and interfacing it with your grow rooms. Not all solutions are the same, and what may have worked in a previous phase or with previous equipment may not work the same way with new gear. Just as how the master grower knows about their plants, manufacturers know about their equipment. This work requires a high level of trust and confidence in each other, which is why it’s so important you find a manufacturer you can consider a partner.

Dan Dettmers is an Applications Engineer at Quest and its Controlled Environmental Agriculture division. Before Quest, Dettmers dedicated over 20 years to research and instruction at University of Wisconsin-Madison, primarily in industrial refrigeration for food and pharmaceutical processing. In his current role, Dettmers leads efforts to develop more efficient methods for handling latent loads and improving the air quality for cannabis and all controlled environmental agriculture operations. He is a contributing member to The American Society of Agricultural and Biological Engineers (ASABE) X653 guideline “Heating, Ventilating, and Air Conditioning (HVAC) for Indoor Plant Environments without Sunlight.”

Geoff Brown started his HVAC career over 15 years ago and has honed his expertise, dealing in every aspect of dehumidification throughout his career. Prior to his position with Quest, Brown was a senior sales manager and sales engineer, who consulted on and managed various successful dehumidification projects. As one of North America’s leading authorities on HVAC for grow rooms, Brown participates in various advisory boards in the cannabis industry and is a contributing member to ASABE X653 guideline “Heating, Ventilating, and Air Conditioning (HVAC) for Indoor Plant Environments without Sunlight.”

George Weiblen, a professor in the College of Biological Sciences at the University of Minnesota and the science director and curator of plants at the Bell Museum, has been working since 2002 to discover the genetic differences between hemp and marijuana.

He’s recently cracked a major component of the code.

A research team led by the Weiblen Lab has developed a genetic test that can predict whether cannabis will produce mostly cannabidiol (CBD) or tetrahydrocannabinol (THC), having broad implications on both cannabis and hemp industries.

The team’s findings were recently published in the American Journal of Botany.

While Weiblen acknowledges that other similar tests have been developed, the University of Minnesota’s research and test delve deeper into the biology and mechanisms behind why the test works. In other words, they’ve discovered on the molecular level why certain cannabis produces more CBD and vice versa for THC.

“We are looking at the genes that are ultimately responsible for the pattern we see,” Weiblen tells Cannabis Business Times and Hemp Grower. “What we’ve done is proven our model across lots of different kinds of cannabis, from industrial hemp to medicinal cannabis to feral ditchweed [wild hemp].”

How it Works

Weiblen says across all types of cannabis, a small area of their chromosomes determines whether the plant will be one of three types: CBD-dominant, THC-dominant or intermediate with approximately equal levels of each.

The team found these consistencies by studying more than 350 different samples of cannabis. (The Weiblen Lab has a DEA research registration and obtained drug cannabis from the National Institute on Drug Abuse.)

The lab test developed by the research team homes in on one gene: the gene for CBD. This gene has two variations that result in it either producing CBD or failing to produce CBD, Weiblen says. Those variations are different sizes on the chromosome, so the test measures the length of the gene to determine which variation it is.

“Just like in humans, where we have two copies of each chromosome, so does cannabis,” Weiblen says. “As a plant, you can either have two working copies of the CBD gene, two faulty copies of the CBD gene, or one of each. How much CBD [the plant makes] depends on which of those three combinations you have.”

It’s much like hair types for humans. For example, if a mother has curly hair and a father has straight hair, their child’s hair could be either curly, straight or something in between.

Interestingly, Weiblen’s team also found the gene for THC is tied to the gene for CBD, and the two interplay to produce the three different types of cannabis.

A Surprising Discovery

During the team’s research, they studied feral hemp populations across Minnesota. And while a majority of those samples met the legal definition of hemp at 0.3% THC or less, others were more complex.

In an unexpected finding, Weiblen discovered that roughly one in 10 feral hemp plants in Minnesota had potential to exceed the legal definition of hemp at maturity. They found 11% of their samples were intermediate-type cannabis, while 1% was THC-type.  

“We found a marijuana needle in the hemp haystack,” Weiblen says.

It’s important to note that the amount of cannabinoids cannabis produces is a different story. Even if cannabis is THC-type, it could still potentially produce so few cannabinoids that it remains within compliance of the federal definition of hemp. While “the ratio of cannabinoids is entirely a genetic phenomenon,” Weiblen says, the amount of cannabinoids produced still has a significant environmental component.

Still, this finding raised questions for Weiblen, especially as many hemp growers and all cannabis growers are looking to not only produce cannabinoids, but also maximize them.

As such, the researchers have suggested changing the definitions of “hemp” and “marijuana” to align with their findings—instead of defining different cannabis types by the amount of cannabinoids they produce, which is reliant on outside factors and can vary wildly, the researchers propose defining them by their cannabinoid “types.”

“As a botanist, we don’t classify plants based on how people use them, but how they differ [genetically],” Weiblen says, adding that the definitions of hemp and marijuana carry both confusion and, in some case, negative connotations. “Now that we see public policy and public perceptions around cannabis really changing, we suggest maybe it’s time to define types of cannabis around their cannabinoid content rather than carry with us all the historical baggage.”

Implications for the Hemp Industry

Beyond public policy implications, the research team’s findings could also make it easier for cannabinoid producers to choose their genetics—an improvement that is sorely needed in the nascent hemp industry especially.

Some hemp farmers are still having difficulty with hot crops that exceed the federal THC limit. This has been due, in part, to troubles sourcing reliable genetics.

Weiblen says this new test could be a good first step in preventing hot crops. Successful crops start with good genetics, and Weiblen envisions seed certification organizations using this test to help eliminate THC-type cannabis from ever reaching hemp growers’ hands.

“One advantage of our test if it’s applied is that it can give farmers some assurance of what is the predominant cannabinoid they’re going to see in their plants,” Weiblen says. “They don’t have to wait until end of growing season to learn that.”

Editor’s Note: This article has been adapted from Chapter 10: Mistakes That Can Jeopardize Your Project from Getting Grow Rooms Right, written by Geoff Brown, Quest’s VP of Technical Solutions, and Dan Dettmers, Quest’s Applications Engineer.

Unlike many other subjects in the construction field, information is scarce when it comes to grow room designs and control practices. As a result, there are common mistakes that can be made by almost anyone—mistakes that hold the potential to limit your grow room project’s success. The consequences of these oversights vary, but in all cases, they could possibly damage your long-term viability by reducing your business effectiveness, increasing your operating expenses, reducing your crop output and quality or posing various other problems.

Here, we review some of the most serious errors and how you can avoid them in your cannabis grow room project.

1. Not Understanding and Articulating Your Desires

Many problems that can happen in a project trickle down from the fact that people involved in the project are not entirely clear on what kind of results the grower is seeking.

It’s very important that you nail down early in the project exactly what it is you’re looking for, why you’re looking for that, and communicate it clearly. Grower expectations can vary quite a bit depending on the type of facility and intended final use of the product. What is needed for fine bud may not be the same as what is required for oil extracts. As a result, key design factors such as the type and intensity of lighting and temperatures/humidity levels for each room must be agreed upon by all involved parties. These operating conditions form the basis for all other aspects of the design as well as the capital, operating and maintenance costs of equipment required to maintain desired conditions.

Considering different product purposes and grower expectations, clearly there is not a “one size fits all” formula for the “perfect” or even “standard” grow facility. Each project should be approached with a blank slate and designed with specific goals in mind.

Ensure that you have every aspect of the space conditions and related factors agreed upon before you move into the design phase, in what’s called a “design intent” document, created by the engineer. This is the only way to ensure that the project will meet grower expectations and stay within the allocated budget.

The first and single most important step in grow room design is for all parties to meet during the preliminary stages. By involving everyone from the start, you can clarify expectations for the project at the initial stage. This vital step ensures that everyone is on the same page and lays the foundation to keep the project on track. An initial meeting is both time and cost effective, plus it goes a long way in establishing a good working relationship with everybody involved in the project.

Do not use “expected” operating conditions from a generic table. Everyone should take the time to review the requirements of this specific grow room. It’s important to be aware that some facilities operate with temperatures and humidity requirements outside of what we would generally consider standard. It is essential to recognize that different grow rooms may call for different conditions either due to their strain, plant species or intended purpose.

When expectations have been expressed and are understood by everyone involved in the design process, it’s time to figure out which solutions can satisfy the requirements.

The operating budget needs to be considered in the planning stage. Every cost, from energy to water, materials to maintenance, should be factored in.

If for some reason the projected operating costs are higher than the available budget, you might have to go back to the drawing board and determine what you can adjust to bring costs back down. Remember that energy costs will be volatile over time and inflation will also have its impact. To play it safe, it’s advisable to make sure that the operating costs fall well within the budget and do not reach the upper end of what’s affordable. This is also why it’s very important to strive for energy-efficient equipment as it provides more predictability in the long term.

Once the operating conditions are agreed on by all involved parties, make sure to create a document regarding the exact conditions to serve as a reminder of what was agreed. If expectations are not firmly decided on and communicated, the grower could end up with the wrong solutions for their needs.

2. Misguided Value Engineering

Value engineering is a technique used in project management that seeks to decrease the purchase price of equipment. Ideally, it would result in a product that costs less but delivers the same performance as a more expensive option.

Value engineering is often used in a budget crunch to bring down the price of HVAC equipment in grow rooms through the elimination of several key functions that contribute to a good environment. The thinking is that, while these features are important, they are not technically required for the unit to operate. But this represents a profound misunderstanding of how these features work and the value of having them in place.

There is also a misunderstanding of the difference between first-cost and total cost of ownership. Often, in the bid and procurement process, there is a motivation to obtain equipment at the lowest possible first-cost. However, this analysis neglects the overall investment of buying equipment which, if done correctly, will pay dividends for many years in reduced costs for operating and maintaining the unit.

Selecting equipment for a grow room is an investment in the facility. Spending more allows you to get better equipment that offers more high-performance features that improve efficiency and longevity. Just like any other product, there are HVAC manufacturers that offer cheaper, but inferior, products. Avoiding this low-quality equipment is important if you’re aiming for a high-performing facility.

While value engineering is a legitimate technique to use when there is a limited capital budget in place, everybody involved in the project should understand the dangers of seeking only the lowest bid.

The optimal balance of capital-cost, installation costs, and maintenance and operating costs will deliver outstanding return-on-investment for the grower. First-cost is, simply, the initial cost to buy the equipment. It considers factors like whether there are any add-on features to the HVAC (like economizer cooling or heat recovery) and can vary depending on the brand and quality of equipment. First-cost can also be called capital cost and that is usually how it’s expressed in a budget line.

Installation carries its own costs that need to be carefully considered in the total purchase price. Total cost of ownership is everything that happens after first-cost, such as the cost of energy to run the unit, the effort required to maintain it, whether the grower will need expensive repairs, and how soon the unit will need replacement. Total cost of ownership can easily, over time, eclipse the first-cost of some equipment. Therefore, both of these costs must be estimated and considered before making any buying decisions. Spending more on the front-end (CAPEX) can avoid greater costs on the back-end (OPEX).

The grower should get involved in the procurement of their equipment because they will be saddled with the long-term costs associated with whatever is purchased. They need to understand what the cost breakdown is for all the equipment that’s being considered in order to decide what works best for their business objectives. The grower should ask many questions and make sure they are being told the reasons for certain equipment recommendations and existing alternatives.

There are some features for HVAC that are considered “optional” add-ons. These may include economizer cooling and heat recovery. These features may be eliminated to pare down the cost of equipment. But does it really result in the same performance? And is eliminating some of these features a smart investment?

Another important issue to consider that is easily forgotten is how much maintenance the selected equipment will require. Every piece of equipment needs some attention periodically. But cheaper equipment can require closer attention than those of a higher grade. By choosing higher-quality components that are more efficient and require less annual maintenance, facilities can realize greater profit over time.

3. Don’t Take a Piecemeal or Band-Aid Approach

Creating a grow facility needs to be a holistic process that considers all the systems as contributing to one environment.

The grower needs to have a plan for how they’re going to tackle every aspect in the near and long term. Most growers build their facilities in multiple stages, which is a smart way to go, but there needs to be come detailed central planning behind it. Know how you’re going to scale that first phase after it’s built.

It’s also important that everything be ready when it’s time to hit the “on” switch, figuratively speaking. If you try to get started, for example, with your HVAC equipment but the building management software is not yet operational, there could be serious problems that occur as a result of launching a half-baked system.

The same goes for relying on cheap band-aid solutions for problems entirely created by short-sighted decisions in the design process. An example of this are extra fans many growers have added to their grow rooms to increase air churn because the HVAC specifications are insufficient to provide the turnover a grow facility needs. While they do improve the churn, it comes at a cost of adding more heat into the space, something often not accounted for in the cooling load calculations.

4. Don’t Pick Vendors—Pick Partners

Picking someone who is looking to be a vendor to you, and not a partner, is a potential mistake for your business.

A partner in this sense means someone you work with who genuinely has your company’s best interests in mind. You should choose someone who is invested in working with you for the long haul to ensure your total success.

Partners understand your business, including all aspects, not just the particular area they deal with. Partners want to help solve your problems. They should also be willing to provide advice based on their experience, even if it means there may be no sale in the end. Partners are willing to make what they sell work for you, and keep it working for the long term.

When you have found one you trust, put that trust where it matters and collaborate with them on whatever solution they are providing. There is certain key information you need to provide to an HVAC partner to allow them to investigate the right equipment for your needs. Because of the proprietary nature of this business, most growers would only feel comfortable about discussing some of these details with someone they trust—a partner, not just any vendor.

Listen to your partner’s recommendations, particularly when it comes to installing their equipment and interfacing it with your grow rooms. Not all solutions are the same, and what may have worked in a previous phase or with previous equipment may not work the same way with new gear. Just as how the master grower knows about their plants, manufacturers know about their equipment. This work requires a high level of trust and confidence in each other, which is why it’s so important you find a manufacturer you can consider a partner.

Dan Dettmers is an Applications Engineer at Quest and its Controlled Environmental Agriculture division. Before Quest, Dettmers dedicated over 20 years to research and instruction at University of Wisconsin-Madison, primarily in industrial refrigeration for food and pharmaceutical processing. In his current role, Dettmers leads efforts to develop more efficient methods for handling latent loads and improving the air quality for cannabis and all controlled environmental agriculture operations. He is a contributing member to The American Society of Agricultural and Biological Engineers (ASABE) X653 guideline “Heating, Ventilating, and Air Conditioning (HVAC) for Indoor Plant Environments without Sunlight.”

Geoff Brown started his HVAC career over 15 years ago and has honed his expertise, dealing in every aspect of dehumidification throughout his career. Prior to his position with Quest, Brown was a senior sales manager and sales engineer, who consulted on and managed various successful dehumidification projects. As one of North America’s leading authorities on HVAC for grow rooms, Brown participates in various advisory boards in the cannabis industry and is a contributing member to ASABE X653 guideline “Heating, Ventilating, and Air Conditioning (HVAC) for Indoor Plant Environments without Sunlight.”

The drug war has harmed communities of color since its inception. For decades and decades, BIPOC (Black, Indigenous, and other People of Color) have been nearly six times more likely to be arrested for drug use than White Americans, despite similar rates of use.

Over the years that legalized cannabis has proliferated across the country, the same trends of market consolidation have emerged in every state that has legalized the plant. BIPOC communities already impacted by the drug war have less access to capital and therefore less access to the cannabis industry. Cannabis market consolidation has always led to white people taking a greater market share while BIPOC communities are left behind.

The legal cannabis industry currently lacks representation of BIPOC executives, business owners, and professionals. Ernest Toney, former global marketing and partnerships manager at Marijuana Business Daily, wants to change that. He founded the BIPOC Cannabis Business Network – a membership community that is working to make the cannabis industry more accessible and profitable for BIPOC professionals and business owners.

BIPOCANN is a place to meet cannabis industry leaders, a place to exchange goods, services and ideas that promote BIPOC economic growth in cannabis, an innovation hub for unique voices and perspectives, and it’s all BIPOC-owned and managed.

In this interview, we sit down with Ernest Toney to hear about BIPOCANN and ask him some questions about the what the future of the cannabis industry could look like.

Cannabis Industry Journal: Tell me about your background- how did you get involved in the cannabis industry?

Ernest Toney: I grew up in Virginia and went to James Madison University where I studied kinesiology, and sports management in graduate school. That led me to pursue a career in sports administration, beginning as a sales and marketing director for a large YMCA in the southwest, followed by a stint as a sales consultant for the Arizona Diamondbacks in Major League Baseball. Immediately prior to joining the cannabis industry, I worked at USA Ultimate – the national governing body for the niche sport of ultimate (frisbee) in the United States. During that time, I managed and scaled adult programs and events across the country. A big part of my job required collaborating with national stakeholders and creating and enforcing policies to grow the sport by making it more accessible to diverse demographics. We also worked hard to increase the commercial visibility of the sport through mainstream media, including ESPN, with gender equity being a the major focus area It was cool because looking back, I learned a lot of things during that five-year period that have been able to apply to the work I’m doing to support the cannabis industry.

But my interest in the cannabis industry became strong when I moved to Denver in 2011, a year before Amendment 64 passed. When Colorado became the first adult use cannabis market in the USA, it was an exciting time. I have always been someone who thinks big picture, about economics and how policies can impact people’s lives. I was interested in what weas going to happen with this new market when it opened.

Early on, I followed the industry trends very closely. Living in downtown Denver, I saw firsthand the effects the cannabis industry was having on day-to-day life, like increased tourism, a housing market boom, a lot of new start-ups, dispensaries opening everywhere. It was just something I knew I wanted to learn more about.

Around 2016, I started making industry connections, but didn’t pursue opportunities until a few years later. Eventually, I was hired in 2018 by MJBizDaily to focus on new business initiatives. Some of my past successes with scaling programs, national and international event management, and community-building aligned with what they were looking for.

I started as the company’s first international marketing manager. In that role, I was responsible for driving marketing campaigns to increase the company’s global readership, event registrations, and business conference presence in foreign markets. After the first year, I transitioned to identify and manage marketing partnerships for the company – which included international and domestic media, event, and affiliate partnerships within and outside of cannabis.

I felt compelled to make a change amidst the social unrest this summer. I was doing my own protesting and volunteer advocacy in Denver, but started to see more broadly, in the cannabis industry, that cannabis executives and companies were bringing attention to the fact that the War On Drugs has been problematic for minorities and communities of color. There was greater talk about social equity programs and how they are not as effective as they should be. There was greater attention to the fact that over 40,000 people are still incarcerated for the plant that others are profiting from – and that the people behind bars are predominantly coming from communities of color. I was in a position that afforded me the opportunity to see what the composition of the global cannabis industry looked like, and I  could see minority representation was lacking in business ownership, leadership positions, and more.

I thought – what is the best way for me to use my talents, insights, and knowledge to affect and change this narrative? Ultimately, I decided to start my own business. Not only was this an opportunity for me to walk the walk being a black man starting a business in this industry where there is a lack of black ownership, but more importantly I was uniquely positioned to be able to educate and let people know about the opportunities to be a part of the booming industry. So, I did some brainstorming and came up with a company, which is called BIPOCANN and it stands for connecting BIPOC communities to the cannabis industry.

The work I have been doing for the last quarter includes directly recruiting people into the industry. If you are curious and want to learn more about the industry, then BIPOCANN can be the entry point. We figure out what your goals are and use the network and our resources to get you connected and figure out where you want to go. Likewise, if you are a service provider, like a graphic designer, accountant, marketer or business owner for example, that sees opportunities for your business to play a role and support it from an ancillary standpoint, BIPOCANN can be an entry point for you too.

The other component to it is working with existing businesses who are trying to make the industry more accessible. I work with existing companies and brands to create platforms that amplify voices and make BIPOC folks more visible, seen and heard within the cannabis industry. We are also helping businesses increase their profitability through diversification tactics and marketing tactics that contribute to their bottom line.

CIJ: Tell me about BIPOCANN- what is it, what are your goals with this project and how has it been received so far?

Ernest: BIPOCANN is a small business working to make the cannabis industry more accessible and profitable for BIPOC professionals and business owners. The prohibition of cannabis has disproportionately impacted communities of color in the Americas. I alluded to this earlier, but there are more than 40,000 people behind bars in the U.S. for cannabis possession and use. There’s evidence suggesting that Black Americans are up to six times more likely to get arrested for cannabis use than White Americans despite use rates being the same.

And then you look at the makeup of the professional industry, there is small representation of business ownership by people of color. The Cannabis Impact Fund references that only 4.3% of dispensaries are Black or Latinx-owned. These problems intersect in a lot of ways.

Now, I know that one company cannot change 100 years of cannabis prohibition and how policy works. But if you want to make this industry more accessible, inclusive, and profitable for those who do not have the access then there a lot of levers to pull. Policy is one. But BIPOCANN is using is more direct strategies now.  We actively recruit people to come in and be a part of this industry, through employment, entrepreneurship, consulting, and collaborations.

We have also created BIPOC Cannabis Business Network and we treat it like a chamber of commerce where members can exchange services, network, and collaborate. It’s all about creating more opportunities for BIPOC professionals and business owners, and it’s a safe space to share your experiences and to ideate. Similar to what you did in the Cannabis Quality Virtual Conference, where there was a dedicated space for BIPOC folks to be seen and heard and tell their story through your virtual panels, we use our resources and network to help advocates for equity and access be seen, heard, and find opportunities to thrive as a business owner or professional.

CIJ: How do you hope BIPOCANN will be embraced by the cannabis community?

Ernest: I think it has been received well in its first quarter of business. We have had opportunities to share our story across a lot of platforms, including multiple cannabis industry conferences, podcasts, and interviews with varied media outlets. We are in startup mode, so currently we are about building a brand, being seen, and helping people understand what we are trying to achieve. We are working towards that right now. We have had some success and folks are supporting our vision and goals.

I am hoping the cannabis industry will look at BIPOCANN as another important resource within the social equity, business development, and networking landscape. I don’t want to be seen as a competitor to the organizations and individuals who have been doing similar work in this space, for much longer, but as an ally. Some of our approaches to bring new people into the industry will include strategically aligning communities and markets where we have strong ties – such as state governments, national nonprofits, and global cannabis networks.

CIJ: Where do you see the cannabis industry making progress with respect to diversity and including people of color?

Ernest: When I look at the types of conversations  and coverage the industry is having, even compared to last year, it seems like more conferences, media entities, brands, and individual leaders are tuned in and trying to figure out how they can contribute to making this industry better, more equitable and more accessible. I am seeing a lot of more attention, attempts to understand where the gaps are and what to do about it.

When I take a step back to think of all the virtual conferences that have made dedicated conference tracks or even entire programs – like the National Association of Cannabis Business’ Social Equity Conference, the Emerge Canna Conference, the Cannabis Sustainability Symposium, and the Cannabis Industry Journal’s post-election social justice panel – or weekly segments from Black leaders like Dasheeda Dawson (She Blaze) and Tahir Johnson (The Cannabis Diversity Report) — those are good signs. They are creating opportunities for voices representing underserved communities in cannabis to share their perspectives and be advocates for change.

But there is still much to do and that includes greater education about the realities, histories, and challenges BIPOC and other minority communities are facing. Going back to the NACB, they recently drafted a social equity standard for state legislatures to use as a baseline for crafting policies and provisions for social equity programs. That and resources from organizations like the Minority Cannabis Business Association, Supernova Women, Cannaclusive, Minorities for Medical Marijuana, and the Massachusetts Recreational Consumer Council, for example are some useful resources for the industry.

Wana Brands is continuing to do good work, and it was exciting to see them become the first sponsor the inaugural Black CannaConference by the Black CannaBusiness Magainze. That was a great example of an industry leader using their dollars, marketing resources, and company values to support an event specifically dedicated to creating, developing, and enhancing Black entrepreneurs and businesses in the cannabis industry.

“It is hard to know what even a year from now will look like.”On the policy front, we just saw on election day cannabis having a ton of success at the polls, passing in every single state where there was a ballot measure.

Arizona did a good job with having social equity provisions directly included in the language on their ballot measure. I think for the states that have yet to draft a social equity program, they can look at what has worked well in some other states and also look at what has not worked well, and how there are loopholes and that invite predatory actions.

I’m excited to see that Governor Ralph Northam and the Virginia Marijuana Legalization Working Group are already identifying the best ways to make a recreational market a beneficial and sustainable one, and tackling how to incorporate social equity, racial equity, and economic equity into a future legalization bill. I am looking forward to learning more after an upcoming meeting with Working Group members. I hope to contribute towards any social equity efforts that will benefit my home state and hometown (a high poverty community at the crossroads of America’s major civil rights movements, with a correctional facility that houses an inmate population equivalent to nearly 10% of the town population).

CIJ: Where do you see the industry moving in the next five years?

Ernest: Ha-ha! It is hard to know what even a year from now will look like.

Just this week the United Nations rescheduled cannabis, which is a big deal! We also saw the U.S. House of Representatives pass the MORE Act. We are inching closer towards federal legalization in the US and I think it will happen within that five-year timeframe, and it will be contentious. There will be compromises on things some folks don’t want compromises on, there will be more big money influencing the outcomes of the industry, and there will be unforeseen or unintended consequences to whatever the federal legislation looks like. I recently moderated a panel of social equity license holders, who were very much felt that federal legalization would harm the disproportionately impacted areas (by the War on Drugs) even more! Their preference was to see cannabis de-scheduled and remain under state control.

I think federal legalization will bring another wave of major mergers and acquisitions, similar to what the Canadian market experienced in 2019, benefiting big business over small business. “We need folks who are educated and informed about these matters to be at the policymaking level to have a fighting chance.”

CIJ: Do you think we can change that?

Ernest: There are so many things at play. The legislators need to have diverse perspectives and representation from the folks in the industry, especially people of color who can speak to the impact that a century of prohibition policies have had on their communities. Those voices and stories need to be heard, but that type of representation is grossly lacking on Capitol Hill…which is all the more reason we need leaders from the aforementioned communities to have a seat at the table when decisions are made.

I say that because a lot of time there are unforeseen consequences when policies are created, so decision makers at the federal level can learn from those of us already doing the work on the local level. I recently had a conversation with a former journalist and colleague who is currently in a cannabis regulatory role. We were talking about how policy and operations intersect with social equity He made the point that “many markets implement license caps, which are intended to prevent oversaturation of cannabis business (the idea being that density of outlets impacts use rates, and particularly youth use rates); in theory, that’s a good policy – but it comes with very real consequences for social equity applicants (because those licenses often go to the wealthiest applicants).  License caps also artificially inflate the cost of those licenses (for a transfer of ownership), which also harms social equity applicants. Lotteries are also generally the result of policy and usually have disastrous results for the social equity applicant.”

So yeah – the rare opportunity to define a new industry that doesn’t just do business as usual, that can right its historical wrongs, and that will reward the communities that have been most harmed by cannabis enforcement, is now. And we need folks who are educated and informed about these matters to be at the policymaking level to have a fighting chance. The optimist in me says “we can do it!” The pessimist in me reminds me that it is 2020 and people still believe the Earth is flat. I’ll keep pushing for change, but I also won’t be surprised if this perfect opportunity to get it right goes wrong.

CIJ: How can people get involved in BIPOCANN?

Ernest: The best way to get involved is to visit www.bipocann.com and support our efforts by becoming an individual member or business member. Not only does that give you the opportunity to connect directly with other members in our business network, but it gives you the chance to be the first to be notified about the latest projects, events, and opportunities we’re working on to change the industry, how we can. By joining, you also directly support BIPOCANN’s goals, contribute to the operating budget of a black-owned business in cannabis, and support the nonprofit partners who we allocate a percentage of monthly sales towards.

You can also get involved by subscribing to our monthly newsletter through the website or by following our social media accounts @bipocann. We are also available for speaking, media, or consulting projects that support social equity, diversity, and inclusion in cannabis. For those types of inquiries, please contact ernest@bipocann.com.

Updated: 11:13 a.m. Eastern Standard Time, Dec. 5

The U.S. House of Representatives has passed the Marijuana Opportunity Reinvestment and Expungement (MORE) Act, H.R. 3884, to remove cannabis from the U.S. Controlled Substances Act. It passed 228-164.

“We applaud the House of Representatives for passing meaningful legislation aimed at ending the federal prohibition on cannabis,” David Culver, vice president of U.S. government & stakeholder relations for Canopy Growth Corporation, told Cannabis Business Times and Cannabis Dispensary. “The MORE Act, which effectively legalizes cannabis nationwide, will help spark a post-COVID economic recovery by creating millions of new jobs, and billions in new tax revenue annually when America needs it most.”

“A body of the U.S. Congress voting to legalize cannabis for the first time is an historic event that will be celebrated by long-time advocates, criminal justice reform proponents, patients, veterans, and the millions of Americans who continue to express their support for legalization at the ballot box,” added Patrick Martin, principal and director of the Midwest arm of Cozen O’Connor Public Strategies in Chicago.

Screenshot of vote tallies as the vote was called Dec. 4

The bill will now go to the U.S. Senate, where Congress members expect it will not pass.

However, Charlie Bachtell, CEO and co-founder of multi-state cannabis operator Cresco Labs, said the symbolic significance of this bill passing the U.S. House is important to celebrate.

“I’m big on the incremental nature of how change occurs in this industry with this subject matter. You know, even if … this doesn’t get heard or let alone pass in the Senate, the fact that you have your second bill that’s cannabis related get approved by the House is fundamentally important. It is the incremental nature of change on cannabis. This is how it looks, this is how it happens,” Bachtell said. “We are witnessing cannabis kind of cross the barrier into not only good policy, but good politics. People get elected on platforms that are supported by being a more progressive view on cannabis. It’s great to see. It’s great to be a part of.”

Victoria Mendicino, chief of staff to the CEO at Revolution Global, an Illinois-based vertically integrated cannabis company, said company leaders see the vote “as the latest signal of increasing momentum around federal cannabis legalization and reform. MORE is the farthest reaching cannabis reform bill to ever pass and ever be voted on by a whole chamber of Congress, so it really stands apart.”

Culver noted that the MORE Act could have fresh support from the incoming Biden administration, as Vice President-Elect Kamala Harris is an original sponsor of the Senate version of the bill.

“We urge the Senate to recognize that cannabis legalization is on the march—supported by a vast majority of Americans—and pass this legislation immediately,” Culver said. “It’s time to unlock the economic and social equity benefits of cannabis, and end this outdated prohibition that has disproportionately punished minority communities for far too long.”

Cannabis’ removal from the U.S.’ list of controlled substances, said U.S. Rep. Sheila Jackson Lee (D-Texas) in a Dec. 2 Rules Committee hearing, “means that going forward, individuals could no longer be prosecuted federally for marijuana offenses. This does not mean that marijuana would now be legal in the entire United States—a very important point. It will simply remove the federal government from the business of prosecuting marijuana cases and will leave the question of legality to the individual states.” Jackson Lee is an original cosponsor of the act.

RELATED: UPDATE: UN Votes to Remove Cannabis From List of Most Dangerous Drugs 

The tension between federal and state cannabis policies has long created issues for businesses operating within state-legal cannabis programs.

“The primary concern has been simple illegality—with cannabis on Schedule I, we’ve been operating businesses, on the adult-use side, that are subject to interference from federal law enforcement,” said Nick Etten, VP of governmental affairs for multi-state cannabis operator Acreage Holdings. “Because of federal illegality, there is no interstate commerce, which is how all other industries in this country function.”

“Any widget in commerce would be allowed to be sold outside of state lines if the demand was there, [but] obviously that’s not the case with the current overarching federal regime,” added Dan Pabon, general counsel and chief government affairs officer with Schwazze, and a former Colorado House representative. “I think the [federal-state] tension is most palpable when you look at the business side of the industry, which in turn, of course, affects the patients and the consumers. It makes the products more expensive, it makes them less available. It makes patients potentially seek out relief in the black market. These are all of the things that no one wants, especially in the kind of pandemic situation that we’re in. It’s certainly something that needs to be straightened out as soon as possible. And I think that’s what the vote in Congress is trying to do.”

Legislation like the MORE Act could also help change the minds of private investors and larger corporate entities that have been hesitant to get involved in the U.S. cannabis industry due to federal prohibition, Etten said.

“Many more traditional entities have sat on the sidelines because of federal illegality issues, and are closely watching these votes as well as opportunity with a new administration,” he said.

“Between decriminalization and the election results not only in White House but all around the country, [these latest moves] signal that cannabis reform, whether it’s the medical or recreational level, is on its way,” Pabon added. “And just like anything else, capital follows a potential new trend or seizes an opportunity. Capital will follow.”

Kim Stuck, CEO of Allay Consulting, agreed that the biggest impact of the MORE Act on licensed cannabis businesses would be financial.

“Nothing really will change for them except that the federal government can’t impose any rules on states and make them follow,” she said. “They’re pretty much saying, ‘Hey, we’re going to leave it up to the states for what they want to do. We’re not going to go in and make any issues against you for having legal cannabis or anything like that.’ … It’ll definitely bring investors in from other places. It doesn’t make it legal, but it’s not completely illegal. I think that people will be a little more [willing to be involved].”

In addition to descheduling and decriminalizing cannabis, the MORE Act creates a “Criminal Justice Office,” which will, among other things, create a grant program to provide job training and reentry services; and provide legal aid, including for the “expungement of cannabis convictions.”

“Importantly, the MORE Act would legalize cannabis with a focus on social justice and equity—an important step in righting many of the wrongs caused by the decades-long failed War on Drugs,” Culver said.

The act places a 5% federal tax on the sale of cannabis products; that tax will then increase by 1% each year and cap at 8%, according to Congress members who spoke during the Dec. 4 full-floor U.S. House debate.

It also directs the Small Business Administration to create a “Cannabis Opportunity Program” that would “assist small business concerns owned and controlled by socially and economically disadvantaged individuals.”

“The damage of cannabis prohibition has left a broad multi-issue path of destruction including justice, incarceration, employment, healthcare and income inequities,” said Hilary Black, Canopy Growth’s chief advocacy officer. “Prohibition of cannabis—the war on drugs—is a war on people, a war on families. Today I am hopeful we are seeing the beginning of the end of that war.  … This is about human rights, about social justice, and access to healthcare.”

The MORE Act would not change all federal laws regarding cannabis, however, according to Stuck.

“The FDA, for example, they still are seeing this as a drug that needs to be approved to be put in product,” she said. “They’re there and they’re going to recognize it when they want to. And they’re going to write regulations when they want to. So, this certainly doesn’t make it federally legal or federally regulated either. It just opens that gate and allows states to do what they want without any federal issues.”

Harris originally introduced the MORE Act in the Senate, and Jerrold Nadler (D-N.Y.) introduced the bill in the House.

In the Dec. 4 House debate on the MORE Act, original cosponsor Barbara Lee (D-CA) expressed her support for it.

Matt Gaetz (R-Fla.) is the only Republican in the U.S. House or Senate to cosponsor the MORE Act, according to Congress.gov.

RELATED: How U.S. House, Senate Results Could Influence Cannabis Legislation

The Dec. 4 vote was bipartisan, with five Republicans and one Independent, Justin Amash (D-Mich.), voting in favor of the act. Six Democrats voted against it. 

Gaetz said in the Dec. 4 hearing that Congress members who oppose the act are not aligned with the opinions of a majority of Americans.

“I’m going to vote for the MORE Act,” Gaetz said during the hearing. “It won’t pass the Senate. It won’t become law. But then we should come back in the 117^th Congress, and we should truly do more for our people.”

David Mangone, director of policy and government affairs for The Liaison Group, echoes this sentiment.

“For industry, the MORE Act paves the way for cannabis reform that seeks to develop a more diverse industry, create access to banking, the potential of capital markets and the elimination of 280E,” he said. “Industry should cheer this vote and be ready to get to work in the 117th Congress on other ‘components of progress,’  including taxation structures, importation paradigms and ensuring that any legislation that ultimately becomes law will protect the communities that the MORE Act seeks to protect.”

According to Jonathan Havens, co-chair of the Cannabis Law Practice at Saul Ewing Arnstein & Lehr, major policy reform will not happen overnight, and even if the bill doesn’t come up for a vote in the Senate, the House’s passage of the legislation lays the groundwork for future change.

“If the House votes to pass the MORE Act, that is one of the two chambers of Congress saying, ‘We approve the legalization of cannabis,’ and our country’s policy toward cannabis has been the same for decades—that would be a significant step forward,” Havens said. “Of course, it would be a lot more helpful if the Senate agreed, took it up, voted on it, and the president signed it into law because that would mean that cannabis is no longer federally illegal.”

Numerous opponents of the MORE Act expressed concerns in the Dec. 4 hearing, as well as in the Dec. 2 House Rules Committee hearing, that Congress should not prioritize cannabis legalization over a new COVID-19 relief package. Supporters of the bill have indicated that the two initiatives are not mutually exclusive.

The Minority Cannabis Business Administration (MCBA) stated in a press release that it supports the bill but opposes specific provisions.

“Although Minority Cannabis Business Association (MCBA) supports and applauds the social equity provisions including the expungement of records and the establishment of an Opportunity Trust Fund and the Cannabis Justice Office, we have grave concerns over the provisions in this bill that we believe would have an immediate chilling effect on individual members in our community and minority business owners more broadly,” stated the release.

A recent U.S. House amendment changed the MORE Act. Alterations include limiting cannabis expungement to people who have been charged with nonviolent federal offenses and to those who have not been sentenced with an “aggravating role adjustment” for directing or overseeing federal criminal activity. It also directs the U.S. Comptroller General to include, as part of broader research on cannabis, the “uses of marijuana and its byproducts for purposes relating to the health, including the mental health, of veterans.”

Chris Lindsey, legislative analyst for the Marijuana Policy Project (MPP), said other provisions in the bill would be “very good” for the cannabis business community. The descheduling of cannabis would allow the industry to access banking, for example, and would provide tax relief for businesses who have long bore the burden of 280E.

“It’s likely that more states would adopt regulatory programs if there were a clear path provided to them by the federal government,” Lindsey said. “Clearly, it’s not stopped the states that have wanted to go that way already, but no doubt, having a system in place that states can recognize would be very helpful, from my own perspective as an advocate.”

Cannabis Dispensary Editor Cassie Neiden, Digital Editor Eric Sandy and Cannabis Business Times Editor Michelle Simakis contributed to this report.

Updated: 11:13 a.m. Eastern Standard Time, Dec. 5

The U.S. House of Representatives has passed the Marijuana Opportunity Reinvestment and Expungement (MORE) Act, H.R. 3884, to remove cannabis from the U.S. Controlled Substances Act. It passed 228-164.

“We applaud the House of Representatives for passing meaningful legislation aimed at ending the federal prohibition on cannabis,” David Culver, vice president of U.S. government & stakeholder relations for Canopy Growth Corporation, told Cannabis Business Times and Cannabis Dispensary. “The MORE Act, which effectively legalizes cannabis nationwide, will help spark a post-COVID economic recovery by creating millions of new jobs, and billions in new tax revenue annually when America needs it most.”

“A body of the U.S. Congress voting to legalize cannabis for the first time is an historic event that will be celebrated by long-time advocates, criminal justice reform proponents, patients, veterans, and the millions of Americans who continue to express their support for legalization at the ballot box,” added Patrick Martin, principal and director of the Midwest arm of Cozen O’Connor Public Strategies in Chicago.

Screenshot of vote tallies as the vote was called Dec. 4

The bill will now go to the U.S. Senate, where Congress members expect it will not pass.

However, Charlie Bachtell, CEO and co-founder of multi-state cannabis operator Cresco Labs, said the symbolic significance of this bill passing the U.S. House is important to celebrate.

“I’m big on the incremental nature of how change occurs in this industry with this subject matter. You know, even if … this doesn’t get heard or let alone pass in the Senate, the fact that you have your second bill that’s cannabis related get approved by the House is fundamentally important. It is the incremental nature of change on cannabis. This is how it looks, this is how it happens,” Bachtell said. “We are witnessing cannabis kind of cross the barrier into not only good policy, but good politics. People get elected on platforms that are supported by being a more progressive view on cannabis. It’s great to see. It’s great to be a part of.”

Victoria Mendicino, chief of staff to the CEO at Revolution Global, an Illinois-based vertically integrated cannabis company, said company leaders see the vote “as the latest signal of increasing momentum around federal cannabis legalization and reform. MORE is the farthest reaching cannabis reform bill to ever pass and ever be voted on by a whole chamber of Congress, so it really stands apart.”

Culver noted that the MORE Act could have fresh support from the incoming Biden administration, as Vice President-Elect Kamala Harris is an original sponsor of the Senate version of the bill.

“We urge the Senate to recognize that cannabis legalization is on the march—supported by a vast majority of Americans—and pass this legislation immediately,” Culver said. “It’s time to unlock the economic and social equity benefits of cannabis, and end this outdated prohibition that has disproportionately punished minority communities for far too long.”

Cannabis’ removal from the U.S.’ list of controlled substances, said U.S. Rep. Sheila Jackson Lee (D-Texas) in a Dec. 2 Rules Committee hearing, “means that going forward, individuals could no longer be prosecuted federally for marijuana offenses. This does not mean that marijuana would now be legal in the entire United States—a very important point. It will simply remove the federal government from the business of prosecuting marijuana cases and will leave the question of legality to the individual states.” Jackson Lee is an original cosponsor of the act.

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The tension between federal and state cannabis policies has long created issues for businesses operating within state-legal cannabis programs.

“The primary concern has been simple illegality—with cannabis on Schedule I, we’ve been operating businesses, on the adult-use side, that are subject to interference from federal law enforcement,” said Nick Etten, VP of governmental affairs for multi-state cannabis operator Acreage Holdings. “Because of federal illegality, there is no interstate commerce, which is how all other industries in this country function.”

“Any widget in commerce would be allowed to be sold outside of state lines if the demand was there, [but] obviously that’s not the case with the current overarching federal regime,” added Dan Pabon, general counsel and chief government affairs officer with Schwazze, and a former Colorado House representative. “I think the [federal-state] tension is most palpable when you look at the business side of the industry, which in turn, of course, affects the patients and the consumers. It makes the products more expensive, it makes them less available. It makes patients potentially seek out relief in the black market. These are all of the things that no one wants, especially in the kind of pandemic situation that we’re in. It’s certainly something that needs to be straightened out as soon as possible. And I think that’s what the vote in Congress is trying to do.”

Legislation like the MORE Act could also help change the minds of private investors and larger corporate entities that have been hesitant to get involved in the U.S. cannabis industry due to federal prohibition, Etten said.

“Many more traditional entities have sat on the sidelines because of federal illegality issues, and are closely watching these votes as well as opportunity with a new administration,” he said.

“Between decriminalization and the election results not only in White House but all around the country, [these latest moves] signal that cannabis reform, whether it’s the medical or recreational level, is on its way,” Pabon added. “And just like anything else, capital follows a potential new trend or seizes an opportunity. Capital will follow.”

Kim Stuck, CEO of Allay Consulting, agreed that the biggest impact of the MORE Act on licensed cannabis businesses would be financial.

“Nothing really will change for them except that the federal government can’t impose any rules on states and make them follow,” she said. “They’re pretty much saying, ‘Hey, we’re going to leave it up to the states for what they want to do. We’re not going to go in and make any issues against you for having legal cannabis or anything like that.’ … It’ll definitely bring investors in from other places. It doesn’t make it legal, but it’s not completely illegal. I think that people will be a little more [willing to be involved].”

In addition to descheduling and decriminalizing cannabis, the MORE Act creates a “Criminal Justice Office,” which will, among other things, create a grant program to provide job training and reentry services; and provide legal aid, including for the “expungement of cannabis convictions.”

“Importantly, the MORE Act would legalize cannabis with a focus on social justice and equity—an important step in righting many of the wrongs caused by the decades-long failed War on Drugs,” Culver said.

The act places a 5% federal tax on the sale of cannabis products; that tax will then increase by 1% each year and cap at 8%, according to Congress members who spoke during the Dec. 4 full-floor U.S. House debate.

It also directs the Small Business Administration to create a “Cannabis Opportunity Program” that would “assist small business concerns owned and controlled by socially and economically disadvantaged individuals.”

“The damage of cannabis prohibition has left a broad multi-issue path of destruction including justice, incarceration, employment, healthcare and income inequities,” said Hilary Black, Canopy Growth’s chief advocacy officer. “Prohibition of cannabis—the war on drugs—is a war on people, a war on families. Today I am hopeful we are seeing the beginning of the end of that war.  … This is about human rights, about social justice, and access to healthcare.”

The MORE Act would not change all federal laws regarding cannabis, however, according to Stuck.

“The FDA, for example, they still are seeing this as a drug that needs to be approved to be put in product,” she said. “They’re there and they’re going to recognize it when they want to. And they’re going to write regulations when they want to. So, this certainly doesn’t make it federally legal or federally regulated either. It just opens that gate and allows states to do what they want without any federal issues.”

Harris originally introduced the MORE Act in the Senate, and Jerrold Nadler (D-N.Y.) introduced the bill in the House.

In the Dec. 4 House debate on the MORE Act, original cosponsor Barbara Lee (D-CA) expressed her support for it.

Matt Gaetz (R-Fla.) is the only Republican in the U.S. House or Senate to cosponsor the MORE Act, according to Congress.gov.

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The Dec. 4 vote was bipartisan, with five Republicans and one Independent, Justin Amash (D-Mich.), voting in favor of the act. Six Democrats voted against it. 

Gaetz said in the Dec. 4 hearing that Congress members who oppose the act are not aligned with the opinions of a majority of Americans.

“I’m going to vote for the MORE Act,” Gaetz said during the hearing. “It won’t pass the Senate. It won’t become law. But then we should come back in the 117^th Congress, and we should truly do more for our people.”

David Mangone, director of policy and government affairs for The Liaison Group, echoes this sentiment.

“For industry, the MORE Act paves the way for cannabis reform that seeks to develop a more diverse industry, create access to banking, the potential of capital markets and the elimination of 280E,” he said. “Industry should cheer this vote and be ready to get to work in the 117th Congress on other ‘components of progress,’  including taxation structures, importation paradigms and ensuring that any legislation that ultimately becomes law will protect the communities that the MORE Act seeks to protect.”

According to Jonathan Havens, co-chair of the Cannabis Law Practice at Saul Ewing Arnstein & Lehr, major policy reform will not happen overnight, and even if the bill doesn’t come up for a vote in the Senate, the House’s passage of the legislation lays the groundwork for future change.

“If the House votes to pass the MORE Act, that is one of the two chambers of Congress saying, ‘We approve the legalization of cannabis,’ and our country’s policy toward cannabis has been the same for decades—that would be a significant step forward,” Havens said. “Of course, it would be a lot more helpful if the Senate agreed, took it up, voted on it, and the president signed it into law because that would mean that cannabis is no longer federally illegal.”

Numerous opponents of the MORE Act expressed concerns in the Dec. 4 hearing, as well as in the Dec. 2 House Rules Committee hearing, that Congress should not prioritize cannabis legalization over a new COVID-19 relief package. Supporters of the bill have indicated that the two initiatives are not mutually exclusive.

The Minority Cannabis Business Administration (MCBA) stated in a press release that it supports the bill but opposes specific provisions.

“Although Minority Cannabis Business Association (MCBA) supports and applauds the social equity provisions including the expungement of records and the establishment of an Opportunity Trust Fund and the Cannabis Justice Office, we have grave concerns over the provisions in this bill that we believe would have an immediate chilling effect on individual members in our community and minority business owners more broadly,” stated the release.

A recent U.S. House amendment changed the MORE Act. Alterations include limiting cannabis expungement to people who have been charged with nonviolent federal offenses and to those who have not been sentenced with an “aggravating role adjustment” for directing or overseeing federal criminal activity. It also directs the U.S. Comptroller General to include, as part of broader research on cannabis, the “uses of marijuana and its byproducts for purposes relating to the health, including the mental health, of veterans.”

Chris Lindsey, legislative analyst for the Marijuana Policy Project (MPP), said other provisions in the bill would be “very good” for the cannabis business community. The descheduling of cannabis would allow the industry to access banking, for example, and would provide tax relief for businesses who have long bore the burden of 280E.

“It’s likely that more states would adopt regulatory programs if there were a clear path provided to them by the federal government,” Lindsey said. “Clearly, it’s not stopped the states that have wanted to go that way already, but no doubt, having a system in place that states can recognize would be very helpful, from my own perspective as an advocate.”

Cannabis Dispensary Editor Cassie Neiden, Digital Editor Eric Sandy and Cannabis Business Times Editor Michelle Simakis contributed to this report.