California’s Cannabis Taxes Are a Disaster and More

In the days of the Armada, a fleet of warships, the scuttlebutt was the rumor or gossip that would spread throughout the ship. Today, Armada Law Corp presents The Scuttlebutt, a daily summery of news articles that people within the cannabis, hemp and plant medicine industries are chatting about along with links to the full articles.

In today’s news:

California’s Cannabis Taxes Are a Disaster

#cannabisindustry – “In other words, from the inception, these programs were designed in large part to raise revenue for the state. And the state does so by funneling money out of the nascent industry in an extremely aggressive way – which is why I (only sort of hyperbolically) called this theft last year.

California is not alone in this, and there are certainly many other states with regressive and punitive tax schemes that all but guarantee the tax-free illegal market will thrive. But California is a prime example of failed policy which legislators and regulators seem intent on making worse….”

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WeHo loosens chokehold on struggling cannabis shops

#californiacannabis – “The new ordinance’s primary aim is to revise waitlist rule provisions in the city’s cannabis licensing framework. It specifically puts a temporary halt on the deadlines which deals with the application process, scoring, and review of cannabis licenses. This action is intended to facilitate extended outreach and consensus-building among cannabis businesses and stakeholders regarding further modifications to the ordinance.

This ordinance emerges from a background of extensive consultations held with local cannabis businesses, stakeholders, including the West Hollywood Chamber of Commerce. These discussions were initiated following requests from various local stakeholders for further ordinance changes to assist cannabis businesses in their successful establishment and operation….”

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Pennsylvania Seeks to Increase Competition Among Medical Cannabis Licensees With SB773 Passage

#cannabisindustry – “Recently enacted Pennsylvania Senate Bill 773 (SB773) introduces several amendments intended to expand opportunities and increase competition among existing cannabis licensees in Pennsylvania. The bill seeks to support independent licensees in the state and is a response to the consolidation among licensees that many states have seen as state-legal marijuana operators struggle under the weight of federal prohibition and competition from the unregulated marketplace….”

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Court approves $1.75 million settlement for cannabis cultivator’s environmental violations

#californiacannabis – “A Humboldt County Superior Court judge approved a settlement that requires a cannabis cultivator to pay $1.75 million for building and diverting water from illegal onstream reservoirs without first obtaining permits required by the California Water Boards and California Department of Fish and Wildlife (CDFW).

The settlement, which was reached after a lengthy investigation, resolves violations by Joshua Sweet and his companies, The Hills LLC and Shadow Light Ranch LLC, that include: the owner’s destruction of wetland habitat and stream channels; conversion of oak woodland to grow cannabis; and failure to work with the State Water Resources Control Board, North Coast Regional Water Quality Control Board and CDFW to satisfy permitting requirements.

If Sweet completes restoration of the damaged property by 2026, $1 million of the penalty will be suspended. This work includes the removal of three unauthorized reservoirs and the rehabilitation of stream channels and damaged wetlands….”

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Maryland Republicans push back against cannabis odor law, but repeal seems unlikely

#cannabisindustry – “Republicans are pushing to repeal a controversial Maryland law that prohibits police from pulling over and searching drivers simply because they smell of marijuana, but Democratic leaders say they aren’t interested in dramatic changes to the state’s cannabis legislation this year.

Senate President Bill Ferguson, D-Baltimore City says Democrats are only considering what they refer to as “improvements” to Maryland’s cannabis law, following its legalization for adult use last year.

“I think we’re going to have a cannabis bill this year that sort of does some – I don’t want to call it clean-up – but adjustments to the system that we passed last year,” Ferguson said. “I don’t think you’ll see major changes to the program, but implementation adjustments.””

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Lawsuit: Siskiyou County unconstitutionally required big money deposit before granting landowner hearing over marijuana plant citations

#californiacannabis – “A Sacramento resident, Her Seng Yang, has filed a lawsuit against Siskiyou County and two of its code enforcement officers, Andrea Fox and John Ottenberg. The suit alleges that the county unconstitutionally denied him a hearing over fines related to a dispute about illegal marijuana plants on his property in Siskiyou County.

Yang was cited for violation of the Siskiyou County Personal Cannabis Cultivation Ordinance after Ottenberg discovered alleged cannabis plants on his property. Yang claims that upon his arrival at the property, he found the plants had already been cut down and left in place. Despite allowing code enforcement access to inspect the property, they refused to confirm that the nuisance had been abated as they did not believe the plants were lawfully removed.

The county’s decision led to Yang accruing daily fines of $1,000 per day for each cited property until a maximum fine of $36,000 was reached for each violation. When Yang requested an abatement hearing to appeal Code Enforcement’s decision, he was unable to pay the substantial advance fine deposit required by the county. His request for a hearing went unanswered with the county instead sending letters demanding payment and stating that the fine amounts were final….”

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This Calif. pot company was once valued at $1.6 billion. Now it’s worthless.

#californiacannabis – “Calling itself the “Apple Store of weed,” MedMen skyrocketed to national prominence in 2018 just as California’s new legal weed market was launching. MedMen’s executives claimed that their sleek retail locations were the future of legal weed. With locations in places like Beverly Hills and West Hollywood, the company predicted it would cash in massively on California’s booming legal weed economy, which at that time was projected to sell as much as $20 billion in pot a year.

But both MedMen and California’s cannabis economy have failed to live up to those promises. The state pot market has stagnated at about $5 billion in annual sales, a fraction of early predictions, and both California’s sales and tax revenue appear to be falling. The state has never been able to bring illegal sales into the legal market — by some estimates the majority of cannabis is still bought and sold on the illicit market outside of regulated stores — and hundreds of pot companies have subsequently gone out of business….”

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