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A battle over wine and cannabis in Santa Barbara County, pitting neighbor against neighbor, is coming to a head. On June 30, a report from a grand jury tasked with monitoring local government issued a scathing report criticizing the county board for its mismanagement of the county's cannabis production.

"The jury believes the Board of Supervisors, in their hubris, failed the people of Santa Barbara County," the report stated. "Now they must amend the cannabis ordinances to regain the people's trust."

Santa Barbara County adopted some of the most lenient regulations for commercial cannabis farming in California and has seen an explosion in production in the past four years—last year, the county was home to 35 percent of the state's licensed cannabis acreage. As a result, locals, particularly vintners, have grappled with cannabis' impact on the area.

In April, a nonprofit made up of more than 200 vintners, farmers and homeowners, dubbed the Santa Barbara Coalition for Responsible Cannabis, filed suit against the county's board of supervisors, citing what the coalition considers a lack of ordinances regulating cannabis production and a faulty licensing program which has allowed farmers to stack licenses and create some of the largest cannabis grows in the state. The suit aims to cut down on the number of unpermitted cannabis farms and stop the board from issuing further permits by challenging the environmental reviews that have led to permit approvals.

"Pursuing legal action is not fun, nor is it a place we wanted to go, but it's necessary," Debra Eagle, a board member for the coalition and general manager for Alma Rosa winery, told Wine Spectator. Eagle felt like the board of supervisors was ignoring its citizens.

From a cannabis heaven in the 60’s and 70’s to a restricted country after caving to international pressure, Nepal has some interesting cannabis laws, and might be looking at some substantial updates toward legalization in the near future.

Nepal is a landlocked country in Asia surrounded mainly by India from three sides, and Tibet from the north. It’s a very small country land-wise, stretching approximately 500 miles East to West, and ranges from 90-150 miles going north to south. Nepal was finally established as a democratic republic after a period of upheaval and violence due to a Maoist insurgency.

Due to its location, being stuck in an isolated zone between two big countries, Nepal was essentially left to its own devices, and didn’t reach the development level of other countries. As an interesting point, the population of Nepal is very young with 60% under the age of 30, and 80% under the age of 45. This is not an indication of a very low life expectancy, as both males and females live on average until at least 70.

 Nepal’s sordid cannabis history

In the 60’s and 70’s, not only was cannabis legal in Nepal, but Nepal itself, being a part of the notorious “Hippie Trail”, was a huge bastion of hippy antics and open marijuana smoking. The Hippie Trail was a land trail that could be cheaply traveled to get to Asia from Europe via Turkey, Iran, Afghanistan, Pakistan, Nepal, and India.

It ended in Katmandu where the infamous Freak Street acted as the culmination of open smoking culture in Nepal, a hippie hideout not so different from Freetown Christiana in Denmark’s Copenhagen. This brought a lot of traffic through Nepal, and fueled its already abundant subculture of cannabis smoking. Cannabis smoking has always been a large part of Nepalese culture, in a religious capacity, medicinal, and recreational as well.

By 1972 Nepal was one of the biggest hash exporting countries, but this came to an end in 1973 when Nepal updated its laws after being pressured by the US and UN. In July of 1973 all shops were closed and all growing licenses cancelled. This had a major impact on the GDP of the country which was reliant on the cannabis industry.

Health promotion hospitals in the provinces have been given the go-ahead to concoct traditional medicines using cannabis to cure illnesses common in their areas, the Department of Thai Traditional and Alternative Medicine says.

The department has authorised the hospitals, formerly known as suk sala clinics, to produce traditional medicine from among 16 recipes permitted by the government which include cannabis as their base ingredients, said Marut Jirasetthasiri, the department director-general.

The hospitals, however, must have a traditional Thai medicine expert on duty to prepare the medicine.

Dr Marut said the hospitals will be free to produce medicines which they believe will provide effective cures for common illnesses in the localities.

More people have begun to seek treatment using traditional medicine, he said.

In the lead up to the legalisation of recreational cannabis in Canada and the ongoing legalisation in some US states, opposing parties continued to warn of the resulting increase in road traffic accidents. However, following legalisation, a number of studies have aimed to assess whether this is actually the case.

Cannabis is the most commonly used drug in the world. It is also widely assumed that the age group that is most likely to use cannabis is the same as those that cause the most road traffic accidents. Although, cannabis, like alcohol, does impair several driving-related skills, according to a study published in The American Journal on Addictions it’s more of a dose-related question.

The impact of cannabis may vary from person to person. For example, it depends on whether the consumer is an experienced user or not; an individual’s tolerance, and how much THC – the main psychoactive compound- is present in the cannabis will affect the level of impairment each person experiences.

Driving under the influence of cannabis

While some found that cannabis users are more likely to drive slower, compensate more effectively in dangerous situations and increase following distance, driving under its influence does appear to have its risks.

One study found that “marijuana use increases reaction time and the number of incorrect responses to emergencies.”

The Dutch government has clarified some of the finer details of its new application to legally cultivate recreational cannabis.

As a part of a new experiment in the Netherlands to legalize the production of cannabis and its sale in coffee shops in the country, only applicants with the capability to produce a minimum of 6,500 kilograms per year will be considered, reports Marijuana Business Daily. That said, growers won’t necessarily be on the hook to produce that much.

With the new application, would-be cannabis growers in the Netherlands will have a lot more red tape to deal with in order to be licensed for production, including a background check and permission from the mayor of the jurisdiction where the cultivation is planned.

Legal growers will also need to buy seeds from licensed sellers and will be supplied with mandatory track-and-trace software provided by the government.

Despite it being a crazy year, Americans can't lose sight of the fact that Election Day is a little over three months away. At stake are 435 seats in the House of Representatives, roughly a third of all seats in the Senate, and, of course, the Oval Office.

But it's an equally important election at the state level. No matter what happens federally, it's unlikely that marijuana's scheduling will be changed anytime soon. This means state-level cannabis legalizations will continue to play a major role in growing the U.S. pot industry.

This coming November, residents of three states are guaranteed to be voting on a cannabis measure in their respective states. However, four additional states may join.

New Jersey: Will be on the ballot

While there's no such thing as a lock when it comes to voting on the legalization of marijuana, New Jersey's constitutional amendment that aims to legalize adult-use marijuana appears to have a very good chance at passing. According to an April survey from Monmouth University, 61% of New Jerseyans would be in favor of a statewide legalization of cannabis. 

If approved, New Jersey would likely be on its way to approaching $1 billion in annual sales by the midpoint of this decade. Curaleaf Holdings (OTC:CURL.F), which leads all U.S. multistate operators in terms of total operating dispensaries (57), would certainly welcome this legalization. Curaleaf already has a presence in the Garden State's medical marijuana industry, and it would likely be able to pivot its existing infrastructure to take advantage of adult-use weed sales within the state.

A highly regarded British think-tank focused on reforming drug laws thinks Canada’s legalisation and regulation of cannabis has gone well.

Transform Drug Policy Foundation has been monitoring Canadian reform efforts for some time, and advised the Canadian Government and some provinces on how to develop regulations prior to legalisation. Its positive views of Canada’s initiatives is a significant contribution in assessing our journey away from criminalisation of simple possession and use of recreational drugs.

There have been a number of efforts at assessing our first year of legalisation and beyond. Not all of them have been as positive as Transform’s evaluations.

The think-tank’s accounting is sophisticated but also provides a primer of Canada’s experiences with legal cannabis, the provision of which was deemed an essential service in Ontario during the early days of the Covid-19 pandemic.

Transform’s assessment delves into the fundamentals — growing, processing and producing. The diverse ways the drug is sold to consumers in the provinces and territories is summarised succinctly and clearly.

In November of 2019, a Pew Research study revealed that 9 out of 10 Americans favor legalization of either medical or recreational/adult-use marijuana. As a political issue, the study found that a majority of Republicans – 55% - and a majority of Democrats – 78% - were in favor of legalization. American voters no longer believe marijuana should remain a criminalized, Schedule I substance. This is not shocking. The people have spoken, the money is flowing, and the globe keeps on spinning. 

The legalization of marijuana for Washington state adults may be thwarting a steady downward trend in teen marijuana use, according to new research from the University of Washington.

The longitudinal study of more than 230 teens and young adults finds that teens may be more likely to use marijuana following legalization—with the proliferation of stores and increasing adult use of the drug—than they otherwise would have been.

"When we think about marijuana legalization, a worry is that underage use may go up," said Jennifer Bailey, the study's lead author and principal investigator with the Social Development Research Group in the UW School of Social Work. "Early use and heavy use during adolescence can have a lot of negative health consequences, then and later in life, so we don't want teen use to be going up."

Bailey notes that before marijuana legalization, rates of teen marijuana use and other drug use had both been decreasing over the last couple of decades.

The study was published July 9 in the American Journal of Preventive Medicine.

The U.S. Food and Drug Administration released preliminary guidance on Tuesday on cannabis-related clinical research, outlining how companies seeking approval of drugs that contain cannabis or its derivatives must follow the traditional drug review and approval process involving clinical trials.

The agency is still working on rules for products that contain the cannabis ingredient CBD, which is widely held to have wellness properties but lacks research to support that view. Many companies are keen to market food, drinks and dietary supplements containing CBD, a non-psychoactive ingredient in the hemp plant, that they say can help with ailments such as anxiety.

As cries to “defund the police” reverberate across the country, cities are looking at ways to shift funds from policing into communities. In California, tax revenues from marijuana should be a clear point of entry. When voters legalized cannabis in 2016, they expected the taxes would be invested in communities that were adversely impacted by the war on drugs. Instead, a new report finds that these revenues are actually funding the police.

The report, California Cannabis Tax Revenues: A Windfall for Law Enforcement or An Opportunity for Healing, which was authored by Youth Forward and Getting It Right from the Start, looks at 28 cities across California that collect cannabis-related tax revenue. It turns out that from the time Proposition 64 was passed to fiscal year 2019-20, 23 of the 28 cities analyzed saw double-digit increases in the amount of general-fund money going into their police budgets. Eight of the 28 cities saw their police budgets grow by at least 25 percent. Overall, the average shift in police budgets for these 28 cities was an increase of 19 percent over that three-year period.

One reason for this is that the revenue collected from cannabis in nearly all these cities (the one exception being Shasta Lake) goes into the general fund, where the largest chunk of spending goes toward police departments. Another reason is that a number of cities are directing these tax revenues toward special units focused on cannabis enforcement, setting the stage for a war on drugs 2.0.

Law enforcement is now beginning to “crack down” on unlicensed vendors, most of whom are people of color. For example, San Diego uses cannabis tax revenues for “enforcement of marijuana laws” and “proactively cracking down on illegal operators.” And Los Angeles allocates millions of their revenues toward the police overtime fund to “investigate and enforce laws relative to illegal cannabis businesses” among other law enforcement functions.

The tragic irony of this is that cannabis tax revenues are now continuing the historic pattern of arrests for nonviolent drug offenses that have disproportionately harmed communities of color for decades. As recently as 2013, Black people were arrested more than twice as often as white people for cannabis offenses, and by 2018 people of color comprised 75 percent of cannabis arrests. Though marijuana use is roughly equal among Blacks and whites, Blacks are nearly 4 times as likely to be arrested for marijuana possession.

A second medical cannabis company has filed a petition asking a state district judge to invalidate rules recently enacted by the New Mexico Department of Health. 

Pecos Valley Production, a medical cannabis company with dispensaries in the southern part of the state, filed a petition Monday in state district court calling for an annulment of regulatory rules that lawyers for the company called “arbitrary and capricious.”

The petition from Pecos Valley argues similar points as one filed last week, on behalf of cannabis producer and manufacturer Ultra Health. Both petitions are filed under the same case.

Lawyers for Ultra Health, one of which is Brian Egolf, who also serves as the state’s Speaker of the House, argued that the Medical Cannabis Program and the DOH failed to show reasoning for new rules. Ultra Health’s lawyers also accused the state of copying regulations from other states that have a medical cannabis program like Oregon and Colorado. 

The petition from Pecos Valley Production also accused the state of adopting rules from other states instead of properly consulting with medical cannabis producers in New Mexico.

The prospect of legal marijuana in Arizona has drawn passion from advocates, opponents, and investors alike.

Just as quickly as support arose for legal recreational marijuana in Arizona, so too did opposition. The advocacy group Smart & Safe Arizona submitted more than 420,000 signatures earlier this month to put cannabis legalization on the ballot. The measure is currently in review, but only 237,645 valid signature are required to qualify.

An Arizona Public Opinion Pulse (AZPOP) poll released this week found that 62% of voters favor legal marijuana. The poll, which surveys about 600 likely Arizona voters each month, reports that support is divided evenly among urban, suburban, and rural voters. Only 32% of respondents oppose legalizing cannabis.

This represent a significant increase from polling data released in December 2019. An AZPOP poll at the time found 52% supported the initiative and 42% were against it.

“Four years ago, marijuana legalization nearly came to fruition,” said Mike Noble, Chief of Research at OH Predictive Insights. “And less than four months before Election Day, Arizona is on the cusp of allowing the adults to use recreational pot.”

The amendment, sponsored by Tulsi Gabbard, would supersede the Defense Department’s rule banning CBD for service members.

A longstanding zero-tolerance marijuana policy could be slowly eroding in the military. Earlier this month, a House committee approved a provision that would let troops who previously used cannabis to re-enlist. This week, Congress passed an amendment to allow service members the use of hemp and CBD products.

The amendment, sponsored by Rep. Tulsi Gabbard, was added to the National Defense Authorization Act (NDAA) and included several non-cannabis amendments. The House of Representatives approved the NDAA in a 336 to 71 vote Monday.

“The Secretary of Defense may not prohibit, on the basis of a product containing hemp or any ingredient derived from hemp, the possession, use, or consumption of such product by a member of the Armed Forces,” the amendment reads.

A memo that was recently made public revealed the Pentagon had quietly moved to make CBD use a punishable offense for military troops. The Department of Defense banned hemp and CBD products in all forms in February to ”protect the integrity of the drug testing program,” wrote Matthew Donovan, Acting Undersecretary for the Department of Defense. Previously, the Navy and Marine Corps. were permitted use of topical products, including shampoos and lotions.

Law enforcement data released by the California Department of Justice reveals that in 2019 the state recorded the lowest number of felony marijuana arrests since 1954, while showing that the racial disparity at play in such arrests continues to grow. 

In the department’s latest “Crime in California” report, law enforcement officials reported that 1,181 arrests for marijuana felonies were made in 2019, down 27% from 1,617 in 2018, the first year of legal recreational marijuana sales in the state. The data is not broken down by offense but includes such activities as unlicensed cannabis sales or cultivation and marijuana sales to minors.

While the total number of marijuana arrests declined last year, “the harassment went up,” said Donnie Anderson, the co-founder of the cannabis trade group California Minority Alliance.

In an analysis of the data, the California chapter of the National Organization for the Reform of Marijuana Laws (Cal NORML) said that the 2019 number of felony marijuana arrests is the lowest total since 1954. A total of 3,769 misdemeanor marijuana arrests were also made last year, down slightly from the 3,835 arrests recorded in 2018.

The report also revealed that the racial disparity prevalent in the enforcement of the nation’s drug laws continues in California despite legalization. According to demographic information included with the arrest data, Hispanic people made up 42% of the felony marijuana arrests in the state last year, while Black people accounted for 22%. White people made up 21% of those arrested, while other groups accounted for 15% of arrests.

If you think the U.S. will soon legalize marijuana at the federal level, you're not alone. Canopy Growth CEO and former Constellation Brands CFO David Klein expects that it will happen in 2022. I've speculated that marijuana could be legalized nationwide as early as next year.

But could presumptive Democratic presidential nominee Joe Biden be putting the brakes on the pot legalization train? Some might think so after reviewing recommendations from a task force that the former vice president formed along with Sen. Bernie Sanders. However, there's more to the story.

Slow-mo Joe?

The Biden-Sanders "unity task force" created a 110-page document chock-full of policy recommendations across a wide array of issues. Among the issues that the task force considered was marijuana legalization. Anyone hoping that the team would recommend full legalization of pot in the U.S. probably came away a little disappointed after reading the task force's document.

The task force called for the decriminalization of marijuana using executive action. This includes automatically expunging all previous marijuana convictions for the use and possession of marijuana. In addition, marijuana would be removed from the list of offenses for which individuals can be deported from the U.S.

There were no recommendations to completely legalize marijuana at the federal level. Will Biden will be "slow-mo Joe" when it comes to legalization if he adopts his task force's recommendations? Not really.

Earlier this week, the US Department of Agriculture approved hemp production plans under the nation’s Domestic Hemp Production Program for Minnesota, Tennessee and Puerto Rico.

The addition of the three brought the total number of state, territory and tribal plans approved so far to 53. These plans provide details on practices and procedures that enable local hemp producers to operate according to the relevant state plan and in compliance with federal laws.

Where a state doesn’t have a plan but will allow hemp production, a national plan will provide regulation and licencing. So far, one state is noted as having a USDA Hemp Producer License – New Hampshire. As we recently mentioned, Hawai’i will also head down this path.

Minnesota Agriculture Commissioner Thom Petersen welcomed the approval of his state’s plan, saying it was a major step forward – but noted ongoing concerns relating to regulations including hemp testing requirements. While the plan is now approved, Minnesota will continue to operate under its 2014 pilot program, which is permissible for this year. Minnesota is by no means alone in this – the USDA status list indicates 23 states have expressed their intention to operate under 2014 pilot programs.

Last year more than 7,300 acres and 400,000 indoor square feet of hemp crops were planted in Minnesota. This year, 511 people currently have grower and/or processor licenses, and  8,605 acres and 4.66 million indoor square feet of growing space is registered with the Minnesota Department of Agriculture.

As COVID-19 puts a crunch on the state’s coffers, the California Department of Tax and Fee Administration is targeting California’s multi-billion dollar underground cannabis economy to get a piece of the pie.

CDTFA announced last week it has taken  sweeping actions against 12 illegal cannabis retailers across SoCal, from Los Angeles to San Bernardino County, in recent weeks. The CDTFA served tax warrants to the dozen in collaboration with the California Highway Patrol, who also assisted with the investigations.

In the process of the tax raids, the state also seized nearly a million dollars in pot products on top of $100,000 in cash. CDTFA said that money will go toward the tax liabilities involved with the various retailers.

“The CDTFA’s collaboration with the CHP is an important deterrent to tax evasion,” stated CDTFA Director Nicolas Maduros said in a statement announcing the actions. “Tax evasion unfairly shifts the burden onto all other taxpayers and makes it tough for those businesses that are playing by the rules to survive.”

CDTFA went on to note that under the California Revenue and Taxation Code, if you are willfully evading or attempting to evade the cultivation tax, the cannabis excise tax or the sales tax you’re committing a crime. But it’s worth noting these actions target retailers that were completely illegal, as opposed to anyone who may be fudging the numbers in a legal operation to mail a few packages East.

Many of the 55 or so state-licensed cultivators who now grow medical marijuana for the three existing dispensaries have their eye on winning one of the licenses.

The state Department of Business Regulation will begin accepting applications Friday from businesses hoping to win a license to operate one of six additional medical marijuana dispensaries.

But it likely won’t be until the end of next year at the earliest before any of the applicants who eventually win one of the lucrative licenses — chosen through a lottery — is selling marijuana, DBR officials say.

The DBR released regulations in March for how those new dispensaries must operate, with the expectation of opening the application period soon thereafter.

The Seventh Circuit’s ruling is important because courts and legislatures may follow its interpretation of the 2018 Farm Bill with respect to smokable hemp.

The Agriculture Improvement Act of 2018 (“2018 Farm Bill”) legalized hemp by removing hemp and its derivatives from the definition of marijuana under the Controlled Substances Act (CSA). The 2018 Farm Bill also provided a detailed framework for the production of hemp and directed the U.S. Department of Agriculture (USDA) to promulgate regulations and permitted states to maintain primary regulatory authority over hemp cultivated with their border by submitting a plan to the USDA.

In 2019, Indiana passed Senate Enrolled Act 516 (“Act 516”) to bring Indiana’s definition of hemp in line with the 2018 Farm Bill and to establish a regulatory framework for hemp production. Act 516 criminalized the possession of “smokable hemp,” which it defines as any industrial hemp product “in a form that allows THC to be introduced into the human body by inhalation of smoke.” Ind. Code § 35-48-1- 26.6. The law provides that “[a] person who knowingly or intentionally manufactures, finances the manufacture of, delivers, finances the delivery of, or possesses smokable hemp … commits dealing in smokable hemp, a Class A misdemeanor.” Ind. Code § 35-48-4-10.1.

In short, Act 516 made it a crime to manufacture, deliver, or possess smokable hemp.

Days before Act 516 was to go into effect, a group of hemp sellers and wholesalers (collectively referred to here as “CY Wholesale”) filed a federal lawsuit challenging Indiana’s prohibition on smokable hemp (we first covered that here). In its filing, CY Wholesale sought a temporary injunction to stop Indiana from enforcing the smokable hemp ban.