Los Angeles hiring cannabis social equity program manager

The Department of Cannabis Regulation (DCR) in the city of Los Angeles is looking for someone to run its social equity program.

The project is part of a handful of efforts in California intended to get minorities and those negatively affected by the war on drugs involved directly in the state’s legal marijuana industry.

According to an online job posting, the position pays $95,776 to $140,021, requires a master’s degree and at least three years of experience with either economic and community development or providing services to low-income, minority or underserved communities.

The L.A. social equity program has been a point of contention for many in the city’s struggling legal cannabis market and has not yet been fully rolled out.

Other California cities that have social equity programs include Oakland, Sacramento and San Francisco.

California only made half as much on 2018 marijuana taxes as expected

When California, the most populous state in America, legalized recreational marijuana last year, many had high hopes for the industry, writes Joseph Misulonas. But unfortunately, it appears initial projections for the success of the industry were a little off.

The California Department of Tax and Fee Administration announced that in 2018 the state collected $345.2 million from marijuana taxes. While that is a huge number, it's actually only slightly more than half of the state's initial projections of $643 million in tax revenue that they predicted they would receive in 2018. 

Many have argued why the state didn't make more money off of legal sales. The biggest reason seems to be the tax rate. California has some of the highest cannabis taxes in the nation, and customers can sometimes pay tax rates up to 45 percent on their marijuana purchases. These high prices are forcing many cannabis users to continue purchasing black market marijuana. This would also explain why California cannabis sales actually decreased between 2017 and 2018, despite it being legal recreationally last year.

Despite the fact that almost everyone acknowledges the tax rate is an issue, California legislators continue dragging their feet on the issue and not passing bills to lower the rate, despite several proposals to do so.

TD Ameritrade Urges Their Clients to be Cautious About Legal Pot Stocks

Canada’s federal legalization of cannabis and the continued expansion of legal use in the United States have led to an explosion of interest in marijuana investments, this year especially. But the U.S. brokerage firm TD Ameritrade is warning their clients and investors in general to be cautious about legal cannabis stocks. In a video posted on the firm’s YouTube channel in late September, TD Ameritrade highlights the risks and acknowledges the seductive appeal of investing in marijuana. Many who’ve observed the cannabis market’s recent volatility feel TD Ameritrade is offering sound advice. Others say the bullish trends of the market are real and that TD Ameritrade is playing it too safe.

TD Ameritrade Video Warns Investors Against Straying Into The “Wild West” of Cannabis Stocks

Cannabis is rapidly moving from the black market to the stock market. But one investment firm is warning, not so fast. TD Ameritrade is urging investors to be cautious and do their homework before buying stock in cannabis companies. Their reasoning is simple: the market still carries significant risks.

The firm’s video begins with a brief history of legalization in North America. It then presents viewers with an image of the North American Marijuana Index which tracks cannabis companies’ stock prices and market capitalization, showing how the value of the index has nearly tripled since its 2015 inception. In short, the setup makes clear why so many investors are attracted to the cannabis industry. Its potential for growth is undeniable.

Then, the other shoe falls. The video says everything that’s exciting about the cannabis industry also suggests it’s a market bubble. It draws parallels between the cryptocurrency frenzy of 2017, the housing market bubble of 2008 and even the dot.com bubble of the early aughts. The bottom line, TD Ameritrade’s video seems to claim, is that the excitement around the industry is overlooking its uncertain regulatory future. And that leads to extreme volatility and in turn, high risk for investors.

Can TD Ameritrade’s Words of Warning Dissuade Young Investors

Exhibit A in TD Ameritrade’s case against cannabis investing is September’s rollercoaster ride for the Canadian marijuana company Tilray. Tilray was the first Canadian cannabis producer to raise capital through an IPO on the NASDAQ. So when trading went public in July at about $17 per share, Tilray’s stock price shot up to $300 per share by mid-September. But almost as quickly, Tilray gave up those gains. The stock was so volatile, in fact, that the U.S. Securities and Exchange Commission (SEC) halted Tilray’s trading five times in a single day.

The SEC also issued an investor alert on marijuana investments and fraud in early September. And these, TD Ameritrade says, are signs that it may be prudent to hold off on significant cannabis investments until the industry matures. Yet it’s not clear whether investors, especially young ones, will heed the firm’s warnings.

Cannabis stocks are attracting young investors in droves. And it’s not only because legalization a generation-defining issue. Fee-free trading apps like Robinhood and TD Ameritrade’s own platform have made it easier than ever for young investors to buy cannabis stocks online. And they aren’t wrong, according to famous short seller Andrew Left. Left acknowledges that it’s hard to tell the difference between real players in the marijuana sector and fly-by-night scammers. But at the same time, he’s convinced the growth is real and here to stay.

So before you invest, make sure to do your homework. Research any company you’re considering investing in. Look up reports and SEC filings—anything you can find. There are also red flags that should dissuade you from investing. These include SEC suspensions, hyped up press releases and company insiders holding large amounts of stock.

Marijuana in the Midterms

Marijuana legalization is going to be a lead issue in the 2018 elections. Advocating for an end to our decades-long failed prohibition is not only good policy, but good politics. Regulating the adult use of marijuana is currently supported by a majority of Americans from all political persuasions, and any candidate for local, state or federal office would be wise to advocate for the will of the people and make ending prohibition a core plank in their election platform. Supporting sensible reform to our nation’s marijuana laws is not just overwhelmingly popular, it is the economic, scientific and moral thing to do.

  With nine states having passed adult-use marijuana regulations, and 30 states authorizing medical-marijuana access, issues surrounding cannabis policy have taken center stage in local, state and federal elections. Over 90 percent of Americans support medical-marijuana access, and 60 percent support legalizing and regulating marijuana in a manner like alcohol.

If you look back at just the past year, it is clear that if we want the implementation of marijuana-reform laws to succeed, we need to begin voting out officials who are permanently afflicted with reefer madness and replace them with forward-thinking individuals who will fight for rational marijuana policies at all levels of government.

With a majority of states now engaging in activities that are in conflict with federal prohibition, it is absurd that House Judiciary Chairman Bob Goodlatte (R-VA), House Rules Chairman Pete Sessions (R-TX) and Senate Judiciary Chairman Charles Grassley (R-IA) refuse to even hold a hearing on this issue.

However, it is not just members of Congress who deserve our attention. With ongoing efforts to delay the rollout of legalization and regulation of marijuana in Maine and Massachusetts, mostly at the behest of those states’ governors, we need to push 2018 gubernatorial candidates to take proactive and positive stances on marijuana policy. If you look to New Jersey as an example, which recently saw the exit of anti-drug zealot Chris Christie and the election of pro-legalization Phil Murphy, you can see the positive impact of having a reform-friendly governor on the tenor of the debate. Already, the state is moving to expand and reinforce its long-suffering medical-marijuana program, and Murphy’s election catapulted the topic of full legalization to the top of this year’s legislative-priorities list.

There are a number of races this year that are worth watching from a marijuana-reform perspective. In Texas, the opportunity to replace Senator Ted Cruz with pro-legalization Beto O’Rourke would add a new, outspoken supporter to the US Senate. In California, there is an outside chance that Democratic Senator Diane Feinstein, who long opposed our efforts despite the vast majority of her party now being in support of reform, could be ousted by current California Senate President Kevin de León, who has a far better record on cannabis issues. Also of incredible importance are the many gubernatorial elections being held, particularly in Maine, where the current governor (and ardent prohibitionist), Paul LePage, will be term-limited out of office. Governor LePage has spent every day since the 2016 election working to slow down or outright prevent the implementation of his state’s marijuana-legalization initiative. We need to ensure that whoever takes the position after him is progressive and aggressive in implementing legalization.

Even on the local level, these elections have a huge impact. In Easton, PA, an effort to decriminalize marijuana failed in the past month due to just one vote, and counties in states that have legalization are often empowered to “opt-out” of allowing retail marijuana outlets in their jurisdictions. Local politics, in many ways, matters just as much if not more than what is happening at the federal level, and reform supporters need to be just as diligent in lobbying their local officials and candidates as those at the top of the ballot.

With the clock ticking down to Election Day, get informed, be sure you are registered, and go out and “smoke the vote” this November.

Wall Street Analyst Estimates US Cannabis Market Will Reach $47 Billion

For years, “$20 billion by 2020” was an oft-heard refrain from market analysts who saw a bright and prosperous future for the legal cannabis industry. Now, with that horizon fast-approaching, analysts are setting their sights on what the next decade has in store. And one analyst, RBC Capital Markets’ Nik Modi, is seeing green.

Analyst Says Concentrates and Edibles Could Propel Sales To $47 Billion Annually

RBC Capital Markets, an investment bank that’s part of Royal Bank of Canada, issued a memo to clients outlining the rapid growth of the U.S. marijuana sector. The memo, authored by Nik Modi, shows how cannabis sales in the U.S. are gaining ground on beer and wine sales.

Projecting a compound annual growth rate (CAGR) of 17 percent, Modi estimates that the legal cannabis category could reach $47 billion in sales annually in the United States within the next decade, according to Business Insider.

Yet the cannabis market in the U.S. faces uncertainties that Canada does not. Regulatory environments are constantly and rapidly shifting as states implement legalization and adopt different approaches to dealing with federal prohibition. Investing in the industry still carries risk.

But RBC Capital Markets analyst Nik Modi brushed off concerns about the unpredictability of legal cannabis in the U.S.. Instead, he drew clients’ attention to a shift in consumer trends that is already having a major impact on domestic retail markets.

Data from BDS Analytics, included in Modi’s memo, shows that the margin on cannabis flower has steadily declined since the beginning of recreational sales in Colorado in 2012. That’s indicative of a larger national move away from flower and toward cannabis edibles and concentrates.

In Colorado, flower made up 70 percent of legal sales when shops opened in 2014. By the end of Q4 2017, flower accounted for just 46 percent of total sales. Picking up the slack were edibles and concentrates. Both are surging in popularity everywhere, and Modi thinks those forms of cannabis can propel total sales beyond $47 billion a year by 2027.

Including Illegal Cannabis Sales Drastically Shifts Financial Forecasts

Another eye-catching aspect of Modi’s analysis is another BDS Analytics chart showing the estimated U.S cannabis market size. The chart compares cannabis sales to spirits, wine, cigarettes, and beer. From spirits at $58 billion to beer $117 billion, all four categories best cannabis at $50 billion. But interestingly, the chart includes total legal and illegal cannabis sales to arrive at the $50 billion figure. It’s unclear what proportion of that amount is made up by illegal sales.

Other cannabis market analysts say that illegal sales still account for the majority of total marijuana purchases in the U.S. But as legalization continues to channel consumers into the legal market, illegal sales are slowly declining.

While access to legal cannabis expands nationwide, the size of the illegal market remains difficult to measure. So does predicting how much of it will move aboveboard in the coming years.

RBC Capital Analyst Praises Big Investment in Canadian Cannabis

The letter RBC Capital Markets sent to clients also lauded Constellation Brands’ recent $4 billion investment in one of Canada’s largest medical cannabis producer Canopy Growth Corp. Constellation Brands is the firm behind the popular beverage companies Modelo, Corona and Svedka. The company has been moving incrementally into the Canadian cannabis market, upping its stake each time. Nik Modi says he’d like to see more companies make similar moves in the cannabis space.

California Lawmakers Pass Bill to Overturn Pre-Legalization Marijuana Convictions

California lawmakers have passed a bill directing prosecutors throughout the state to overturn convictions for acts that are no longer illegal under the state’s Prop 64 cannabis legalization initiative. The bill would also reduce many felony convictions for marijuana-related crimes to misdemeanors.

The measure, Assembly Bill 1793, was passed by the California Senate Wednesday with a bipartisan vote of 22-8 after being approved by the California State Assembly on May 31 by a vote of 43-28.

If the bill is signed into law by Gov. Jerry Brown, it will direct the state Department of Justice to identify cases from between 1975 and 2016 that are eligible to be overturned or reduced by July 31, 2019, and notify the appropriate district attorney for action. Prosecutors will then have until July 1, 2020 to decide if they want to challenge the reduction or elimination of any of those convictions.

Prop 64, passed by voters in 2016, legalized the recreational use and sale of cannabis and eliminated many marijuana-related crimes. That decriminalization also applied retroactively, making many eligible for a reduction or elimination of past cannabis convictions. Those with convictions for non-violent felonies including possession or distribution of less than one ounce of cannabis are eligible for reduction to misdemeanors. Prosecutors have the right to challenge relief based on the criminal history of affected individuals.

Thousands of Cases Eligible For Relief

The justice department estimates that 220,000 convictions qualify to be reduced or eliminated.  Prosecutors in San Diego and San Francisco have begun to proactively reduce or eliminate convictions, but many other district attorneys in the state have said that they do not have the resources to follow suit. That puts the burden of relief on those with the convictions, many of whom may not be aware that they are eligible. Some with convictions that qualify for a reduction or elimination have taken it upon themselves to petition the court for relief, but only a small minority of those who are eligible have done so.

Sen. Scott Wiener, a Democrat from San Francisco who voted for the measure, said it “creates a simpler pathway for Californians to turn the page,” according to an Associated Press report.

State Sen. Joel Anderson, a Republican from San Diego County, said that reducing felony convictions to misdemeanors will allow people to regain lost civil rights, including gun ownership.

“This bill will take those people off the prohibited list, save us time and money,” Anderson said.

AB 1793 was introduced by Democratic Assembly Rob Bonta of Oakland. He said that “the role of government should be to ease burdens and expedite the operation of law — not create unneeded obstacles, barriers, and delay.”

Although AB 1793 received broad bipartisan support, not all lawmakers agreed with the elimination of past convictions. Republican Sen. Jim Nielsen of Gerber argued against passage of the measure by his colleagues in the Senate.

“This directs us to forget any prior behavior that was illegal,” Nielsen said. “They should not be given a pass.”

With the approval of AB 1793 by both houses of the California legislature, the bill now heads to Gov. Jerry Brown for his approval.

Marijuana growers, manufacturers have yet to get the green light from L.A.

Months after California legalized the marijuana business, pot growers and manufacturers lament that they are still locked out of the legal industry in Los Angeles.

More than 100 shops have already gotten city approval in Los Angeles, but not the companies that have historically furnished them with cannabis, which were supposed to be second in line under a complex set of city regulations passed in December.

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L.A. had originally planned to finish processing their applications by April but has not even started accepting that paperwork. As 4/20 rolled around Friday — the informal holiday for pot enthusiasts — there was no official word on when that would happen.

That has aggravated marijuana growers, manufacturers and other cannabis companies seeking to do business legally in Los Angeles. Under California law, they cannot get state licenses if they do not have local authorization. And if they don't have a state license, it is illegal for newly licensed shops to buy their products.

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"If people don't get their licenses in the very near future, their businesses are tenuous," said Aaron Herzberg, founding partner of Puzzle Group, a law firm specializing in cannabis licensing and real estate. "Maybe those businesses are driven into the black market entirely."

Marijuana companies that had lined up business locations are being "bled dry" as they hang on to costly leases, said Adam Spiker, executive director of the Southern California Coalition, a cannabis industry group. Ryan Jennemann, manager of the cannabis cultivation company THC Design, said his firm has cut dozens of employees in recent months.

"It's an unsettling feeling," Jennemann said. "We're in a state where cannabis is legal. The 4/20 holiday used to be an underground thing — now they're talking about it on MSNBC. And we don't have permits."

The delay has also prevented any new operators, including shops, growers and other marijuana enterprises, from getting into the legal industry in L.A.

Under the regulations, they would get a shot at city approval in a third phase of applications, after L.A. grants approval to marijuana growers and manufacturers that had been supplying existing shops.

City officials have chalked up some of the delay to short staffing as the newly formed Department of Cannabis Regulation started poring over business applications. The department currently has only four staffers and has relied on workers loaned to it from other city agencies. Council members voted to hire more employees in February, but those positions have yet to be filled.

“The shift from cannabis prohibition to regulation — in the largest cannabis market in the world — is complex,” said Cat Packer, who heads L.A.’s Department of Cannabis Regulation. "Getting it right will take time." (Al Seib / Los Angeles Times)

As of Friday, the department had granted approval to 139 pot shops that had been operating in line with an earlier set of city rules — the group of businesses that were first in line for approval. But before other marijuana businesses can apply, the city has been trying to work out remaining details for its "social equity" program, which is intended to help people and communities hit hardest by the war on drugs.

To be eligible for the second phase of licensing, longtime growers and manufacturers that supplied the existing shops must also qualify for that program. If not, they would have to seek licenses in the third phase along with all other kinds of applicants.

Eligible social equity entrepreneurs include poor applicants who either have been convicted of some marijuana crimes or have lived in areas disproportionately affected by pot arrests, as well as firms providing space or other assistance to disadvantaged applicants.

But city officials say they are still figuring out how to proceed.

This year, council members asked to reexamine whether additional communities in the San Fernando Valley, Boyle Heights and parts of downtown might have been disproportionately affected by the war on drugs, potentially allowing people who had lived in those areas to qualify for the program.

L.A. also needs to fund and set up the outreach and assistance programs that are supposed to be provided under the program — or decide whether to press ahead with licensing social equity applicants before the city can offer such benefits, city officials said. That decision would be made by council members.

A spokeswoman for City Council President Herb Wesson did not provide comment Friday.

"The shift from cannabis prohibition to regulation — in the largest cannabis market in the world — is complex, and involves a broad range of stakeholders," Cat Packer, who heads L.A.'s Department of Cannabis Regulation, said in a written statement Friday. "Getting it right will take time."

California Minority Alliance Chairman Donnie Anderson, whose group advocated for the social equity program, said that "we definitely wanted the city to be farther along, but I understand that the city has to make sure things are right." He added that the city needs to ensure businesses don't find ways to "scam the system" meant to benefit poor and marginalized applicants.

The proposed budget released last week by Mayor Eric Garcetti includes $3.7 million for the cannabis department next budget year, more than four times as much as this year, and provides for 28 staffers.

In his budget, Garcetti also estimated that the city would get $30 million from taxing the marijuana industry, a crucial infusion that will help bankroll city services. The delay in marijuana licensing has already cost the city this year: It had been anticipating $16 million from taxing cannabis businesses this budget year, but is now expecting to pull in only $4.4 million, according to the mayor's office.

Marijuana's margin, like alcohol, is going to be captured in the end product, investor says

• When looking to the future of cannabis, Navy Capital founder Sean Stiefel says the marijuana industry will look a lot more like the alcohol industry, than big tobacco.
• Insofar as the alcohol industry has distinctive branding, different product lines and end product-based margins, the marijuana industry could be quite similar.
• In the short-term, Steifel anticipates Canada's impending nationwide legalization will drive marijuana prices way up.

There's going to be a massive undersupply of pot: Marijuana investor  5 Hours Ago | 04:23

Navy Capital founder Sean Stiefel says for the burgeoning marijuana industry, the profit isn't in the plant — it's in the end product.

"We're talking about vapes, oils, edibles, topicals, sprays -- all of that stuff is coming, and as science catches up to marijuana, you'll see more and more of those end products," Stiefel said on CNBC's "Closing Bell."

Stiefel founded New York-based investment firm Navy Capital in 2014. In 2017, the firm launched Navy Capital Green Fund, which invests in public equities in the global legal cannabis industry.

In Denver, where recreational marijuana has been legal since 2014, Stiefel said sales of the cannabis plant don't dominate the market, so much as products derived from the plant. And that's where the big money is.

"Look on the other side of it, the cosmetics and some of the more luxury items -- you can't keep them on the shelves," he said.

As for the future of the burgeoning industry, Stiefel thinks marijuana will look a lot more like the alcohol industry than big tobacco, but will likely share traits with both.

Insofar as the alcohol industry has distinctive branding, different product lines and product-based margins, the marijuana industry could be quite similar. And while Steifel does not consider cannabis purely a commodity, like tobacco, he does hope the cost of the actual plant will decline considerably.

"We actually would like for the price of raw marijuana to come down, because we are believers that the margin, like alcohol, is going to be captured in the end product," Steifel said. "You don't necessarily know the price of grain or potatoes going in the vodka or beer, but you know the price of the beer, and there's tremendous margins to be captured when you make products for the end user."

In the short-term, however, Steifel anticipates Canada's impending nationwide legalization will drive marijuana prices way up.