🌿 Cannabis is on the ballot, Green Dragon set to shutter, and financial institutions reach all-time high

Happy Friday Pre Rollers! Welcome to another edition of The Pre Roll, the cannabis newsletter that keeps you up-to-date on the industry happenings you need to know.

Before diving in, we wanted to give a quick reminder that next Tuesday, November 5th is Election Day. Be sure to get out and vote!

Here’s what we’re rolling up this week:

• Cannabis is on the ballot

• Green Dragon set to shutter

• Financial institutions reach all-time high

…and more. Let’s get to it.

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🚨 ROLL CALL

Policy

Cast your vote. Election Day is almost upon us and cannabis is on the ballot in four states next week.

Florida (recreational) 

• Amendment 3 would make the possession, purchase, or use of cannabis for personal consumption legal for adults 21 years of age or older.

• Limits would be set at three ounces or five grams in the form of concentrate.

• Existing medical dispensaries and other state-licensed entities would be able to acquire, cultivate, process, manufacture, sell, and distribute cannabis products and accessories to recreational users.

• The amendment needs at least 60% of the vote to pass.

• If passed, regulations will be implemented within 6 months (by May 2025).

• Former President Donald Trump, a Florida resident, said he plans to vote in favor of the measure.

• Florida Governor Ron DeSantis and his wife Casey have been campaigning against the proposal.

• Florida Senator Rick Scott is voting no.

• Florida-based MSO Trulieve has contributed $141 million to the Smart & Safe Florida political committee in an effort to get the proposed amendment passed.

• Big names such as best-selling travel writer Rick Steves and Barstool Sports founder Dave Portnoy have shared their support.

• Recent polling shows strong enough approval for the amendment to pass.

Nebraska (medical)

• There are two proposals — Initiative Measure 437 and Initiative Measure 438 — related to medical cannabis up for vote.

• Initiative Measure 437 would allow the use, possession, and acquisition of an up to five ounces of cannabis for medical purposes by a qualified patient with a written recommendation from a health care practitioner, and for a caregiver to assist a qualified patient with these activities.

• Initiative Measure 438 would allow the possession, manufacture, distribution, delivery, and dispensing of cannabis for medical purposes by registered private entities, and establish a Nebraska Medical Cannabis Commission to regulate such activities.

• There are two initiatives due to a law requiring each measure to only contain one subject; the Nebraska Supreme Court ruled that a medical cannabis measure in 2020 violated the single-subject rule and ordered it be removed from the ballot.

• Attorney General Mike Hilgers and Secretary of State Bob Evnen questioned the validity of signatures for the state’s medical cannabis petitions in October, but sponsors of the measures pushed back.

• A trial is underway surrounding the measures; both remain on the ballot, but if the legal challenges are successful, election results could be invalidated.

• Each measure needs a simple majority to pass.

North Dakota (recreational)

• Measure 5 would create a new chapter of the North Dakota Century Code that would allow for the production, processing, and sale of cannabis and the possession and use of cannabis by individuals 21 years of age and older.

• A state entity would be directed to regulate and register adult-use cannabis production businesses and dispensaries.

• Protections would be provided for individuals 21 years of age or older who use cannabis, but penalties would be given out for violations.

• Certain employer rights regarding use of cannabis products by employees would be preserved.

• The measure would supersede local ordinances that otherwise prohibit the purchase, sale, use, delivery, or growing of cannabis by or to individuals 21

  years of age or older.

• If passed, an adult-use cannabis program will be established and implemented no later than October 1, 2025.

• Similar initiatives failed in both 2022 and 2018; medical cannabis passed in 2016.

• A recent poll found 45% in favor of legalization, with 40% opposed, and another 15% undecided.

• The measure requires a simple majority to pass. 

South Dakota (recreational)

• Initiated Measure 29 would legalize the possession, growing, ingesting, and distribution of cannabis for individuals 21 years of age or older.

• Individuals would be allowed to possess up to two ounces of cannabis in a form other than concentrate and have up to six cannabis plants with no more than twelve per household.

• Driving under the influence of cannabis would remain illegal.

• Possession or consumption would be restricted in areas such as schools or where tobacco is prohibited.

• Employers would be able to restrict an employee's use of cannabis and property owners could regulate the use of cannabis on their property.

• The measure does not affect current laws dealing with hemp or impact the state’s medical cannabis program.

• A recent poll suggests a majority of respondents oppose the measure.

• The measure requires a simple majority to pass.

We’ll have more coverage on the outcomes next week.

Business

Slay the Green Dragon. Colorado-based multi-state cannabis operator Green Dragon is set to shutter.

The company sent a notice last week to the state Department of Labor and Employment indicating it plans to lay off all 59 workers at its 92,000-square-foot grow facility in Denver by the end of the year. All 17 dispensaries in Colorado are expected to close by then as well.

In Florida, Green Dragon anticipates closing its 400,000-square-foot medical cannabis grow operation and its 39 retail locations.

Green Dragon was acquired in August 2021 by Eaze, which announced recently it is ceasing operations itself.

Policy

Take it to the bank. A record number of financial institutions are now working with cannabis businesses.

According to the Financial Crimes Enforcement Network (FinCEN), a bureau within the U.S. Department of the Treasury that has been tracking these trends for the past decade using filings for “Suspicious Activity Reports” (or SARs) made by financial institutions on behalf of cannabis clients, there are 831 banks or credit unions working with cannabis companies as of Q2 2024. That number is up from the 815 in Q1 2024 and 799 in Q4 2023.

🇺🇸 STATE OF THE INDUSTRY

Arizona: Recreational cannabis delivery is allowed starting today; previously only medical cannabis delivery was authorized.

Kentucky: The first 26 medical cannabis licenses were awarded through a lottery drawing — 16 cultivators and 10 processors.

Massachusetts: The Cannabis Control Commission finally removed the two-driver rule for cannabis deliveries.

New York: A judged ruled that the NYC law used to shut down unlicensed cannabis businesses is unconstitutional, putting the enforcement effort known as Operation Padlock to Protect by Mayor Eric Adams in question.

Washington: An audit discovered that the state’s cannabis tracking system failed; a more efficient tracking system is not expected to be fully implemented until 2031.

💻 TECH

Metrc announces agreement with the Commonwealth of Virginia

The cannabis regulatory technology company signed a contract to be the state’s track-and-trace software to support the regulation of its medical cannabis market.

💨 QUICK HITTERS

• A Wisconsin pizzeria accidentally served pizzas laced with THC oil.

• Canadian police took down an organized crime group making illegal cannabis edibles resembling name-brand products.

• Regulators in New York have banned the distribution of cannabis pills infused with caffeine.

• Stephen Colbert made mention of the GTI x Magnolia Bakery partnership on The Late Show.

📚 WHAT WE’RE READING

• Kim Rivers wants to legalize marijuana in Florida. She has to beat Ron DeSantis first. (POLITICO)

• This SF 'wunderkind' became a CEO at 23. Now his business is booming. (SFGATE)

• Berkeley activists started a marijuana dispensary 25 years ago. Today, there’s none older in the nation (Berkeleyside)

• Cannabis regulators concerned about predatory practices in Missouri’s social equity program (Missouri Independent)

🎙️ POTCASTS

• Cannabis Is Booming, So Why Isn’t Anyone Getting Rich? (Freakonomics Radio)

• Capitalizing on the Green Rush: Duncan Mendelsohn on Cannabis Real Estate and Strategic Investing (Preferred Return)

📽️ VIDEO OF THE WEEK

🔎 JOB BOARD

• Growth Marketing Manager

  • PAX Labs

  • $110,000—$145,000

• Midwest Regional Manager

  • BRĒZ

  • $85,000

• Head of Growth

  • VIIA

📨 PUFF, PUFF, PASS REEFERAL PROGRAM

Stay tuned for more cannabis industry news next week!

💚,

The Pre Roll Team

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