As the novel coronavirus continues to spread across the country, governors and other local government officials are increasingly being asked to determine what types of businesses and services are truly “essential.”
When it comes to cannabis businesses, government officials in those states where cannabis has been legalized (whether for medical or adult-use) have largely agreed that such businesses are essential and may remain open amid the pandemic.
Although having been deemed essential in numerous states across the country, state-legal cannabis businesses have been shut out from federal coronavirus assistance as cannabis remains illegal under federal law.
This has prompted cannabis lobbying groups to call for state-based loans to cannabis businesses that are not eligible for federal funds. While the nation’s economy remains in flux and uncertainty abounds for state-legal cannabis businesses, it must be remembered that every cloud has a silver lining. In the case of cannabis that silver lining might just be a trend towards broader legalization and reform.
In mid-March, we began seeing directives and orders from state and local governments limiting the movement of residents and closing nonessential businesses. As part of their directives and orders, government officials concluded that certain “essential” businesses may remain open and other related services may still be utilized during the pandemic.
Fortunately for state-legal cannabis businesses, most have found support from state and local officials.
However, some states with legal cannabis have instituted limitations. For instance, in Colorado, while medical cannabis dispensaries can remain fully open, adult-use cannabis dispensaries have been limited to curbside pickup.
Like Colorado, Nevada has also limited the operations of adult-use dispensaries, closing all physical locations to the public and allowing only for home delivery.
Massachusetts has gone even a step further. As of March 23rd, under the direction of Governor Charlie Baker, all adult-use dispensaries have been ordered closed.
Governor Baker’s decision has been met with stern resistance from owners of those dispensaries shuttered under the governor’s order. In fact, Governor Baker has now been sued by five of the state’s dispensary owners who seek an injunction against the order that has forced them to close.
Baker has defended his actions on the grounds that Massachusetts’ adult-use dispensaries attract out-of-state customers, which Baker says could increase the risk of spreading the virus.
The dispensaries owners have countered that, if the order continues, it will cause profound and irreparable damage to the nascent adult-use cannabis industry. Additionally, the order will deprive Massachusetts residents of safe access to regulated cannabis and will make it very difficult (or potentially impossible) for certain medical cannabis users to obtain marijuana legally, say the dispensary owners.
A hearing on the dispensary owners’ request for a preliminary injunction is scheduled for April 14th.
In Utah, Governor Gary Herbert’s “Stay Safe, Stay Home” directive has not included medical cannabis businesses among those specifically listed essential businesses. Even still, the only three operational medical cannabis pharmacies in Utah, Dragonfly Wellness in Salt Lake City, Perfect Earth Modern Apothecary in Logan and the newly opened Perfect Earth Modern Apothecary in South Ogden, have remained operational under Governor Herbert’s directive.
According to a short video on Dragonfly’s website, they have put in place responsible social distancing practices at the pharmacy. Also, for those patients that intend to use a letter of recommendation as opposed to a medical cannabis patient card, Dragonfly has asked those persons not to enter the pharmacy until they have received an email indicating that the patient has been pre-registered with Dragonfly.
As it relates to Perfect Earth, the pharmacy had a soft opening of their Logan location on April 1st. On its website, Perfect Earth indicates that it is taking certain steps to protect the well-being, health, and safety of its patients, caregivers, and employees.
To that end, Perfect Earth says that it has enacted all CDC recommendations in relation to the frequent sanitizing and disinfecting of its facilities. Perfect Earth also says that it has instituted a no-contact policy and will be limiting the number of patients in its lobby and on its sales floor.
Other pharmacies that are slated to open later in the year may enact similar restrictions if state, county, or local orders/directives require as much, or the pharmacy deems it necessary to protect patients and pharmacy workers.
While it is no doubt momentous that cannabis businesses have largely been allowed to stay open during the spread of the virus, many state-legal cannabis businesses are finding the inconsistencies between state and federal as it relates to the legalization of cannabis frustrating. Because THC-rich cannabis (and therefore the sale of that cannabis) remains illegal under federal law, state-legal cannabis businesses are barred from receiving federal assistance, including aid for small businesses included in the $2 trillion coronavirus relief package that was recently passed by Congress.
This has prompted six cannabis lobbying groups, including the National Cannabis Industry Association and National Cannabis Round-table, to write a letter to state treasurers and governors asking for assistance for cannabis businesses.
Specifically, the lobbying groups have asked for the creation of a state-based lending or loan guarantee program for cannabis businesses to fill the gap that has been left without access to the Small Business Administration’s Paycheck Protection Program and Economic Injury Disaster loans.
The groups are also calling for short-term liquidity for expenses, health care costs, paid sick leave and other things for economic relief. The letter also asks local leaders to urge their states’ congressmen and women to make state-legal cannabis businesses eligible for the SBA program.
Based upon the foregoing, you might be shaking your head at how cannabis businesses can be deemed as essential on the one hand and then denied access to federal economic relief on the other, or you might be thinking that it is all doom and gloom for those in the cannabis industry that cannot remain fully open or appropriately funded.
While the cannabis industry, like almost every other sector of the American economy, has been negatively impacted by the advent of the coronavirus, all is not lost. Cannabis sales soared across the country in March, especially during the first half of the month as coronavirus became a global pandemic.
Additionally, according to a Gallup poll from last October, approximately 66% of those polled favored the legalization of cannabis.
All of this tells us that cannabis is no longer relegated to the shadows of America, but rather it has become mainstream. This is a fact that should not be lost on federal lawmakers.
The time for aligning the will of the American people and their state lawmakers with the federal government on cannabis legalization is long overdue. If cannabis is deemed essential by state lawmakers during a pandemic, then it should be deemed essential generally by the federal government.
Congress should heed the voices of its people (and the direction of state lawmakers) and give Americans legal access to the plant, while instituting social justice and other reform for those languishing in jails and prisons for cannabis offenses. Free the plant, and free the people.
If you would like to read more about J.D. Lauritzen and the legal counsel he provide in Utah, visit his website at www.utcannabislaw.com.
