MJBizMag July 2020 - 16

Trends&HotTopics | John Schroyer
Coronavirus Spotlights
Marijuana Sector Double Standard
I
n a letter sent to U.S. President
Donald Trump in mid-May, the
chief executive of a large California
marijuana company gave voice to a
steadily growing sentiment within the
cannabis industry.
" We are a group of Americans
who have full taxation but no real
representation, as we are treated as
second-class citizens, " wrote Kyle
Kazan, the CEO of Glass House Group
in Santa Barbara, California.
Kazan's letter focused primarily
on the U.S. Small Business
Administration and its position that
state-legal marijuana companies are
ineligible for financial relief during
the coronavirus pandemic because
the industry remains federally illegal.
Kazan pleaded with Trump to allow
companies such as his to apply for SBA
loans so that law-abiding marijuana
businesses would have the help they
need to weather the pandemic.
What the letter illustrated, however,
is that the industry is also beginning
to lose patience with government
officials-both at the federal and
state levels-who have been content
to let marijuana businesses strive to
remain operational under conditions
any other mainstream trade would
revolt against.
It's a double standard that the
industry has lived with for years and
recently has been under the spotlight
because every state with a functioning
medical cannabis market has
deemed those businesses " essential "
during the pandemic.
A Cry for Help
Three-thousand miles east of Kazan's
office, Boston-based CommCan
co-owner Ellen Rosenfeld testified
to the Massachusetts Legislature in
April on behalf of a bill that would
fund a new paycheck-protection
program for companies ineligible for
federal coronavirus relief. In other
words, a new fund to help cannabis
companies through the pandemic.
Rosenfeld told lawmakers that if
the bill passed, her company would
likely receive $400,000, which she
thought would be fair given that
CommCan paid more than
$1.3 million in taxes and fees to
federal, state and local governments
in 2019 alone.
" I cannot borrow money. I cannot
issue more stock on the Canadian
Securities Exchange. I cannot initiate
another round of financing. I cannot
get a bridge loan or an SBA loan. I
cannot get a line of credit or borrow
against any of my wholly owned
facilities, " Rosenfeld said, arguing
that a state loan would help protect
her employees from the coronavirus
Gratitude for the ability to keep doing
business through the pandemic hasn't
erased the double standard created by
Congress' inaction on marijuana reform. "
14 Marijuana Business Magazine | July 2020
as they go about their typical
work routines.
As of press time, Massachusetts'
payroll bill was still pending in
committee.
'Abused by the System'
In Chicago, Cresco Labs CEO Charlie
Bachtell said his company didn't
even bother applying for any state
or federal aid because it wouldn't be
worth the time spent on the effort.
" The (Congressional) aid packages
were at least going to be as big of a
lift if not bigger than tackling those
other issues we've been historically
working on, " said Bachtell, who
also serves as chair of the National
Cannabis Roundtable, which has
been trying to persuade Congress to
repeal Section 280E of the Internal
Revenue Code and pass the SAFE
Banking Act.
MJBizMag July 2020

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