Vermont Legislature SmartTranscripts:

[Nick (Livestream Technician)]: All right, we're live.

[Rep. Lisa Hango (Vice Chair)]: Thank you. Afternoon. This is House Government Operations and Military Affairs, and we're back. It's 02:30 in the afternoon to discuss S-two 78, an act relating to cannabis, actually take testimony on. So we'll continue on. And our first witness is Dave Silberman. Dave, would you introduce yourself,

[Jeffrey Pinsonault]: please?

[Dave Silberman]: Thank you. Thank you for inviting me here today. My name is Dave Silberman. I'm an attorney. I specialize in cannabis law. I operate Flora Cannabis. That's Vermont's first ever, retail store in beautiful downtown Middlebury, and I direct the Vermont Cannabis Action Fund, also known as VCAF. VCAF, if you're not familiar, is a coalition of over 50 retailers, manufacturers, and cultivators. We focus on, improving Vermont's cannabis market with concrete actionable solutions that support the market as a whole rather than further dividing the market and trying to pivot one type of licensee against another. Before I dive into the substance of s two seven eight on behalf of VCAF, on a personal level, I wanted to alert you of an important technical issue that has come up recently. It starts with the bedrock of Vermont's cannabis market structure is this thing called the one license rule. It's a single sentence in seven VSA nine zero one that prohibits a person from directly or indirectly owning more than one retail license. Without this rule, local operators who have limited access to capital would very quickly be swallowed up by large out of state operators. This has been a common occurrence occurrence in other states' markets, and it's something that the legislature very wisely chose to prevent from the outset. Over the past four years or so, there have been, many attempts to circumvent this one license rule. And I will say both the legislature and the CCB have done a very good job of nipping those attempts in the bud. There is another such end run that is being attempted right now. And in this case, they're trying to leverage what they perceive to be a loophole that somehow allows group control of multiple licenses. I've identified a simple change to the definitions of control and affiliate that would serve to support the CCB's correct interpretation of existing law in this current case, and it would help to keep our markets small and local. I've shared this language with the chair, and I hope you'll take that up. So now back to February. The CCB has given us a a road map for responsible market growth. It's this supply and demand report that they just recently released and which you'll find on your committee page. At the joint hearing in February, last time you saw me, you heard me describe a cannabis market suffering from oversupply, from retail oversaturation, from collapsing prices, and from competition on an uneven playing field from both out of state stores and illicit sellers, unlicensed sellers. Since then, the CCB released this report, and this report backs up our concerns with hard data and provides a detailed analysis of exactly what is driving consumer choice into the illicit market versus the regulated market. The upshot of the report, I think it's four main points. One, only 68% of cannabis being purchased by Vermonters today is being captured by the regulated market. That means nearly a third of total demand is being satisfied by other channels, channels that do not provide the public safety benefits of the regulatory system nor collect taxes for the state. And in my estimation, we should be focusing our our efforts on trying to get those 32% that we're missing. That's low hanging fruit Rather than trying to find ways to grow the market, try to capture the whole thing.

[Rep. Lisa Hango (Vice Chair)]: Question? I know.

[Rep. Chea Waters Evans (Ranking Member)]: I'm just not in your field of nutrition.

[Mariah Flynn]: Do you

[Rep. Chea Waters Evans (Ranking Member)]: mind if we ask questions you're talking?

[Dave Silberman]: Not at all. Not at all.

[Rep. Chea Waters Evans (Ranking Member)]: So can you tell me when you're trying to capture that extra whatever that final third? I'm not saying we should do this, but would lifting things like potency caps and limits on what goes in a package, would that help? Or is that a different issue?

[Dave Silberman]: I think lots of different things can help. I will get to the things that I think would be most helpful and are most doable in the limited time that we have in my testimony. So I will address that.

[Rep. Chea Waters Evans (Ranking Member)]: Okay. And I have another question that maybe you are also going to address, which is what is the figure for other states that have legalized candidates? Like, what is their do you know?

[Dave Silberman]: So I don't have current figures for every of the 25 states. I remember the last time I looked at Colorado, they were well into the eighties.

[Jeffrey Pinsonault]: Oh, okay.

[Dave Silberman]: Interesting. So we we could be doing better.

[Rep. Chea Waters Evans (Ranking Member)]: Okay. Thank you.

[Dave Silberman]: We should

[Rep. Robert Hooper]: be doing better.

[Dave Silberman]: So the second main point of the report, they found that the existing retail footprint is sufficient to support local purchasing behavior statewide. That's a quote. Sufficient to support local purchasing behavior. Consumers are not choosing the illicit market because stores are too far away or there's not enough of them. Three, the single most influential factor driving consumers to the unregulated market is Vermont's artificial legal limit on product potency. And four, the report found that there is broad interest in purchasing cannabis through alternative settings, specifically mentioning cannabis cafes, special events, farmers markets, things of that nature. On the other hand, delivery did not make the list as an important driver of consumer choice. So the priorities of my organization, VCAF, for responsible market growth. Bringing more consumers into the regulated market is good for public health, it's good for public safety, It's good for the state budget. And it's good, most importantly, for the safety of cannabis consumers, from my perspective, the most important. And at this late stage in the session, we recommend two kind of big impact policy changes. One is ten milligram edibles. Vermont is an extreme outlier on edible potency. There are only two other states, Massachusetts and Connecticut, that limit edibles to five milligrams per serving like we do. And Connecticut, by the way, appears poised to go to ten milligrams. Their house, has passed a bill that's now in their senate to increase that to the national standard of 10. Ten milligrams is not high potency. Ten milligrams is the national standard. If you ask any retailer in this state, they will tell you that customers come into their stores every day asking for ten milligram edibles and take their business elsewhere. Cannabis industry is fully united on ten milligram edibles. There there is no split in the industry about this. Now I wanna address the public health concerns that have been raised by some advocates around changing potency limits. First, I wanna reiterate Vermont is an extreme outlier on edibles potency. If our five milligram limit was delivering tangible public health benefits, we would see it in the data somewhere. We would see it perhaps in measurements like lower ER encounters associated with accidental ingestion cases, lower than the other 23 states that have ten milligrams. But we don't see that evidence at all. We don't see any evidence that the five milligram limit has an extra health extra public health benefit when compared to states that have the national standard of ten milligrams. That's what we should be looking at, is our unique policy choice delivering a benefit over the states that have made a different choice. All we see is people who want their ten milligram edibles buying it elsewhere. My store is near Lake Champlain. I see my customers go to New York. On the islands, they definitely see people going to Plattsburgh. So second, it's important to separate the discussion of edibles and their potency from the other discussion around concentrate potency. The concerns that you have heard around things like cannabis hyperemesis syndrome and things like that, those stem from consumption of high high potency concentrates, not standard potency ten milligram edibles. The different risks associated with these two products should not be conflated. Talking about them as if they are one thing with the same risk profile serves to confuse, not educate. Our second priority, events and cafes. The CCB's report makes clear that we need new ways to reach our consumers, cannabis customers, outside of dispensaries. And, again, the cannabis industry is fully united in favor of creating these new licenses for special events. The cannabis equivalent of a beer tent at a concert or festival, as well as farmers markets where growers can sell at an organized event. And we at VCAF agree that any license type should be able to obtain a permit to host a a special event. But to uphold the integrity of the regulatory oversight system, we believe that any non retailer who posts an event should be required to contract with a retailer to effectuate that final actual sale to the consumer using the appropriate retail level security and training and through our industry standard inventory management systems that are connected real time, in real time integrated into the CCD's track and trace system. We think that is critical for maintaining the integrity of the regulatory system. Now we also want Vermont to join 12 other states now, including Massachusetts and New York, in licensing cannabis cafes and lounges. Think third places where responsible adults can safely enjoy infused foods and beverages in the social atmosphere. The CCB's report, this economic analysis, showed 63% support among cannabis consumers for this type of license type, even more support than for special events. Delivery on the other hand has very low consumer demand according to the economic analysis that CCB put out, and it sharply splits the industry. The delivery model currently envisioned by s two seventy eight is opposed by a majority of my coalition's members with many showing the same concerns raised by the CCB yesterday in their testimony, including my members who support delivery as a concept having the same concerns about this specific provision. As drafted, we believe that this provision threatens to do more harm than good, further intensifying already overly intense competition for that 68% of the customers we already capture instead of stabilizing the market and helping us bring in consumers from the illicit market. So I'll quickly turn to other aspects of two seventy eight. We support the purchase limit increases in sections two through four. We do wanna note that the hash equivalent of two ounces is 16 grams, not 10. And we urge that the math just be fixed there. That that's a just math incorrect fact. Could you repeat that? A ounce of cannabis yields eight grams of hash. So two ounces would yield 16. As currently drafted, the two ounces is said to be a 10 equivalent. Now, I know the CCB yesterday talked about equivalents more broadly, and I want to address that quickly as well. Look, we believe the CCB got product equivalencies right for the first three and a half years of the market. And last fall, they started a process to fix a problem that did not exist, and in that process, the CCB kicked a hornet's nest, and they withdrew that process of trying to redefine what product equivalencies are. We urge both the CCB and this committee to respect the status quo on the ounce to milligram conversion rate and just leave it alone. It has been working well since 2022. There have not been any issues with people buying in our market and reselling outside the market. That was the concern around the one ounce limit to begin with. And if there is not a problem, please don't try to fix it. My organization supports the fee reductions in section 10 a, and in fact, we would support further reducing fees for other license types as well. I would especially point you towards the wholesale license fee, which at $4,000 is prohibitive for the level of sales that wholesalers do, the level of profits that wholesalers have. In this bill, there's some really great language about encouraging coops. I've long suggested to the market that cooperative wholesalers is a great path to market for cultivators who are having trouble, you know, with sales and deliveries and running around to our 115 stores in the state. I think reducing that fee would would really allow them to take advantage of this excellent opportunity. We oppose section 11 of the bill as currently drafted. This is around municipal authority. We urge you to either mandate or create a strong positive incentive for towns to actually hold their retail opt in votes. Only a third of the 252, I think, towns now in Vermont have ever held a vote. This has led to this unnatural clustering of stores in few municipalities that allow them. And so I think, you know, if there is a consternation around requiring a town to take a vote, another idea would be to set a deadline by which a town either has a vote or is deemed to have opted in and be switched to an opt out regime and allow them to then opt out. But something has to be done on this opt in constriction of the market. I don't think that's what anyone had in mind in 2022 to only allow retailers in, you know, 50 towns in the state without giving the residents of those towns the opportunity to vote on it. We'd also like to see in section 11 some clarification around the municipal ordinance authority to require them to treat cannabis businesses in the same way that they treat similarly situated non cannabis businesses so that towns can't single us out unfairly simply due to any lingering anti cannabis bias, and believe me, there's plenty out there. Everyone I've ever dealt with in the town of Middlebury, where I am, has always been very professional. But even within that construct, there is a lot of anti cannabis bias out there. And we just don't want to be in a situation where this accidentally allows towns to make it so hard for cannabis businesses to operate that they really can't, even though they legally, technically could. So I thank you for your time. That is all my

[Rep. Lisa Hango (Vice Chair)]: That's all.

[Nick (Livestream Technician)]: Thank you.

[Rep. Lisa Hango (Vice Chair)]: Doctor. Waters Evans, do you have a question on this section?

[Rep. Chea Waters Evans (Ranking Member)]: I did, but it's sort of forgotten one of those.

[Rep. Lisa Hango (Vice Chair)]: I got one.

[Rep. Chea Waters Evans (Ranking Member)]: I'll see. Okay, go

[Rep. Robert Hooper]: for it.

[Rep. Lisa Hango (Vice Chair)]: Robert Hooper? I'm not you go Oh, Robert Dave, Hooper?

[Rep. Robert Hooper]: Just what you were just talking about with the towns and their autonomy are not of opt in, opt out, It's like when in my town as well, we took a vote in our town, it did pass, we do have dispensaries in the town I reside in. But what is the opinion of the total group? Is that just your personal opinion? You think we ought to go down that route of some sort of, everybody at some point dates certain needs to opt in and, you know, taking that, it just feels unvermantling. Just my thoughts of taking away that autonomy from it. I don't know.

[Tim Tierney]: I'd just

[Rep. Robert Hooper]: like to hear more

[Jeffrey Pinsonault]: on that.

[Dave Silberman]: Yeah. So my group, you know, the 50 plus members of my group are are united in wanting something.

[Rep. Robert Hooper]: And

[Dave Silberman]: we're not, you know, ideological about this. We we just want, to see towns take votes. And over on in at the other chamber, we tried to push a floor amendment, just requiring a statewide vote, and that didn't go for, you know, whatever reasons they had down there. I'm I'm I'm very practical. Any solution, that you guys are are happy with, I'm happy with.

[Rep. Robert Hooper]: Yeah. I just again, I just have to look to the towns having I don't want us to legislate their entire lives either. And I'm not just saying business, like, but I just, in general, think. So I yeah. And we wanted to to think on.

[Dave Silberman]: You know, it's one where it's very unusual where we give towns, you know, this opt in. Right? There's not really a whole lot of that, in state law elsewhere. And I just think because we didn't create much of an incentive for towns to do it, and because it's quite difficult difficult for people to collect the 5% petitions, especially in some of the larger towns, you know, we've just here we are.

[Rep. Robert Hooper]: Yeah. I'm sure we'll probably talk about it. Thank you. Okay. Thank you. Thank you.

[Rep. Chea Waters Evans (Ranking Member)]: Thank you. Ripwater Evans. So, can you explain to us, because I think maybe not everyone on the committee is familiar with this. It was What is the process for getting a town to vote?

[Dave Silberman]: There are two paths. Yeah. One is the select board just decides on their own to put the the item on a ballot. And that can be at a regular meeting, could be a town meeting, could be a special meeting, can be at election day. The other, is to collect, petition signatures from five percent of the registered voters in your town, and then the select board would have to put it on the ballot. There's language for in the senate bill here, that would clarify that, yes, in fact, it is mandatory. But, I'm not familiar with any situation where someone has collected 5%, of their town and signatures, and then their select board rejected it. I believe everyone's been treating it as mandatory. We didn't begin, but we

[Rep. Robert Hooper]: had it put on the

[Rep. Chea Waters Evans (Ranking Member)]: ballot By petition? Decide. Okay. So it's just like any other it it that's how it it usually works if you wanna do something. Okay. Thanks. Robert Hooper?

[Nick (Livestream Technician)]: Dave, did you just say that you can get the select board to draft an article on election? Sure.

[Dave Silberman]: The select board can have a

[Rep. Lisa Hango (Vice Chair)]: I didn't know that.

[Rep. Robert Hooper]: More vote. Yeah.

[Dave Silberman]: Well, so this one has to be a by law, it has to be a Australian ballot. Yeah. Yeah. But, you know, you can you can put a town article as long as you give sufficient warning, you can put it on any it would make sense to me to do it on a day you're already doing an election rather than try to do a

[Nick (Livestream Technician)]: Sorry. Well, I thought you were saying that SelectBoard could put could draft the article on election, and that doesn't seem right.

[Dave Silberman]: No, they could draft it and pull the vote up. That's right.

[Rep. Lisa Hango (Vice Chair)]: They have to work, obviously. Five days. Any other questions for Mr. Silbern? No. Okay, thank you very much.

[Dave Silberman]: Thank you very much.

[Rep. Lisa Hango (Vice Chair)]: Appreciate it. And we'll go back to Jeffrey. Just stepped out for a minute. So we'll move on to Jill. Would you like to come up, please, and introduce yourself? Welcome back. Thank you.

[Jill Sudhoff-Guerin]: Hi, I'm Jill Sathav Keiran. And today, I'm representing the Medical Society, the Pediatrics of Vermont Chapter, and the Vermont Family Physicians. We are happy to be able to comment that we're not opposed to S-two 78 as it passed the Senate. We're grateful for the decisions that they made around maintaining our public health protections within our recreational market. And we urge your committee to maintain these protections. My testimony is not going to be very long today. It's going to be fairly brief. But what I've submitted to the committee has three of the priorities for the public health community that we would like you to maintain. And that includes maintaining the 60% THC potency cap for solid concentrates. And I've got a bunch of fairly new research on that that I've included in the testimony if you want to read it. And we also urge you to keep the advertising regulations that we have in place right now. And then we also would say, let's keep the excise tax where it is. As you know, 30% of the tax revenue goes into substance misuse prevention. And we have a very robust prevention system that Vermont has built out. There are four regional, they're called PLOs, and they're doing amazing work within the communities and working with community organizations. Going back to what's in the bill now, I would just say that the public health community has really worked with the CCB and the legislature to ensure that we have a protective recreational cannabis market. We provide evidence based data. Frameworks and work to share what's happening in the field, in the ER, with the potential risks of cannabis overuse. And our focus is really on preventing youth access, reducing high potency product consumption, and making sure that our labeling and packaging make sure that there's transparency for the consumers and that people are safe. We do have a couple of remaining concerns in February, and we do not support increasing the package size from one hundred milligrams to two hundred milligrams. And that's largely because of what we see in our ERs when our little ones get into cannabis packaging. And actually in 2025, the American College of Medical Toxic Toxicology put out a position statement recommending limiting the maximum total package content to fifty milligrams just to decrease that risk of the kids getting into it. And this panel does, just to answer anybody's question, this panel does recommend keeping it to that five milligram size. And they actually say the safest thing to do, and some states are doing this, is going to a single serving packaging. And our own emergency doc at UVNMC, he's also a toxicologist from Northern New England Poison Center. I put his quote in there, but really when he's talking about what happens when kids accidentally ingest these THC products is they can get extremely sedated and they can actually stop eating and stop breathing, sometimes have to be intubated. So that's why we're concerned about package size. Other than that, we don't have any other things to say about the bill, except we're a little concerned about the event permit pilots and the delivery permit pilots. Can those be done safely? We don't support public consumption. And so do we have the capacity of the CCB to make sure that all of our public health and public safety protections are going to be able to be put in place for these things. And

[Rep. Lisa Hango (Vice Chair)]: that's all I have for you today. Thank you. I guess I'm surprised that you have just listed a bunch of things that you need to see maintained, and you have several concerns, but you're still overall supportive of the bill.

[Jill Sudhoff-Guerin]: No, I wouldn't say supportive is actually not the right word. Not opposed. Not We understand there's probably some things in here that the market would like. We worked really hard with the Senate to maintain our public health protections. And like I said, those three core pieces of the potency caps, the advertising regulations, and the excise tax we see as the most important. And so like I said, we've really moved to trying to work with the CCB and trying to work within the market to make sure that there are public health protections, we believe those strengthen the market. And much appreciated your willingness to work with the CCB and with the legislature on this to get it right. Any questions for Jill? One moment.

[Rep. Lisa Hango (Vice Chair)]: Thank you very much.

[Jill Sudhoff-Guerin]: Jeffrey?

[Rep. Lisa Hango (Vice Chair)]: Welcome. Sorry. You had trouble getting here.

[Jeffrey Pinsonault]: Thank you, vice chair. Thank you, committee. Some handouts here. There's three packets.

[Rep. Lisa Hango (Vice Chair)]: You could just start by introducing yourself when you're ready.

[Jeffrey Pinsonault]: There's certainly three. There's three.

[Rep. Robert Hooper]: Yes. Exactly. There's three different documents.

[Jeffrey Pinsonault]: Exactly. And there might be some extra which I'll Okay. Alright. Thank you all. I know it's been a busy day, busy week, and thanks for your understanding with, my arrivals. Good afternoon. For the record, my name is Jeffrey Pinsonault. I am the co founder and executive director of, Vermont Growers Association. I just want to say, we've seen this committee take on many important matters, this general assembly, so we want to recognize, and thank you for that work, and your time and energy, on this still nascent, regulated market, which has been ongoing. So thank you for your time, not just on hemp and cannabis, but on other issues as well. Good to see some of you, some familiar faces, some new faces, to use your time well, during my testimony, and if I may ask, pause for a minute, how much time, are you affording us? Just so I can

[Rep. Lisa Hango (Vice Chair)]: we don't really have a strict time limit, although I do know that some of us need to leave around 04:00, and we have

[Jeffrey Pinsonault]: Okay. Great.

[Rep. Lisa Hango (Vice Chair)]: Three other witnesses besides yourself. Terrific. So there's approximately an hour left to divide up between three of you.

[Jeffrey Pinsonault]: Okay. Great. Great. Terrific. Thank you for that. It's very helpful. So to use this time wisely, I'm gonna just make some brief introductions. I see some new, members. So I'll talk a little bit about myself and our organization, Then I'll spend a couple minutes talking about the Vermont market. We're about four years in. And then sort of broadly how we see the economics of cannabis markets in general. Just a couple minutes on that. They are unique markets, so we wanna impart some of our perspective, on this committee. And then we're gonna proceed to specific recommendations for bill, s two seventy eight, and that's what those handouts before you should reflect. So the first one is my written testimony, I'm gonna verbalize, maybe skip some sections in the interest of time. The next packet is the Vermont Cannabis Equity Coalition's bill recommendations section by section. And then the last, packet is the coalition's legislative priorities for 2026. So pretty comprehensive handouts there. So starting with introductions, as I mentioned earlier, my name is Jeffrey Pinsonault. I'm the provider and executive director of Vermont Growers Association. I myself, am a long time legacy market cultivator here in Vermont for a couple decades now. I've got some pretty deep roots with the state, and, myself, and other local small legacy producers. And when I use the word legacy, I'm referring to the unregulated market, the illicit market, it's got a couple names. We try to avoid black markets as we're we don't want to feed into stigma, so I often use legacy or unregulated interchangeably. So some context there. So we've set up Vermont Growers Association March 2019, along with some other local producers, and the purpose of us forming is to support an equitable craft centric cannabis marketplace through advocacy, education, and marketing, resource development, business development, workshops, community building events, and more. Vermont Growers Association, we're very proud that it is the oldest member based nonprofit organizing and representing the adult use space. Though we have growers in our name, we do represent the entire supply chain. So we have retailers, manufacturers, labs, and, ancillary businesses such as banks and insurance companies that are our members as well. Vermont Bureaus Association is proud that we practice coalition advocacy. You may be familiar with the Vermont Cannabis Equity Coalition. That is an interstate coalition comprised of other member based nonprofit organizations. One of them is here, so that includes rural Vermont, NOFA Vermont, the Vermont Racial Justice Alliance, Green Mountain Patients Alliance, And collectively, we feel like that coalition represents the local communities in this state, that are most impacted and have the greatest stake, in the cannabis marketplace. And I wanna stress that the cannabis marketplace includes both adult use and the medical cannabis program as well. The medical cannabis program often doesn't get as much airtime as its stakeholders would, like in the state house, but we hope to change that perhaps with this committee. In addition to being a founding member of Vermont Cannabis Equity Coalition, we're also very proud that, BJ is a founding member of the Vermont of the National Craft Cannabis Coalition. So, the National Craft Cannabis Coalition, advocates and organizes for national cannabis policy that includes the interests of small farms and businesses in Washington, DC. We're very proud that the NCCC has earned the support of several other national organizations. Some of them you may be familiar with, normal, the Drug Policy Alliance, the Parabola Center for Law and Policy, and I believe that you've had a witness previous earlier this session from the Parabola Center for Massachusetts. And we're we're we're very proud that those organizations, supported, NCCC's work through the Small Homestead Independent Producers Act, what's called the SHIP Act. The SHIP Act is something that we developed in 2022, and it was the first piece of, legislation in congress, in this nation's history that began to bring forward the interests of small businesses and farms in the cannabis space. We're very proud of that work. Largely a messaging bill, Washington DC is a little bit of a mess right now, especially around cannabis and hemp, but we think, nonetheless, it's important to include the voices of small and independent producers, and businesses in that natural conversation. So we operate, at the state level and then also at the federal levels, when it comes to cannabis law. So please feel free to ask us any questions, not just about state law, but also about what's happening in the federal level as well. Today, I'm going to be giving my testimony as a member of the Vermont Cannabis Equity Coalition. So moving past introductions, little bit about the market and as we see cannabis markets in general. So Vermont's adult use market is nearly four years old, and to this day to this day, cannabis transactions a majority of cannabis transactions take place in the unregulated market here in Vermont. That's important framing for this conversation for bill two seven eight. I'll say that again. Vermont's adult use market is nearly four years old, and to this day, most cannabis transactions in this state take place in the unregulated market. We'll discuss why.

[Rep. Lisa Hango (Vice Chair)]: Yeah. You're gonna ask the question that I think I was gonna ask. Do you wanna

[Rep. Chea Waters Evans (Ranking Member)]: ask it? No. Thank you. So the previous witness said that it's two thirds of them are, I believe it was 68%, right? That were that were legal transactions. So I'm confused just about the disparity, like where the data is coming from.

[Jeffrey Pinsonault]: Sure. Where I can say our data is coming from, and that's before you It's coming no problem. It's coming from Whitney Economics. Whitney Economics is the country's leading cannabis economics firm. They are the most prestigious cannabis economics firm in the country. They advise govern governments and also on the global scale as well. So there are differences of opinion out there, and we believe that this firm has the most merit. And so do other state governments. They they were contracted by New York State for their equity program, Massachusetts, and others. So that's where we get that under the problem. And in fact, in my next sentence, to continue, thanks to the question representative. The country's leading, cannabis economics firm, Whitney Economics, reports that in 2024, on average, across all 24 adult use states, approximately 29.4% of all cannabis transactions occurred in the regulated market. So that means 70% of cannabis transactions in states with regulated markets take place outside of the regulated market. That's what this, economics firm, has assessed, which is widely held across the country amongst individual states and advocacy groups and also regulators, as well. So this is this is widely recognized. And that's important because I'll I'll unpack that a little bit more in my testimony. But what that means is on average, every state with an adult use market, including Vermont, an overwhelming majority of the market share, 70% on average, takes place outside of the regular market. We don't necessarily view that as a policy failure. Policymakers had good intentions when they were devising these regulatory frameworks, but we do believe that it provides an opportunity, and that's what I wanna lead into, with my testimony. So what is that opportunity? Those opportunities are policies for reform that overlap between economic development, market viability, competitiveness, justice, and the original intent of the enabling statute here in Vermont, which is act one sixty four in 2020. Some of you are around for that. And that stated intent is to equitably transition the state's small cannabis producers, which by extension means their customer base into the regular market for the purposes of public safety. So tying it back to the intent of this body back in 2020 with our our enabling statute. So to continue, while the nation's leading cannabis economics firms report that on average, about 30% of all cannabis transactions in states with adult use markets take place in the regulated market, Vermont, we feel, did a much better job than most other states in crafting a regulated market that is accessible for local unregulated producers, the farmers, and the product makers that existed in the black market here in Vermont for several decades. You all did a pretty good job of making the regular market accessible to them. And we also did some things different from other states, and some of those things include home occupancy exemptions for small producers. That is allowing them to cultivate or make products in their place of residence. That's incredibly important. Most states don't have that. Also, allowing outdoor cultivators to place, to to grow, on land in current use. That's also incredibly important. Most states do not do that. We also afford some of the regulatory benefits of farming for those outdoor cultivators as well, whether it's sales tax exemptions and whatnot. So some of those reforms that Vermont chose to embark that other states did not likely captured a greater share of the market, We believe in Vermont that number to be closer to 40%, so about 10% above the national average. So our perspective is right now about four years in, the market that we created has captured around 40% of the total market share. So let's unpack that a little bit more. So why are adult use cannabis markets unable to capture a majority of the state's potential market share, even in states like Vermont that did a better job than most? This is why. In the mid two thousand tens, when adult use cannabis policy first emerged, and those first two states were Colorado and Washington state, recall. Those were the first states to develop a commercial cannabis marketplace, and their initial focus was on public safety and understandably so. This is something that's been criminalized. It was illegal, grown, and sold in the shadows. States are now bringing it on board and developing frameworks. That first impression, that first direction for that approach for the development of these markets was around public safety. Concerns at that time regarding underage access, impaired driving, societal impacts. Some of these themes may be familiar to those who were around during, you know, January, the original legislation deliberation. And also, in totality, those dominated policy formation at that time, impaired driving, youth concerns, social societal impacts. And then as a result, we're about over a decade now into these markets. We've now assessed that they've devised a market design that mandates things like a multi tier distribution system that's centered on retailers, distributors, and all of that disadvantages that comes comes to realize, disadvantages small craft producers and promotes things like integration and consolidation. And that's exactly what we're seeing play out here in Vermont right now. And that's also what we see out see play out in across all the 24, states with regulated markets. So it's not exactly, good news, but, again, these are opportunities. And so economists suggest, addition to everything that I just said, in addition to the the sort of public health focus on the development of these regulated markets through focusing on things like underage access, impaired driving, and societal impacts. In addition to all of that, economists suggest for several different reasons that a significant portion of the unregulated market customer base will not participate in a regulated market unless they can purchase directly from a producer. So I'll say that again. Economists suggest that for several different reasons, a significant portion of the unregulated cannabis market customer base will not participate in the regulated market unless they can purchase directly from producer. So why does that make sense? That makes sense if you think about it. The unregulated market, the black market, the illicit market, which has been forever defined as local small growers and makers, do a couple of things. They either sell their products that they grow and produce directly to their own customer base, many of whom then develop a loyal customer base, And then also, they sell wholesale to, say, dealers. That is the black market or the unregulated market.

[Rep. Lisa Hango (Vice Chair)]: Wait. You said they sell wholesale to who? Dealers.

[Rep. Chea Waters Evans (Ranking Member)]: Oh, I thought you said kids.

[Jeffrey Pinsonault]: No. Okay. No. I

[Rep. Chea Waters Evans (Ranking Member)]: was like, that's just like a problem.

[Jeffrey Pinsonault]: So we're painting a picture of what Vermont and every state's illicit or regulated or black market, unregulated market has looked like forever. And that's important because that that speaks to the unique characteristics of this regulated cannabis market.

[Rep. Lisa Hango (Vice Chair)]: Do have a question?

[Rep. Chea Waters Evans (Ranking Member)]: No, I keep asking them before everyone answers that so I'm going wait. I do have a question though.

[Rep. Lisa Hango (Vice Chair)]: I'm not really sure we can compare the Vermont illicit market to like big city's illicit market. Good point. Because you're talking about small local farmers growers and I'm not picturing that in New York City or San Francisco or anywhere else.

[Jeffrey Pinsonault]: Great comment, vice chair. And what that means is because Vermont is more of an agrarian state, our black market, which I was a partner for over twenty years, we have way more producers and farmers that sell directly to customers. And these are like neighbors down their block, really. And less, say, dealers where you may find them in Austin and more, built up cities. So we have them, but it's important to recognize the realities of that market because we're trying to attract them into the right industries. So great point.

[Rep. Lisa Hango (Vice Chair)]: So, was wrapped, so I'm still trying to get my head wrapped around and this morning's testimony was trying to compare flower to the cannabis to the, when we're talking cannabis market, we're talking after the flower has been processed and it becomes the I'm still trying to figure out at what point does it become cannabis, I guess? Well, first of all, this morning we were talking about hemp. And that is a little bit different product. And we also have a chart on our webpage, I think it's yesterday's, that kind of breaks down the terminology that might help you. Continue on unless you have a really specific question you need to ask. Rutland? No, she can explain it in later Okay, terms great. Thank you. Go ahead.

[Jeffrey Pinsonault]: No problem. And just for the committees on edification, cannabis is interchangeable with cannabis smelt, flour, smokeable flour in this context, and I believe that is the sort of statutory definition for Vermont in the regulated space. By contrast, we have cannabis, which is smokeable flour, and then cannabis products, and those would be packaged products ranging any anything from, say, gummies to hash, and I don't wanna go down that rabbit hole. Okay. If if that provides some clarity. And so as we sort of round out unpacking what the unregulated market is, in the illicit market, historically, producers would either sell directly wholesale, or do a little bit of both. And that's the reality of the market here in Vermont. And since market share is finite, committee, that means that the regulated market has to outcompete the unregulated market. If there's pie, we're fighting over that market share. It's as simple as that. And so that's our perspective on unregulated and regulated markets. So continuing on, regulated markets won't ever capture 100% of the unregulated market share, and they don't need to. They just need to capture a majority of the customer base to become viable, which means that for regulated markets to become viable, they need to attract that tight knit customer base loyal to unregulated producers. That's really important. And if you speak to licensed producers right now, they will tell you they know dozens of people who do not engage the regulated market because for whatever reason, they refuse to go into a retail shop. They would much rather and will not engage the regulated market until they can purchase directly from the producer that they've been doing for decades. That's really, really important. And so bringing it back to Vermont, what this means is once those customers can then purchase products from their producers, they will then be more inclined to visit a retail shop, especially those producers with good relationships with retailers. This is a this is a familiar market dynamic here in Vermont. This is an agricultural market. And what I want to impart on this committee is the importance of strong relationships between farmers, local grocery stores, farmers markets, CSAs, cooperatives, and the reciprocal economic growth from that market dynamic is well known across Vermont and, I think, in the state house when it comes to every agricultural commodity except for cannabis. And what we're asking of you is to consider cannabis in a similar manner. We do not think that cannabis should be regulated and is freely available as, say, tomatoes or other vegetables. We believe in a well regulated market, but those principles for the economics of the market remain the same. And so that's one of the major reasons why regulated markets are unable to capture a majority of the market share because that market share is most familiar with engaging directly with producers. And we're over ten years into this experiment with these sorts of markets outside of Vermont. Colorado, Washington State, they first commercialized cannabis in 2013. So we now have a pretty strong body of evidence of the limitations of these market designs. And so that's why Whitney Economics access, assesses the those figures for, adult use markets. So, back in Vermont, because of the market design policy choices such as retail opt in, which you all, have heard of from earlier today, that created a patchwork of municipalities that have shops that don't have shops. That's approximately 32% of all towns in the state. About 78 out 247 municipalities allow for retail sales. That's a structural bottleneck that would damage any other market, whether it's beer, cheese, or cannabis. If you could only sell and and make available those products in 32% of our towns, that's a structural bottleneck. So that is not necessarily overproduction, that is lack of access. Also, over 160 cultivators and manufacturers have relinquished their licenses since initial licensing in 2022, with the leading reasons for exiting as reported to the CCD being market access and profitability. So again, that speaks to exactly that market access issue that I talked about a moment ago. Mandated multi tier distribution markets lead to integration and consolidation. They squeeze small producers out of the market who cannot get by on wholesale alone. If a regulated market does not provide some sort of direct market distribution to producers, the unregulated market will continue to outcompete it. It's as simple as that. The question before you and your colleagues is, would you prefer to capture that market share and potentially capture that potential tax revenue or leave it in the unregulated space and leave it up to our neighboring states markets as well. We're actively absorbing those sales. Any questions?

[Rep. Lisa Hango (Vice Chair)]: I think so. I think I will ask you if you would give your recommendations to the committee because we're just about a third of the way through that hour that

[Jeffrey Pinsonault]: we talked

[Rep. Lisa Hango (Vice Chair)]: about in the beginning of the session.

[Jeffrey Pinsonault]: Certainly. Thanks. Of course. So moving into the recommendations. There are 32 secondtions of the bill. I'm going to touch upon three to four key areas.

[Rep. Lisa Hango (Vice Chair)]: So, Yes? I was just going to tell you, but I may not have this correct. I'm not sure you have the right version. Let me just take a really quick yeah, I'm not certain. Yours says

[Jeffrey Pinsonault]: That's passed by the Senate.

[Rep. Lisa Hango (Vice Chair)]: Okay. That is that is it. Yours said draft 3.2, and ours does not. So, yes, we're working off of as passed by the senate.

[Jeffrey Pinsonault]: Okay. Great. And so so are we. Perfect. Thank you. So the four key areas that we want to touch upon, and and I urge you, to please review, our coalition's, markup, of the bill. We have some sections of the bill, that have been removed, and we ask that, you consider restoring them to this legislation. The first key, discussion item is section 28, and that's appropriations. This was a a two part appropriation in section 28, 1,000,000 to the cannabis business development fund, and 1,600,000 to the land access opportunity board. We see that framing as to characterize those two appropriations. The first one, the cannabis business development fund is reinvestment back into the industry. That's something that is essential that is missing from this regulated space. Other sectors, whether it's farming, or other, commercial goods sectors have technical and financial assistance available to them Because of the federal designation, for cannabis, federal coffers are not available for state programs, and funding and supporting of these businesses, as I believe many of you may be aware. So as a result, we need to spin up our own version of support, whether it's technical or financial assistance, and that comes in the form of, in Vermont, so far, the cannabis business development fund. Putting that to aside, the LEOB, the land access and opportunity board, we see that as a mechanism of community reinvestment. Something to keep in mind is community reinvestment in general is appropriated at the state level. And on average, about 25% of the cannabis excise tax in various states is directed to community reinvestment, 25%. I believe New York State does 40%. Right now, we do zero. And that's not just roads, that's not just schools or, you know, community centers. That's also, other other areas, whether it's access to land, access to housing, aspects that you need that one would need to participate in this regulated market. And that's what we're asking you to consider. And if appropriations is not appropriate for this committee, if this if that's outside of the purview of this committee, then we would ask that you work with the appropriate committees and colleagues in the house to restore that funding, for the cannabis business development fund and community reinvestment purposes through the LEOB?

[Rep. Lisa Hango (Vice Chair)]: I think that we recommended both of them out of this committee. And just so you know, a committee of conference has now been announced today for the budget. So the House and the Senate are differing, and those are the items to be brought to the members who are going to be on the committee of conference. So we'll make sure that we look at our recommendations and go forward with that.

[Jeffrey Pinsonault]: Thank you.

[Jill Sudhoff-Guerin]: Thank you for bringing it up.

[Jeffrey Pinsonault]: The second item that I'd like to raise is medical program reforms. Medical cannabis program reforms. The agency, the CCB, in its act one sixty six report from 2024 introduces, recommends to the general assembly what we feel are non controversial, very reasonable medical cannabis reforms, and that is moving oversight of symptoms and conditions out of the state house and into the CCB, appointing a board that would then develop recommendations on an annual basis for the symptoms and conditions that are eligible for the medical cannabis program instead of deliberating, say, medical conditions and science in committees such as this. Other states have stood up a similar structure. We support the CCB's recommendation to do as such. We ask that if this committee is not the appropriate committee to discuss that reform for the medical cannabis program, that you work with your colleagues in other committees in this house chamber to do as such. And, again, that is coming from the cannabis control board itself. We want to lift up that recommendation and see some sort of movement this session for improving the medical cannabis program. That is an important sensitive demographic that should be included

[Rep. Robert Hooper]: in this bill as well.

[Rep. Lisa Hango (Vice Chair)]: If I'm not mistaken, that's not our jurisdiction, our area of jurisdiction, and it probably could be with could House Human Services, but we'll find out the answer to that as well. Thank you.

[Jeffrey Pinsonault]: Thank you. And then maybe to conclude here, we're asking outside of addressing those missing sections, important reforms that everyday Vermonters are interested in seeing. We're also asking that you consider strengthening some of the provisions in this bill. So for example, jumping down to the delivery permit. So we're asking with all the context that I gave previously in my testimony today that you all consider measures such as adding on-site as an option. So not mandating delivery, but allowing producers the option of either delivering or doing on-site to sell products directly in a well regulated manner. That's because some producers are not comfortable allowing the general public to visit their facility, and some are. And so we don't wanna pigeonhole producers. We wanna give them that safety, that mechanism, that option to interface in an area, in a space that's most comfortable for them. So whether that's delivery or on-site, that's that's a a a proposal consideration that we would ask that you consider to strengthen the delivery permit.

[Rep. Lisa Hango (Vice Chair)]: So that's on-site of the producer's facility direct to consumer?

[Rep. Robert Hooper]: Correct.

[Jeffrey Pinsonault]: We also ask that you at least bring the number of permits for what we would consider the on-site and delivery permit to 30. Right now it's at 15. The event permit is 20. We do not know where the 15 number came from, but we at least recommend parity with the event permit. And the reason why we suggest 30 is because there are a significantly number, more there are more licensed producers than any other license type. There's something like close to 400. And so we think that just reflects that makeup of issued licenses.

[Rep. Lisa Hango (Vice Chair)]: Think the events are not the number you just said? I believe it's the delivery is 15, but I feel like the events is

[Jeffrey Pinsonault]: Should be 10 public and 10 private, I believe.

[Rep. Lisa Hango (Vice Chair)]: That I will have to look through the bill on because I'm only remembering 10 total. But I could be wrong. So, okay, any questions at this moment for our witness? No. Anything further you want to add?

[Jeffrey Pinsonault]: No. I guess in closing, I'm not sure how long this committee is going to be delivering this legislation, but I would ask that you consider bringing in, making time for local stakeholders. There are many very smart, very dedicated, very, compliant small producers, retailers, and the like that would love to come in here and share and speak to some of these interests and and and positions. And I and I ask you to consider that to come in.

[Rep. Lisa Hango (Vice Chair)]: Thank you. We certainly have a list of folks who are interested in submitting written testimony. A lot of people already have, and also people who are willing to come and testify in person. And I can't answer how long we're going to be dealing with this bill, but the end of the session is coming. So we may find out that we have to get it out of here quickly, or we may have another couple of weeks.

[Jeffrey Pinsonault]: Thank

[Rep. Lisa Hango (Vice Chair)]: you.

[Jeffrey Pinsonault]: Well, thank you for your time.

[Rep. Lisa Hango (Vice Chair)]: Yeah, thank you for coming in. Mariah?

[Mariah Flynn]: Yes. Hi. Can you

[Jeffrey Pinsonault]: see me

[Mariah Flynn]: on the screen?

[Rep. Lisa Hango (Vice Chair)]: We do not see you, but we can hear you.

[Mariah Flynn]: Well, great. Halfway there. I have a few slides. Oh, yes. I'm sorry. I know why you can't see me. I wanted to make sure I didn't share my screen until you were ready. There you go. Hello. Sorry. I have a few slides. Should I share those on the screen or do you have them already there?

[Rep. Lisa Hango (Vice Chair)]: I'm gonna take look. If you sent them earlier, we should have them?

[Rep. Robert Hooper]: Yep.

[Rep. Lisa Hango (Vice Chair)]: Okay. I'm hearing that we do have them on our web page, so you don't have to share your screen if you don't want to go through that trouble and you can

[Mariah Flynn]: I don't mind doing it if if I'm allowed to? It's fine.

[Rep. Lisa Hango (Vice Chair)]: You are allowed to, but we do all have them. So it's entirely your pleasure.

[Mariah Flynn]: Okay. Sorry. It looks like sharing is not available anyway, I'll

[Rep. Lisa Hango (Vice Chair)]: just We could enable that if you need it.

[Mariah Flynn]: I don't need it. I just wanted you to know which slide I was talking about when I was talking about it. But I'm good. That's fine. Thank you. Thank you. So hello. Thank you for the opportunity to speak with you all today. My name is Mariah Flynn. I use sheher pronouns. I'm a certified prevention specialist, and I work as the coalition director for the Burlington Partnership for a Healthy Community. We're a substance misuse prevention coalition that serves Burlington. I want to actually just realize I should probably have the slides for myself. If you look at that slide, the first slide that's on the three that I sent you, our work is in community level prevention. We're looking at what are the root causes of substance misuse in a community at the community level. There's so on the right of that side, you see there's the Vermont prevention model, which has the different levels at which you can provide intervention to support prevention of substance misuse. Looking at systems and organizational community and personal, and our work is mostly in the community level. So what that means is that we're looking at implementing strategies that help prevent folks from developing a substance use disorder. And we do that in a lot of different ways through supporting education, by helping to improve community design, by supporting increased community connection. Basically, our overall goal is to help make it easier for people to make informed and healthy choices about substance use. Because of that, I spend a lot of my time looking at data and emerging research about cannabis. I've been interested and involved in Vermont's conversations and policy changes about cannabis for a long time. And one of the reasons I'm paying particular attention to cannabis is that in Burlington where I work and in my conversations with I have with other folks in Vermont, cannabis continues to be the substance where I most often see the biggest disconnect between what we've learned in the last ten or fifteen years from the research about it and what the public understanding or knowledge is about substance, people's understanding of cannabis just really has not caught yet caught up to the science. And so I reached out to the senate back in February about my concerns with the bill when it as it was initially introduced because I was worried about the negative public health impacts, particularly on young people in the original proposal. And I do wanna, similar to Jill, commend those who recognize that some of that initial proposal in the bill to reduce regulations was not in the best interest of the public. As someone working in substance use prevention, I was concerned that in the initial bill, it read like a marketing strategy for cannabis. Some of the things like reduced advertising restrictions, increased potency, the reduced taxes, removing the community's voice to opt in at local sales have been removed. I just want to reiterate my appreciation for recognition that those are not in the best interests of the public and being removed and continuing to keep it that way. There are still some things in the bill that I think are places to be a little concerned and to think about what the impact might be on the public. In the interest of time, I just want to share a couple of points that are relevant to my field that I hope you'll keep in mind as you're looking at this bill. The first is that Vermont has the highest reported use of cannabis in the nation. Also have one of the highest rates when you break that out by different demographics. We also have one of the highest rates of use in The US among our youth populations and our young adults. And so to me, this is not an area that we want to be number one in. Because young brains are still developing, they're very much more susceptible to developing an addiction or a substance use disorder. We really need to be thoughtful about any policies that focus on giving more access to cannabis. Things like increased purchase limits and product sizes and events where people are using in public. Those are the types of things that to me are concerning given where Vermont stands in our issues with substance cannabis use already. What we really need in Vermont right now strategies that acknowledge that our high cannabis use rates are a problem and are working to address it. We really need a well funded public health campaign to educate Vermonters about the health risks of cannabis so that we can help people catch up to the science. We need policies that work further upstream and put more guardrails in so that so many people don't keep falling into the river of addiction and needing more intensive resources downstream. That's one of the things that I think about when I was looking at this bill. The other consideration is just how much adult focused policies, things that are about supporting adult use, have an impact on youth. And I think partially because cannabis commercialization in Vermont started during a pandemic, I'm still learning about all the ways that our current cannabis laws, things that we did just a few years ago, are impacting Burlington and our youth, and we're still learning a lot about that. So one of the things I hear, we do a lot of work with partners in our school district in Burlington. And the counseling department has been talking, the folks who are working with kids in our counseling department have been talking a lot about the fact that kids still have a lot of confusion about cannabis. And they're getting a lot of mixed messages about it because they're seeing it normalized in more and more parts of the community. We're also seeing this issue, you might have heard maybe in other bills you're looking at that nicotine vaping products are becoming so accessible and prolific at the same time. It was happening around the same time as the pandemic, and at the same time we legalized cannabis. You're seeing kids this interchanging in our schools of cannabis and nicotine vaping and product use. That seems like it might be leading to the problem we're having, which is that in our schools, kids who are starting to use are progressing in the addiction cycle much faster than we used to see in the past. And so something to think about as we're, again, thinking about more access to substances, what does that mean for this cycle that kids are in right now? On the second slide that I have there, you can see the, results of a survey that we do. So we work with our school's district to implement this survey every two years with the middle and high schools. And one of the questions we ask students is we give them a list of about 19 different issues that could impact a young person's life that students have come up with. And we ask students to rank them as either a big concern, somewhat of a concern, or not at all a concern for the young people in their school and in their community Burlington. So on the screen, you can- or I'm sorry, in your, in your slide deck, you can see, that in 2023 and 2025 for our middle and high schoolers, that issue of vaping that I talked about is coming up in the top levels of concern for them across middle and high school and across 2023 and 2025. It's continuing to be an issue that they see as a top concern. But one thing that was new in our most recent round in 2025 is that cannabis or marijuana use has also joined in one of top concerns, which to me is a flag of, okay, for some reason, this is popping up to them as more concerning to pay attention to now. I don't know what, you know, we don't have all the reasons why that is, but something that I wanted to flag for you as something that kids in our schools are noticing as an issue.

[Rep. Lisa Hango (Vice Chair)]: That's interesting. Also, I noticed alcohol is not on any of their lists.

[Mariah Flynn]: Yeah. It's always interesting to see what pops up and why. Our questions don't dig into that anymore. Then I'll leave you with Liana, which is on our third slide. And so right now, I'm working with my partners in the Burlington School District on a kind of last minute urgent thing that we decided we needed to do to bring parents together in the high school because there's a particular grade in our school of young one of the younger grades at the high school that's really having a hard time with cannabis alcohol use also in school. We, I think, need to bring parents together to, wrap them with support. And to me, it just flagged for, like, one of the reasons I was thankful to be able to come here today is to have an opportunity to just say, please slow down, with the idea of kind of increasing access to substances and be really thoughtful about it, about how quickly we push Vermont to increase access to more and more cannabis, which I think is somewhat of what you see in this bill. We're still learning about all the ways that the current access might be negatively impacting our most vulnerable Vermonters like our kids. I'm needing more help to figure out how to address that and how to help make our policies best support our young people in the community. And this is Leanna in the last slide. Leanna is a ninth grader now at Burlington High School, but she, took these pictures last year when I worked with her at Edmonds Middle School, and she was in eighth grade. She wanted to show what images she walks by on her way to and from school when she's out in her community. Edmonds Middle School and the high school where she is now, Burlington High School, are both in Downtown Burlington. And so she's walking up and down Church Street regularly and around the downtown area. And on her walk, just in this one block you see on the left, she walks by two bars and three cannabis shops right in downtown, right in one block. And there's more if you keep going, right? I think to me, this is a visual sign of the normalization of substance use, telling her about what adults in her community value as important. And before we keep thinking about how we continue to add to those high cannabis use rates in Vermont that I mentioned earlier by offering more public places to use cannabis and bigger purchase limits and product size, from the area of the community that I think about or the field that I work in, I would urge us to put just as much time to think about how we can improve the public understanding of health risks of use and consider how the current landscape is impacting young people and normalizing cannabis use for the next generation. For Liana's generation, the cannabis available has a lot higher potency than previous and use carries a lot more potential short term and long term risks. So I'm hopeful that we can find a way to make it just as easy for Leanna and her friends to access good information and a healthy community as it is for adults to get more and more cannabis. I appreciate your time. That's all I had. But I'm open to questions if you have any.

[Rep. Lisa Hango (Vice Chair)]: Thank you. I appreciate the real world example, the lived experience. That was a great example. Does anybody have any questions for our witness? Brooke Boyden. At the beginning, you shared that Vermont has the highest reported rate of cannabis use. I was just wondering where that data will confirm or if you could share that.

[Mariah Flynn]: I can share. I would guess that it's probably also in the testimony that Jill shared. I think she has a link to that same data, but I'll send my testimony and include the link to that. Believe it's from the National Survey on Drug Use and Health, which is done across The US.

[Rep. Lisa Hango (Vice Chair)]: Any questions? No, well, you very much for being with us. You're welcome to listen on Zoom if you like, or if you have something else you need to go to, you're welcome to leave as well.

[Mariah Flynn]: Thank you.

[Rep. Lisa Hango (Vice Chair)]: I just wanted to clarify for Jeffrey that, yes, the bill says 10 private and 10 public events. I checked on that event permits. So yeah, you're welcome. Sorry, I didn't know that off the top of my head. And we have Nathan and Tim from ACCD, and I don't know which one wants to go first. So please have a seat, welcome, and introduce yourself.

[Tim Tierney]: Good afternoon. Happy last April.

[Rep. Lisa Hango (Vice Chair)]: Thank you.

[Tim Tierney]: My name is Tim Tierney. I am the senior economic development director for the Agency of Commerce Community Development within the Department of Economic Development. I'm here with Nathan Davidson, who is our economic specialist. We both oversee what we call the Cannabis Social Equity Program. And I'm going to give you just a little brief history on that, and then I'll give a real quick request. In fiscal year 'twenty two and 07/21/2022, our department received an appropriation of $500,000 and someone asked, what is this about? So there we found out that we actually were in charge, newly charged to oversee a cannabis social equity program, which then I took the initiative with then specialist Randall Zotch to stand up a program to provide social equity determined participants in the cannabis industry to provide technical assistance and access to capital. So we did some thorough research of states that provide these programs, mostly in Oakland, California, Colorado, Massachusetts. We found out what worked and what didn't work with programs that they had. We then developed a program, and found out that one thing, we could not provide loans. There's no one in the state that does loans. The state government does not do loans. We do not. There's no one even in the state that we could actually pass through money to provide loans because there's no federal guarantee when it comes to cannabis. So we actually asked our agency administration, can we provide beneficiary payments? Which is not a grant program. The grant a grant program, which we administer many of, would require probably a bigger threshold, more friction for participants. And these folks and the social equity folks are basically, you might know this already, folks who are black, Hispanic, I mean, marginalized communities from the past, or someone who's has been or is related to or directly related to a person who was incarcerated due to cannabis laws. So, the cannabis control board actually tells us who is a determined social equity applicant. What we have is we went then we then put out a request for proposal around the whole country for people to bid on someone that would provide technical assistance. And the main theme was someone that had actually dealt with social equity population. That was the most important thing to us. And we found a group in Massachusetts. They were the we thought the best provider of technical assistance, that means they're helping out with business planning, marketing. Nathan, help me here. What else we got?

[Nathan Davidson]: Bookkeeping and finance, building out their QuickBooks website. We just got a report with that done for the bank closets. They said design, marketing, IT development, HR, process development. So it's a wide range.

[Tim Tierney]: And they do a very long intake interview with every company. We now have a pretty good set of applicants who utilize this program and they can direct contact with this RHODES Consulting out of Massachusetts. And every year, every time they relicense, they can actually apply very simple application to receive on a beneficiary payment every time a social equity person, individual, in a business, to receive a beneficiary payment of $5,000 So that's we found that initially, we had a $500,000 appropriation, and we thought it was a one time appropriation, which it was, and we didn't know how many applicants were gonna come. We've since received two other $500,000 appropriations, and we also received $52,000 licensure fees that were required, I believe, by the labs. And we also received some donations to the program. And by the way, state government financial management systems do not like donations, we found out. So, but we finally we got them into the fund. So we have basically, and, Minh, you can help me. Nathan, again, about $350,000 remaining in that fund?

[Nathan Davidson]: At this point, I'm not sure if I should be saying my name and title for the record. Yeah.

[Rep. Lisa Hango (Vice Chair)]: I realize that. It's okay.

[Nathan Davidson]: Nathan Davidson, Vermont Department of Economic Development. As an economic development specialist, we have around 267,000 remaining. Alright.

[Tim Tierney]: So, and this year, we are aware that tier one manufacturers and cultivators are in need of assistance. And we can provide technical assistance and training programs. And Nathan actually set up a program this year using the Vermont State University program to actually have social equity participants attend a seminar on advanced marketing. We found there's I mean, and and even all kinds of different things we can help them with. And but it also allows other folks to attend those at a more lesser fee outside of social equity. So we're trying to do that more and realizing that contacted by the CCB, that tier one needs more technical assistance and business help. And therefore, I think that's what was put in here, that if there was a million dollar appropriation, we were more than happy to be a pass through to find a service provider that could actually provide more agronomy more. That's one thing that's missing. I think that the agronomy help, we don't do that. Our consultant doesn't do that. But also provide technical assistance to people outside the social equity platform. But without appropriation, right now, currently in there, it looks like we don't have the funds or the wherewithal to actually help out those 300 so Tier one. So people. So we're asking, like, if there's no appropriation, that it be removed from the bill this year. Because there's just it's an impossibility. Otherwise, we're going to have $270,000 is not going to go very far. And we're also just going to basically water down what we can provide these social equity folks. So that's our request, if that makes sense. I hope I didn't speak too fast at the end of the day here.

[Rep. Lisa Hango (Vice Chair)]: I'm still trying to find the section in the I think

[Tim Tierney]: it's page 28, 29. Is that what I have on

[Rep. Lisa Hango (Vice Chair)]: Thank you. Appreciate that. And section 23. Wrapwater Evans has a question.

[Rep. Chea Waters Evans (Ranking Member)]: Oh, was first. Sorry. That's okay.

[Rep. Lisa Hango (Vice Chair)]: Rutland, Jenks. Was just out of curiosity, did you say this is the only type of business that we do this kind of support for?

[Tim Tierney]: It's the only sector that we do this for.

[Rep. Chea Waters Evans (Ranking Member)]: I had more of a comment with just that. I always feel bad that we have set up the system to give people access to these licenses and these opportunities to compensate for What happened to them in the past, and then we they're not always folks who are well versed in running a small business or have the knowledge or expertise or resources to get it. And so, you know, like. Like, in the Under the guise of helping, we've made things really difficult for a lot of people.

[Tim Tierney]: Well, I mean, think this program has helped out a lot.

[Rep. Chea Waters Evans (Ranking Member)]: That's what

[Jeffrey Pinsonault]: I hear.

[Tim Tierney]: And we're finding that the social equity participants actually I mean, obviously, this is an We heard before, an oversaturated market. But we're finding it's a higher survival rate for folks who've gone through this program, the social equity participants, that are staying remaining because of, hopefully, what they have reached out and have those resources. It does make a difference. Yeah.

[Rep. Chea Waters Evans (Ranking Member)]: I feel like not funding that would be

[Tim Tierney]: So that but that's funded. I'm saying the million dollars wait. There's another there's another ask in there about basically providing tier one

[Rep. Chea Waters Evans (Ranking Member)]: Yeah.

[Tim Tierney]: And manufacturers and alright. Well, I can look at the language here.

[Rep. Lisa Hango (Vice Chair)]: Make my first businesses

[Tim Tierney]: Thank you.

[Rep. Lisa Hango (Vice Chair)]: Economic empowerment status by the board.

[Tim Tierney]: Yes. And and so I talked to the I talked to the cannabis control board yesterday, the board members, and they are, right, without an appropriation, they are great, and you can corroborate that with them that the removal of that statement about the tier one manufacturers and processors and growers and producers, because without the money, this is just not gonna work. But we we have the $270,000 to continue our work with the social equity folks, and I think that'll get us through next to the next fiscal year. I mean, obviously, there is a finite amount of people that are using this program. So a lot of them have been through the help. So we're not seeing that many more applicants come in, in this sector. So I think that there is enough money to continue next year. If it's needed, we'll come back, we'll come and ask for additional funds. But I don't know you I heard mentioned before that the million dollars is not there. It could be there, and you will find out if it is. So what?

[Rep. Lisa Hango (Vice Chair)]: We haven't had a chance to look at the senate version that just barely came out. So I'm not sure what they did with this money, but we did request money. So anything is possible. Anybody else have any questions for our economic development witnesses? No?

[Dave Silberman]: Thank you. Oh, my pleasure.

[Tim Tierney]: Nice to meet you all.

[Rep. Lisa Hango (Vice Chair)]: You as well.

[Rep. Chea Waters Evans (Ranking Member)]: Thank you.

[Rep. Lisa Hango (Vice Chair)]: I think that's it for today. We've had a really long day, so appreciate everybody being here and keeping on task. With that, Nick, we can go off live, and everybody have a good

[Nick (Livestream Technician)]: day.