Vermont Legislature SmartTranscripts:

[Sen. Kesha Ram Hinsdale (Member)]: Cannabis regulation to the delivery sales something or other something something that

[Sen. Alison Clarkson (Chair)]: you Okay. Can do about Let's go back. We're back live. Welcome back everybody. Tucker, we are at Cannabis Advertising.

[Tucker Andersen, Legislative Counsel]: That is correct, and for the record, Tucker Andersen, Legislative Council, we are on page 10 of the Committee Amendment, draft 1.1. We are on line 12 under the Reader Assistance heading Cannabis Advertising. In section ten, seven BSA section eight sixty four is amended in subsection C. Under current law, cannabis establishments are prohibited from advertising their products via any media, unless the licensee can show that not more than 15% of the audience is reasonably expected to be 21 years of age. This amendment clarifies changes, excuse me, that prohibition, so that cannabis establishments shall not place a paid advertisement in any third or part of the paper, unless the licensee can show that not more than 30% of the audience is reasonably expected to be 21. Explaining some of those changes. First, this lifts the prohibition on in kind advertising or posting, for example, on websites or social media owned by the company, Their retail establishment is variety, is the prohibition is on paid advertisements in third party. Okay, so third, Thomas, do have a question?

[Sen. Thomas Chittenden (Member)]: So, this applies to Vermont growers and retailers. I think what Senator Rutland was just raising, it hit me with some growers and retailers recently that they have people out of New York advertising with radio and with other ads. Does this regulate or restrict out of state companies from advertising in Vermont papers?

[Tucker Andersen, Legislative Counsel]: Not under the current structure of Title VII, and I'm sure you've been here, who's more expert in that.

[Sen. Kesha Ram Hinsdale (Member)]: Okay, and

[Tucker Andersen, Legislative Counsel]: what I could So it's Vermont's care of establishment.

[Sen. Kesha Ram Hinsdale (Member)]: This is something that senator Chittenden and I just learned about, which I just explained. If what I think would be a valuable addition to this bill is just that if we I think we should move forward with these provisions that would then level the playing field for our local retailers to advertise in ways that is not prohibited for New York to advertise in our New York retailers to advertise to our distributors right now. And then that would give us the infrastructure if we add an additional piece, if they are breaking our state laws with how they advertise. So if they're advertising in the UVM Sync, for example, I think that would be a violation for how we would want things advertised, and then we could go after them right now. The CCB is saying they have no jurisdiction to do anything about New York cannabis retailers.

[Tucker Andersen, Legislative Counsel]: So where are they advertised?

[Sen. Kesha Ram Hinsdale (Member)]: And I should also say New Hampshire and Massachusetts because we heard from Brattleboro as well about this being a major issue for them in Brattleboro.

[Tucker Andersen, Legislative Counsel]: Just Oh. I have I haven't heard that in our neck of the woods. But Okay. My question is, what venues were they what how were they where were they at?

[Sen. Thomas Chittenden (Member)]: Seven days. Oh, seven days. Okay. And radio stations too.

[Sen. Kesha Ram Hinsdale (Member)]: They're like, papers that are in the islands.

[Dave Silberman, Director, Vermont Cannabis Action Fund; Owner, Flora Cannabis]: But, like, Instagram, Facebook, those

[Sen. Thomas Chittenden (Member)]: ad advertising get that geo fenced, or if you're based in New York, those ads that are Vermont. So then we don't get any sales debt, any taxes. Exactly. New York sellers. So Yeah. I think it worked.

[Tucker Andersen, Legislative Counsel]: Pepper has just restoring us. Pepper just raised the issue of the now newly understood fact that New York State growers and Retails. Retailers are advertising in Vermont, and our law doesn't seem to prohibit that.

[Sen. Kesha Ram Hinsdale (Member)]: So we should give our retailers a fair shot and then regulate better by adding language to what how we regulate alcohol and tobacco that they can't break our laws with how they advertise too much.

[Tucker Andersen, Legislative Counsel]: So it's Pepper, do you want?

[James Pepper, Chair, Vermont Cannabis Control Board]: Yes. For the record again, James Pepper. It is true and we are seeing it. We generally, when we see this, reach out to New York, their office of cannabis management, and just alert them to this. If we saw something that was like, they would break their advertising laws, for instance, like something that was directly appealing to youth, then they can take action. We we just we don't have jurisdiction over their licensees, but we do have a good working relationship with New York. But as far as just, like, you know, with discrepancies between New York's laws, where they're more permissive than our laws, you know, we don't really if we went and told New York, hey. They're advertising in a way that breaks Vermont laws but doesn't break your laws. They don't really have much to say about that. So

[Sen. Kesha Ram Hinsdale (Member)]: Unless we change the law.

[James Pepper, Chair, Vermont Cannabis Control Board]: Unless we change the law.

[Tucker Andersen, Legislative Counsel]: So it sounds like we need to address that. Yeah. Okay. Great. Thank you. Great. And some background with all this and a few things that we're about to get to in the advertising statutes, that with some of the other regulated products and substances that you all work with, there are either federal regulations or US code that govern how those products can be advertised, and what I'm talking about specifically is alcoholic beverages. The way that alcoholic beverages are labeled and some of the restrictions on how alcoholic beverages are advertised is regulated by federal regs adopted by the TTP, the Tax and True Care of. So one of the amendments that you will see in subsection c is that the threshold for one percentage of the audience is reasonably expected to be 21 is raised from 15 to 30, and that's the requirement for alcoholic beverages under those rules. So this squares the cannabis statutes with alcoholic beverage regulations at the federal level. Subsection e on page 11. Under current law, all advertisements have to be submitted to the board for review. This repeals all of that language requiring preapproval and replaces it with a requirement that does exist in state law, as well as federal law for alcoholic beverages. So under state federal law, alcoholic beverages cannot advertise their alcohol by volume content as an inducement into purchasing of the products. Right. And they can't compare products. We have more alcohol by volume than, you know, this and that. So the language that is added starting on line nine for cannabis establishments. The cannabis establishment shall not state the THC content of any cannabis or cannabis product in any advertisement in any medium. The cannabis establishment shall not advertise or promote the sale of cannabis or cannabis products depending on The United States or the pigs that the product has a higher THC content than other similar cannabis or cannabis products. So no ads that say there is more millibrands of THC in this chocolate bar than our competitor. Correct.

[Sen. Thomas Chittenden (Member)]: That's only relevant to Vermont sellers. Correct? At the moment. Yeah.

[Tucker Andersen, Legislative Counsel]: At least under this current draft. So and something to flag there as well is that there will be extra jurisdictional issues that could come up with trying to use long arm enforcement in other states in their regulated markets. And as we look at possible federal changes, federal law, this we could again have this again would be a competition, an interstate commerce issue that we might wanna come into agreement on in terms of agriculture breach of claim. Certainly. Okay. Right. Section 11, section eight sixty six of Title VII is amended. This is a conforming amendments to the restrictions on advertising, so follow on to page 12, the same amendments related to placing paid advertisements in third party media and in grant form for the expected audience under 12. Okay. On page 12, in section 12, under the Reader Assistance heading for the Canada's Excise Tax, subsection A of 32 BSA, section 7,902, the Excise Tax is lowered from 14% to 10%. Recommend hearing from your talented, diligent, hardworking joint business office about what the revenue impact That is the first witness on this section. What is the impact to our revenues? Alright, under the reader assistance heading for municipal authority, we're gonna get into some clarifying amendments related to the types of conditions that can be put on permits by the local control commissions, as well as a section related to votes to authorize the operation of cannabis establishments within the municipalities. Seven ASA section eight sixty three, subsection B, if you follow on to page 13, current law, the local control commissions can put some conditions on the issuance of a local permit. Specifically, they are allowed to put conditions on the issuance of that permit based on 24 BSA section forty four fourteen. So those would be bylaws or upon ordinances, police power, regulatory authority, regulating signs of public nuisances that are adopted to 24 BSA section twenty two ninety one, the board of the municipality's charter. So the struck language relates to the limited set of regulatory authority that can be added as a contingent funding issuance to the loan firm. Can you give us striking that regulating signs of public nuisances opens it up to any basis that a municipality has adopted an ordinance under 24 BSA section two thousand two ninety one can be added as a condition condition on the issuance of the permit. What does that phrase condition on the issuance of the permit means? It means that at the time of application, or at any point during the licensee's life and renewal of their license, the municipality could demonstrate to the CCD, hey, licensee is violating our set of ordinances governing this subject. So, just as an example, regulating places of entertainment if this were to go into the lounge, or existing authority violating two thousand two ninety one sub-eleven related to the abatement of public nuisances. This now opens it up to any of the ordinances that may be about to have a 2291.

[Sen. David Weeks (Clerk)]: So what are we trying to affect here? His plain stern visit?

[Tucker Andersen, Legislative Counsel]: Well, what is the perfect yeah.

[Sen. Kesha Ram Hinsdale (Member)]: I actually tried come from out public, like, for it's what they picked up from our other patient. And I think we had this conversation last year when the moratorium came to us. The moratorium was understandable in the context that right now municipalities don't get to regulate cannabis like they do alcohol. So, very familiar with this, at least in Burlington, because they have to have array licenses and on premise consumption licenses and they all have numbers that I forget and you have grocery stores that sell beer, like they all have different licenses And the municipality is very involved in who gets those licenses and how they're cited and, you know, can regulate all of that further. If you accept if you opt into cannabis retail in Vermont, that's it. Then you don't have the authority conferred to you to regulate it beyond that. It lives with the cannabis control board, tries to be differential municipalities, but that just doesn't make sense.

[Tucker Andersen, Legislative Counsel]: There's a more limited set of conditions, right? So you have to comply with any bylaws that have been adopted under 24 BSA point four fourteen, and the licensee has to comply with any ordinances that have been adopted by the municipality related to public nuisances or signs. But those are the only two police power basins that a municipality can require the licensed establishment to comply with in order to keep their permit. So this broadens it out to the full scope of municipal authority as a condition on the issuance or renewal of a permit.

[Sen. Thomas Chittenden (Member)]: So this one reason why city of South Burlington that when I was on city council and why I've heard councilors not wanna put this before the voters is that they they understood that under current law, if they had the vote and they were the voters said, yes, we wanna sell pot dispensaries in our city, they would not be able to use zoning to say where in the city the dispensaries could be. Maybe that's incorrect or not, but would this allow the city of South Burlington to add into their zoning bylaws? That's one example of the town, say in the U Mall and then west of this street down here, that's where dispensaries can be, but they can't be over here.

[Tucker Andersen, Legislative Counsel]: Yes, although much of that is covered by new law, expands it out to the full scope of both bylaws and ordinances. So you've the ordinance. Now, some of the confusion that I think you're highlighting right now, we'll actually get to in clarifying amendments to subdivision unit one. Because under current law, there is a prohibition on municipalities using their bylaws or their ordinances to effectively prohibit the operation of the cannabis establishment. And so the history behind this is they had a local opt in vote. The voters vote to approve the existence of these cannabis establishments within the municipality, and the general assembly at the time had extensive discussions about, well, what happens if the voters approve it, and then the legislative body of that municipality adopts an ordinance saying that those cannabis establishments are prohibited. The response was, well, there will be a limited basis for conditioning the issuance of the permit, and then in subsection b, we will have a blanket prohibition. The municipality shall not prohibit the operation of North Campus establishment within the municipality through an ordinance adopted under 2291 that were a bylaw adopted pursuant to 4414, and they shall not regulate the cannabis establishment in a manner that has the effect of pitting the operation of a cannabis establishment. And from what I understand, the way that this was structured in eighteen point one caused a lot of confusion. Yeah, I bet. That it was effectively forcing municipalities to accept cannabis establishments to pop up wherever Wherever the But municipality this would allow them to regulate it as they would like. The clarifying amendment here, hopefully, makes this clear, that he shall not adopt an ordinance or bylaw to expressly put it in the operation of campus establishments. He can adopt a bylaw or an ordinance saying there shall be no campus establishments in the town of Sarksborough.

[Sen. Thomas Chittenden (Member)]: But they could say not in these areas.

[Tucker Andersen, Legislative Counsel]: Correct. Right. So they could qualify it, but they can't. The example that came up at the time was if there was a bylaw that set a limitation on how many vials you could be within a school. Right. That was the class example that's brought up. It's a classic example brought up in effective prohibitions under zoning generally, because once you have areas within the municipality where there's quite a few of these institutions that you're labeling, for example, schools, you can effectively prohibit that commercial conduct Right. Within your municipality.

[Sen. Thomas Chittenden (Member)]: Mhmm.

[Tucker Andersen, Legislative Counsel]: Right? So that was the kind of prohibitive zone that the general assembly of the saying should not exist. So that's that last clause. Right. Regulating the cannabis establishment in general, it has the effect of prohibiting the operation of these guys. I appreciate that, but in other ordinances that they could apply to a cannabis license.

[Sen. Kesha Ram Hinsdale (Member)]: Just let's just say I I have not talked to Vermont League of Cities. I've had a focus, but I've talked to a lot of local elected officials, and I think they welcome this, especially in places where they already have cannabis retail and they're struggling with the like a moratorium is a sledgehammer. You know, they'd like to have a scout goal, right? We could ask the sitting hub by president of Burlington, who also sits on their cannabis advisory, whatever it's called. They like I welcome local government to say how we could improve this section, but everything I've heard is they they need this tool. I don't know why we haven't done this yet. It's time.

[Sen. Thomas Chittenden (Member)]: Okay. Great. One more thing on this. So I appreciate the intent that I'm hearing, but I don't see this language as clarifying as crystal y as possible that this would allow them to do that. So if there was a belt and suspenders approach, making clear that the the effect can't would ban it across the entire city is what you can't do, but still make it clear that they can restrict the city's location.

[Sen. Kesha Ram Hinsdale (Member)]: We want to do that, but we've been careful about how we said that about shelters and like it is a constant fight to just I make

[Sen. Thomas Chittenden (Member)]: just don't see the clarity.

[Sen. David Weeks (Clerk)]: So, Senator Chittenden's point, actually using double negatives is always kind of confusing. I'm wondering why it just doesn't say municipality may and then sub paragraph one, adopting organs, etcetera, allowing the operation of it. Why does that be so we should work out?

[Sen. Thomas Chittenden (Member)]: I agree, that's 2¢. I like the intent, but I'm not seeing the clarity of this.

[Sen. David Weeks (Clerk)]: Make it clear and drop a double negative. I've I've got the notes in here. One of

[Tucker Andersen, Legislative Counsel]: the reasons for the double negative is that, again, the approval of the operation of cannabis establishments is not authority that you have given to legislative bodies. Right. You have given it to the voters. Right. So this is intended to restrain a legislative body from overruling the vote of the municipality and effectively prohibiting the operation of these establishments once the voters have given votes on it. Right.

[Sen. Kesha Ram Hinsdale (Member)]: We did this to ourselves with the

[Tucker Andersen, Legislative Counsel]: patchwork approach. Well, with the McDonald's ban, you know. Okay, let's keep going. On that subject? Just slightly more than halfway through, we could love to get through this. We'll have some sections at the end where we will burn through pages of Okay. Section 14 has a new section eight sixty three a. This is going to detail municipal votes concerning the operation of cannabis establishments. Subsection a, twenty twenty six general election is when this is proposed for. City, towns, and incorporated villages, those are the only municipalities we're dealing with here, the big three, that as of 07/01/2026 have not voted on the question of whether to affirmatively permit the operation of cannabis establishments shall vote on the article contained in this section. Some of it would be a city town or incorporatability shall vote on the article by Australian Battles. So background context, section eight sixty three contains all of the procedures for the opt in vote. This is compelling at the general election in 2026 any municipality that has not held an opt in vote yet to hold it on that date. Tom, it's a

[Sen. Thomas Chittenden (Member)]: If you want to get into wordsmithing, I would just say on line ten and eleven, if you want to make this even crystal clear to that previous point, I would add, shall a licensed cannabis retailer be authorized to operate in the municipality within the confines of designated ordinances or zoning by the city or something to that extent, if that makes sense. Because the fear is that they don't want it everywhere throughout the municipality, and this is so vague, that I could see, you know, many people being opposed to this just because they don't want quite literally, POT stores everywhere. Right.

[Sen. David Weeks (Clerk)]: Yeah, so I'm curious, being that we already are talking about a saturation problem, why are we enforcing this vote? I mean, this is not to talk to you.

[Tucker Andersen, Legislative Counsel]: Part of the reason is a little bit of a catch 22. We have saturation problem because so few towns have opted in. So I think the objective of this this section is to really force the hand of of towns that haven't chosen to opt in.

[Sen. Thomas Chittenden (Member)]: So, Senator Weeks' point, I live in South Burlington as many know and we do not allow it, Burlington does. So Burlington has like 17, I don't a ton of them, there's just none in South Burlington. So many of the arguments are that it would desaturate the market and there are spaces in South Burlington where it makes sense but this would force but I could take your point.

[Sen. David Weeks (Clerk)]: But it isn't the point that they haven't voted or the municipality hasn't put it on ballot. That's in itself an effort. It's a it's a perspective of why can't we respect that why do we have to force a vote for every town.

[Sen. Thomas Chittenden (Member)]: I'm not arguing for that I just want to tell you why.

[Tucker Andersen, Legislative Counsel]: It is a crowd of people to

[Sen. David Weeks (Clerk)]: make their own decision if their decision is not to have a vote in the first place, that's a decision.

[Sen. Kesha Ram Hinsdale (Member)]: This was a huge debate and the reopening.

[Sen. David Weeks (Clerk)]: Right, we're the vote.

[Tucker Andersen, Legislative Counsel]: You're right, but on the other hand, we do have this concentration problem. And we have a patchwork problem. And we have a patchwork problem.

[Sen. David Weeks (Clerk)]: So we have a difference in opinion of communities.

[Sen. Kesha Ram Hinsdale (Member)]: Well, I think so even when we look at states that have different regulations, we then are we then say, okay, this this municipality now has to manage possession and, you know, driving under the influence, etcetera. This ensures that they know they can manage that and that they have a local option tax to bring resources to that, but they also do have to take a vote. So we don't, we've affirmatively said rather than one person on an elect board stopping it from going to the voters every time, that voters should have this decision once and for all so we can move past it.

[Tucker Andersen, Legislative Counsel]: Background on this that I did provide for the Senate Government Operations Committee where this section is in a standalone bill is that this same effort happened for alcoholic beverages in 1960. So at that point in time, there were still driving towns in Vermont. Yeah. Towns were given the authority to opt in to alcoholic beverage sales, and the state, as a matter of policy in that year, said that you have to at least hold the vote on whether to determine whether you're going to be a So dry town or whether you're gonna allow the sale of alcohol and beverages.

[Sen. Kesha Ram Hinsdale (Member)]: I mean, like, two dry towns.

[Tucker Andersen, Legislative Counsel]: And that change. So that may be a change in this section is that we that we at least they have to weigh in. And Okay. The Yeah. Way that the question is ranked here is the same way that this ranged. It was ranked in 1969 for those local votes. I can't believe that was that late nineteen sixty nine. Wow. Yes. There are So is this framed exactly the same way we framed it in 1969? Yes. With the providing the warning and asking the binary question of whether or not the sales will be authorized by licensees. Now, for alcoholic beverages, they bifurcated the question because you had you had a lot of beverage alcohol purity laws in title seven. So they split the question. Will you allow malt and vinous beverages to be sold within this town? Yes or no? Or will you allow four to five wines and spirits? So there, in addition to the drive towns, you also have towns that in the past voted to allow all Hawaiian as beverages, but not spirits. Okay. Sub C, a vote to permit the operation of a cannabis retailer shall take effect six months after the date of vote, and may be rescinded at any time. Six month delay is approved. Give them time to adopt ordinance in the bylaws. Yep. Alright. Section 15, we have some updates to the amendment. See, fees. So, seven BSA Section eight forty six is proposed for Amenden Care in Sub C. Is the timing of the distribution of fee shares to municipalities. After reduction for costs of administration, change collection, the board shall pay local license fees on an annual basis to the municipality, instead of a quarterly basis. Under the Reader Assistance heading for two year ID cards and product registrations, 70 SA Section nine ten, under the fee schedule in subdivision V, cannabis establishments licensed by the board shall possess a biennial license fee of $100 instead of an annual fee of $50 for each employee, and employee licenses shall be valid for two members. Yes. And this is a remind us who this is a request from. I do not know the answer to any question. So, we're on section 16, the true year employee identification. This makes it easier to remind me for whom. It's creating an option. It will cost and as I recall we have 1,100 employees in the cannabis world 5,000 products.

[Sen. Kesha Ram Hinsdale (Member)]: This

[Tucker Andersen, Legislative Counsel]: would simple this this is a challenge I think for CCB because the products change all the time. And with some regularity anyway, at least this is my understanding. I'm I'm not sure who

[Sen. Kesha Ram Hinsdale (Member)]: I don't know. We do biannual licensing fees for a lot of things because it makes it easier businesses to operate. I think that's the spirit of Yeah.

[Tucker Andersen, Legislative Counsel]: We'd love to hear from CCB because the product piece changes quite a bit. So anyway, just the tag.

[Sen. Kesha Ram Hinsdale (Member)]: Well, and let's also still try to be consistent about what we're asking business to do in the process because there's like, we've seen this with any industry, but labeling changes and our whim about you know, it's it it requires a lot of expense and time for people to manage that, though. Right.

[Tucker Andersen, Legislative Counsel]: But In in the space that we're talking about of these regulated products as well, I would note that this is the the area in Vermont law where you have employee licensing involved here. This is something that will be developed, at least in my sports wagering lottery line for casino employees. Right. So we don't license liquor anymore. If you're employees, you license the We do. Establishments. Right. Okay. Right. Maybe you'd love to take

[Sen. Kesha Ram Hinsdale (Member)]: this out altogether when we're licensing of individual voice.

[Tucker Andersen, Legislative Counsel]: Let's hear from CCB first. Okay, under the products, in subdivision nine, the existing licensing fee and provisions are kept inflated, but there is qualifications for longer product registrations under that subdivision. It would be prorated at the same per year cost for products that are low risk, shelf stable, as deemed Ford, guidance is required to be published. Is there any other Alright, in the next couple sections Swineback concept of items that are low risk and shelf stable. All my goods. Under the Reader's Assistant setting for the Repeal of Integrated Citizens Provisions, we're gonna move through a whole bunch of sections where references to the integrated licensees are subsections of repeal, and at the end, one entire section related to the integrated license. From what I understand, these are no longer being issued and are kind of an outdated license structure that harken back to opening proposed development standards. Section seventeen, seven BSA, eight sixty one, subdivision 24, the definition of integrated licensee is released. We're on page 16, section 18, and the regulation by local government section, references to the integrated licensees is structured throughout. We're on page 17 now, section 93, and the youth statute, which you've already seen. 7BSA eight sixty six references to integrated licensing. So this is just to also include striking integrated licensing. Correct. Approve Section 27 BSA eight sixty eight under the prohibited products, page 18, and in seven BSA eight eighty one, section 21, page 18. There is repealed references within the rule statutes to the integrated discuses. Same in section 22, seven BSA nine zero one, striking references to the integrated licensees and making conforming amendments to the list. In subdivision three B, another for appeal, like references to the integrated disc disease, section 23 on page one, seven BSA section nine zero four, and section 24, seven BSA nine zero four, for the rule of the nuclear weapon consistencies. Yeah, I forgot that. So you can skim through this. I was going through the substantive list, but you could move all the way to page 23 to get to the next set of substantive or operative amendments besides striking references to increase success. Under the Reader Assistance heading for CDDF grants for cultivators, manufacturers, and traffic and allergy businesses. These are grants from the Cannabis Business Development Fund, and Section 28, 7BSA, 1987 is amended. Subsection C, which is the subsection that deals with the grants that can be used from the Fund. The Fund shall be used for the following purposes, to provide low interest rate loans in grants to, subdivision B, tier one cultivators, tier one manufacturers, and businesses that have been granted economic empowerment status by the board. The board has adopted the standard for what an economic empowerment business is, so I will not provide a non tested public record what the basis for determining which one of these tier one paid licensing businesses were qualified by your staffs. This expanse could use to be clean ones. In Section 29, Sub A, we have some appropriations. In FY '27, dollars 1,000,000 is transferred from the general fund to the cannabis business development fund, and that will back up the paid Spanish business grants. And in subsection B, in fiscal year 2027, dollars 5,600,000.0 is appropriated to the Vermont Land Access and Opportunity Board for purposes of loans, grants, and financial assistance, pursuant to Texas A three twenty five view. I did note, at least in the last draft of the budget, I looked at it, that there was an appropriation to the LAOB for grants under this ten days' age group, and five years' grant programs that are supported by it. So that maybe something you want to hear from JFOR. Is there already an appropriation considered in the budget that covers this? And I can't remember if there is to the AOB. No. The last that I saw, I believe it was 1,000,000. Yeah, was pretty modest.

[Sen. Kesha Ram Hinsdale (Member)]: Yeah, they'd love to come in.

[Tucker Andersen, Legislative Counsel]: Well, I got I specifically asked for that to be a biggest, and they'd probably need more time. Okay. Within the repeals section, you have a repeal of an integrated license statute that's in conformance with all the other cleanup. You have the repeal of cannabis establishment, the chapter of government cannabis establishments not being applicable at Hemp or Therapy, to the accused of cannabis, that I don't have any feedback or information on the policy choice or why that cleanup might be necessary, but it is repealed July 1. And then you have the prospective repeal of those two permits under the pilot program scheduled for 07/01/2028. The effective dates line up so that section 14, which is the mandated local vote Right. Takes effect on passage, and that all other sections take effect on the Library's funding purposes. Thank you. So is that a question for us on Section 30B Declaration? What's the intent of that? Oh, I actually think that's something that was suggested by the CCB. Is that CCB effect? So we'll have Pepper. Great. Thomas?

[Sen. Thomas Chittenden (Member)]: Good. Time are okay?

[Tucker Andersen, Legislative Counsel]: Absolutely, we have until twelve and we're going hope to hear a bit of a response and update from Pepper and then twelve, so yes.

[Sen. Thomas Chittenden (Member)]: Very helpful, and if you said this, my apologies, but what is the policy intent about stripping out integrated licensee? So why are we getting of that?

[Tucker Andersen, Legislative Counsel]: So, again, the integrated license was issued to the existing medical licenses prior to the expansion of the regulated adult use market, I there are people who are gonna know Okay. The details much better than I do, but I think even the name comes from allowing those particular licensees to acquire multiple forms of licenses under the updated statutes and to encourage them to enter the regulated marketing. So, part of that was allowing them to be, for example, vertically integrated, hence the integrated presence. So, Pepper can speak to this. Any other questions for Tucker? Thank you. This is a big piece of work. Thank you very much. My pleasure. Thank you for Gives having us a good launching pad for our work.

[Sen. Alison Clarkson (Chair)]: Pepper, would you like to join us? No. We could just begin. It doesn't just begin. Yeah. We just and give oh, that's not quite scalding teeth. There's one. Still scalding is the question. Yes. And you've heard some of the questions, but I think we'd appreciate your response to these sections, your input, and an update maybe on your conversation with which may be happening next week, which may be your update. Yes. So for the record, James Pepper, chair of

[James Pepper, Chair, Vermont Cannabis Control Board]: the Candidate Control Board. Thanks so much for having taken the time to to do this bill. I You always just like to start from the perspective that passing tax and regulate took about ten years to be.

[Tucker Andersen, Legislative Counsel]: Yeah.

[James Pepper, Chair, Vermont Cannabis Control Board]: And went to almost every single committee, at least on the house, had an opportunity to weigh in on the bill, add to it in way and so this industry is regulated in ways that are just, not like other industries as a result. And so it's really important that every year, there's kind of an audit of the industry to make sure that whoever fears were responsible for putting this section in or that restriction in, know, whether those are actually having their intended effect. And I know that these are controversial policies that are in this bill, seen them debated to death over the years. And I think we just need to start from the perspective that everything that's in the bill can be done safely. And I say that not because I'm looking into the future, but because everything that's in this bill has been done in one of the other 26 adult use states. So we've seen these issues play out, and I think that it's good to have these debates. I don't feel like it's my job to tell you you should or shouldn't do these things. You know, the market should reflect how the legislature wants it to look, not how I shouldn't be substituting my personal opinion about how the market should look. You know, we have to follow the laws that you pass. Sometimes there's some room for interpretation at the board, but really, you know, we look to you, you tell us how this market should look, not the other way around. I think the best thing I can do is just give you my best impression as to what it would take at the board to implement some of these things, and what the outcomes might be compared to how the market has evolved.

[Tucker Andersen, Legislative Counsel]: And I think that is our expectation. Great.

[James Pepper, Chair, Vermont Cannabis Control Board]: Yep, thank you. So I can start at the beginning, the prohibited products, increasing the potency caps or concentrates. I say that we never want to substitute arginine for yours. This is an issue where you've asked us in three subsequent years, we've only been around for five years, to weigh in on this issue. What is the consequence of, what is the efficacy of this app? What are the consequences of getting rid of it? So we actually have three reports that you can look up, I'll send them to KRA afterwards, because they're historical reports. Essentially, this cap, in the board's opinion, because you asked this sort of opinion, is probably doing more damage than good from a public health perspective. People are concentrating cannabis to ninety nine percent, and then in order to achieve the 60%, they're putting other stuff into it. They're diluting it with things. Usually, like Not healthy things. I mean, we have restrictions on what you can put into products. There's very little understanding about what the effect of, I mean, they're putting in things like terpenes, other parts of the cannabis plant to dilute back down, but there's no, like, are unnatural levels of terpenes. You know, they're not naturally occurring in the cannabis plant, so we don't know the public health thing.

[Tucker Andersen, Legislative Counsel]: Of what?

[James Pepper, Chair, Vermont Cannabis Control Board]: Of the

[Sen. Kesha Ram Hinsdale (Member)]: Of the diluators. Yeah. The diluting Okay. I mean, I I feel like you're making it sound a little bit like all of this is nefarious. They're they're just trying to respond to the to the cap, but really

[Tucker Andersen, Legislative Counsel]: what I don't think

[James Pepper, Chair, Vermont Cannabis Control Board]: no. It's not nefarious. It's it's people yeah.

[Sen. Kesha Ram Hinsdale (Member)]: To me I mean, it I think the bigger point here is that, like, people go seeking a certain amount of THC and we're not really helping them make their best consumer choices with the dilution.

[James Pepper, Chair, Vermont Cannabis Control Board]: That's right. And, you know, I mentioned another report that we just got that just says, you know, this isn't a market like alcohol where there's a robust supply of market operating alongside it. Cannabis, if you want a 90% potency concentrate, it's widely available, you can go on Instagram, find it, it can get delivered to your door, unregulated of course, we're just pushing, we're just creating an exclusivity lane for those alternative markets by keeping certain products prohibited on the adult.

[Tucker Andersen, Legislative Counsel]: So, I will then follow-up on that, which is, if naturally occurring THC level is 90% roughly, why don't we just take it to 90%?

[James Pepper, Chair, Vermont Cannabis Control Board]: There's various extraction methods, so I just don't wanna confuse people. I like that idea. But we have said that the CAB is not, getting rid of the CAB is probably in the best, well, it's the board's opinion after having a lot of public meetings

[Tucker Andersen, Legislative Counsel]: with These reports that we have that says getting rid of the CAB

[James Pepper, Chair, Vermont Cannabis Control Board]: is probably for the best.

[Tucker Andersen, Legislative Counsel]: Mhmm. Yeah. Tops.

[Sen. Thomas Chittenden (Member)]: Good to reflect on how we compare to

[James Pepper, Chair, Vermont Cannabis Control Board]: our neighbors. So, yes, and that's another just general question I'd like to put to the committee. I have created a comparison chart.

[Tucker Andersen, Legislative Counsel]: Yes, of gonna get to us.

[James Pepper, Chair, Vermont Cannabis Control Board]: Is one of those things.

[Tucker Andersen, Legislative Counsel]: But we have it now. No. We did present it.

[James Pepper, Chair, Vermont Cannabis Control Board]: Okay. We're one of two states that have this potency cat, plus in Connecticut, of all of the adult use states. We don't have this cat on the medical side, but so it's just us and Connecticut that have this.

[Sen. Thomas Chittenden (Member)]: New York, Massachusetts do not have this.

[James Pepper, Chair, Vermont Cannabis Control Board]: No, Colorado, when they were debating this issue, they decided to have increased labeling requirements on higher potency products to kind of give people just a better informed consent essentially about what they were getting. That could certainly be an issue. One thing that's in this bill is if there's a concern that these higher potency products have adverse effect on the developing brain, what you have here is age restriction, that it's, these would only be available in about 25 and all of hertz values

[Tucker Andersen, Legislative Counsel]: is 24. So what I'm hearing is that we might wanna consider actually lifting the cap and and figuring out what we do with that market from '21 to '25.

[James Pepper, Chair, Vermont Cannabis Control Board]: And it's

[Tucker Andersen, Legislative Counsel]: Is that

[Sen. David Weeks (Clerk)]: Part part of our report

[James Pepper, Chair, Vermont Cannabis Control Board]: is also about the economic, mean, the economic, the revenue, the foregone revenue on this. It's hard to say, it's hard to measure how many people are on the planet staying on the illicit market.

[Sen. Kesha Ram Hinsdale (Member)]: Well, Alissa or other things. This equivalent conversation we've had for years is how many Vermont Life Displays you would see in a New Hampshire liquor center, which they are having the same conversation about liberalizing cannabis retail and having it co located with their with their liquor retail outlets. So that's a whole another thing. But when we have that conversation, it's often about like the Costco mentality. I'm gonna do my one trip over there or I'm gonna stop, you know, when I'm traveling to Boston and I'm gonna load up on things because it's cheaper and easier to do and and actually legally possible. And it doesn't mean I it doesn't necessarily mean I'm going to binge drink. It just means I'm gonna have my stocked liquor cabinet. Right? So the retailers, I think, would like to when they speak next week are just gonna say, what this encourages people to do is go to other states and get different products and bring them back home because they live in places that are very far from cannabis retailers, and this is a consumer option that they're making like you would Costco even though you're not gonna eat 20 pounds of things. However,

[Tucker Andersen, Legislative Counsel]: craft growers I mean, however, we have an advantage if it has to be shelf if it does that I don't know what shelf stable and what isn't, but maybe shelf stable is an advantage here because if it isn't shelf stable for a long time, they're not gonna buy and golf elsewhere. They're gonna buy regularly. Then I do I have this right or up? Struggling. So that is an advantage perhaps for our graft growers.

[Sen. David Weeks (Clerk)]: So is that true? I didn't get that.

[Sen. Kesha Ram Hinsdale (Member)]: I didn't get that either. Oh, I can't get that right. I did

[Sen. Thomas Chittenden (Member)]: not. For the record,

[Geoffrey Pizzutillo, Executive Director, Vermont Growers Association]: Jeffrey is still over month for our association. Broadly speaking, just sticking with concentrates or hatch for a moment, there really is no shelf life per se, but a year is considered freshness, so just keep that in mind. And then flour, even more sensitive. So if you're shipping something, you're gonna lose that controlled environment.

[Tucker Andersen, Legislative Counsel]: So that's an advantage, I believe, is what I was trying to say, from the grass growers, because it is not shelf stable foods like Costco products that are like

[Sen. Kesha Ram Hinsdale (Member)]: Okay, but with, in relationship to this bill, this the potency I mean, if if Dick Sears could speak now, like, potency cap has always been somehow associated with, getting higher faster when for most people it's a way to take one trip to the store and stretch their consumption over a longer period of time.

[Tucker Andersen, Legislative Counsel]: Yeah. Who knows? Certainly Dick was not an expert on that.

[Sen. Kesha Ram Hinsdale (Member)]: Right. But we could always say if you get a 30 rack of beer, we've had this conversation before, and you drink it all in one sitting, that's a problem that we need to address. But many people will still make consumer choices to go get a larger amount of beer that do not have to do with veggie turkey.

[Tucker Andersen, Legislative Counsel]: Agreed. But again, to go to our craft brewers, it's not shelf stable for a long time. It's, you know, you want to drink it in a timely fashion as I understand.

[James Pepper, Chair, Vermont Cannabis Control Board]: So back to you, Pepper. So that's the potency cap. This leads into the conversation naturally into the transaction, which is the next thing that's being changed here. So, moving from a single transaction, or next package limit, okay, so this is increasing the amount of THC that can be in a single package.

[Tucker Andersen, Legislative Counsel]: We're moving to past rulemaking pounds section three, line 21, I believe, if I'm noticing those, I don't know. Right, the two hundred milligrams.

[James Pepper, Chair, Vermont Cannabis Control Board]: Two hundred milligrams. So currently, a single package can contain one hundred milligrams of THC. We have five milligram servings per gummy or per chocolate, and so essentially 20 gummies can be in a single package. This would mean that you could have 40. How this compares to other states, in New England's, we have Massachusetts is at one hundred and ten milligrams per package, Maine is two hundred milligrams per package, New York one 100, Connecticut, and New Jersey 100. Would align us with Maine, and I'm sure there's other states I have, but only for my comparison chart, let's see if I can. The transaction limits. So again, this was debated pretty heavily in 2020 when the bill passed, how much should a person be able to purchase a single transaction. There was a concern that was raised during that debate that you could purchase however much cannabis you wanted. At the time, New York had not legalized, and the answer still hadn't, that you would purchase large amounts, drive across the border, and sell it in alternative markets, sell it to kids or whatever else. So you set a transaction limit at one ounce per transaction, and it's equivalent to cannabis products. So this proposal is raising that to two ounces, Then compare it to the other New England states, Vermont one ounce, Massachusetts one ounce, although they both the House and the Senate have passed competing bills to raise that two ounces. Maine, 2.5 ounces, New York, three ounces, Connecticut wine, New Jersey corn. So just, again, these are policy choices for you all to make. The oar board product equivalency, this caused a little bit of stir, and all I can say is that there's no great way to determine what a product equivalent of one ounce of flour or two ounces of flour is. This is a report that I sent to Tamara earlier today.

[Tucker Andersen, Legislative Counsel]: Right, which is now on our website and she emailed the link to us, it's a big report.

[James Pepper, Chair, Vermont Cannabis Control Board]: Yeah, well so connect, and the report is from Colorado of 2015. They were the first state to legalize and they dealt with this issue first. And I can just kinda jump to the conclusion, they hired a consultant, the consultant said there's no good way to determine this. You look at the physical equivalency, which is in a ideal setting, how much THC could you extract from an ounce of cannabis, you have one number. If you look at the, if you account for the different ways that cannabis is absorbed through the body, whether it's, you know, smoke, ingested, sublingual, and you're trying to equate that to an ounce of cannabis, you get a different number, and drastically different number.

[Tucker Andersen, Legislative Counsel]: Which is the most, in fact, the fastest?

[James Pepper, Chair, Vermont Cannabis Control Board]: Incalation. And then if you look at maybe a market price, like you take the average cost of an ounce of cannabis and you equate that edibles, concentrates, and other products, you can do it that way and get a vastly different number there. So honestly, states are all over the map on where they land on product equivalencies. I I I've got a comparison chart for you on this. You guys really should just think about what makes the most sense, whether that fear of people purchasing large amounts of quantities of cannabis and then selling them in alternative markets is is real. I think what we heard most recently from, you know, rural Vermonters and to people with, you know, health conditions is that they want to do the Costco shop once a month. You know? They wanna buy large amounts and just bring it home and not have to go to the store every week, really, every couple of weeks. So, you know, if those are the two kind of competing issues, it should be. And then you have the report from Colorado. If you want to base this on the kind of physical equivalency, the pharmacokinetic equivalency, and market price equivalency, and I'll give you a comparison chart of the other states.

[Tucker Andersen, Legislative Counsel]: Be correct. Yeah. You want us to go to possession? Well, possession and transaction.

[Sen. Thomas Chittenden (Member)]: Question on that topic we were just on is they don't smoke pot. What what how long does two ounces usually last?

[Tucker Andersen, Legislative Counsel]: Yeah. That's good.

[Sen. Thomas Chittenden (Member)]: That like a pack of cigarettes? Is that a carton of cigarettes? What?

[Tucker Andersen, Legislative Counsel]: How long is it fine?

[Sen. Kesha Ram Hinsdale (Member)]: It's and and everyone's different. Some people do smoke any cigarettes in one day. Impossible.

[Tucker Andersen, Legislative Counsel]: Impossible. But that's impossible. So an average cannabis consumer

[James Pepper, Chair, Vermont Cannabis Control Board]: We did some analysis. Did some analysis on retail sales, and the average market basket that's checked out card is a collect analysis. We don't look to see how We don't track individual customers. You know, we don't

[Tucker Andersen, Legislative Counsel]: How long until they come back? Actually, we have a retailer in the room who might be able to answer this question.

[James Pepper, Chair, Vermont Cannabis Control Board]: Yes.

[Tucker Andersen, Legislative Counsel]: So, David, could we turn to you for kind of like your average customer?

[Sen. David Weeks (Clerk)]: The other day.

[Tucker Andersen, Legislative Counsel]: The other day. David Silberman. Thank you.

[Dave Silberman, Director, Vermont Cannabis Action Fund; Owner, Flora Cannabis]: For the record, Dave Silberman, director of the Mock Cannabis Action Fund, the owner of Flora Cannabis Licensed Dispensary in Middlebury. I I agree with chair Pepper. It is very, very difficult to say that, you know, how much of this will last for every customer. We have some customers who will buy multiple ounces a week for their own personal consumption. These are people who smoke a lot of cannabis. We have other customers who will come in for an eighth a day. So that would be, you know, an ounce a week ish. I think for the average, sort of median customer, an ounce a median customer who smokes regularly but not constantly, let's say, an ounce will last, know, three, four weeks. You know, we we see that.

[Sen. Kesha Ram Hinsdale (Member)]: I mean, it's like what people would usually have purchased on the illicit market for, like, they would, I don't know, some

[Dave Silberman, Director, Vermont Cannabis Action Fund; Owner, Flora Cannabis]: I I should add also, you know,

[Sen. Kesha Ram Hinsdale (Member)]: the the chicken ounce.

[Sen. Thomas Chittenden (Member)]: You know? We we

[Sen. Kesha Ram Hinsdale (Member)]: That's the kids that

[Dave Silberman, Director, Vermont Cannabis Action Fund; Owner, Flora Cannabis]: We are okay with letting people have a lot of different kinds of alcohol at home. Right. Right? We don't tell them that you can only have 1.5 liters of alcohol, you know, which will kill you if you consume it all in one sitting. Right. You know, people like to have a variety. So people like to have some flour and some edibles and some tinctures and some beverages that we have now and some vape cartridges. So people like to have a variety. And and when you add those all together, I think a lot of people, a lot of cannabis consumers of ours have at home much more than an ounce together. And that's perfectly fine because they're not harming anyone. It's just their stash.

[Tucker Andersen, Legislative Counsel]: Their hash stash.

[Sen. Thomas Chittenden (Member)]: Their hash stash. Yeah.

[Dave Silberman, Director, Vermont Cannabis Action Fund; Owner, Flora Cannabis]: Their head stash.

[Tucker Andersen, Legislative Counsel]: Yeah. Their head stash. Whatever.

[Sen. Kesha Ram Hinsdale (Member)]: Excellent. So you you could there is a way to say if you consumed x amount of something all at once Tucker, thank you. It would be you would face concerns. Look forward to something. More common with alcohol poisoning. There's there's not even necessarily maybe to answer your question, like, a thoroughly equivalent health induced or, like, cannabis induced health impact you could have on yourself.

[Dave Silberman, Director, Vermont Cannabis Action Fund; Owner, Flora Cannabis]: Is no toxic There there is no lethal amount of cannabis. Right? There's it's a non toxic substance like alcohol.

[Sen. Kesha Ram Hinsdale (Member)]: Right. It's that's a

[Tucker Andersen, Legislative Counsel]: good thing for people to understand. There's no lethal amount. You can't overdose.

[Dave Silberman, Director, Vermont Cannabis Action Fund; Owner, Flora Cannabis]: Mean, can have an unpleasant experience.

[Sen. Kesha Ram Hinsdale (Member)]: Right, but you can't have a lethal overdose.

[Sen. Thomas Chittenden (Member)]: Correct.

[Sen. Kesha Ram Hinsdale (Member)]: Well, you can with alcohol, you can with most of their Yeah, scheduled

[Dave Silberman, Director, Vermont Cannabis Action Fund; Owner, Flora Cannabis]: and then you go to sleep,

[Sen. Thomas Chittenden (Member)]: and you wake up and you're fine.

[Tucker Andersen, Legislative Counsel]: And and that is true for children as well.

[Dave Silberman, Director, Vermont Cannabis Action Fund; Owner, Flora Cannabis]: I I mean, you know, look, we don't sell to children.

[Tucker Andersen, Legislative Counsel]: Right. No.

[Dave Silberman, Director, Vermont Cannabis Action Fund; Owner, Flora Cannabis]: No. We we right. And we have childproof packaging on all the edible products that, you know, children might accidentally consume. We encourage people to have safe storage of their stuff. You know, that that I'm not I don't wanna minimize Right. That risk. I also don't wanna overblow it. Right? When children are taken to the ER for accidental consumption, it's scary for the child. It's scary for the I have I have kids. It's scary. Right? It's It's not lethal. And we've had a couple of years ago, we had the head of the ER at UVM come in and talk about this. It was when you were considering the change from fifty to a hundred milligrams in a package of edibles. And the conversations of what had been,

[Sen. Thomas Chittenden (Member)]: and I think

[Dave Silberman, Director, Vermont Cannabis Action Fund; Owner, Flora Cannabis]: this was actually in the house of Bob's, was that you would need to a child would need

[James Pepper, Chair, Vermont Cannabis Control Board]: to

[Dave Silberman, Director, Vermont Cannabis Action Fund; Owner, Flora Cannabis]: consume thousands of milligrams of THC in order to have a, life threatening experience, thousands of milligrams, not hundreds, not tens, right, thousands.

[Sen. Kesha Ram Hinsdale (Member)]: I'm more worried about batteries at my house.

[Tucker Andersen, Legislative Counsel]: And we will hear red lights as to, you know.

[Dave Silberman, Director, Vermont Cannabis Action Fund; Owner, Flora Cannabis]: I would just encourage you to bring actual doctors in. Right. We, you know.

[Tucker Andersen, Legislative Counsel]: We are doing exactly that. You have your friend Jill on. Right. On the. So, we will have a couple of those. So we have three minutes left anything else you want to just address before we

[James Pepper, Chair, Vermont Cannabis Control Board]: move to the next topic it's a wild kind of you know detour it's totally different issue so it's probably best to just save it But if there are things that I can provide the committee other than the compare the comparison chart, I've got potency serving package limits, transaction limits, I've got delivery Advertising. Advertising.

[Tucker Andersen, Legislative Counsel]: That's on the chart you sent us.

[James Pepper, Chair, Vermont Cannabis Control Board]: Not yet. Not yet. But that's the one that I'm developing this next time. Taxation rates, social consumption, advertising, local authority, and how some of the tax is reinvested into the Kansas City.

[Tucker Andersen, Legislative Counsel]: And this is for the 26 states that have legalized it?

[James Pepper, Chair, Vermont Cannabis Control Board]: I can do all 26.

[Tucker Andersen, Legislative Counsel]: No, no, that's okay. No.

[James Pepper, Chair, Vermont Cannabis Control Board]: It's done regionally. This is all of New England. Right. Perfect.

[Tucker Andersen, Legislative Counsel]: So will you send that to us?

[James Pepper, Chair, Vermont Cannabis Control Board]: As soon as it's done. I just haven't done those last two, the local Thank you. But thank

[Tucker Andersen, Legislative Counsel]: you for doing it. Can can you give us a quick update on your talk about our federal how we try and prepare ourselves for that?

[Sen. Thomas Chittenden (Member)]: Yes.

[James Pepper, Chair, Vermont Cannabis Control Board]: So I've sent out the call. We I wanna talk about this. Has any state introduced this and it's just the New England regulators that call. I can do all 26, though. It's not no. That's not a big deal. Has any state introduced legislation on this? What's the debate like? And what are your kind of thoughts about it? I think that should be new in The States. We have our regular meeting next Tuesday. Great. And so I will raise it there as well.

[Tucker Andersen, Legislative Counsel]: I think I'd appreciate it just because I want us to be as prepared as we could possibly be and have identified triggers that would Right. Bump, you know, that would would put put pieces in place that would enable us to be protective and enabling all at the same time. Exactly. So I think that it matters, I think, to all of us Right. To the industry. Sure. Okay. Right?

[James Pepper, Chair, Vermont Cannabis Control Board]: Would you like to hear from New Jersey or

[Tucker Andersen, Legislative Counsel]: I think depending on what their response is on this conversation. Absolutely. Great.

[James Pepper, Chair, Vermont Cannabis Control Board]: Alright.

[Tucker Andersen, Legislative Counsel]: Because they are both partners and competitors. Exactly. And so we've wanna I think all of us probably wanna protect, particularly New England recently, our craft books. Great. Well, thank you. We're gonna go offline. We're gonna see you tomorrow. Tomorrow's Friday. Happy Friday.