The Rotation: Vol. 1
Update on Cannabis Act Review, Delivery in Ontario and Job Market Growth in the US
Cannabis Act Review Behind Schedule
The mandatory review of the Cannabis Act three years after its implementation (October 2018) has not yet been initiated according to MJ Biz Daily.
- According to Health Canada, “preparations are underway” but a timeline was not provided as to when the review is expected to start.
- The snap 2021 election, Covid-19 and a newly appointed Health Minister are cited as potential reasons for the delay.
- There is uncertainty whether the review will cover primarily the mandatory issues like public health, youth access, impact on indigenous communities and home cultivation or broader issues impacting operators in sector.
- Some of these broader issues the industry is hoping the review will address include THC limits on edibles, the excise tax regime, and marketing and packaging restrictions.
The industry has high hopes that the mandatory review will lead to major changes to the current regulations. We do believe the review will be the catalyst for important discussions and debates that may lead to some updates and proposal of key amendments, we are cautiously optimistic that there will be significant updates to the Act any time soon and the review will primarily be an opportunity to reflect on the legislations itself, where it has succeeded, and which fears may have been unfounded.
Cannabis Delivery Here to Stay in Ontario
The AGCO has announced that delivery and curb-side pickup will become permanent for cannabis retailers starting on March 15, 2022.
- New rules have been established such as orders having to be placed with a specific store location, delivery windows, restrictions on third-party delivery and delivery-only businesses as well as new requirements for websites and other online platforms.
- Delivery to First Nations communities is permitted unless the community has requested otherwise through the submission of a band council resolution (BCR) to the AGCO.
- Some of the current delivery and curb-side pickup rules will be permanently established in the Ontario Regulation 468/18 under the Cannabis Licence Act, 2018.
This is a positive development for cannabis retailers in Ontario that invested significantly in facilitating delivery and curb-side pickup and will welcome the added certainty from this announcement. Giving retailers more options to reach customers can have a significant impact on brining cannabis users into the legal market and providing access to municipalities that have opted out and do not allow cannabis retail stores.
Cannabis Job Market Continues to Grow
Leafly has published a new cannabis jobs report looking at each state’s specific regulatory environment, investment climate, cannabis license data, and past performance and provided one of the most comprehensive cannabis employment studies to date.
- As of January 2022, the legal cannabis industry in the US supported 420,000+ jobs which include direct cannabis jobs like cultivation and retail as well as indirect ancillary jobs that serve licensed companies or depend on legal cannabis sales.
- According to the report, a total of 100,000+ net new jobs were created in 2021.
- California remains the top state for cannabis employment with 83,607 jobs, followed by Colorado with 38,337 and Michigan 31,152 respectively.
- New Mexico, New Jersey, New York, and Connecticut are expected to open their first adult-use cannabis stores within the next 18 months which should spawn thousands of new companies and tens of thousands of new jobs.
- In adult-use states, mature markets like Washington and Colorado are experiencing significantly slower growth rates when compared to emerging markets like Michigan and Massachusetts.
The number of jobs that the cannabis industry has created is astounding, especially when you consider that it is still federally illegal in the U.S. The driving factor of this job creation is additional states allowing legal access to cannabis for adults. Although federal legalization is unlikely to happen soon, the number of jobs the cannabis industry creates continues to be one of the strongest arguments for it.