All right. Good morning. My name is James Pepper. I'm the chair of the Cannabis Control Board. Today is June 10th, 2021. It's currently 9.32. I'm going to call this meeting to order. I'm going to do a few administrative details before we move to the agenda. Our finalist our executive director position has accepted, so we'll be voting on that decision publicly later today. And now that our core team is in place, we're going to be moving to recruiting and hiring a consultant. Kyle has drafted a request for services, the details, and the scope of what we're looking for. We'll be posting that to our website later this week. On Monday, the governor signed S-25, which among other changes adds members to our advisory committee pushes our fee structure report, which was supposed to be submitted on April 1st to October 1st. It establishes the Cannabis Business Development Fund. It accelerates the transfer to the Cannabis Control Board of the Medical Registry, and it creates two new positions for the board, an administrative support person and a general counsel. So we will be posting these positions as soon as possible. With respect to our advisory committee, those names are starting to trickle in. I'd say probably about half of the names have been appointed at this point, and I'll post those as soon as the full list has been finalized. And then just one last point here for anyone, any members of the public that are looking for sort of more real-time updates on the Cannabis Board. Nellie, our program tech, has created a button on our website where you can subscribe for updates. So that website is ccb.vermont.gov. That's ccb.vermont.gov, and there's a button on the homepage listed as subscribe to updates. So I'm going to then now turn to the agenda.  So last week we heard very clearly from some of the key legislators in the House and the Senate that championed Act 164 and S25 that the primary intent of the legislation was to prioritize the legacy market and small cultivators and try to empower the board to create a welcoming environment for them to join the regulated market. So that's going to be our focus today. We're going to be hearing from a number of witnesses that have a much deeper understanding and expertise in farming and agricultural practices and can help us understand, A, what they hope this market will look like kind of in phase one, phase two, and then also what are their primary barriers to entry and what are the advantages and kind of limitations of Act 164 and perhaps maybe what we as a board should be recommending to the legislature in our subsequent reports. So Kyle was instrumental in getting the agenda together for today. So I'm actually going to turn things over to you, Kyle, for you to kind of manage the witness list. Yeah, thanks, Pepper. I appreciate it. Happy Thursday, everybody. Hopefully everybody was able to stay cool over the last week or so. At least in Montpelier, it feels like it's it's cooled down this morning. So happy that that's the case if we're on a meeting for the next four or five hours in my hot little study here. So first, I, sorry, I hate to break in. I forgot to approve the minutes. Let's just get that out of the way quickly if you don't mind. So I've reviewed the minutes. They look good to me. I think they're posted draft minutes are posted on our website. Can I get a motion to approve? So moved. Seconded. Call in favor. Hi. Okay. Sorry, Kyle, go ahead. No worries at all. Yeah, I'm really excited about the agenda today. I think we've got a lot of folks that have been in and around this space playing important roles in the agriculture world from a policy perspective from a owning a store that helps serve those that are interested in growing cannabis and hemp to those that have been a part of this process really from the get go and have had a voice both in the state of Vermont and at the in some ways at the federal level and in other states pushing for cannabis regulation. I also want to mention we're going to be hearing from the Interveil and UVM extension later this afternoon. And those are two organizations along with a number of other important service providers in our state that really look to help small businesses manage all of the all of the nuance the business side of things the technical side of things when it really comes to having a successful business, especially in the in the ag world. So, Stephanie and Kendall, are you with us? I see you here. Hi, we're here. Hi, Stephanie and Kendall. Trying to turn our camera on. I don't know if we're are we allowed to do that? Yeah, if you wouldn't if you wouldn't mind turning your camera on that would be fantastic. It won't let me on the screen. Is Nellie able to help me? No. Nellie, can you give them presenter status? I'm working on that. They should be able to turn their camera on. I'll poke around in the settings and see if I can figure it out. Yeah, let's just give it another 15 seconds or so to figure out just so we can you know make the most of your time because I'm really interested in hearing from you guys. Okay. Wow, well, this is really annoying. Yeah, that's too bad that we can't get the camera working. It's okay. You should have that option on my end of things at least. Yeah, it said we're a presenter and my little turn camera on button won't doesn't do anything. It's not clicking mute myself. Man, that's so annoying. It's okay. It's okay. So, Stephanie and Kendall, thank you so much for joining us. You and White River Grow Pro in White River Junction and I know you've been servicing that part of the state with a lot of these you know with a lot of the functionality required to really you know grow plants and whatnot. So, if you wouldn't mind giving us an introduction to your background briefly maybe what you guys are doing at White River Grow Pro and then we'd love to kind of hear about your perspectives on this emerging market, how small cultivators can play an integral role to this market. And you know I think one of the things that has been on my mind and that I've asked from a lot of different folks that I've been speaking to is you know I think it's, I think James, Julie and I all have some power bestowed through Act 164. I think if we set a fee structure that helps small cultivators that's something we can do. We can help on the back end with some paperwork stuff but what else can we do as a board to really help small cultivators find their footing here. Awesome, well thank you so much Kyle and everyone for having us today. My name is Stephanie Waterman. I'm my husband Kendall Smith is here. I'm sorry you can't see us today due to technical difficulties but like Kyle said we're the owners of White River Grow Pro. We are a specialty gardening store that specializes in supporting the cannabis industry and growers of all sizes. We've been in business since 2014. Our roots come from the underground market and this experience really drives much of our world view. We focus on advocating for the rights of home growers and small cultivators and we have a vast knowledge of the cannabis community at large because we have been a part of it for many decades. As you can imagine we have a large number of clients who are interested in participating in the legal market and so we're here today to talk a little bit about what in our view we think the board can do to support and encourage the transition from the illicit market into the legal market. At Grow Pro we do hope we can participate in the legal market in some way. We would like to add the addition of seed and clone sales for example to our offerings and we do hope that the board will consider nursery licenses or things for stores like mine who would like to participate in that way. Before we dive into what we think is most important for small cultivators we want to thank you for having us here today and thank you for acknowledging the importance of small cultivators. We believe it's a thriving part of the Vermont cannabis industry and we thank you for acknowledging that. It's also important to acknowledge we have a really thriving industry already in the state and have for decades and we really want to honor our roots and transition this underground market into the legal market with policy that favors craft growers over corporate firms. Kendall's going to speak a little bit about his background. So you know I grew up in Vermont. I've been in many places in this country before I moved back to Vermont to settle down and I may or may not have been cultivating cannabis for 30 years or so. Anywhere from home grow a registered cannabis called caregiver and a commercial underground grower. I was a registered medical cultivator in California in the early days of prop 215 and I've kind of watched how legalization out there has affected the underground market and really failed to bring that market into play. As I see today the path to the legal market for underground growers in Vermont remains yet to be forged from what I see in the in 164 that there are many aspects that despite the best intentions of the lawmakers really work against craft cultivators and instead really favor corporate cannabis. And while again we you have limited control over some of these we as you said we think you're going to be the ones that the legislature is going to count on to make recommendations that will level the playing field. One of the things that I see that keeps happening in legislation everywhere is that legislators keep legislating use and I think that I mean that's a lost cause as long as you're legislating use you're going to miss out on the revenue associated with that. If you have arbitrary caps on THC content and flower and concentrates and the milligrams per serving and how many milligrams in a package people will go elsewhere for those things that if the fancy is flower that's coming out that everybody wants is 32 percent people aren't going to not have it in Vermont because they're not allowed to grow it somebody's going to grow it and somebody's going to get it. So same thing with concentrates I mean butane extraction is explicitly illegal in Vermont and I don't know anybody who wants to smoke a dab who doesn't smoke a butane extracted dab it's it's so we don't get to legislate use we only get to include or not so I think those are huge barriers and really I think that that's a big part of something that I keep seeing. Yeah it's a potential it's an area for lost revenue any exclusion to the last inclusion is yeah it's lost inclusion it's it's something that will go towards the underground market instead of towards the legal market or by excluding it or to our neighboring rec states. Sure um well well we see a lot of barriers working within the structure of Act 164 we see some key areas that we can focus on that we think are most important the first being access to a fair and equitable market two reasonable zoning laws and three the path to market for small cultivators reasonable fees and application structures is something that is long-toded as you know a key to supporting craft growers so we're not going to linger on that we want to be sure we avoid the exorbitant fees like we've seen in California for things like environmental impact testing you know things like that that have really high price tags and long wait times because those really affect growers. Assistance to help meet testing requirements via access to affordable testing I think it's important for us all to acknowledge that testing is consistently a bottleneck in legal markets and I think the board should consider addressing that early on um full panel testing is also very expensive and we've seen that be a hardship for small hemp farmers in Vermont um I want to make it clear that we believe that full panel testing is the right thing um it protects consumers and it protects our environment from destructive growing practices um but we have to work together to bring down the cost of testing and increase turnaround times in our labs and while we do not support waving testing entirely for small growers we do feel that there needs to be accommodation for small batch producers either via state sponsored testing that keeps pricing low or allowing them to consider batches differently than in a larger commercial grow um maybe a group of cultivators all cultivate the same way and have the same practices and therefore they're monitored in a different way yeah um the other important thing is you know continuing however we can to level the playing field so that large multi-state operators are not given priority over small Vermont farmers the head start for medical dispensaries to sell recreationally is in direct opposition to the Vermont legislature's desire to support small business in Vermont um the head start on rec sales coupled with unlimited canopy size they have as medical facilities put small growers at a disadvantage um you know as small cultivators we're going up against Cureleaf who was until very recently the largest cannabis company in the world um and these are the people operating in our state already um and our legislature has given them um a leg up I mean it's that stuff you know we're going up against us growers the now second largest cannabis company in the world who has been given unlimited canopy in our state to go up against us right and the head start and complete vertical grow so I mean we're really as in the business sense of things I mean we're coming in at such a disadvantage right going up against them you know a lot of people who defend the head start say it's made up for by licensing the small cultivators at the same time um you know our issue with that argument is that there's really no guarantee that the medical dispensaries will purchase from small cultivators or that they'll pay a reasonable rate as 25 attempted to address this but failed ultimately in creating a referendum um to that regard so we we think it's also your responsibility as the the medical program shifts your purview to look at the inequalities already at hand in our state and further provide regulations so our medical dispensaries can no longer be allowed to skirt regulations with little to no accountability the next big piece is zoning um so allowing cannabis cultivation in commercially zoned areas only is another huge barrier as we see it with 164 for the underground market this was a detrimental amendment added to the bill that will further provide roadblocks and instead we need to look at additional zones in which cultivation may be permitted if certain safety and security measures are met because otherwise who's how many average vermonters have enough money to purchase a commercial property outright without any loan on it in order to cultivate which is basically what has to happen and you know the the fact that that's the way only indoor only in commercial zones keeps that out of the hands of most everybody i mean i'm sure all of you how many of your friends can afford a commercial building to buy outright and then invest in everything it takes so that's not the average vermonter you have the challenge of not being able to have a mortgage or you have to find a landlord who's willing to rent to a business that is you know operating in a federally illegal space um you know i i think it's important to think about where the underground market is operating now um they're in basements and barns and facilities in residential agricultural commercial zones all around the state they've been operating for decades with no one the wiser and if these grows can meet certain security and code requirements they should be allowed to transition into the legal market and let's look at hemp as an example in the state so the we've registered as hemp farmers the last three years we've been able to register the row room in the basement of our home as a commercial space and have however many plants we want in our backyard there's no reason why THC plants shouldn't be similarly regulated again allowing small grows to be licensed if they can meet their requirements we do really feel that this is key towards transitioning underground cultivators by allowing them to transition existing grow rooms to legal operations and Kendall spoke a little bit already to the barriers of being required to be in a commercial zone because of affordability and that it does it requires more money to participate if we one creative way to get around this is if we look towards increasing the number of plants allowed for home grow and providing a way for people to sell overage into the legal market this could provide a path for conversion to the underground market you know a lot of growers that we see you know it's the the market has changed significantly in the last seven years that we've been operating in the state a lot have left towards more favorable states like main growers have moved to states where it's easy for them to do their thing where they can have a big row and you know the smaller smaller growers that are here you know they may be selling you know five to ten pounds a year that helps put food on the table and pay their fuel bill in the winter they're not making a lot of money from it but it is a way to transition people to the legal market if we can figure out a way to do that also really takes away from the liability of having a mortgage on your home and all of those things if we can have our personal grows be bigger and however we can register a larger personal grow kind of thing whatever you might have to have a license to sell whatever but to have it be a personal grow that has a path to sell to a growing association a club a buying club a something that then can help with testing and distribution it's not that everybody's going to get in I mean I can tell you that most growers are not qualified don't grow cannabis that would make a market they're not growing good enough cannabis that would actually make the market and so that's there will well yeah I mean it's everybody who thinks they're going to get in won't and and you know anyway sorry um the other important thing to acknowledge is that the national lobbying groups that supported and pushed for commercial zoning and preference of indoor grows did so under the guise of environmental protection and really the real motivation here is to increase cost of entry for growers by taking away the ability to grow under the free light of the sun allowing for outdoor and sun grown grows with reasonable requirements meant is an integral part of lowering the cost of entry to the cannabis market I would really like to see cannabis be a potential for farmers around our state to diversify their businesses and further strengthen their family farms and I think we can do it it's important to talk about the agricultural designation or the lack there of for cannabis you know it's a it's a little bit strange because obviously cannabis is a plant we are farming it it is agricultural at its nature I I understand why the legislature admitted cannabis from receiving this designation it was explained to me that you know the agricultural designation also comes with a significant amount of leniencies in terms of zoning in several towns and with regards to certain you know environmental regulations or tax breaks and we support more regulation of cannabis because we want to uphold the environmental standards and we want to control where it's grown to an extent but we do feel strongly that you should be able to farm cannabis in an agricultural or even a residential zone area if you can meet the requirements you know looking at things like security of your grow space your electrical standards and odor control are all very reasonable requirements that any grower can meet many illicit legacy underground growers already do that they're their neighbors to people who don't know that that's what they're doing because they're doing everything well in order control and you can't tell that's what they're doing exactly sometimes you can but we also want to talk a little bit about the path to market and a great way to support small growers is to provide options beyond the dispensary model we fully support farm direct sales and understand the challenges in regulating this even if growers can sell direct to consumers via co-ops or registered client lists like we see in the main medical program this would further aid in conversion of underground grows to the legal market one thing i think is important to consider when we look at regulation of cannabis is to look towards one of vermont's thriving industries the craft beer market this is a highly regulated business it allows for direct to consumer sales and we we can do this with vermont craft cannabis as well you know i'd like to touch on one thing before we sort of wrap up what we've said and and i think it's really important as we move forward with legalization in cannabis that cultivation is done responsibly and that we cultivate sustainably indoors and outdoors we just don't think that we should have people polluting commercial farms polluting it's you know northern california growers stole water from rivers in the summertime when they're low from salmon and steelhead streams and drip-systemed you know fox farm and general hydroponics salt based fertilizers which have high nutrient laden runoff that get back into the wastewater system we don't need that in vermont it's already taxed organic soil grows are beautiful they bio-remediate they're they're wonderful things if if we think about it and when can when home grow became legal the city of burlington had recently completed a 320 million dollar upgrade to their wastewater treatment system it's my opinion and i don't have any scientific backing for this but if every grower in burlington was growing hydroponically and had to dump their wastewater into down the drain which hydroponic growers do the city would need an entirely other upgrade into the wastewater system because of the severe excessive nutrient runoff and i think it's really important as we move forward to to grow sustainably um yeah and this we we feel that that can be managed um through policy through environmental policy um and that it doesn't mean that you have to be inside an organic sun-grown cannabis operation growing in the earth of vermont has far less environmental impact um than our current medical dispensaries three of whom are growing hydroponically with salt-based fertilizers um indoors so you know these are important considerations you know how do we keep the industry green how do we uphold vermont values um of environmental stewardship um how do we include the community that is there um and i think it's possible i think we have a lot of work to do um and i i am i'm heartened by the board um and their inclusion of us in today's conversation um and really trying to to figure out how can we do this and do this together so thank you for your time we're happy to answer any questions the board may have well thank you so much step sorry no thank you yeah are there any questions for Stephanie and Kyle all that you'd take over i was just going to thank Stephanie and Kendall you you i was scribbling down notes as you as you spoke certainly appreciated i know we're on a a pretty tight packed agenda this morning before the public comment session at at noon but julie pepper do you have any questions for Stephanie and Kendall um i have just one and i um considering um Stephanie what you said about like either residential uh well i mean i guess i'm thinking mostly of of residential what type of security um measures do you have in mind when you when you share that suggestion and would that add to the cost um and would that also limit a path to market well you know some of the things i think about insecurity and grow operations are simple things like security systems and cameras that well yes there is an upfront cost you know you can for under $1500 have a system installed by a major monitoring company and you can get a home system for less than $200 that goes to your phone that has a camera yeah and i mean and that you know those are things to think about you know but that i can get a system with adt for example you know we're having one installed at the shop you know this an upgrade and it's not expensive and we don't expect that there is no there has to be a cost to entry to any business right you know you can't just open a business for nothing you have to have some money put away but the the difference between having to take a current grow room and retrofit it maybe with a high tech security system versus the electrical upgrade your electrical system so that they're meeting certain code requirements that is far less than having to go and potentially purchase a building outright for cash if you cannot find a landlord willing to rent to you um and so so that sort of shifts it shifts it a little bit in our mind um and it also you know gives growers a reason like hey you have this wonderful space already set up let's transition you to the legal market and it's a it's a it lowers the barrier in our opinion and you know a lot of the underground growers they they're they're growing four and six lights now these are not few grows anymore you know those guys all move they all move um and some are coming back but um you know it's all small stuff now you know and really it's like ma ma and pa me ma and pa you know we'd love a way to earn 15 000 a year um being able to sell an overage from our personal grow i'd actually love to earn be able to you know i give a lot of it away um i'd love to be able to grow more plants and give more stuff away um you know sure well thank you Stephanie and Kendall i have and we we've got to we got to move on to to Graham with roll from on i do have one question for you i mean i i totally can understand and appreciate your concerns about wastewater treatment i think not necessarily even in the burling greater burlington area but what kind of stress would certain types of operations put on our more you know aged waste and smaller wastewater treatment facilities in different places throughout the state but the other aspect of waste here is plant waste biomass waste and i recognize the underground market is only operating at a at a certain scale as you just referenced now and maybe waste hasn't um you know been this huge issue based off of scale in and of itself but i'm wondering from an underground perspective what what is is as the underground market found any ways to monetize that biomass waste um or how is it typically disposed of i don't want this to end up in in coventry um or is there is there composting going on just if you wouldn't mind touching on that very briefly what well i mean our our plants are you know we put stuff we when we go out to dinner and it's not organic that doesn't go into our compost because we feed our cannabis plants our compost so you know our you know so well grown plants aren't going to be full of of nasty stuff and they compost right back in i mean you know composting compost is everything i mean you know so we we personally compost um you know i think it's hard to speak to what all growers would do when you have you know you're harvesting 100 plants what are you doing with that i do think it is important to consider you know composting chipping things up and composting um is a really viable solution and i think that can be part of the the waste management in general um and like kendall said you know these are it's organic material um we let's come let's compost them in our commercial facilities if it's all chopped up i mean i think sometimes people worry about you know anything potential left over on them and how you're kind of managing that away from people but you know if you have some sort of standard for you know you're you're chipping it up and putting it into the compost i don't know i mean it makes great when i grow all the leaves that i pull off everything go right on top of the soil underneath the plants they just turn into mulch so the only thing that i have left over at the end is a very small sticks and stems and they just go into the compost pile and they go fairly quickly cool i've got a i got a quick question if you don't mind and i'll try and be brief um uh are we we're in kind of talking about your testing and some of the bottlenecks that are there um you know obviously one of the primary motivations behind this bill at least from the majority of people that voted for in the legislature was a consumer protection aspect um you mentioned something around kind of cooperative cultivators using common grow practices um could you talk a little bit more about kind of that vision and what that could look like are you thinking something along the lines of the caps program or kind of co-located um cultivation you know for me it's it is you know when i picture that i picture that you know we form a group called the upper valley probiotic growers association and we all commit there to using you know only certain inputs into our garden only using certain products so that if you know being a part of this group means that we're only using certain sprays and you know mostly relying on insects for our ipm program and that we're all using organic top dress living soil and that you know we're not using any salt based mineral based um nutrients that there's no runoff that we're reusing our soil i mean i'm i'm currently on the eighth time of using the same soil i just pull a small root ball out and put another one in and grow again and so i don't have any waste going on except for sticks um but you can that's a potential way to manage via you know a set set of growing practices that everyone is adhering to and then you know with with certain regulation or check in on those grows periodically to confirm that you know then maybe those those groups of growers can pool their money to batch test um you know sample batch testing maybe you're not you're not testing every plant you're not testing you know every harvest necessarily for every grower but are there other ways we can be creative um around that um you know growers co-ops you know and that's it's similar to like saying like okay well here's a group of organic certified they've been certified by NOFA um and they're organic listed you know maybe they clean green certified whatever yeah whatever it is um well you know well thank you that's that's great i think testing in the bottlenecks i think the hemp community saw the bottlenecks with laboratory testing be a huge issue the last couple years and testing is going to play an important role however however we decide to slice and dice it i think is yet to be determined but um we don't want those same bottlenecks to you know strangle this industry at the get-go recognizing that there's only a certain number of labs in state that really offer this type of testing in those labs also do a lot of you know testing for other types of um you know whether it's food so on and so forth allergies um and they're not completely devoted to this but Stephanie and Kendall thank you so much for your time i look forward to following up with you in the coming weeks and hopefully we can have you back um at some point in the future to to check in and and provide us any more thoughts great thank you so much we appreciate it good luck thank you thank you all right graham with roe vermont are you are you with us if you are you can turn your there he is hey graham packhouse this morning for you looks like yeah that's good timing um yeah thank you so much for inviting me and my other coalition members here today and Stephanie and Kendall thanks for that that great testimony you just provided yeah graham so so just very uh quickly so i think the next one two three four four folks on the agenda are all from your coalition i just want to make sure i think we've got about an hour or so for all four members to kind of give some remarks maybe we can we can stretch that a tad bit i just want to make sure we're we're giving everybody on the agenda their their opportunity to speak with us and if you wouldn't mind um introducing your coalition and then telling us well telling us what the mission of the coalition is but also telling us about roe vermont as well that would be great absolutely thanks kyle and um you're right it's the next four of us are three of us are organizations who are part of vermont kingdom's equity coalition one is a cultivator um small farmer who is a member of the vermont growers association and um you know we often testify as a team so we maybe we can also do some back and forth and i can you know i can pass early and respond later if there's stuff that's more appropriate for me to speak to um but yes my name is graham you thanks through for not i'm the policy director at rural vermont um i'm also a small farmer i have a grass fed and finished beef business i also do some ag research and um do sort of home to farm scale buildouts for folks related to gardens or fencing or et cetera um so rural vermont is a 35 year old um agricultural advocacy organization more or less that through organizing education and advocacy works forward towards equity and access in vermont's agriculture and food systems um our coalition is vermont equity coalition and uh rural vermont is a member of the northeast organic farming association is a member unfortunately maddie kempner the policy director couldn't make it today she embarked on a cross country road trip yesterday with her family um we have closed that kyle i said that sounds fun i pardon me which is i was doing that it sounds great um we have uh vermont growers association and jeffrey pizza to lo who will be speaking later we have joshu decatur of trace vermont and we also have the vermont racial justice alliance and justice for all which is mark hughes and mark can't make it today um so quickly you know rural vermont started advocating in this issue in 2018 when the governor's cannabis commission i believe it was the time was traveling around the state taking testimony in different regions in our interest has been multi-fold largely has been around access and equity for for small producers but also recognizing the historical harms and the current harms ongoing from the criminalization of this plant and how that's disproportionately affected communities of color poor communities and and others um so our coalition is really about the intersection of all these points of equity and access and recognizing the the ties between economic equity racial equity and agricultural equity and access so all of those things are fundamentally important to our coalition and you will hear us all speaking today and i'm sure in days going forward to these issues um you know i really want to as i think kendall and and stephanie pointed out you know we are hopeful um you know for the work that you all are setting out to do we're we're extremely disappointed in act 164 and i imagine that you've done your homework a little bit and seen our testimony in the past we opposed the passage of s54 um we opposed the passage of s25 this year we don't feel as though they've made space for small growers and cultivators for the legacy market we do not feel that they've adequately approached social equity or repairing harms done to particular communities over time there are certainly some positive things in the bills but we'll focus today on you know what we'd like to see and some ideas we have and hopefully we can speak going forward more but i think it's important to just mention at the beginning and um sort of mark for all of us that we're at like a century essentially of criminalization here um based on xenophobia based on racism classism that's what we're coming out of and it's sort of frustrating i think to us that there's still so much taboo entrenched with this um given that history and given the acknowledgement of that's why this has been criminalized um so our hope is to really in our vision is to create an equitable fair um just distributed marketplace for this product which repairs past harm and positions those who have been in the legacy market and those who have been disproportionately affected by criminalization over time to succeed in this marketplace um so and i think you know this really puts you all in a really special position you know at the state house our coalition was unfortunately not giving the opportunity to bring in anybody to testify outside of our coalition the aggregate over the number of years that all this legislation has been entertained only one agricultural committee and that was senate agriculture this session took our coalition for a few hours so that's to say that this bill you are looking at has not is represents a significant amount of um lack of agricultural literacy um and we're really hopeful and excited about this process with you all because we know this is there's going to be a public rulemaking process all these folks you know hundreds of cultivators and small businesses who we represent and are in our different memberships will hopefully have the ability to make their voices heard here as they have not in the legislature so thank you you know ahead of time for that and i think it's really exciting we're excited to hear everyone's voices um so i'll start with sort of agriculture as a small farmer and as an organization you know working in agriculture for 35 years you know clearly as as was mentioned you know this is currently not considered an agricultural crop uh the cultivation is not considered agricultural we clearly disagree with that determination it was put in relatively last minute in the s54 process and um we recognize that that's sort of outside of your purview directly although you can make recommendations to legislature to change existing statute um but just really quickly we feel that designation designation is an issue of economic access um as well as racial equity and access um programs like current use like agricultural easements um grant programs for people to get into agriculture these are all meant to facilitate economic access to land economic access to the ability to produce medicine to produce food to produce crops and when we consider this industry non-agricultural all those existing farmers who have put their land into current use agricultural easements have that land immediately taken off the table of production potential they are put in a position of making a choice to either pay a penalty to take their land at a current use or break a contract with their agricultural easement if they want to participate in this program or they are left with the option of trying to find an alternative site um potentially on more marginal land um to try to participate they'll have to start a new business etc I think the last Stephanie and Kendall spoke really wonderfully to the issues around zoning um and I'd say that we are 100 in agreement with that um but to give you some other ideas you know the national average farm income is consistently around negative 1200 to negative 1400 dollars you know the agricultural community really struggles to make a positive return I think even in the Vermont scale folks are very familiar with the financial challenges of running any scale of agricultural business in Vermont we also recognize that um direct markets are essential for small producers and currently in the bill producers are all sort of required to give only given the ability to sell wholesale which I can I can use my business as an example I think we can also use Vermont as a state as an example you know Vermont competes very well at the craft scale we have a very challenging time competing at commodity level across the globe and across the country similarly if a producer who can produce on you know 10 uh 10 000 square feet of indoor space and a producer trying to produce in 1000 square feet of indoor space or 4 000 square feet of outdoor space and 40 000 square feet of outdoor space are trying to sell at the same price point and trying to stay in the same wholesale market the smaller producer is going to be significantly disadvantaged we need the price point that we can get from direct markets we rely on our relationships with our community members with our customers we do not have the economy of scale to compete with larger businesses and we really feel like this the focus of this industry in Vermont should be around small scale production distributing that wealth as much as possible bringing in the legacy market making this accessible for the people who live here to actually diversify their income support their families etc you know one way of thinking about this too is are you going to facilitate people being price takers or price makers people who can direct market our price makers they set the prices that they need to run a viable business as Kendall and Stephanie spoke to you know small growers who are required to sell to dispensaries or to other retailers are going to are going to be at a disadvantage in terms of a price perspective and I think this is a really unique opportunity actually as we've seen with commodity markets such as dairy or others well let me just say this is weak at the Vermont scale we can't usually affect controls over economies that cross state boundaries this is an industry where we currently can do that which means that we can create an equitable structure to have this market exist within and we do recognize that you know nationally the trend is probably going towards legalization and we feel like if we can set up a state-based structure which puts equity at the forefront then you're going to be positioning these small businesses very favorably when it comes to the changes nationally it may be the case that some of our laws cannot stand when it comes nationally with interstate commerce laws etc in the future but there are programs we can create sort of like the appellation standards and wines which can also protect small businesses just as Kendall and Stephanie were speaking to designations based on region of growing on production practices on scale and the way we set up this marketplace right now can really position our folks to either be successful or to be totally overwhelmed when the national trends change the national laws change some of the things that we consider critical so I'm getting a little distracted here by this little girl breathing heavily on me but we included in our recommendations a vertically integrated small farm license which would allow small cultivators to grow process and sell directly we really think this is a critical step for Vermont to take this is what small farmers do they produce themselves they process and make value value out of products and they sell it directly that's how they stay in business that's how they run a viable business we this this privilege of vertical integration is given to the largest scale businesses currently and we feel like it would be very reasonable and wise to create a similar opportunity for the smallest scale producers and there's a lot of opportunities you know to sell from the farm to sell delivery via csa to sell at farmers markets we don't feel like these are unreasonable um asks or ideas we just feel like this is a really culturally taboo subject unfortunately and we already spoke to sort of the legacy of that so one of the the primary um asks we have a view and what something is very much within your control is the differentiation between indoor outdoor and mixed light growing um currently the law does not do that and what we are suggesting is a a one to two to four ratio just for every 1000 square feet of indoor growing there's 2000 square feet of mixed light growing allowed or 4000 square feet of outdoor growing these are standards um taken from the Humboldt County area of California where it's an area which is oriented towards small scale outdoor production which we really feel is is critical for this state as well um and the reason we have these differences in allowance is because an indoor production setup is a year-round production um it's a controlled environment outdoor production is a seasonal production it's a totally uncontrolled environment last year we had one of the hardest for us we've had in 100 years in early to mid-september um which I'm sure we tab it on a bunch of legacy growers uh crops um those are things that you can control for an indoor environment so that's why when we try to create equity in the marketplace it's so important to differentiate between indoor mixed light and outdoor because you're really dealing with entirely different growing environments entirely different capacities to for production um and you're also dealing with issue um as was spoken to you by Kendall and Stephanie you know the impacts of of those types of growing we're not against indoor growing but we think that this industry should be oriented towards facilitating outdoor production it's accessible um and it has less of an impact we we could we can get the stats for you on as we they spoke to water issues but also electrical drawdown in California and Colorado has been extremely significant we're in the middle of the um Global Warming Solutions Act here in Vermont one of for all Vermont's recommendations to the Ag and Ecosystem Subcommittee will be to facilitate the creation of the cannabis laws towards outdoor growing as much as possible I think it'd be very wise for them to consider the future impact of a marketplace would to be more indoor oriented um in terms of barriers to entry um you know this whole sale requirement that we we spoke to is currently a barrier fees and costs I think that's obvious um uh testing was spoken to a little bit the cost testing but also the logistics of testing batch sizes locations transport we need accommodations for smaller producers which was said before and maybe I didn't say it in the original part but getting back to the ag designation you know our our contention isn't that all cannabis production should be considered agricultural but that outdoor production of cannabis should absolutely be considered agricultural um other barriers security requirements and we've heard this also in speaking to folks across the country that security requirements can absolutely be a barrier to access especially for smaller producers and legacy folks currently in the law you'll see that there is one standard written it's not differentiated for indoor or outdoor production and we feel that's highly problematic um it requires I don't have a language right in front of me but I believe it requires um a locked facility and you know field-based grow that language is very challenging to accomplish we were assured in uh in the legislature that that could be accomplished with electric fencing etc but I I think it's it'd be important to consider you know spelling this out a little bit more in in the law and in your recommendations there should be differentiated security standards and not only for indoor and outdoor but also for different scales as Kendall and Stephanie were suggesting um also this this notion that it can't be visible to the public is a very um potentially very challenging issue for those who are small landholders and want to participate in this industry um one thing to keep in mind from agricultural perspectives we don't often grow the same crops in the same place year after year after year we move our crops for reasons of pest pressure soil reasons etc um some of these requirements just need to take some of these basic agricultural literacy things into account um another big barrier is licensing structure and I think that Jeffrey of Rockrose Association will really get into that um following me or following um following one of the the folks coming after me um let me see in terms of licensing just the overview again um differentiating between indoor mix the mixed light and outdoor but also production caps you feel production caps are there's there's a couple ways of limiting supply one is through limiting the number of licenses the other is through production caps we feel like the ccb and the legislature should not limit the number of licenses at least for the smallest scale of grow there should be an unlimited number of licenses there should be an ongoing enrollment period um our recommendations for the smallest scale and Jeffrey will get into this it's 1000 square feet for indoor and 4000 for outdoor I feel like it's entirely reasonable for that scale um to have an ongoing application process and there to be an unlimited number of licenses if our goal is to affect supply control then we can put production caps on such that there's no license that can produce as much as it wants and such that the largest license is actually relatively limited in skies and this will just again facilitate distributed wealth distribution throughout across the state and throughout this industry as opposed to um single companies that can produce large amounts um some open questions I just want to um bring up our our breeding you know we feel like that's not really covered in existing legislation uh selling of starts um sale of seed um how to differentiate between indoor space needed to start plants for outdoor production versus indoor production itself um and a couple of things I'll just briefly say before I pass it on is um home grow allowances were briefly spoken to by Stephanie and Kendall and it's our position that the the current home grow allowances are not sufficient and they're actually very hard to reasonably be in compliance with um we've heard from a number of members that that's the case for example if you need to if you're starting from seed and you're trying to get to your four immature female plants it's pretty hard to start with four seeds and get to those four plants uh you're going to need to start with more plants than that to actually get to the final allowable number so we've increased we've you know made a suggestion in our coalition to increase the number to to to to 10 mature plants for uh for home grows and that may not be the number you choose but I think it's just worth taking into consideration that the current number is really not doesn't have agricultural literacy built into it and it's really not appropriate it's very hard to be in compliance with um you spoke of a phase sort of one and other phases of this market place at the beginning and I think from our perspective what's really critical is that we start from a place of equity as opposed to a place of market concentration and phase one we need direct market access or small cultivators we need to differentiate between indoor indoor and outdoor we need production caps um if if thinking about in phases is helpful um that's fine I think from our perspective we just need to start with equity last couple things one around youth prevention and security we've we've gotten the sense that there's some conflation of our advocacy and agricultural use more broadly with increased risk to youth and increased security risks and we just want to say straightforwardly that we have seen no evidence to support any of this narrative um we are we are not here endorsing underage use of cannabis um we have proposed that outdoor cultivate or the security of outdoor cultivation be at the discretion of the outdoor cultivators and I think we just need to think about this a little bit reasonably um if someone is going to steal cannabis from an outdoor production site they are going to be taking there's only a certain period of time a certain number of weeks or up a year where that cannabis is is uh intoxicating for lack of a better word that cannabis has to be it can't be used directly off the plant it would have to be brought somewhere dried for a number of days this is a very fragrant product and then would have to be cured so the likelihood of of our policies are outdoor growing leading to increased risk amongst youth is we see is a significant stretch for the imagination and if people can present us with evidence we'd be happy to respond to it um but I just wanted to address that right away um in the last question I think we have is there's currently three entities which hold the five medical licenses um but law prohibits one entity from owning more than one integrated license in the coming market we would like to know how this is going to be resolved um and I'm not sure that's a question you all can answer um I'll leave it there and pass it along thanks Graham pepper Julie any questions I don't think we have an answer to that last question quite yet um I did have a question um for you Graham and thank you for being here and thank you for all the advocacy that you've done um if we did follow the recommendation of having an unlimited number of small cultivator licenses that you know the application period could be open continuously and we wanted to rely on small cultivators to meet the market demand how much of the how much of that demand do you think that you know those types of license holders could could cover could accommodate if we if we um had production caps on the larger folks and we started with the small cultivators um I mean you know we don't want to overestimate the market demand we don't want to underestimate it um and we want to rely on small cultivators to meet it so you know do you feel like current small cultivators can meet 100 percent of the demand or I mean and if that's a question for Jeffrey or someone else please feel free to pass it on yeah one I um I'll pass that on to Joshua and Jeffrey and the folks coming after me to respond to I know Jeffrey's going to get specifically into all the details of our licensing and they both have a lot of perspective from in the industry over time that they can bring to the conversation. Graham I have one question before we move on I think Josh is next and I know we're a little bit over that kind of breaking up the hour as I try to at the beginning and here I am asking questions so you know well and for everybody else Graham and I've worked together while I was at the Agency of Agriculture I do understand and appreciate a lot of your perspectives I I hope that we can move this program into one that's a little bit more focused as an agricultural product more so than a commercial product um and I agree it's it's a challenge the way farms are typically set up in this state to really have your crop completely hidden from from public view it can be a real challenge depending on you know how close you are and farms are often barns are often close to roads so trucks can get in and out of them all year round and I totally appreciate that I think you know my understanding of one of the reasons why well if we if we moved obviously the agriculture this is an ag state it's been an ag state for the last century or two right I hope we can move this program one that that recognizes that as you kind of alluded to and agriculture does enjoy a lot of you know exemptions from certain things benefits there's a lot of grant programs as you mentioned set up for folks in the ag world I think that there was some anxiety around what happens if these large MSOs or whoever the case may be whatever the case may be move in here that they might adulterate or take advantage beyond what any of us want when it comes to some of those exemptions and I think maybe the answer to my question you you addressed when it comes to the indoor versus outdoor you know the differentiation between commercial and ag use but I'm wondering if if you've thought at all about you know if this is an ag product recognizing what that kind of means how can we work to make sure that folks don't take over advantage of some of the advantages that ag typically it does enjoy you know I think that's a great question and I think you know even if we designated it as ag because there are certain exemptions it doesn't mean that it can't be particular regulations put on it to limit exemptions people are uncomfortable with but in terms of MSOs or other entities coming in and sort of exploiting the existing exemptions I think that from our perspective we're just talking about outdoor production being considered agricultural and we are putting our our recommendation is that the largest scale outdoor production could be one acre so we're talking about a relatively small scale of production the small scale license to be 4 000 square feet the largest scale would be for approximately 40 000 square feet so we leave very little room for a sort of exploitation or for environment for you know social economic or environmental exploitation I think with that scale of production I think some of the concerns around the nuisance related to agriculture and the right to farm laws in my understanding and Kylie I mean you you're a lawyer so you may have more understanding than myself or at least I believe legal background based on what you told us I believe that the news the right to farm laws protects a pre-existing agricultural operation from new plants some cannabis growing operation for example you know there would probably be some things to work out I think odor is one but I also feel it's a little challenging to think about odor you know we have housing projects we have all kinds of stuff located close to interstates close to places which are far more damaging and concerning than the smell of a plant which is going to smell for a few weeks every year you know I think it I'm I that's sort of my response to that one particular nuisance is that I think there's a little bit being overblown around it considering some of the other odors that we deal with agriculture and just in our society in life thanks Graham I appreciate it I know we're running a little bit behind Josh I want to make sure that that you have ample time to give us your your thoughts are you with us hello I am hi Josh feel free to turn on your camera if you would like to there he is an apologies I was a little late technical difficulties here this morning but I'm glad you were able to join us then yeah so thank you all I'll start by introducing myself I'm so able to meet Kyle but I don't think the rest of us have have met yet um so I come from a background in cannabis cultivation I've worked in California out west I've been a medical caregiver here in Vermont and I also co-founded trace which is a tracking trace solution currently facilitating the Vermont hemp program and through that experience was really lucky to see markets roll out across the country and have a front row seat um to a lot of the the challenges faced in other places over the past few years but I'm also here today primarily in my capacity as a member of the Vermont Cannabis Equity Coalition which you know is focused on an equity first approach to cannabis rulemaking cannabis legislation and policy so I also want to say a huge appreciation of the farmers who joined us today I think it's always great to hear from the members of our community that are going to be the the local small business participants in this market so I'd also like to just quickly thank all of you at the CCB for having us here today all of you in your capacities it's you know the rulemaking process I think is a really important step in the democratic process you know we advocated quite fervently and for a long time in the legislature and it was great but as Graham referenced there really wasn't the amount of time or detail specifically to ag and equity issues that we would have liked to see or that we feel is right and I think the legislature in general had a difficult time dissecting some of the particulars around issues surrounding legalization and they also had a difficult time dissecting some of the interests of people who were proposing or advocating for certain things and why they were advocating for those things and that leads me to what I want to say I'm going to try to be brief because there's a lot to get to today and I you know in general from you know Jeffrey or Graham or the growers you'll hear today you know we you know support those policy points that they're hitting very specifically and those points have been made with lots of thought lots of discussion from the community and lots of evidence-based equity perspectives on what gets the best results for a market but you know there's a real split in the cannabis industry not just in Vermont but around the country and a real struggle that's been happening as these markets have been rolled out and there's two distinct interests at play one of them being interests of people who are approaching and businesses and entities that are approaching the cannabis market as a new opportunity to create high-valued businesses many of them publicly traded currently who are interested in market control market capture high revenue growth shareholder return and competitive advantage and that's you know as we've seen play out the folks who have for better or worse usually worse 99% of the time and usually because of some of the stigma that still surrounds the plant and the industry are often heard by legislators as more trustworthy or more informed or you know less risky participants in the industry but the reality is when you look around the country that that's you know simply not the case and I think that what the CCB is going to be considering today and for the whole time you're you're in this job is you know what do we want the cannabis market to look like and who do we want to be the people who are benefited most by the rules and regulations that are put in place and I think that there are elements that you you're going to hear talked about today here from small farmers and members of our coalition things like land stewardship things like craft production things like agro tourism things like rural economic development things like equity itself that are just not simply in the minds of or primary driving motivations of some of the multi-state operators all the multi-state operators and most of the larger businesses that are approaching the emerging cannabis market more from the perspective of a capitalist opportunity rather from the perspective of you know building a small sustainable farm that can support one's family and be a integral member of the community around them so that whole perspective and all those possibilities of what the cannabis market in Vermont could be to people who are here farmers who are struggling people who've been adversely affected by the war on drugs because of the color of their skin that is something and all those participants and all that richness that could come into the state of Vermont in our local economy thanks to cannabis is not an element of rules and regulations in an industry that prioritizes the the bottom lines and the profits of a select few that happen to have access to the type of money it takes to build a 50,000 square foot indoor grow or it takes to pay for an integrated license or you know you name it or make donations to politicians so you know all these things are at play here and I think when we talk about and consider rules that are going to govern cannabis in Vermont it's just important to really consider and think deeply about who they stand to benefit and if they're being done to protect profit interests of a few businesses or if they're being done to advocate for what's fair safe diverse equitable for local members of our community who deserve a shot at participating in this market and that's really what folks are asking for they're just asking for an even playing field where they have a reasonable chance at running a business and I think you know when when alcohol was legalized after prohibition you know the three-tier system came out of antitrust and the anti-monopoly interests that were at play at the time where they you know split up each level of the supply chain and made it so that entities businesses or individuals could only participate at one level and not all three right so this is not new in a lot of ways but it's ongoing and you know things need to be done again with this rollout of this market to make it so that there isn't that consolidation or domination by those with the most ability to invest so you know the policy you'll hear today I just want to underscore score again has come from communities of people it's come through from discussion it's come from crowdsourcing it's come from looking at evidence across state markets of what's worked and what hasn't and although Vermont at this point in time I would not say is a a leader or a trailblazer when it comes to legalizing cannabis in the first place we can still be a leader in a trailblazer in terms of how it's legalized and how the market is set up and rolled out and you know the rationale given when we were advocating for legalization in 2016 2017 2018 I know it was going on a lot a long time before that but I was still in college um I think the uh you know was that we're gonna wait and we're gonna take our time and we're gonna see how it goes in other places so that we can do it right so a few years went by people took their time they considered they saw how it went in other places and now we're going to find out whether that was to really do it right or whether that was you know just because it was difficult to deal with so um anyway I think I'll wrap it up there because I want to make sure uh we can get to the rest of our coalition happy to answer any questions um and yeah I just want to underscore something Graham said as well about equity being a leading consideration across all rules and regulations that are made in cannabis not something that just gets its own conversation on the side or in a vertical but as a horizontally applied analysis of everything going on so when we're talking about security what's the equitable approach to security when we're talking about water management and land what's the equitable approach to that and we're talking about licensing what's the equitable approach to licensing you know it's uh it's a shift in perspective but an important one if you want an equitable result at the end of the day so thanks josh I definitely agree that it's not going to be a one-size-fits-all type of situation we've got to pay special attention and take the extra step to dig into that nuance and recognize certain things need to look different for certain license types um pepper we're running a little bit behind so maybe we can save questions and perhaps follow up with you josh if we if we have them um I know we've got chris white I think you're you're scheduled to speak next with us and then Jeffrey after that I know we have Dave silberman coming right around the top of the hour and I mean hopefully Dave is a little bit flexible and we can start his perspectives around 1105 but um or so but chris um thank you josh appreciate it um thanks chris if you're if you're with us feel free to turn on your camera hey guys I'm chris white nice to meet you start nice to meet you um first of all congrats to you guys you guys are feeling a very um historic and important role and uh you're appointed officials you know you don't have constituents so consider that a luxury as you do your your your deliberations and I have complete faith in you guys um like you're here doing the thing you're supposed to do already listening to all of us talk so good job by you I'm I'm I'm super positive about this um and I hope to to meet you all some someday in person um I just want to second everything everyone said I'm not going to talk about policy or I think a lot has been said that I agree with um as a farmer and a small business owner and somebody with like some creative capital I would really appreciate the opportunity to sell my own products and educate people in my own way with my own words and my own spirit and and my passions and um people are gravitating towards my farm because of the message that I'm able to tell and and the feedback I'm getting is like oh this is a little different this really this feels like Vermont um and I I'm I'm I'm over the moon about the opportunity that is here and I just really hope that we can focus on uh agriculture cannabis being an agricultural commodity because um the ancillary benefits of agriculture extend far beyond what's what's valued on paper and I think right now uh you know we do live in in kind of an oligarchical society and a lot of people are looking for that value that's not on paper and and in a lot of ways farms and creative diversified farms are providing that and people are curious so Vermont does a big thing uh protecting its its farmers and I think we need to continue doing that in in in in uh cannabis um I think whoever came up with the term cannabis control board did you guys a little bit of a disservice I think you're really the cannabis access board um and I would encourage you and all of your deliberations to consider that word almost like a meditation like like are we gonna are we gonna allow this at farmers markets like access you know like just think about it because if you if you approach it from the control perspective you're approaching it from that historical or that historically um negative perspective where we have this incredible opportunity to be positive and know that everyone involved uh is a positive uh community someone who's looking for positive community action um and the people who aren't are are are probably out of state large actors um and just one factoid that I wanted to bring to the table just to sort of illuminate the the agriculture nomenclature versus commercial nomenclature and when you emphasize one you devalue all the ancillary opportunities that are associated with the other being agriculture that are not associated with commercial like as josh was saying there's sort of two sides to this there's the profit seeking and then there's the ancillary value creating and vermont you know people come to vermont to get away from you know the first one to find the second one and um and so one acre of cannabis uh can sequester 4.2 tons of carbon uh per ounce uh of indoor uh cannabis creates the same amount of carbon as a full tank of gas so cure leaf has a hundred thousand 100 thousand square foot facility that's a hundred thousand uh full tanks of gas um if you do the math you know I think the assessment of the CEO of cure leaf that vermont's not going to be able to do this without them from an environmental standpoint it might be the other way around I don't think that they're going to be able to sustain their business in a healthy way for people the way we're trying to do it without these uh unlimited amounts of one acre gross which actually sequester carbon so if it's about economic opportunity create access if it's about uh environmentalism uh give us the the uh the breaks that farmers are getting because we need them because farming is very expensive so uh that's that's my piece and I just want to say thanks for having me thank you so much chris really appreciate it in the interest of time again chris maybe we can follow up with you if we have any questions I do agree words matter put people put a lot of credence in words in words shape the way we think about things so I appreciate that um let's move on to jeffrey just because it's 10 53 and I know we're running a little behind schedule jeffrey are you are you with us there he is good to see you again hi there hi kyle uh can you guys hear me okay yeah excellent sounds good um thank you chris uh thanks for taking the time out of your busy life uh as a small farmer uh to share with the board thank you josh graham stephanie and kendall um as the trade association for kind of professionals in vermont uh as a member of the broader coalition that graham alluded to um we hope to continue this level of engagement uh with the board local kind of professionals not just today uh but throughout this entire process um so thank you uh thank you chair pepper uh kyle and julie members um thank you guys for allowing cultivators uh the space to speak today I've been heartened by many of your statements and the inclusive process you have begun with this new agency um after not finding much success uh as graham had alluded to and josh spoke to this as well uh arriving at equity in the state house with legislators over the past couple of years we are hopeful I want to trust that we are hopeful that this new agency will foster a more inclusive process and steer vermont towards an accessible and uniquely vermont marketplace uh and I think that's important and I would stress that as a theme a uniquely vermont marketplace um I want to stress also uh that this is not just an opportunity for vermont and for vermonters uh this is an opportunity for you individuals uh for you as a board um this is an opportunity for all of us uh you can help bring us to market you can help us arrive at it successfully uh it's successful equitable a crack centric and a world recognized marketplace that's ultimately what we're seeking here that is our outcome uh so this is also your opportunity as well uh for the record uh just uh some introductions we're sort of the new kids in the block here um my name is jeffrey pizzatello I'm the co-founder and executive director of vermont gurus association uh I'm a professional kind of scorer myself uh I've also been a registered caregiver in our vermont marijuana registry since the program has been operational uh that's 2004 when douglas enacted s76 for those who were around back then uh I also helped bring ssdp to uvm uh which is a personal uh moment of pride for myself uh ssdp is students for sensible drug policy it's part of the drug policy alliance um that's important to me we had bernie as a gas way back then so again that's a little personal win for me uh a good moment in my life um I've been advocating and growing for over two decades uh personally uh I'm a knf cultivator that's Korean natural farming and I practice polyculture that's not monocropping like many farmers in this state um and by the way that is not only one of the most environmentally friendly ways of cultivating cannabis indoor and outdoor uh but as kendall mentioned um so eloquently it would be nearly impossible under the regulations uh under act 164 currently as it stands um so a little bit about bj really quickly um bj is the trade association for vermont's cannabis professionals our dues paying members reflect every corner of the industry uh from producers to retailers the entire supply chain uh it is their voices that we feel should be leading uh the conversations around defining and forming the adult use marketplace uh think of us as the vermont brewers association back during the 1990s when greg newton organized the local beer industry to create effectively the beer industry the marketplace we have today um bj formed in march 2019 and since then over the short few years together with advocates across the state and with our coalition we've managed to materialize some actual equity for vermont's so for instance last year we doubled the craft cultivation uh canopy size from 500 to 1,000 crucial for our cultivators um that was s54 last year fast forward to this year we developed retail opt-in language that begins to remove the head start or what we call in the industry the first mover advantage that corporations currently receive under 164 um we're happy to report that burlington and several other municipalities across the state including s6 junction which is looking into it now in colchester are passing this language um that's important uh and in that process our organization has brought awareness um to the vermont cannabis community uh and in aligning and identifying our shared interests as a collective vermont's voices are vital to the development of vermont's adult use marketplace that's why we've created an annual policy survey to ask local consumers and business owners what they want for regulation what works for them what types of licenses they want how much should license fees be uh we have consumer behavioral data sets about wherever monitors would rather purchase cannabis cannabis related products what obstacles small businesses see before them to reach market how they envision the marketplace uh i wasn't all of you guys uh the data sets from our 2019 and 2020 policy survey we're on our third year for 2021 we we run at the end of the year for the next subsequent session um but just to give you guys a preview of some of the the data points that we are looking at and that have informed some of our policy that you've heard already um 85 percent of consumers would rather purchase cannabis and cannabis related products from a locally owned business than a corporate outlet 85 percent and by the way this sampling is just under 500 individuals across the state 65 percent of respondents say independent testing is important to purchasing a product 78 percent of local producers would rather sell their products directly to consumers than wholesale them 78 percent of local consumers would rather sell their products directly to consumers than wholesale them 1200 square feet is the average flowering canopy size for our legacy gardens right now 1200 square feet that's what informed our case study to push 500 to 1000 square feet last year um and lastly just a little sampling here um laws and regulations which include licenses themselves uh small businesses tell us across the state are seen as the biggest obstacle for entering the market so 89 of small business respondents say regulation not financing not time not experience not skill but regulations and licensing is the largest is the most important the biggest obstacle for that when it comes to reaching market policy that you've heard already i was getting some feedback there if anyone else thinks that way anyway i'll continue uh so uh chair pepper has said several times now uh to the effect that no state has gotten it right yet um so we urge you to stay open to stay receptive to new and unique ideas and concepts that other states have not explored yet i just want to underscore that um when we're talking about arriving at a uniquely from marketplace that is critical um no state has gotten it right yet uh 164 currently includes as Graham uh and my and josh my colleagues have mentioned uh 164 currently includes racial economic medical and agricultural inequities that s25 which was recently enacted does not address uh and in some cases uh it even compounds some of those inequalities i want to take a moment to stress that racial equity cannot be compartmentalized into a single priority or social equity especially when it comes to the issue of prohibition uh and that equality must be first recognized as systemic and therefore foundational to every policy and every issue before the board um today we are here to discuss small growers and transitioning for monitors out of the legacy or traditional marketplace um and as it stands today uh it is a challenge for most local cannabis professionals uh as um has been echoed uh earlier today to see themselves in this new law i will be clear and i will be brief um specific to small growers and businesses we need equitable licensing production caps uh the thc caps removed the prohibitive product uh language reformed reasonable testing reasonable advertising reasonable security and of course agricultural regulations that are farmer friendly uh zoning and other parameters that have been mentioned today uh for licensing we propose a uniquely vermont licensing structure as my grand uh as uh grand had uh eluded to uh our craft licensing tier uh is a rolling licensing system with reasonable fees and costs that came from our policy survey so we took uh the data sets that vermonters shared with us in terms of what they're able to afford and what they envision for this marketplace and we uh explored what other states do we connected with other uh advocacy and organizations in say california or again pennsylvania and massachusetts main for years now and we arrived at what we think is the uniquely vermont uh system this is similar to uh you know uh alcohol and raw milk it is a rolling licensing system and i would urge you guys to explore this model um what we see in other states when states pick winners and losers the licensing structure uh small businesses always lose out so we uh want fair competition let the market decide the winners here um and i just want to say no matter the fee structure that you guys do arrive at uh it should be much less than whatever is proposed for the integrated licenses so just keep that in mind um vermonters see this uh and that's important to us there are rumors going around that the retail license is going to cost upwards of $100,000 that is unacceptable um we urge you to look at oklahoma and delaware their legislation does not include first mover advantage at the licensing level corporate led marketplaces have demonstrated they create inequalities and fall short of viability act 164 is currently a corporate led market model um we change this by including vermonters more to statute with a licensing structure when massachusetts found themselves with the corporate led marketplace and its commission the ccc they were dragging its feet uh issuing licenses what did activists do to correct this matter they developed a new licensing type a delivery license they proposed it in statute and it is now seen as a natural success um so licenses need to be equitable um and to answer your question uh chair pepper from earlier yes uh unlimited licenses with a fixed production cap will absolutely be able to provide for the market uh vermont consumers and consumers from out of state we're actively providing for those individuals already so we just need to make sure that we successfully transition those businesses to be able to pay taxes and sell above board uh or again in other states have rolled out pretty relaxed licensing themselves uh just turning to some other states for a moment and they found themselves with market saturation um but those states did not have production caps so that's just some contrast for you guys learning from that lesson act 164 currently will allow for large inappropriate factory farm style production it will there is no production cap for uh rec licenses as you guys know for the integrated license holders um that is woefully inappropriate for vermont uh as kendall and stephan had raised uh these businesses grow at scale with environmentally unsafe techniques um so we propose uh licensing caps uh for indoor and outdoor production i believe grant had touched upon these so i will skip over them but if we for instance guys i want to say this if we uh do implement production caps that will diminish any sort of um corporate interest uh they will not be interested in investing in a state where they're capped at say 10 000 square feet indoor and 40 000 square feet outside it is your job to make sure that the licensing goes to the appropriate actors and to avoid shell companies in the games that we see in other states we are hopeful that you guys have the tools uh and the means to do so uh we just ask that we now complete the other end of this equation um just move on neighboring states don't have thc caps uh for years local businesses have been safely producing craft edibles and products in vermont using uh dosing standards that are uh widely applied in other states those dosing standards are prohibited under 164 for years consumers in vermont have been purchasing these products these safe limited dosing products these craft products that are made safely and responsibly these consumers these businesses will stay underground uh and consumers uh and tourists will not travel to vermont if these thc caps stay in place so i know this has come up we urge you guys to remove them uh direct sales are the quickest and the best means to arrive at a safe and secure marketplace to curb use amongst youth and then normalize the plant amongst society in the state uh uniquely vermont licensing structure and direct sales is also the fastest and the most viable path to arriving at a marketplace best prepared for federal legalization and guys this is going to happen sooner than we realize so what do we want to do you know ask yourselves do we want to spend a couple years uh with a corporate led marketplace uh where we slowly bring in vermonters over time which other states have shown to not terribly be successful or do we want to lead with vermonters and be prepared for say the eight million consumers that are beneath us in york state on day one um i just want to stress guys um last september uh the international drug policy consortium uh and i will share this link with you guys if we have that seamless report they work with the un they are a global entity they issued a long and thorough warning uh a warning to countries a warning to states and provinces and countries that there are efforts that in efforts to tax and regulate cannabis quote they say markets have been captured by corporations and are and are not set up to redress harms brought on by the war on drugs quote from the report communities that have borne the brunt of the war on drugs are being excluded from these legal markets not only does this mean they don't benefit from these critical reforms but these developments are serving to further entrench and exacerbate inequalities uh and again if you guys have not seen that report i will share that i think that is critical to the work that we do um and lastly i'll end uh i had more to say but i'm uh truncating some of my my statements i will leave you with this anecdote uh we all know hill farmstead if sean hill was forced to sell his beer at wholesale to a corporate outlet he probably never would have chosen to become a thank you for your time thanks jeffrey really appreciate it um i'll i'll certainly ask that you send us any data sets or our other studies or whatever the case may be our way we would love to see them dav silverman are you are you with us hi dav i appreciate i appreciate you being with us and apologies for running a little bit behind schedule but if you wouldn't mind introducing yourself i know you've been um fighting for this marketplace to exist for a number of years so we're looking forward to hearing from you thank you um thank you commissioner harris and thank you commissioners for having me here uh my name is dav silverman i'm an attorney in middlebury uh since 2015 uh and around the same time the chair pepper started getting involved in uh in cannabis legalization legislation um that's when i got involved as well uh working in the legislature trying to help them shape their uh policies and and uh wind the way through the very complicated politics of of uh getting us to where we are um and um you know uh we are where we are and uh now we need to figure out how to get this thing implemented and i'm glad you're uh you're having me here uh to talk about that uh and if it's okay i'd like to uh share some slides absolutely see are you uh are you a presenter now does he have that functionality i see yes okay what whether i know how to do it is a different story i get that so there's an up arrow right next to the unmute mute button the microphone and if you hit that up arrow a whole um all your desktop options should come up and you just got to select the one that has the slides yeah unfortunately i get the share tray and the share tray is empty um nely is there any way you could maybe put up the slides that i emailed you since i can't absolutely and that's uh that's sometimes an error i get if i just close the um the uh program that i wanted to share and reopen it sometimes that works but i've got your slides open can share them myself okay let me see if i can yeah why don't you go ahead and get them up so that we don't um waste time yeah sorry guys don't be sorry happens to me all the time too there we are um so uh the title is uh here we are we're talking about empowering legacy growers to thrive in the regulated marketplace and i think that's going to be um you know something that's difficult for for both sides uh you know legacy growers are are used to working in an unregulated marketplace and regulators are not used to working with um folks who have been um working in that sort of shadow economy um and so i have some uh some specific thoughts and suggestions to uh to go with to present to you guys we've flipped the next slide um i just want to present some uh very quick disclaimers uh first uh i do represent cannabis clients um but the opinions presented today are mine alone not those of any clients i'm not being compensated for the work in presenting this or preparing this uh that's a lobbying disclosure uh and finally while i am an attorney i'm not your attorney uh so nothing herein should be construed as as legal advice uh thank you next slide um the i've heard um you know your your statements in your previous meetings and and i'm really heartened by what appears to be some shared goals that we have which is to create a a regulated system uh for cultivation and sale that encourages existing suppliers to come into the market that enables fair competition that prevents big companies from monopolizing the market that favor small cultivators over large ones and and that promotes equity uh and environmental and social stability sustainability all of those things are really important um and we're driving my advocacy work leading up to act 164 next slide please act 164 gives the control board quite a few powerful tools i want to talk about four of them specifically today one will be the small cultivator exceptions powers that you have in section 904a the other is your authority to set licensing tiers under 901d2 the other is your ability to enable vertical integration and not just under the integrated license type combined with the one license rule and we'll talk about that a bit as well and finally a real passion project of mine has been limiting the impact of prior criminal histories and we've done quite a lot of work here and i think you'll find that there's some really powerful language in the statute to help you overcome the disparate impact that policing has had on on certain communities in Vermont next slide um the section um section 904a i've put some of it in front of you here gives requires you to make exceptions or accommodations where appropriate to small cultivators uh and there's some express legislative intent baked right into that um you want you are mandated by the legislature to encourage participation in the regulated market by small farmers you're mandated by the legislature to move as much of the illegal market as possible into the regulated market you're mandated to consider policies to promote small cultivators and and consider the different needs and risks that small cultivators present versus larger cultivators um and so those exceptions or accommodations are going to be really critical and thankfully uh next slide nely um your authority under 904a is almost unconstrained it does say 904a does say that you cannot grant those 904a exceptions with respect to environmental and land use requirements i do include a but there i want to get back to that other than that all it says is the those exceptions must be appropriate um that is your determination that is your right to determine what is appropriate acting reasonably in your enforcement discretion uh back to the environmental land use land use requirements while you cannot grant exceptions or accommodations under 904a that doesn't mean that you cannot consider the different needs and risks and that doesn't mean that you should stop um thinking about how to promote through policy when you're writing your environmental and land land use policies it just means you can't do 904a exceptions um and so for example when you're making recommendations to the legislature around land use you might want to think long and hard about how it is that we encourage small growers many of whom work out of their homes right out of barns out of basements out of maybe the an extra room how do we make sure that they can continue to do that because if we require growers to rent a warehouse or rent a commercial building or change the way that they do business out of their residences today they're just not going to come into this market um another big thing that i hear from multiple growers that i've spoken with is is if you make things too complicated for us we will not come um so step one is going to be making sure your applications are simple this is a lesson that i think you can learn from california uh their applications for small growers when they were trying to get you know the the the humboldt farmers to come into the market that so far they have mostly failed um in their applications you know there is a host dozens of standard operating procedures that folks are required to present and and these are you know when you're talking about a side hustle when you're talking about somebody who's doing this out of their home not as their primary business or maybe as their primary business as well they're not going to have these things ready and while certainly service providers like myself lawyers accountants consultants will be available why require something that is that is very expensive for folks who are you know by definition very small so i think it's going to be very important to keep these applications simple and and make sure that you're only asking for the information that is really critical for your licensing decision what do you need to know who owns this operation where is it what are you going to do there you know beyond that to get into you know what your human resources policies are and and things like that that that may be uh very important for large operators just becomes irrelevant and a paperwork exercise rather than an exercise in actually doing anything that helps consumers or helps transition small small farmers into the market i also urge you to think about through your policy making powers to stand up some sort of support infrastructure for small growers in licensing and in compliance with with your rulemaking some somewhere where they can call in and and get help on a you know non-enforcement basis on really just how can we the control board help you the grower succeed and also you have to keep fees low especially non-refundable application fees if those fees are high they will not come next slide please some things that some specific areas where you can do some nine or four exceptions i think to great effect are around your your security requirements and also defining what an enclosed lock facility is different growers today use different levels of security you know somebody who's growing outdoors you know maybe they're using their geographical security maybe they're just really far back from the road in an inaccessible spot somebody who's growing in the barn in their house in a residential neighborhood probably has cameras i would just urge you to not be prescriptive about the type of security and not require you know specific things like oh you have to have eight foot fences you have to have key cards you have to have cameras give people a menu of choices let them present to you a reasonable security plan rather than mandating a one-size-fits-all solution and think about how you can encourage greenhouses you know that is there's some great environmental gains to be had there you know you can extend the growing season without having to go fully indoors and using lights and think about how your security requirements might impact agritourism which i think is going to be an increasingly important part of small cultivators overall business model at least for some you know you'll have some folks will want to find a way to augment their wholesale level sales if they do not have a a retail license and another area and by the way feel free to jump in and stop me at any time if you have questions want to get deeper into any of this or we can talk some more at the end another area is around packaging and labeling you are required to put out some rules on packaging and labeling with small growers i really want to encourage you to allow growers to contract responsibility up the supply chain um if someone is growing strictly for the wholesale market making them be responsible for labeling their product for consumers is just it's nonsense they're not selling to consumers they're selling to a retailer who will sell to consumers or they're selling to a wholesaler and further on the chain and there's no need to make them incur the costs of you know these labeling machines or child resistant packaging they should just be able to deliver in bulk when they're going up the regulated supply chain testing um this is one where you know there's a real struggle here to there's a real conflict between wanting to make sure that what consumers get is is clean and safe which is a huge um priority of mine um but but also we have to recognize that especially early on we're going to see testing capacity be limited um you know i only know of a couple of labs in the state right now that are ready to apply for licenses and if you don't allow some flexibility for small growers in testing requirements you may accidentally be creating a bottleneck that really harms the small growers early on um and finally um think about exceptions to seed to sale tracking especially if you're going to mandate a costly software solution um and perhaps think about ways to not impose that cost burden on small growers whether by giving them exceptions or working something out with the provider so that the the licensing fee the software license fee is not borne by by small growers who really can't afford it and finally you know you see me underlining there at the bottom i once the state of emergency is over and once you guys can get out in the field and talk with people get out there talk with people not just the folks who are comfortable getting up here in front of you today but get out there and and visit hemp farmers cannabis growers and ask them you know show them what you're planning show them what you're drafting and ask them what they think uh before you get to the point of you know official public comment um next slide please um 904a has another provision that uh i think has not gotten enough attention uh it's a small grower jumpstart uh in subsection d uh subsection d says that upon licensing a small cultivator may sell cannabis to dispensaries this language it's unique to small growers it does not apply to other uh licensees so when when uh bigger licenses get start getting issued a month later in june uh this doesn't apply they can't start selling upon licensing they can start growing upon licensing but small cultivators can sell upon licensing and so there's some legislative history here um and and yes this language is a little obtuse but what's what it's intended to do is to provide small growers an economic jumpstart uh particularly when the initial retail market is small you're only going to have you know a maximum of five probably more likely three integrated licensees selling to the public plus the the other medical outlets that'll be it in terms of the market for the first five months that growers can sell into um and so the legislature wanted to make sure that small growers many of whom we know are already growing today can take advantage of this market immediately uh and in fact they reiterated this via s25 which i guess i should update these slides to reflect its new act numbers since it has been signed into law uh s25 created an affirmative requirement that the dispensaries must purchase from these 904a growers and you take that together the only reasonable interpretation of this upon licensing language is that you do you are not to care where this initial batch of cannabis came from and why it is that it took no time to go from seed to sale and so i really urge you to um to focus on this language and provide this economic jumpstart that the legislature intended by crafting a 904a exception to seed to sale tracking for small growers in the initial licensing phase next slide please this next topic the one license rule i call it section 901d3 um it does allow for vertical integration and not just under the so-called integrated license what it prescribes is horizontal monopolization and so a person directly through affiliates can have one and only one license of each type which means you can grow and you can sell uh either to retail or you can be a wholesaler or you can be a manufacturer you can have one of each of these licenses each license has its unique sets of um authority of what activities that are authorized but um you know if you decide to be a grower it doesn't mean you can't also be a retailer um and and it goes a little further it also says that each license only allows one location uh and the idea here was really to keep things small uh to avoid having you know what we've seen and there's a an actual chain called star buds uh in uh colorado and uh oklahoma uh last i checked they had 14 locations i don't know how they didn't get sued by starbucks for trademark infringement uh maybe maybe that day is coming um but that's not what we want here we don't want mcqueed we don't want star buds we want small local independent um and so this rule says um you are to look past just record ownership you're to look to beneficial ownership you're to look to affiliates affiliates are defined not as 10 ownership but also there's other uh non ownership or non 10 percent factors that could make someone an affiliate uh of another person um and so i urge you to take a look at this and think broadly about what are the indicia of control um in in the context of a a licensee uh whether that be that licensees executives and directors very common in a securities law context um i would urge you to set by rule uh that franchisors are deemed to control franchisees uh and that way you do not have franchises um i urge you to dig deep into um the corporate formation documents and demand that you see voting rights agreement and operating agreements that have perhaps uh corporate veto rights because um you know somebody with a nine percent ownership stake might in fact exert effective control over a company through voting rights or through veto rights uh and also look to management contracts management contracts are very common um or were very common in the medical marijuana space in Vermont um when it was initially only uh only non-profit companies were allowed to own licenses but those non-profit entities then entered into management company management contracts with for-profit companies that actually operated the the dispensaries um and you know you'd want to make sure that those sorts of uh relationships well you know maybe they're fine uh they're certainly controlling uh because you know a management company can direct the management or affairs of the licensee finally this is i think a lesson we've learned from Massachusetts is you've got to make sure that the public has visibility into this stuff um in Massachusetts you know they had a three license rule uh and the way it was put into effect I think was very ineffective nobody could really tell and I don't think they went into the beneficial ownership level either so they they didn't look to like you know trust and nominee arrangements and things like that um so I really urge you to require deep deep disclosure of beneficial ownership and other aspects of control and make that information public um I'll say this also on just the flip side of what I'm saying if you require public visibility of ownership information that may discourage investment right there may be folks who are willing to invest in this industry quietly um and who would not be interested in doing so out loud and I think there's a policy decision to be made um as to what's more important for you guys whether it's you know to make sure that people have ready access to capital in all its forms or whether public visibility is more important next slide um the act 164 uh has a few um just a few words about licensing tiers um you're required to uh set tiers for cultivators and you're required to set those tiers by size although not clear to me that you're required to set them only by size um and specifically I know you're hearing from intervail a little later today I want you to to think about how you can encourage that sort of activity um intervail style where you you can have a co-location of farms um I think that you know that this one location per license does not mean one license per location and um you know there there's some real opportunities for cost sharing uh for compliance cost sharing in particular uh if you allow co-location now um there are other license types not just cultivators that you can and in one instance must set tiers for you are required by law to set tiers for retailers but it doesn't say how or on what basis um so size yes uh but I think risk is is a much more pertinent factor uh when you're setting tiers uh and when I think of the risks the different kinds of retailers uh can pose well you know so there's consumable product product that you know for a lack of of better term gets you high uh intoxicating products versus non-intoxicating products like most topicals you know not transdermal uh THC but um you know salves and balms and things of that nature so for example um you know today yeah I live in Middlebury the natural foods co-op has a nice lock glass display with CBD products including CBD salves and you know these are high value products and it's a really nice way to sell those and and it creates a marketplace for our local hemp growers um you know that sort of retail activity is very different than selling flour selling edibles selling uh you know other intoxicating products and you might want to think about in fact I really encourage you to think about setting up a tier of retail license for non-intoxicating products that can be very low burden very very low burden because they're non-intoxicating products also seeds and clones and starts um you know that's that's that's a different risk level than a full-spectrum retailer let's say and also less profitable right so you know you think about um you know I I go to a greenhaven nursery uh to get my vegetable starts uh maybe I can also go there for a cannabis start or maybe I can go to the local grow shop uh for a cannabis start um or or my seeds um I don't necessarily need to go to the store where I also buy my edibles or my dried flower uh and finally there's got to be a way there has got to be a way to get cannabis into the small rural general stores that are dying all over the state uh help us preserve this like small town commercial heritage uh allow them to have some kind of cannabis corner uh you know figure out a way these people they sell beer they sell wine they know how to check ID but um figure out a way to to have non-monoline retailers um especially uh ones that that we want for historical preservation reasons um you are not mandated but have the discretion to set tiers for manufacturers and wholesales wholesalers as well um when I think about manufacturing tiers I I I really want to think about risk um and I I think there's a different risk level um that extractors pose versus people who take extracted product uh that they take oil or uh or or concentrates and use them to make another product um and those are I think two very different license types uh in terms of what kind of regulations are going to be applicable to them um and there's probably room for different tiers of extractors as well uh because someone who's making bubble hash is going to be presenting a different level of say fire risk than somebody who's using ethanol extraction or butane extraction which is not legal uh so you don't really need to deal with that uh for wholesalers uh one one type of wholesale tier that that that comes to mind is is a grower co-op wholesaler uh so this would be a wholesaler that primarily buys from its member owners and and and then sells it on into the retail market you know that allows small growers to increase their their pricing power by working together and not not competing with each other um and I think that's something that we really ought to encourage uh kind of goes along with the the interrail style approach uh and when you set tiers you know you can absolutely vary your regulatory burden based on tier um but you can also vary your fees and I think that's going to be very important and and when you think about fees please think about not just size but but the type of of entity and and what kind of profitability they're gonna have so for example with with cultivation you know your indoor license fees could probably be three four times higher than your outdoor license fees um because that's you know they're gonna get three four times as much product uh growing indoors uh versus outdoors just giving our short given our short growing season next slide hey Dave Dave I hate to I hate to interrupt just just wanted to let you know that I know you started about fiveish minutes behind schedule but we're um if you you could try and expedite so we can get our last speaker in before noon that would be fantastic but um I really want to hear the rest of your presentation but I'm just giving you a couple minute warning how about that perfect because this is my last slide all right there we go finally here look we um we I worked very hard on this language that you see in front of you in the first bullet point um you cannot deny a license or a work permit to someone unless they presently pose a threat to public safety or the proper function of the regulated market uh this language was put in in the center judiciary committee February 2019 um we worked on this language to focus on the threat of violence uh in the industry um and to um uh root out organized crime influence uh but we absolutely do not want to perpetuate the well known well understood well demonstrated systemic biases the in the in the policing and prosecution system and we know that you know if you are a black or brown for mantra you're three or four times as likely to be pulled over by police officer you're three times as likely to be searched once you're pulled over even though you know you're about one third as likely to have contraband on you and uh you know those biases just continue through the charging decisions to judges insurries and the end result is that that Vermont has the absolute worst in the country racial disparity in its prison population um and so you know it's really important that you not use this bias to make a new one or to further perpetuate this bias by denying people with criminal histories licenses or the ability to even work through a permit in this industry um and and so we've made a lot of progress uh we've we've passed a law requiring the automatic expungement of cannabis misdemeanors but you know there are many many existing growers who have records that are are still not eligible for expungement whether because they're federal records or because they're uh they're felony records um and we want those people in the industry um and in fact if if we exclude them from this industry what will happen is that this regulated market will fail uh because the folks who are out there growing will just keep growing uh they just won't be growing into the regulated market um and so you know when you make your policies around uh you know what is a present threat to public safety um please don't be broad here uh be very specific and be very narrow um and and let people get into this unless there's a real real present risk um so that's it next slide is just my contact information and uh any questions happy to answer thank you so much dave really good stuff here um pepper julie any questions before we move on to our last speaker before a public comment uh i do have a question um dave thank you for that presentation i particularly enjoyed um slide nine i believe it was around 901d and the recommendations you made there about uh ownership um and how we can vet that um that was my original question that i had written out and then here was slide nine there was but um uh i just uh of course would love to talk to you at criminal history records don't really have the time for that um i wanted to ask you about the legislative history behind um the prohibitive products um and the concentrates and the thc caps in particular we've heard from a number of people that that's just going to perpetuate a black market or an illicit market for those types of products um but i also know when the legislature has you know they'll create a study committee for things that they're open to then they'll have prohibitive products for things they're not open to um so could you just talk a little bit about the legislative history behind those two in particular the high thc or the thc caps or limits and the concentrates and why those were you know um kind of explicitly prohibited there's um i think two different um topics here one is sort of thc caps on edibles the five milligrams per serving um you know that came out of house government operations uh we had talked about um you know 10 milligrams which is what most states do five milligrams which is what massachusetts uh uh does in fact i passed around the table uh some edibles for massachusetts that i picked up the week before my testimony and uh you know folks were uh you know these folks in the committee do not have a whole lot of experience with with cannabis and so they were able to see and touch and smell none of them uh eight as far as i could tell so that was good because it you know trying to be professional here um and um so uh you know the discussion kind of centered around well this is what massachusetts does the the five milligrams per serving uh and sort of you know massachusetts was the closest market to us you know washington colorado california were all 10 milligrams um and uh you know they're kind of far away um so that's kind of where that came from um the uh the the prohibited products uh the 60 cap on solid concentrates uh that came from uh the the health committee the house committee on health um there was a lot of concern there uh there also the 30 flower cap came from there there was a lot of concern uh you know from the medical community uh aired in that committee uh and originally they proposed a 15 cap on flower um and we talked with the committee about how that you know really would leave very little existing market uh in the regulated market we showed them for example from the medical dispensaries uh well over 90 percent of their sales of flower was for flower over 15 percent and so they they understood uh and and i think they settled on 30 percent because that really does start to approach just sort of the natural maximum that that the flower can produce uh you know the some growers may tell you oh you know i can go higher than that but but really can't get much higher than that um and so that's where the legislature um kind of settled on that one um the 60 cap on concentrates there was a really a lot of i think well meaning but perhaps under informed concern uh around what high thc concentrates do to users especially novice users and uh you know whether they are more addictive and you know i was in the other side of of this in lobbying i didn't want to see these caps because i i do think that the more you exclude from the market uh a product that is popular um the more likely it is that that the consumers who want that product will just continue to get out from their existing sources um and and that's not what we were trying to do here uh but the legislature chose a 60 cap on solid concentrates and that's solid only right so that's not liquids that's not oils um it's solids um and you know in s25 you were asked to to recommend something on that as well uh whether that solid concentrate cap should apply only to end user products uh or also to intermediary products and and i really urge you to to to ask the legislature to shift their thinking at least on that intermediary product uh because you know what what we see is uh you know solid distillate a powder distillate is a popular um manufacturing ingredient um and so some edible products um you know you don't want to put oils in them um and uh so the this powder distillate is is what has sort of come into the market uh in other states uh gummies for example um and so if you require manufacturers to dilute before they sell and then require then have bakers like undilute while they're baking right or whatever to take the water back out that doesn't make a whole lot of sense um and it just adds cost uh and and creates an opportunity for somebody to violate the law um without providing any consumer safety when at the end of the day the product that they're going to sell is going to still have to comply with all of the other requirements like the five milligrams per serving so i think again what the legislature was really concerned with was you know uh dabbing you know they keep hearing these these these like really scary words dab shatter you know um and they don't know and they're not really experienced um you know i can i can think of maybe two people on that committee and the health committee who might actually have some personal experience with dabs um and um you know so you get suboptimal policy that way um but in your recommendations i would really urge you to um to at least get them to list that cap for the intermediary manufacturing products thanks for that thanks dave so dave really appreciate um your your your time with us this morning it's been very helpful and i look forward to continue to hear from you moving forward thank you very much appreciate the time no problem next we have jehala dudley jeffrey i know that your hands up unless you did that unintentionally i would really like to save comments you may have from any presentations to be heard in our public commenting period because we're running about almost 20 minutes behind schedule i understand i really appreciate i just want to bring up one clarity with what that previous guest had said guys there there really is no um natural ceiling for thc levels and plants and i would urge you guys if you do have the industry uh questions to turn to different macros association our constituents are the industry players in the state so i just want to bring up that point of clarity uh thank you thanks jeffrey um jehala nellie tells me that you're with us on the phone um and if you're muted oh okay you know how to unmute great sometimes that can be a challenge yeah hi everyone um sorry i can't join via video um i just moved to plain field and my my internet's pretty sketchy right now um but i thank you for taking the time on the phone yeah um i'll be pretty quick uh probably a little bit of a broken record but um just to introduce myself my name is jehala dudley i'm an owner of foxholler farms i've been in the cannabis industry for almost seven years or so in policy and growing in regulated markets in colorado and regulated markets here in vermont and also my personal experience as a hemp farmer um so i i guess i'll say second you know just to refer to section 904 um it was the intent of the general assembly to encourage participation in this market by small local farmers and as a small local farmer um it felt like the bill that was or ended almost everything but however i will acknowledge that the legislature put a lot of onus on the board to look into these barriers for small cultivators and as dave said make sections accommodations recommendations to support you small growers and farmers so i thank you guys i thank james kyle and julie for arranging with today because it's so important and um you know i so appreciate that you're listening to our concerns and can move forward with them in mind um i'm going to refer to a letter that i that myself and 60 small growers signed and wrote to the legislature back in february of 2020 we outlined a bunch of these concerns that we've been speaking about today and i'll pull right from that letter um my first concern in terms of barriers for farmers to join this market is just that the ability for us to join that market um in act one 64 there's a couple places where the wording talks about cannabis not being regulated as farming and cannabis produced from cultivation shall not be considered an agricultural product or crop so unless a small farmer or a small grower is zoned as industrial commercial or not zoned at all there's an immediate question mark in a barrier as most farmers in the state of vermont are farming on agriculturally zoned areas they are then at the whim of the town zoning officials to hopefully make a quick decision to allow them to cultivate and as a lot of us know zoning decisions are not quick um and i will add it's more than just a barrier it's an unknown it eliminates farmers ability to plan it leaves um our hopes to participate in this market on a town timeline to get together and decide on zoning rules um and just you know thinking about how that's been going with retail it's a process um the second thing i was actually thinking a lot about this this morning i took out a ruler and i measured um what would be a thousand square feet and i thought about it um i thought about it like a farmer would think about it and it was this you know we think about our inputs and our outputs the cost of our inputs we calculate nutrients media cost equipment labor etc um and just like any business then we calculate how much we make when i calculated the thousand square feet and i was visualizing where i would put my plants my vegetative zone my flowering plants my clones my stock plants my drying and curing facilities and the cost of doing that and the viable pounds that would come from that and be sent then to a retailer um when i do this as a farmer when i do this with other crops like my tomato crops my flower crops every year at the end of the year and figure out how much they've made i then go on to cut what crops i should not continue growing because they're not making me money and on a thousand square feet i would cut the cannabis crop after the first year or i would likely you know continue to grow that crop at a loss hoping that one day i can get a larger license um so that's just the barrier i would like to point out and i know that's been already said and then um the last thing i will just touch on are the timelines and although you know i'm super happy with the legislature for accepting small cultivator licenses sooner than other licenses you know the idea behind that was amazing but for me it feels like the efforts are in vain as the only outlet for those sales are through integrated licenses for the first few months of the market so you're leaving my ability to sell my product in the hands of my competition a competition who has actually been legally ramping up production the last three months before licenses are even granted to them so that they can have their own you know their their own production line um so that is also it just feels like an unknown there you know the way my product is spoken about the way it's priced the way it's sold it's no longer up to me so at that point at that point you know do i wait and lose five months of a new market because i don't want to sell directly to my competition or do i hope that my competition accepts my product and treats it and treats me with respect so you know if i'm if i'm going to sell my tomato crop i'd rather sell it to the local co-op than to the shaw's and that's you know that's just for me that that feels like a barrier um to have to sell to the competition um and then and then i think that's it because the last point i was going to make is just um you know the thc caps on the flower i do think it's going to be really hard to eliminate the dark market without that people want the products they want so we're going to either regulate it or we're not going to regulate it and um yeah that's all i have to say and you know there's lots more but those those are my biggest just my concerns of you know the perspective of me as a farmer trying to join this market one day pepper you got a question uh jehala this is uh james pepper here um thanks for joining us and uh thanks for all the advocacy you did on act 164 um my question really comes down to we're we're trying to i think crack this night of prioritizing small cultivators while also providing a tested you know clean pure product in the market and i just you know i i just don't know how we get around the kind of testing bottleneck that we keep hearing about and i was wondering maybe if you could speak to that a little bit maybe from your experience in the hemp worlds or or just you know what is the kind of minimum level of testing that you think that we could require that would allow participation from small cultivators and still maintain that kind of consumer protection aspect of this that's so you know underlying the the purpose of this law yeah that's a tough one because it's you know as a hemp farmer testing is super expensive um and you know i think some of the language talks about every bastion needs to be tested um as a consumer i won't like i want to know what's in my product i want to know the percentage of thc um but if you're asking a farmer to make you know 20 to 40 tests on a crop every session that's it's just not going to be affordable um i don't know how to answer that question james but i might i might think about maybe making a larger plan to have a have a more robust state lab i i was gonna say yeah i was gonna ask is it is it do we request more investment in the state testing capacity to kind of even do like mobile testing i don't even know if that's a possibility but i'm just curious this is an area that i feel like we need to really drill down into yeah i mean if testing is going to be a requirement and it should um you know if i if i don't care about what's in my product i i'm going to keep going to the dark market but i but i want to care about what's in my product so i'm going to buy it legally um yeah i think it's just a resource problem at that point you know i i you know the state lab has a pretty small capacity right now i i think the legislature should really be thinking about ramping up that capacity um so they can act as a third party and state regulated testing lab um and then maybe just making it more accessible for smaller testing labs to move over to the thc market um but yeah that's a difficult one because it is really expensive jayla bouncing off this conversation and a word or phrase that you just use there is what i've been um figuring out the best way to ask which was third party and i know depending on your size and your scale it's hard to really bring your own you know labs are can be cost prohibitive to bring into your business you know um and have your own type of testing lab i would imagine though yeah if you do if you do make that investment you balance that versus how much it costs to get third party tested and depending on our regulatory structure depending on other third party certifications that a certain business might carry from a organic or sustainab