The Daily Hit is a recap of the top financial news stories for Wednesday, December 11, 2024.

On the Site

Berkshire unit seeks dismissal of Trulieve’s insurance coverage case over worker death

Berkshire Hathaway’s insurer says the worker’s death falls outside of Trulieve’s $3.1 million policy with the firm.

Read more here.

Tilray AMA: Cannabis beverages offer the biggest opportunity

The company’s chief financial officer also fielded numerous questions regarding the use of stock to pay debts and its plans to reach profitability.

Read more here.

More California officials caught in cannabis bribery cases

Newly unsealed court records reveal that Baldwin Park officials were soliciting bribes for supporting companies.

Read more here.

Weedmaps to more than double its outstanding shares to raise $224 million

The regulatory filings also provided a glimpse into the inner workings of the company.

Read more here.

Minnesota cannabis regulators scrap lottery for standard licensing

The state will maintain its 50-50 split of licenses between social equity and general applicants.

Read more here.

FBI raids office of Michigan cannabis businesses’ minority owner

The legal troubles will pose a test for Michigan’s Cannabis Regulatory Agency.

Read more here.

In Other News

Cannabis advertising

A Vermont cannabis company is suing the state over advertising restrictions that it claims are free speech violations.

Read more here.

CBD Life Sciences

CBD Life Sciences announced its intent to acquire a cannabis growth license in North Las Vegas, a move that positions CBDL at the forefront of Nevada’s thriving cannabis cultivation market, which is projected to surpass $1.3 billion by 2025.

Read more here.

From the arrival of a New Jersey shop co-owned by a member of the Wu-Tang Clan to a dispensary located just minutes from San Francisco International Airport, here are the notable new dispensaries that opened in the past month.

Got a new shop? Put it on the map. Visit Leafly Success to advertise. 

California

Embarc—San Bruno, CA. Opened Nov. 15. Travelers of San Francisco’s SFO Airport had early reason to give thanks with the opening of San Bruno’s first dispensary — located just minutes from the bustling international travel hub. In addition to its sublime convenience, the location means Embarc now has an impressive total of 16 dispensaries across California. 120 El Camino Real, San Bruno.

The Showcase—Fairfield, CA. Opened Nov. 27. Located east of Vallejo, the Showcase provides Fairfield customers with a wide array of top-shelf cannabis products. Proving its name is no fluke, Showcase stocks premium flower, edibles, and more. They also offer a Compassionate Use Program in addition to a menu stocked with daily deals. 101 Grobic Ct, Fairfield.

Colorado

The Buzz—Grand Junction, CO. Opened Nov. 9. The arrival of the Buzz makes a total of seven retail dispensaries now operating in Grand Junction, Colorado. Family-owned and operated, The Buzz — the chain’s fourth store to open thus far — boasts a menu of unique strains at “competitive prices” made even more convenient thanks to the store’s drive-through option. 1022 N 3rd St, Grand Junction.

Connecticut

Sweetspot Farms—Stamford, CT. Opened Nov. 11. Founded by two Stamford natives, Sweetspot Farms prides itself on its “community-focused values, local discounts, and a commitment to consumer education.” Sweetspot’s second location also features an “innovative digital bud bar” and “licensed pharmacists on staff and available to answer questions.” 111 High Ridge Rd, Stamford.

Illinois

Mystic Greenz—Belleville, IL. Opened Nov. 6. You can cross Belleville off the list of cities in Illinois without a cannabis dispensary. Since early last month, Mystic Greenz has saved locals the drive to Collinsville or Sauget by offering quality cannabis products in Belleville proper. The location is the fourth for Mystic Greenz and is run by store manager Tabitha Brinkman: a lifelong Belleville resident. 360 S. Green Mount Rd, Belleville.

Massachusetts

EMBR Cannabis—Springfield, MA. Opened Nov. 27. More than $2 million was invested to build Springfield, Massachusetts’ first dispensary fully constructed “from the ground up.” Now open for business, EMBR represents the final product of a reclamation project that saw a long-time vacant lot transformed into a new dispensary that is also set to feature new green space in the form of a forthcoming “pocket park.” 461 Boston Rd, Springfield.

Michigan

Mango Cannabis—Lansing, MI. Opened Oct. 21. Known for their chain of medical dispensaries in Oklahoma, family-run Mango Cannabis has expanded to Lansing, Michigan to open its first retail location. With a second store set to arrive in Waterford early next year, Mango Cannabis is landing with a splash in the form of a new, 4,000-square-foot “flagship superstore” that features “sleek design elements” and an “intentionally minimalist layout” intended to “showcase products as the focal point.” 5620 South Cedar St, Lansing.

Simply Loud—Detroit, MI. Opened Nov. 1. Detroit’s newest dispensary is proudly Black-owned and absolutely stocked. Visit Simply Loud and choose from hundreds of products, including “260 types of vape cartridges and disposables” and “150 kinds of infused prerolls” while enjoying an interior “unlike any other dispensary in metro Detroit” complete with “stylish Herman Miller furniture” and sculpture work from local artists. 216 E. Milwaukee Ave, Detroit. 

New Jersey

Hashtoria—Newark, New Jersey. Opened Nov. 13. It was a true party at the grand opening for Newark’s newest dispensary, Hashtoria. That tends to happen when your shop is co-owned by Wu-Tang Clan’s Raekwon and Charlamagne Tha God, who both turned out to celebrate the debut of an adult-use cannabis retail space which is set to “evolve into a premier consumption lounge” early in the new year. For now, customers can enjoy loyalty rewards via the Hashtoria app and marvel at the physical space: the result of a collaboration with award-winning architect Rachael H. Grochowski. 799-805 Broad St, Newark.

Main Street—Highland Park, New Jersey. Opened Nov. 22. Main Street was created “with the intention of bringing a truly local feel to the cannabis business.” That makes sense considering the store’s owners include both second-generation and third-generation Highland Park residents.  Providing an “upscale establishment” located in the suburbs of New Jersey, Main Street’s menu features a curated list of premium cannabis products available for purchase seven days a week. 311 Raritan Ave, Highland Park.

New York

Northern Lights—Canton, NY. Opened Nov. 14. Northern Lights is a family-owned and operated dispensary named for its location in northern New York. Serving residents of St. Lawrence County and the greater Canton area, Northern Lights offers a menu ripe with all the latest brands to hit the market. The dispensary’s current offerings include premium products from the likes of Camino, Jetty Extracts, and Rolling Green. 51 Main St, Canton.

Strain Stars—Riverhead, NY. Opened Nov. 29. Clocking in at an impressive 14,400-square-feet, Strain Stars’ new location in Riverhead marks the second store for the chain previously credited with opening Long Island’s first dispensary — in Farmingdale — last summer. Strain Stars also puts a big emphasis on local community, having recently donated $100,000 to Farmingdale State College to help establish a new endowment. And get ready to browse because the Riverhead location boasts “nearly 2,000 products, including flower, concentrates, edibles, topicals, vaporizers and accessories.” 1871 Old Country Rd, Riverhead. 

Did we miss any? Leave a comment with a new one.

Got a new shop? Get it on the map. Visit Leafly Success to advertise. 

The California cannabis industry is increasingly underwater with its tax bills to the state, and it appears that the primary tax authority wants to ensure more effective collections.

According to the California Department of Tax and Fee Administration, the state industry’s total outstanding tax tab neared $1.3 billion as of Oct. 31. The figure represents “the total accounts receivable for cannabis excise tax and sales and use tax accounts for known cannabis sellers,” including all unpaid taxes, penalties and interest, the agency wrote in an email to Green Market Report.

Taxes, interest and penalties from audits alone make up $727.7 million of that, the agency wrote, dating back to 2018. Another $354.4 million in reported but unpaid excise, sales and use taxes are also part of the total.

That’s up from an outstanding balance of roughly $287 million in February. It’s also up from the estimated $732 million calculated by GreenWave Advisors in April, of which 72% was owed by  companies that were already out of business.

No easy answers

The ballooning tax bill could explain why scores of licensed California cannabis dispensaries in the Los Angeles area recently received notices from the CDTFA stating that their mandatory tax payment schedule will change from quarterly to monthly, which has caused some alarm, according to industry sources.

However, operators can contact the CDTFA by Dec. 1 to request their payment plans stay the same, the agency said.

Dispensary owners began receiving the “Notice of Change in Reporting Basis” letters around Nov. 1, according to Jerred Kiloh, owner of The Higher Path in L.A. and president of the United Cannabis Business Association.

One such notice, shared with Green Market Report, states, “The average tax liability you report is at a level that will change your reporting basis. As a result, your reporting basis is changing from quarterly to monthly, effective January 1, 2025.”

CDTFA Notice of change 11.7.24_Redacted

“My members are worried that they have to pay this new reporting requirement,” Kiloh said. “We’re using that to buy products and sell them to float our debt.”

One member’s reaction was to simply declare that he’d close up shop in January if he was going to be required to remit taxes every month.

“That is how slim the margins are in this industry, that we’re utilizing floated tax dollars to buy products to put on our shelves to sell so we can afford to pay the taxes,” Kiloh said.

Kiloh said he tried calling the CDTFA to request that The Higher Path remain with quarterly payments, but the staffer he spoke to was unaware of the notices.

“I had to go through three different departments to finally get to an adjuster, and that adjuster still didn’t know what they were doing. So this is a problem. So even if you call, there’s still no clear path to an answer,” Kiloh said.

Kiloh said Thursday that he’s still awaiting clarification from the agency that he can share with UCBA members to put their minds at ease.

Business as usual?

CDTFA clarified to Green Market Report that there’s been no change in policy as far as marijuana tax collections from retailers and said notices were only sent to “affected taxpayers.”

“CDTFA’s general guidelines for changes to filing frequency can be found in our Compliance Policy and Procedures Manual,” the agency wrote in an emailed statement. “If taxpayers have questions about their accounts or a letter they received from us, they can contact our customer service center at 1-800-400-7115 or their local CDTFA office.”

Cannabis tax attorney Regina Unegovsky said she can’t say that’s an industry-wide issue, but she’s helped several clients through the process to maintain their quarterly payments.

“In the past, whenever any given business reaches certain reporting volume (i.e. sales) then they get switched from quarterly to monthly,” she said. “It used to mean a good thing – that the business has grown. These days, I get it – it’s so much tougher on compliance time.”

“Long story short, I have been able in the past to have the CDTFA back off on the change for a bit to give the taxpayer time to adjust or back off completely as well,” she wrote.

Kiloh said that he thinks it’s a trigger within the state tax code that led to the confusion. CDTFA has the option to such a switch payment schedules from quarterly to monthly if a business owes the state more than $20,000 a month, and he said The Higher Path and many other dispensaries typically pay far more than that to the state.

But Kiloh faulted the agency for not being clearer in its communication with marijuana companies that are struggling to survive. He said many of UCBA’s members were thankful when he reached out this past week to inform them the switch is apparently something they can opt out of.

“Of those almost 200 emails, 70 of them came back and went, ‘Oh my God, thank you, Jerred. I thought this was going to be like the death blow of us,’” Kiloh said. “So when you look at the amount of people who either didn’t read it, didn’t understand, it felt like this was going to happen.”