 Okay, we're all set for recording. All right. I'll get started. My name's James Pepper. I'm the chair of the Vermont Cannabis Control Board. Today is August 31st, 2022. It's one o'clock and I call this meeting to order. Looks like, I mean, I've got quite a few remarks, so this might be a longer meeting today, but let me just get going. First, I just wanted to clarify something that I mentioned at our last meeting about cultivators that may have jumped the gun and started planting prior to being licensed by the board. Let me try to be as clear as possible. What you are doing is a crime. You are in criminal jeopardy if you're growing more than the home grow limits without a license. The cannabis board has no authority to direct law enforcement agencies or to stop state's attorneys from prosecuting crimes. And I apologize if that was not clear. The point that I was making is that the CCB will not penalize you. We will not revoke your application. We won't impose a fine or an administrative penalty or refer your case to law enforcement under the following conditions. First, you have a pending cultivation application before the board and you're making a good faith effort to complete the application. Two, you're operating within the scope of the license that you're seeking. If you applied for a tier one license, you can't have 2,500 square feet of canopy or more than 125 plants. And you have to be complying with all other regulations that apply to your license type, things like inventory tracking and record keeping, advertising restrictions, pesticide usage, etc. And finally, you can't be committing other crimes such as selling your products to the public, particularly to youth, moving cannabis across state lines, or inverting illegal cannabis into the legal market. So this is not an invitation to break the law. This is a recognition by the board that we asked the legacy market to go legal. And we're not going to punish the very people that took us up on this offer while we work through pending applications. Again, we can't control how law enforcement agencies will react if they get a complaint about an unlicensed grow. It's probably also important to discuss how the cannabis board interacts with law enforcement more broadly. This is one of those highly regulated industries that exists under the specter of state and federal criminal enforcement if you intentionally and sometimes unintentionally break the rules governing your license. The cannabis board is not a law enforcement agency and our compliance team are not law enforcement officers. We don't wear badges. We don't carry guns. We don't have the authority to arrest people or refer a case to a prosecutor. However, the legislature did grant the cannabis board primary compliance and enforcement authority over the adult and medical markets. We intend to take an education first approach. We know our rules are brand new and licensees might make good faith mistakes. And I'd like to take a moment to mention that our inspectors had visited over a hundred grow sites already and without fail, everyone is doing their best to follow the rules and operate within the scope of their license. So thank you for that. But if we receive a complaint or observe evidence of a violation, our compliance team will conduct an investigation. The results of that investigation may result in no action. It may result in a warning, a fine, a suspension of a license or any of the other administrative actions that are listed in our board rule number four. If we have credible evidence of criminal activity, we may need to refer the matter to a law enforcement agency for them to conduct their own investigation that may lead to a criminal referral. I would very much hope that these are the very rare cases, though. The primary law enforcement agency that we could be referring credible criminal investigations to is the Department of Liquor and Lottery. Their enforcement division is comprised of sworn law enforcement officers. We can't control the 100 or so law enforcement agencies around the state. If a local police department receives a complaint about a cannabis operation, they may come and investigate on their own, even if you're licensed. We are developing guidance for law enforcement and will be providing a training to hopefully get everyone on the same page. But to think that there's going to be 100% uniformity around the state, particularly early on, is probably unrealistic. But getting your license and complying with the board regulations is always your best defense when anyone shows up at your door, whether that's a CCB inspector, Department of Liquor and Lottery officer, or any other law enforcement officer. An update on licensing. You know, we haven't held meetings for the past two weeks in order to allow some of our staff here to catch their breath for the fall. But looking at the register for this week, it's hard to believe that anyone actually did take a break. We have over 60 applications up for approval, including a number of wholesalers and product manufacturers. The two integrated applications are near completion, and we've begun our review of retail applications. I'd remind everyone watching that retail applications are complicated and require jurisdictional input from many agencies that we cannot control or expedite. Fire safety, the Department of Taxes, there's local approvals, including local cannabis control commissions if they exist. There's the Department of Liquor and Lottery if you're going to be selling any kind of vape cartridge or vaping device. And then there's potential for Act 250 permits as well. In general, you need to have all of these approvals worked out before the CCB can issue you a license. So when you think about everything that goes into this, you know, I have a hard time believing we would have been able to license any significant number of retail applications in the one month period between September and October that the legislature prescribes in Act 164. October 1st remains our target date, but we can't make any promises. We want these licenses to be issued as much as anyone, but there's no way for us to cut corners. Our primary objective is to roll this market out safely, effectively and equitably, and we are not going to compromise that mandate in order to meet an arbitrary deadline. A quick update on the market and how it's shaping up. Our consultants have started to plug the raw data of our licensing numbers into their market analysis model. We have posted the updated model to our website, but unless you know how to use it and you know how to manipulate the underlying equations and assumptions, it can be a little inaccessible. Just one example, it has a random number generator in it to account for uncertainty around things like when the board was actually able to issue licenses and when licensees were actually able to be in operating. So this means that every time you open the model or hit F9, the model will spit out different results with respect to what this market will look like in year one and two. Also, every assumption built into the model, things like projected market share of flour versus vapes versus edibles, things like indoor versus outdoor cultivation, things like crop loss are adjustable. The default assumptions that are there when you open the model are our consultants best guesses based upon the data they received from our tourism department, from medical sales, from out of state data. But you can actually adjust all of those assumptions yourself and see how it changes the outcomes. I say all this just as a warning that this model is a very powerful tool and it's downloadable for anyone to use, but it can be kind of tricky to understand how it's working. Some of the assumptions that were made on good data are already proving wrong, for instance, now that the actual market is starting to take shape. But for anyone who wants to see kind of the updated projections, it's on our website ccb.vermont.gov. Some of the high level takeaways from the early numbers though is as of right now we've issued just short of 350,000 square feet of canopy. We have about the same amount left in pending applications. That number will change significantly after today after we approve kind of 60 additional applications. But the kind of total number, rough number of canopy in square footage is about 700,000. Our split between indoor and outdoor cultivation is skewing heavily towards outdoor. That's both in actual licenses issued, but also in the pending applications. If you take what we've already issued and add in the pending applications, we're about 35% indoor versus 65% outdoor. So that sort of breakdown is a very good start to the market. It's very good from an environmental perspective, but it does create some very important considerations. Certainly early on and probably into the long term, Vermont is not going to have enough testing or product manufacturing capacity to meet all of the market's needs at harvest time. If you're a cultivator, you should really start thinking about who are going to be your extractors, who are going to be your testing, who's going to do your testing. And ultimately you shouldn't rely on them being available right away, so you should also be thinking about storage. If you're a lab or a product manufacturer, please think about how you might be able to meet the increased seasonal demand for your services around harvest time. This sort of indoor-outdoor split can also lead to price instability at various times in the year. Just as a warning, our model does have some basic price assumptions based upon overall yields, but it doesn't take into consideration how prices may fluctuate throughout the year based upon harvest. Let me see a banking update. So via CCU, the Vermont State Employees Credit Union has temporarily paused adding new accounts for cannabis businesses. There is a ratio of cannabis accounts to compliance staff that is recommended by the National Credit Union Association, and via CCU has hit that quota. It's my understanding that they're currently seeking additional staff and will resume opening new accounts as soon as possible. I just didn't get any indication from them whether that will be in a few weeks or a few months. It's my understanding that the New England Federal Credit Union still has capacity to open new cannabis accounts. Also last week, the Vermont Federal Credit Union announced that they would begin opening cannabis accounts in Vermont. Both of those organizations' contact information is available on our website. Incidentally, an organization called the PBC just updated their banking cannabis directory. There are a number of cannabis-specific banks that claim to operate nationally. I don't know anything about these banks, and this is certainly not an endorsement of any of them, but I did run their names by the Department of Financial Regulation. And DFRs verify that they're all legitimate financial institutions and all have deposit insurance through either the FDIC or the NCUA. So we're going to post those banks, those financial institutions, along with their contact information to our FAQ page under banking. And as soon as we get an update from VSECU, we'll communicate that out as well. Inventory tracking, I mentioned a few times in the past, but we are going to go in a slightly different direction on inventory tracking than many other states. You're not going to need to put RFID tags on every plant or update your inventory each day. You do need to track very specific data points about your inventory and how it's moving both within your business and through the supply chain. You'll need to report that data to the board at regular intervals. With the help of a third-party analytics firm, the board's going to be tracking that data and analyzing it for irregularities and suspicious activity. But from a financial and human capital perspective, this system is a lot less intensive than what is required in some of the other major inventory tracking platforms. We have an agreement almost finalized with the company that's going to build the data reporting portal. It's going to be an extension of our licensing portal, and you should be able to access it directly through your CCB login, and it will be Salesforce-based. That sort of functionality and integration is not going to be ready until sometime this fall, though. So in the meantime, licensees will be required to submit their inventory records directly to the board through an online web-based form that will be available on our website. The Agency of Digital Services has built these forms for us, but they're currently being tested, validated, and debugged. I do expect them to be ready hopefully by the end of the week, maybe early next week. And our plan is to release both these specific inventory tracking data points for each license type as well as these online forms where you can report your inventory as soon as possible. When everything's ready, we can do a walkthrough of them at one of our next meetings hopefully next week. We also posted our testing requirement flowchart that's available in our guidance document as well, or in our guidance section of our website. Few basic administrative details. So this is kind of a special message for anyone who's filling out license applications on behalf of another person or a business. CSI, who conducts our background checks, has let us know that a bottleneck is forming in their processes due to a lack of communication from principals, financiers, owners, anyone who they're conducting background checks on. You know, sometimes they need to be in touch with the actual person that they're conducting a background check on, but they noted that sometimes the only contact information they have is for the law firm or the representative that filled out the application and not for the owner or principal themselves. So we've updated our forms, our application to stress that when it comes to these folks, the financiers, the owners, the principals, that we'd like you to put the people's actual contact information, not just the law firm's contact information. And we think this will speed things up significantly. Finally, the tax department has updated its cannabis tax guidance document. It's very user friendly. It's easy to understand. And you can find that at tax.vermont.gov slash business slash industry slash cannabis. And we also link to it on our guidance page. So, other than that, I just, we just need to approve the minutes from our last meeting, which was on August 10, 2022. Kyle and Julie, have you had a chance to look at those minutes? Yes. Yes. All right. Is there a motion to approve? So moved. Seconded. All in favor? Aye. Aye. Aye. Okay. So we, this is the last meeting from our prior meeting schedule, regular meeting schedule. So we need to adopt our meeting schedule for the kind of remainder of the year. I know we circulated a document internally, but is it, can we pull that up? Is that accessible? Sorry, I didn't mean to spring that on you. No, I should be able to find it in my, in my inbox. Essentially, we're going to keep the same meeting schedule Wednesdays at one, but I think it's worth pulling it up because I think there's a few dates that fall on holidays. I haven't pulled up, Brent, if you're not able to find it. I've got it. I've got it now. All right. Thanks, though. Okay. So these are the proposed meeting dates for the remainder of this calendar year. The idea would be to stick with our current time of Wednesdays at one o'clock, except for a few exceptions. And those exceptions are noted. So we've got September 7, September 14, September 21, September 28. And then our first October meeting will be on October 6, which is a Thursday. And then the remaining meetings in October, the 12th, 19th and 26th are all Wednesdays. November will be the first three Wednesdays, which are the second, the ninth and the 16th Thanksgiving week. We will not hold a meeting. So we will skip the 23rd and then meet again on the 30th of November. And then again, December 7th, 14th and 21st are all Wednesdays. And then the last week of December, we will skip a meeting on the 28th. Great. Is there a motion to approve this regular meeting schedule? I move that the cannabis control board accept the meeting schedule as presented by staff. We'll second. Any discussion at all? Nope. Looks good. Hi. Okay, Bryn. I'll turn things back over to you. Okay. So we'll start your register as we always do with some information about the medical cannabis program. The data that you see in this week's register is for a number of weeks since we last met. So it's from August 10th until yesterday, the 30th. So in that time, we've received 56 new patient applications and 163 renewal applications. And we've issued 205 patient cards. Received three new caregiver applications and six renewal caregiver applications. And we've approved for and we've also approved for employee, dispensary employee cards. And as noted here, our staff are currently processing applications received on or after July 27th. So that does put us about four days outside of our 30 days set for a window. And we staff are aware that we are outside of this range. We've been in contact with patients who have pending applications and we are developing some efficient fees to improve our timing and being able to process these applications. So hopefully we'll see an improvement there next week. So now we'll move on to our adult use license applications. And this data is upstate as of yesterday. So a little bit of a wall of numbers here. I'll try and point out a few things of interest. The board has 63 full license applications that are recommended for licensure by staff this week. The majority of those are mixed tier one cultivators also have nine outdoor cultivators up for recommendation this week. And we have three tier two manufacturers up for recommendation this week and two wholesalers. And then we have some stragglers, one indoor tier five, one mixed tier two and then four outdoor cultivators that are not a tier one. And you can see that we've got 19 retailers in the few for review. And as the chair pointed out earlier, some of these applicants are currently under review on staff have not updated that status for everybody. I just want to remind everybody that staff are really prioritizing reviewing these applications. And there are times that they are not able to update the status of that application exactly when they start reviewing it. So we are still developing our internal processes and this is something that we will improve on as time goes on. But I want to make everybody aware of that. Can I just make a make a point here based on this chart, which is it looks like when I look at the kind of submitted received under review numbers for cultivators. It looks like we are largely through our backlog. I know that there's some in incomplete status usually that means that it's incumbent upon the license the applicant to do to take an action. And there's some in resubmitted but for the most part it looks like we're through our cultivator backlog. Correct. Yes, the team is very excited about that. That's great. Okay, so I'm going to move on to our recommendations for this week. They have a long list. So I'm going to jump right in. And given the fact that we have a long list. I'm just going to go through a by submission number and license type. So we've got submission 13 applying for mixed tier one submission 68 applying for indoor tier one submission 103 mixed tier one submission 125 indoor tier one submission 139 indoor tier 141 indoor tier one 143 indoor tier one 146 indoor tier one 206 and mixed tier one 226 indoor tier one 238 indoor tier one 253 mixed tier one 284 outdoor tier one 285 mixed tier one 286 mixed tier one 290 mixed tier one 296 mixed tier one 297 mixed tier one 308 indoor tier one 309 mixed tier one 315 mixed tier one 322 mixed tier one 331 outdoor tier one 336 indoor tier one 339 mixed tier one and 347 indoor tier one. Next stage submission 362 indoor tier one 367 outdoor tier one 371 mixed tier one 417 mixed tier one 432 indoor tier five 440 outdoor tier four 469 mixed tier one 535 outdoor tier four 582 mixed tier one 584 mixed tier three 590 mixed tier three 605 outdoor tier one 615 outdoor tier two 629 mixed tier one 685 outdoor tier three 703 indoor tier one 718 mixed tier two 740 outdoor tier two 741 outdoor tier one 755 mixed tier one 765 outdoor tier two 766 outdoor tier two and 803 outdoor tier three H3 828 outdoor tier one 837 indoor tier one 895 indoor tier one 912 is a wholesaler 917 tier two manufacturing 926 tier two manufacturing 975 wholesaler submission 1000 outdoor tier one 1017 tier two manufacturing 1024 indoor tier one 1029 outdoor tier one 1032 mixed tier one 1290 outdoor tier one 1360 outdoor tier one and that is your full list all of these applicants have demonstrated compliance with board rule and statute and staff is recommending them for full licensure. I will move on now to the social equity portion actually first we have a new addition to your register this week which is some staff on license amendments and amendments are any change to your application. The application that a licensee needs to update their application in any way that wouldn't trigger a license renewal that is considered a license amendment. So we've got some numbers for you here so we have mixed cultivator tier one who is licensed to is seeking an amendment and an outdoor tier one cultivator who is licensed to is seeking an amendment. This can be quite minor updates to contact information or even like a typo and a business name. So these are amendments that don't require board approval. This is some statistics for you to review. So moving on to the social equity stat. We have nine social equity applicants that are up for licensure this week. As you can see we've got many in incomplete or we submitted status about 25. And we approved or issued about 42 licenses to social equity applicants that put those at around 90 90 applicants who have social equity status or seeking social equity status that are in the process. Or have a like or have a social equity license. And then we have four recommendations for social equity status this week. We have submission. 895 staff are recommending social equity status for this applicant as they meet the criteria for social equity individual applicant is the sign and board rule. Submission 1163 they're recommending social equity status for this applicant as they meet the criteria for social equity business applicants as defined and board rule. Submission 923 are staff are recommending social equity status for this applicant that they meet the criteria for social equity business applicant. Submission 916 also recommended for social equity status as they meet the criteria for a social equity business applicant. And lastly we've got four applicants that staff are recommending that the board deny social equity status for submission 740 and submission 567. Both of these applicants do not meet the criteria for social equity individual applicant as defined and board rule. Submission number 723 staff are recommending denial for this applicant that they don't meet the criteria for social equity business applicant. And lastly submission number 91 staff also recommend denial of social equity status for this applicant as they don't meet the criteria for social equity individual applicant and board rule. And staff are ready to discuss these social equity status denial and executive session with the board. Great. Well it's a tremendous amount of work. Thank you for even just reading it was kind of a lot of work. But thank you for that. So, yes, I think what I heard is that the board should be going into executive session to discuss the social equity status denial recommendations by the staff. I think that's we should do that before we approve the other 63 licenses and other recommendations. Yep. Is there another item that we need to discuss in executive session as well. Yep, there are the board should discuss the staff recommendations for social equity status denial. And also there is one applicant is up for recommended licensure this week. So, those have a presumptively disqualifying sense on their record. Okay, any sense of how long we'll need for executive session. I would, I'm going to estimate at least 30 minutes. Great. Well, is there. So before we vote on any of these we're going to go into executive sessions there a motion to tend to our executive session. We've approved that the CCB go into executive session to consider confidential attorney client communications made for the purpose of providing professional legal services to the body. And that the executive session is required because premature general public knowledge regarding such communications would clearly place the board at substantial disadvantage. The board expects Susana Davis executive director of the Department of Racial Equity and Jay Green, the racial equity research and policy analyst to join effective session. Second. All in favor. Hi. Okay, so why don't we say if it's 136 right now why don't we come back like five after two. And we'll shoot for that. Sometimes these do go a little bit long, but we'll shoot for just a little bit after two o'clock to return. All right, are we ready? Is everyone ready to resume? Yep, let's do it. Okay. So, just for a time check it's 215 we ran a little bit long. Sorry about that. So the executive this session, the board was looking at kind of the rationale behind the staff's referrals for the social equity denials and then also the rationale to recommend approving a applicant that had a presumptively disqualifying offense. And we kind of listened to their reasoning and we're ready to now vote as a board on their recommendations. And I think we can just lump them all together because I think the general gist was we're going to approve all the staff recommendations. So is there a motion for that? I move that the board accept each of the recommendations for as presented to us in this meeting. I second. Any discussion before the vote? No. Nope. Just again, as you mentioned a couple times pepper thank you to everybody even during the so-called time to take vacation still rocking it so it's impressive. Yeah. Yeah, I agree. Okay. Well, all in favor. Hi. Hi. Great. And just to be clear that was for all the staff recommendations including the 63 licenses that we just approved. So that's great. Thank you. Just as you mentioned Kyle to the staff for their diligent work. And I think if I'm right, all we have left to do today is public comment. So yep. All right. So why don't we do that? Thanks to everyone who joined the meeting today and kind of sat through the executive session. If you'd like to make a public comment, we'll start with the people to join via the video link. You can just raise your virtual hand. We'll call on you in the order that you raise your hand. And then we'll move to people to join via the phone. Thank you so much for your time for public comment, Keith. Oh, CCB. How are you today? Go ahead. Thanks. I just have a question on your track and trace system that you're going to be implementing. Why is Vermont going to be the outlier out of 20 states in the nation that are using metric and metric is designed for track and trace and accountability for consumers and everything else. It's very low cost to state of the mall or any other states that has been using it and it has excellent information through their portal and through their team trainings. And it's very low cost. It's it doesn't cost anything for the licensee holders to use that thing, but to buy the tags or to use a laptop to put their inventory in. And that's all I need. I've spoken to one of their visit their government representatives. Her name is Jean, and she said she would love Vermont to pick metric to use. And it's very it's not complicated at all. So I'm just wondering why you guys are choosing to be the outlier out of 20 legal states using metric rather than going with metric. Just out of curiosity. And then one other question. Will you guys be conducting more roundtables for the medical patients of Vermont? Thanks for the questions. And generally we don't turn this into kind of a question and answer session. It's really meant for people to provide comments to the board. However, we do note your questions and we try to kind of respond to them at our next meeting or kind of if there's kind of common questions that get answered or asked, then we update our guidance document. But I'll kind of talk about track and trace at our next meeting, I suppose, and why we chose the path that we did. And yeah, thanks for the questions. Next tree frog farms. Thanks for everything you guys have done. I was just looking for more recommendations or clarity info on as the track and trace system will develop this year. After drying for curing and storage purposes, we'll be able to gather like strains into the same containers and kind of kind of bulk up. You know, we've harvested this from these 10 plants, but once now they're dried, they could all be stored or cured together and kind of lumped into their own trackability. Thanks. Yeah, thank you. And again, I think our goal, hopefully, is to kind of walk through and more detail track and trace next week if we're ready. Otherwise, very soon after, and we can kind of dig into some of these questions. Shannon. Shannon. Hi, I just wanted to make a quick comment on packaging. I know it's probably been something guys have been hearing a lot, but we I think we finally came to a solution for us, but I know getting there was very difficult. There's not. Can you really maybe release something that has very clear guidelines on it? Because there's really not. It sends you on a wild goose chase to find all the different statues and what's required. And also just to note that I understand why you're going in a green direction with packaging, but it's very expensive. And a lot of these manufacturers have very high minimums to get 10 products to get glass with wooden lid products to get anything customized like that. And so for a startup family businesses, small businesses, that's a huge upfront cost to be putting out, you know, 20 to $30,000 to get containers in different sizes with the 5,000, 10,000 minimum order. So just want to put that out there for everyone who's frustrated and struggling with this. Yeah, thanks. Thanks, Shannon. Tito. Hi there, hopefully everybody's having a great day. I'm just, I just want to make one comment when it comes to the disclosing the location of licensees. I know we've been through a lot with that conversation. And currently it's landed on just disclosing the town that you're in, but I'd really like to see that move to the county. I still think that the county accomplishes the goal of transparency yet is also vague enough to protect growers whose buildings cannot be hidden from the road always. And sometimes these towns are really small and it's just too hard to hide. And also I've heard a lot that the state requires any business to give them their physical location. And it's actually the state just requires a physical location, not the actual physical location necessarily where your cannabis is being grown. So I just wanted to point that out. And I really hope that you guys can find it to switch to counties. I think that would do the trick. Thank you everybody. Hope you have a great day. Yeah, thanks, Tito. Anyone else who joined via the link, please raise your virtual hands. And then also if you've joined via phone and would like to make a public comment, just hit star six to unmute yourself. Keith, I see your hand up, you know, as a as a role during these meetings, we don't do. What's that? It was a mistake. I was moving my mouse. Sorry. Yeah. Yeah. Yeah. No problem. Dave Silverman. Thanks for all the work and thanks to the staff for all the work they did the last two weeks really showed the number of applications. I know that there are still a lot of manufacturer applications in the queue. And given the race against the clock to get products into stores, I'm going to repeat a public comment I made a few meetings ago about the potential for expediting the CSI background check process for those pending applications. My sense is your process is to wait until the initial staff review before authorizing CSI background checks, the CSI background checks, then take a week, possibly two weeks, depending on the complexity. If there's any way for your manufacturing applicants that are in the queue to push that forward for the CSI check before the initial staff review is done, get them done so that there's not an additional wait after the initial review. That would be very, very helpful to anybody who wants to open retail on October 1. Thank you. Thanks, Dave. Anyone else for public comment? Either virtually or on the phone. And again, the phone at star six to unmute yourself. We'll close the public comment window. Again, you can always reach out to the board. If you go to ccb.info at vermont.gov, it goes out to all of our inboxes. Any comments you want to make there. And other than that, we'll see you next Wednesday during the meeting. Thank you.