By Nancy Lavin of Rhode Island Current
Spencer Blier, who was expelled for smoking marijuana from his first college, spent the following decade as a perpetual University of Rhode Island Student while growing medical marijuana in his log cabin on campus for state patients.
The Rhode Island Office of cannabis regulation reports that despite a not-so-promising start, the 35-year old Warwick native, who is also a licensed cannabis grower, ended 2023 as the state’s third highest salesperson, with $2.2 million.
Blier’s political acumen grew as Mammoth Inc. grew.
According to reports on state campaign finance, he donated $1,000 each to the campaigns for House Speaker K. Joseph Shekarchi and Senate President Dominick Ruggierio in the fall 2023. Blier does not expect major changes to the law this year. The nascent cannabis industry has already achieved major victories, such as expansion of recreational use with a 115 page bill passed in 2022.
Blier’s recent contributions to his campaign were described as “just letting them know that we are here.” You never know when a big decision will be made, and you’ll want to have the opportunity to speak to them and share your opinion.
He’s still a relative newbie on the political scene.
Ask him if he, along with other Rhode Island cannabis businesses owners, might form a Political Action Committee (PAC) to leverage their collective power for larger campaign donations. According to the state law, PACs can donate up to $2,000 per candidate, but they also have an annual $25,000 donation limit.
Blier replied, “I have no idea what a PAC even is.”
After becoming frustrated by government red tape that stymies their businesses, he, and other cultivators, are beginning to realize the importance of winning friends and influence people on Smith Hill. They attend fundraising dinners and donate to campaigns, and hire lobbyists who represent their interests before lawmakers.
The Rhode Island Cannabis Act, passed in May of 2022, outlined a major expansion for recreational sales and usage. It also included advertising capabilities and 24 new licenses for pot shops. Cultivators still wait almost two years for written laws to become a reality.
The law established a Cannabis Control Commission to oversee implementation, but it didn’t convene until June 2023. Matt Touchette, a Rhode Island Department of Business Regulation spokesperson, stated that the commission is in the discussion phase, and has received input from the 11-member Cannabis Advisory Board. The Office of Cannabis Regulation expects to complete rules and regulations by the end of the year.
The rules have not been finalized yet and two dozen retail licenses pending cannot be issued.
Jeff Padwa is a lobbyist for Sensible Cultivators for Intelligent Reform, a group of ten local cultivators including Mammoth.
Regulatory delays squeeze cultivators
Padwa stated that there are only seven licensed retailers in the state, limiting the amount of tax revenue and profits from cannabis sales.
Padwa, speaking of 2023 cannabis sales reported by the state, said that based on the number of adults who use marijuana, they would expect to be around $200 million. However, it is still within the $100 million range.
According to the Rhode Island Secretary’s State lobby tracker, SCIR paid Padwa $15,000. Padwa’s lobbying on behalf of cultivators earned him $5,000 in 2022 and $60,000.
Blier explained that the increase in payments and presence is partly due to the fact that growers have more money than before. Blier struggled, like many other cultivators to get his Warwick-based business going.
Blier remembered that “the first five years were like every two months, will we stay in business?”
In 2017, the state started issuing licenses for cultivators to grow medicinal marijuana. He started his business in 2017, just as the state began issuing licenses to cultivators for medical marijuana.
Blier estimates spending $1,300 per month on lobbying via Padwa. However, the cost varies depending on how many cultivators pitch in to support SCIR’s State House appearance.
Padwa stated that many other licensees do not actively grow and sell their products. Touchette confirmed in an email that all licensed growers listed online are operational as required for the normal license renewal process.
The Rhode Island Cultivator Industry Association is a separate group of cultivators, but it’s not clear how many are members. Armando Lusi is the president of the association and a member on Cannabis Advisory Board. He did not respond to multiple emails and phone calls for comments.
The Cultivator Industry Association has not been represented by any lobbyists in the state lobbying database for the past five years.
Peter Kasabian is the co-founder of SCIR and owns LOUD in Warwick, a cultivation center. He said that although there is no formal association, many cultivators share their ideas and strategies on a more informal basis. Kasabian is also trying to recruit growers who are interested in joining the group.
Kasabian stated, “I completely understand and appreciate their decision not to engage in politics.”
He’s not a political junkie. He is clearly frustrated as he complains about the time he spent driving to the State House and searching for parking, with “no food” available, just for a few minutes of rubbing shoulders with legislators.
He said, “I shouldn’t be there.” “I am not a politician, I’m a small-business owner.”
Kasabian continues to travel, or pay Padwa for his services, and give money to the top elected officials. He gave $1,000 each to Ruggerio, and Governor. Dan McKee (D), in November. Plus a $1,000 donation to Shekarchi, in September.
He said that the donations were made out of desperation. “We asked for shops and the Governor gave us a bunch of bureaucrats. It’s laughable.”
Compassion centers had head start
The compassion centers that have been around for a longer time and were able serve patients as early as 2013 appear to be more powerful.
Their fight for advertising rights is one example. The 2022 law gave advertising rules to the Cannabis Control Commission. This prevented retailers and growers marketing their products, even though Massachusetts competitors were lining state highways in their own billboards.
In the spring of 2023, Pawtucket Mother Earth Wellness defied rules and displayed ads along I-95 for its retail shop. By June 2023 lawmakers had agreed to allow the Department of Business Regulation to come up with interim rules that would let pot shops advertise. The Cannabis Control Commission has yet to issue formal regulations for cultivators.
Rep. Scott Slater of Providence, a Democrat, who sponsored legislation in 2023 to allow dispensaries to advertise, claimed he did not know when drafting the law that cultivators would be exempted.
In order to correct this, he introduced a new bill earlier this month. It would allow cannabis cultivators to advertise during the interim period until final regulations are adopted if it is approved.
Slater acknowledged that there are competing interests between dispensaries and cultivators.
Padwa says that their diverse priorities are partly the reason why there is no single trade association or group.
Padwa stated that he believes if you asked the hybrid retailers and compassion centers, they may say they prefer to not have more stores as it would mean less competition.
“It would not surprise me in Rhode Island if there was ever a cannabis association, with members from all sectors of the industry. It wouldn’t be surprising to me if there was never a PAC.
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Rhode Island Current reached out to business leaders and lobbyists from all seven of the compassion centers in Rhode Island and asked about their influence and spending at the State House. Many did not respond to multiple emails and phone calls for comment.
Chris Reilly, a paid lobbyist by Thomas C. Slater Compassion Center sent an e-mail response.
“We continue to monitor any legislative or regulatory proposals that may impact our business, customers and patients,” Reilly stated. Every year, we are presented with proposals regarding everything from taxation and fees to regulatory mandates and patient access. We must stay informed on all issues relating to the cannabis industry, particularly since we are in a highly-competitive regional cannabis market.”
According to the State Lobby Tracker, Slater spent over $340,000 between 2020 and 2023 on lobbyists including Reilly. According to the Office of Cannabis Regulation, the company had $25.3 million of sales in 2023. This was the second highest among retailers.
Greenleaf, another of the original centers, in Portsmouth, has paid former state senator Stephen Alves, a lobbyist, more than $270,000 between 2019 and 2022 to lobby on behalf of its center. Greenleaf did not pay Alves since January 2023 for lobbying.
Alves said that the company had decided to stop lobbying at the State House. Greenleaf didn’t return any calls seeking comment.
The power of numbers
A united organization would also be able to share the costs of lobbying. John Marion, Executive Director for Common Cause Rhode Island, says that this is a practical reason many other industries have formed trade associations in Rhode Island, from hospitals to small business.
He said that it was not logical for every hospital in Rhode Island, to have their own lobbyist. However, a hospital association is logical.
According to reports on campaign finances, cannabis business owners and employees contributed more than $20,000.00 to McKee’s, Ruggerio’s and Shekarchi’s combined campaigns in the fourth quarter 2023.
Stuart Procter was one of them. In the fourth quarter 2023, the co-founder of PureVita Labs and its lab director donated $500 to McKee. Procter is also a member of the state’s Cannabis Advisory Board. He donated the money to McKee through a fundraiser event at Spain Restaurant Cranston, which took place in December. Procter was joined by PureVita CEO and co-founder Dr. Jason Iannuccilli. He is a radiologist.
Iannuccili stated that “no one expected that $500 or $1000 would move the needle. But it was an opportunity to present a discussion with someone who has the power to affect change.”
According to reports on campaign finance, Iannuccilli made contributions to McKee’s campaign in previous years, but not 2023. He recognizes that politics and marijuana are intertwined, but does not believe that campaign contributions or lobbying should determine Rhode Island cannabis’ fate.
He said that “these decisions should not be affected by lobbying but should be based upon data”.
The data includes information on how many people use marijuana recreationally or for medical reasons, the health and safety issues surrounding cannabis products, as well as what other states have done to stay ahead of the marijuana cloud, both right and wrong.
Iannuccilli stated, “There is no perfect example state that you can point out and say, “They are doing it perfectly.” “By looking at mistakes made by those who have come before us, we are able to learn from them and change our ways.”
Aaron Smith, CEO and cofounder of the National Cannabis Industry Association, noted that cannabis businesses in other states had also struggled to come together under one organization.
Smith explained that “it could be different viewpoints on policy or, sometimes, it’s personality and ego.”
Smith believes that business owners should put their egos aside to find a common ground. The 500 members of the association have worked together to make their voices heard on Capitol Hill.
Smith stated that it is more important than ever for small business owners to have a voice. There are many issues that lawmakers must deal with. “If there’s not a concerted attempt to advance our agenda it will never come about.”
Smith explained that the association’s lobbying expenditure in Washington, D.C. was down from $500,000 annually in previous years, mainly due to the economic challenges facing its members and the industry.
Mike Trainor is a spokesperson for McKee’s campaign. He declined to comment about McKee’s contributions to his campaign or McKee’s relationships with cannabis business owners. McKee’s budget proposal for fiscal 2025 decouples the state tax code and federal policy to allow cannabis business owners to deduct expenses when filing their state income taxes. This is a nod towards the industry.
Shekarchi, Ruggerio and others said in a joint email statement that “the cannabis industry is an emerging and rapidly growing sector of the economy and is heavily regulated.” They are not treated any differently from other advocacy groups. “We comply with all aspects campaign finance laws.”
This article was originally published by Rhode Island Current.
Rhode Island Marijuana retailers reach $100 million milestone in first year of adult-use sales
Photo by Mike Latimer.
The post Rhode Island Marijuana Industry Steps Up Political Savvy with More Campaign Donations to Politicians first appeared on Marijuana Moment.
