Articles Tagged with cannabis business attorneys

In the wake of devastating wildfires in Northern California, many cannabis farmers were dealt a particularly hard financial blow. Cannabis businesses are generally unable to obtain insurance coverage. This is because the insurance industry is regulated by federal law – a federal law which classifies marijuana as an illegal substance. For this reason, when millions of dollars of crops were destroyed, the losses were not compensable. The wildfires also destroyed cash reserves of many businesses. Many cannabis businesses are forced to operate entirely in cash for the same reason – federal law prohibits regulated banks from offering financial services to cannabis businesses. With large cash reserves on site and many evacuation orders coming instantaneously, business owners were not always able to save their business funds. Now, the state Department of Insurance is speaking to cannabis business owners to learn about the challenges they face, and how the insurance industry can better meet the future needs of the cannabis industry.cannabis business lawyers

A New Option for Protecting Cannabis Business Assets

A series of recent moves within California’s insurance industry indicate that cannabis business owners may be better able to protect their assets from future acts of force majeure. The Insurance Journal reports that, for the first time, a carrier admitted to the California Department of Insurance has filed to provide coverage to legal cannabis businesses within the state. Other carriers have expressed the desire to file with the Department to offer similar products to the legal cannabis industry. Standardized insurance forms for the cannabis industry may also be available in the very near future.

In April 2017, Governor Jerry Brown signed an executive order which declared an end to the state of emergency in California related to the drought. This lifted many of the legal restrictions placed on water use of California residents and businesses. Unfortunately, California’s water woes are far from over. Marijuana farmers and grow operations are finding it particularly difficult to meet their high water consumption requirements while meeting obligations under state water laws.cannabis business lawyers


The Conflict Between Business Needs and Conservation of State Resources

California’s Mojave Desert is the site of many new cannabis grow operations. News Deeply reports that American Green (the country’s largest publicly traded marijuana company) purchased the entire town of Nipton, California. Nipton is home to twenty residents on eighty acres of land. American Green plans to turn it into the first cannabis resort in the United States. The resort will boast Wild West themed amenities, employee housing, and bottled water infused with cannabis. Unfortunately for American Green, the huge water demand of these activities could conflict with the provisions of California’s new Sustainable Groundwater Management Act. For the first time in California’s history, groundwater users must ensure that aquifers to not suffer from chronic depletion. Business owners now have a legal obligation to ensure that their depletion rate of groundwater aquifers does not chronically outpace the recharge rate by precipitation.  This places responsibility on private business owners to manage their use of valuable natural resources. In the area surrounding Nipton – where a golf club and the world’s largest solar thermal power plant have already placed significant demands on area groundwater – this responsibility could become onerous. Continue reading

Since recreational marijuana was legalized in California as of November 9, 2016, residents and government regulators have experienced many unintended consequences of the regulatory sea change. Perhaps one of the most bizarre outcomes is changing an increased power needs for those areas of California which house indoor grow houses.Cannabis farmer attorneys

This is not unlike the British phenomenon of “TV pickup”. There, utility administrators must respond to predictable surges in electricity use. reports that these surges are a well-documented correlate of the widespread use of electric tea kettles immediately after popular TV programs end. The British National Grid allots an electricity reserve to manage these surges, and can even access reserves in France when needed. If there is a lesson to be learnt from British utility services, it is that careful planning around reliable data can be used to prevent interruptions in service and other problems as a result of increased electricity demand.   Continue reading

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