ALC-Medical Marijuana Oversight Subcommittee

We'll call this meeting to order the medical marijuana oversight subcommittee. Of course on the agenda today is item C.. We will have the health department Matt Gilmore it if you all would come on up. Last meeting we had some questions concerning pesticides and you've asked health department come back. if you would please identify yourself for the record who you represent. Matt Gilmore partner health. Coming Nelson Department health Charles Thompson Department health. You may proceed thank you Mr chair Matt Gilmore partner health so we were here I guess it's been about a month or so ago now you'll have some questions I'm not the expert so I brought some experts with me I think they can help address those but miss Connie Milton section oversees the the issue the cards for medical marijuana and Mr Thompson is one of our attorneys and he can help address the kind of questions with statutes or rules but rigid opportunity and happy to take any questions you might have a thing misconduct may have some statement she wants to make and then we can go from there that's okay. I think I ninety thousand go ahead and okay off okay members thank you for having us we that's some questions last time but just briefly before those before we get those questions Arkansas department health has is y'all may already know has the responsibility when it comes to under Amendment ninety eight for issuance of patient registry cards caregiver right caregiver cards labs to approval of labs lab testing standards and labeling so that is our extent of our authority underneath Amendment ninety eight right now we have a total of well this was Saturday's numbers I do not have this is the most recent report I have seventy seven thousand five hundred seventy cardholders in Arkansas of Arkansas patients busy Payton visiting patients which is which is under Amendment ninety eight if you're visiting and you have a card another state that's active and and and legit you comes Arkansas have visiting patients card if you're visiting Arkansas for some reason of those visiting patients we have six or sixty five care giver card six hundred and eight those are for people that can't make it out to the dispensary to pick up the medication those also include parents of minors who have registry cards and so minor patients in Arkansas and it was a question regarding last time there's eighty three minor minors with patients in Arkansas When it comes to which I know there's a question of minors getting cards in Arkansas Amendment ninety eight does not put a age limit on defining a qualifying patient there's a just as a person so a minor could in fact get a card with a with the carrier as long as they had a care giver which is parent would be a care giver by definition in the statute so the parent of applies for the care giver card at the same time the miners getting their patient cards that's how that works that cannot be changed by the Arkansas department of health through rule or policy that is Amendment ninety eight specific provisions so you would have to change the law to change that so I knew do know there was a question last time on that when it comes to pesticides when you look at the past decides there's an or rules there we test for I believe fifty nine fifty nine pesticides in Arkansas in their certain standards thresholds they have to meet if they don't those samples are rejected they have a chance to read the test them if they for and and then if they fail they with the then that batch would would would would fail we also test for heavy metals and some other things we do have individuals from one of the labs here and they can get into the the two Grady I'm not a chemist I'm not very good at math so that's why I went to law school so he could talk to you about the science regarding that I think. Is that what was that all that it was at all the questions I believe we had. Did you did you want to add anything on. Regarding the minor's. Part of the process is when the that patients requesting a registry identification card has to have a physician written certification and reminders part of that process is the parent has to be a participant in that process and receive information from the physician regarding medical marijuana and their child or if it's a legal guardian in that child and they also have to sign the physician written certification indicating that they perceive that information and they understand that and then again on the Caregiver application they have to sign when they signed their signing that they understand and they're going to be responsible for the Management of that medical marijuana with that minor patient. I'm ready for questions. Yes Sir I think so okay Mr Johnson on the pesticides. Does a grower have to get permission to use of pesticides from you all. that's not that's outside of our outside of our scope we stripped we strictly strictly a promulgate the what we're going to test for but that's outside the scope of home what what they can and cannot use okay representative love you're recognized for a question. Thank you Mr chair so. As you know we're talking nine I thought about something how does how does the medicinal marijuana alignment with the prescription drug monitoring program it or doesn't. Representative love thank you for the question minutus on marijuana's outside the PDMP PDMP it is not reported to the PDMP. So. We're not monitoring how much is being distributed wages. The if memory serves me correctly a patient is limited to two and a half. Ances every fourteen days so there is a limit two the prescription drug monitoring program actually monitor is. Prescribers. So. I go back to represent love by definition Amendment ninety eight a medical marijuana certification and is not a prescription. That's by that's defined in the Amendment ninety eight. We work to do thank you. Senator Chesterfield you're recognized for a question. Thank you Mr chairman thank you all for being here today as we look at the rules regarding pesticides we have wanted more stringent rules is that not correct. That is our understanding it's one of the more stringent ones and and in the United States which is a good thing because then we preclude those pesticides we're going into these individuals who have come to rely on this for either emotional physical health. What I am concerned about while you're here and I will address it to the members of the cannabis industry also is. The state contract the state contract you we have is with bio track is that correct. That's correct center in and I keep the I'm hearing concerns about bio track are you hearing those same concerns. I have not had any come to me personally I don't know miss Mel may be able to to comment on that. On I have not received any complaints we work without track consistently. Be happy. Afterwards to get some more information from you so that I can do a little unless the industry folks because they're the ones who have to deal with bio track on a daily basis. And they are talking to me about that just lost. In accuracy of data and we want to make sure that that data is accurate we want to make sure that if it says a ten ten ounces then it's ten ounces rather than eight we want to make sure of all of that and the concerned that I'm hearing from the providers is that by a track is not done a good job and have not been responsive. To their needs so just wanted to lay that out there and I'll be visiting with them when they come to the table to make sure that if we have a state contract that the state that the contractor is doing what he or she is supposed to be doing in order to facilitate the process so I'll wait until they come here since you have not heard of any nobody here heard of anything wrong with bio track okay thank you thank you Mr. Okay represent right you're recognized for a question. It again okay okay up this may be just a little bit out of context of may have a lot to know kind of. It to the at this point is four one half percent. On the tax for in a right on the state level. Representative right we don't have any stats on that will work as far as the tax rate that's outside of our its with more with the. Okay. Him or question. Seeing none we appreciate you dismissed thank you. At this time we go to Adam D.. Of bill of paschal. If you would come up in I would ask everyone to introduce themselves. And who they represent. I know we only have three microphones and I ask that you would to a. I am pulling toward you when you get ready to speak so we'll be able to hear you clearly. We will do so in Mr I will be able answer questions here shortly. Hello everybody I'm bill Pascrell most of you know me today I'm here in my capacity as the executive director of the Arkansas cannabis industry association a CIA for short our association represents the growers the sellers and those who provide goods and services to the industry. we'll go through some brief things no here in a minute but I want you all to know that we're here today and offer our association and our expertise as a resource to this committee going forward and will be happy to come and visit with you anytime you want us to come we've also requested that this committee and a couple others come due one of our cultivation facilities since you may know this past session you passed a law that will allow for the tour and due in the areas where marijuana is actually grown and produced so we hope you'll take us up on that because we think that will be a great learning opportunity and give you guys a chance to ask questions of the people that are there on the ground doing the day to day work I'm gonna be real brief I'm going to talk about seven things I want you to know about the industry and then I'm gonna turn it over these folks to do the day to day work and are the real experts and can answer your questions but there are some things I want you to keep in mind about the industry. Currently we have five cultivators that are operating and selling medical marijuana in Arkansas will have another one that should be coming online within weeks next week or two we have thirty six dispensaries that are operating we have one of those it's very close to coming online so we should be up to about thirty we should be up to thirty seven in real short order. this is a real I. statistic the industry today employs over fourteen hundred people and it's growing. Our average base wage is about fifteen fifty and it varies from region to region in the state depending on the economic situation there. the licensee's both dispensary and cultivators have invested over a hundred and seventy five million say that again a hundred and seventy five million in physical plant and equipment today. They've the dispensaries of sold over fifty four thousand pounds of marijuana since the the first dispensary opened in may of twenty nineteen. The sales of top four hundred million in dollars which equates my rough math to about a little over forty million dollars that the state has collected in taxes so we feel like we are bringing some economic vitality to the state and we appreciate all the help that you have given us and the regulators have given us in getting this up and running it is still an industry in its infancy we've just been operating for about two years but we're beginning to see some of maturity in the market and these guys will be able to address that as they make their brief presentations I have Robert to be and home are right Robert with natural state medicinals he is the president Alex gray you'll know him but he wears lots of hats like me he's here today and in his capacity as owner of good day Arkansas which is cultivation facility down in upon loss and he's also part owner in good day Little Rock which is a dispensary as soon moved west little rock and the robin remind. On the far right there is the executive director of harvest cannabis dispensary in Conway so we've got a little bit of all up here today and I think Dan rather made join us briefly he's he's our banking gas so if you have questions about banking but Alex you. Make your. Again my name is Alex gray here on behalf of good day farm Arkansas we acquired a license in November of twenty twenty and polled are construction permit in pine bluffs on December seventeenth and completed a hundred thousand square foot renovation and invested in excess of thirty million dollars in three and a half months we obtained our approval from ABC on April second so we've been operating for I guess approximately four and a half months in pine bluffs we have a currently a hundred fifty four employees and you know I'm I'm here to can answer any questions you have I will say that one of our newest I'm probably one of our most important hires is in the audience very clear McLaurin who we were able to snag from state police so we again this is a we're it's an honor to be here it's not to be a part of the industry in Arkansas this is a a compliance businesses what we tell people so I know everybody up here works very diligently with our state regulators and I want to commend them for doing a good job and this is a it's it's a lot and this the industry is growing I do work in other states as well and then the southeast and every state is very complimentary of Arkansas's program and the way it's set up and and so I think you also should be a proud of what we have here and again here to answer any questions. Good afternoon my name is Robert to Ben and I am the presidency of natural state medicinals cultivation. and our ownership consistent Harley of Arkansans the majority of which are medical professionals we completed construction began operations of our facility and March of two thousand nineteen. Over the past two and a half years we have developed a wide variety of medical cannabis products over thirty different cultivars of cannabis vapor products concentrates a wide selection of teachers topicals and even suppositories from our White Hall facility we make deliveries to every dispensary on a regular basis. Our team is composed of a hundred and thirty our Kansans only one of which will be brought in from outside the state but she happily considers herself to be an Arkansan now FOR a team we have about half a million a month and payroll in addition to that we offer medical benefits don't dental vision an HSA and four oh one K. matching. up over the question of two and a half years we've really developed a pretty sophisticated operation but it's pretty difficult to describe and a brief time with you all but I will echo bills comments that you are invited to come see our facility at any time I left I've left behind some information as well as my business card the free to reach out to me anytime with any questions. Good afternoon everyone my name is robin Amman I'm here on behalf of harvest cannabis in Conway Arkansas I'm the executive director of that facility and it's a dispensary which that's in a different place than that supply chain from the cultivators we are the firm the forward facing element of the industry we see the patients every day thank god we have relationships with them we know sort of and in some instances we know what ails them and what they respond to the best we opened in October of twenty nineteen we are in the majority owned by women we're very much a small business in every sense of the word in fact we are a family project and and and most respects my mother and father are the majority owners of the business and they are very active in the day to day affairs of the business and have become very knowledgeable about the industry and which is very unusual because my mother started in Conway Arkansas running a gardening business and and really at the time had no interest or understanding of and over the course of two years because of just how intensive this industry but what requires of you she's become an expert. in those two years ago from essentially eight employees which is far too few to over thirty employees we run seven days a week understanding business hours and in terms of volume we're somewhere between the fifth and seventh highest volume and a dispensary in the state of. And that you know is based on information released by the FNA which gives you a sense on a on a macro scale what the state is doing in terms of how I'm sold and what that has a net in terms of dollars happy to answer any questions you might have about the retail process but that's that's pretty much it. Are you all ready for questions or all right representative right you're recognized for a question Mr fellows I thank you over the past couple years is is come along and you know in in the beginning and I I really want sure you know about it but I'll tell you something that happened the other day have free and. Been crippling arthritis since she was fourteen years old take he was taking handfuls of medicine. In which you know hydrocodone is bad for you yeah we know that and he was taken for a day. And the terminal room. He started doing this. Because he only takes one to. And I'll. I ask him if there's any side effects you should John I I don't see anything should I feel better you not get around better any lives with his mother. Any grows a garden for her you know she's eighty four and she was skeptical about it. She went and got a call or. And gas she's getting around a whole lot better she's eighty four years old. So well I think that we probably if it's going to be successful we might need to think about you know is it for half percent now I thank the seller is a no Sir there's a four percent privilege tax that goes the Cancer Institute there's a six and a half percent of the state's state sales tax so it's ten and a half percent total okay okay thank you all appreciate your being here to Dan roda has joined us if you have questions about the banking side of it he will be the man that can answer those works. And Robert you want to talk to Mr rai about a couple of examples that you've gotten recently emails yeah absolutely as a cultivator we don't have a lot of exchange with the the patients unfortunately however this summer I've received a few letters from patients and it's all right I like to share those with you briefly I had the first one is from a care giver for their for their child I had the good fortune to try your to ensure that had C. B. D. C. B. G. and T. H. C. my son has cerebral palsy has been taking your one to one CBD to THC tincture which helped immensely he began to be able to walk again without having spasms was able to get off one of the strong muscle relaxers you have been taking the teacher you created with the added CBG is remarkable he says that it has helped him immensely. I have severe arthritis fibromyalgia cancer and terrible back problems I tried this teacher and I'm amazed with the relief that I got. And stories like these that are really encouraging and the one that you share that really drive us every day The staff the second story it says that I received I recently purchased a THC distillate and adaptable syringe if I may say god bless you one and all I have serious digestive problems and this gave me the best relief I've ever had I hate paying bills they're only bandaids and the more trouble than they're worth I seriously want to thank everyone there for all that you do people like me don't have much choice in what we do or how we live you collectively make my life easier to get through again thank you very much please keep up the great work. Okay represent have you finished. All right. Representative Scott you're recognized. Okay Senate Chesterville you're recognized for a question. Thank you Mr chairman thank you gentlemen for being here One of the there's several things that are of concern to me you said that the average bill is fifteen fifty an hour. Is that the lowest or is that the highest no that's average the it ranges anywhere from fifteen to twenty and then we have salaried employees at the cultivation facility summit to dispensaries most of the dispensary folks and correct me if I'm wrong or or hourly wage folks are they making more than the eleven dollars hourly wage or is it commented another make everybody's paying pretty I have a lot at least fifteen yes ma'am yeah I guess when you said every that could mean your thing last summer paying more. It's one of the things that I raised earlier ease it was raised to me that bio trick. There are problems with bio track and I'd like to reach one of the address that so that I can so that we at the state level can understand what we need to do better. I'm with the guys that that deal with bio track but I can tell you it's we've had some issues. And I'd like you to be quite Frank with me. Don't sugar coat it. Mister to bin is probably little more involved with the operation side and is a little bit more about five track but I hear on a daily basis that we have issues sometimes things go just disappear and Bhadrak there are other times when bow tractors at work and and the the tech support if you want to call it we have issues there it it it it's prevalent and I think every I know certainly every cultivator and and dispensary would probably echo your concerns on that we work with them and and we do the best we can because that's really all that we we have to use bio track that's the seed to sale communicator with us in the state but it you know there there certainly are some issues that need to be fixed in the state has this contract with them yes ma'am why have you not taken the time to say that the state this is working really poorly or not as good as it could be we have we have communicated that with our but I guess not just to Mr Gilmore missed mail today Mr Thompson well the department of health doesn't isn't really as involved in that process it's really more with ABC the enforcement and so are we constantly are dealing with with these issues and and communicating with ABC so about track is down or if it's not working we don't really. Deal with the this is really not department health issue it's it's really kind of an enforcement ABC issue so we we we work with ABC on a daily basis to try to address these issues but if it's down is not working then that is a glitch in the process and what we want to do is to make sure that the citizens of this state who have these cards. Are given the best possible service so I missed your I would hope that we would bring in at our next meeting ABC so we can talk about this and look at that contractor even bring in bio track itself. So that we will know. What they can do better if you have concerns about it so I'd like to hear from each person if you don't mind messaging yes. Senator just feel thank you for that question and first of all like to say I don't believe there is a perfect software solution in existence right now the ones that I'm aware of or originally created I believe five track included for a different industry and when the cannabis industry I was gaining popularity they were modified to work for that that being said it's the number one thing that keeps me up at night we have over fifteen thousand you I and our or serialized you want to say what you aliens are universal identification number you can. I which is a batch or group of products inside our facility and and there's been mentioned that the things disappear I've witnessed it with my own eyes groups of things disappearing and then reappearing as a different product and there's going to be collections again with any any sort of software but what we are doing it natural state is we're implementing a totally separate system for us to keep track of internally that we have more confidence in we've invested a considerable amount of capital and that and we are operating or actually launching next month or to be operating out of that and then inputting the data into the the state side provide tracked separately Tech support was was mentioned that's probably the biggest areas about track improve on if you call the support line you may not get a call back for two weeks at Ludwig I've greater relationship with one of their technicians but they're on the west coast signed and they have their cell phone number but an example this week for some reason or another it would not let us send out a delivery but we we could not what's called manifested call by track no response and our deliveries go out at around eight thirty AM I'll have to wait until ten AM until is business hours on there and in order for them to to log in an override some things and that's that's a regular occurrence it's it's extremely frustrating. I think the first thing that I need to explain is that my only experience with any seed to sale tracking system is through this program here so just sort of echo what Roberts saying I've heard anecdotally that in other states that use different software as their backbone there also problem so there is no perfect solution there's just a better you know there might be a better version of what we have right now in and the second thing that needs to be understood as there are two different types of bio track that everyone or most people have to deal with one state system that the state's contracted with to provide the underlying seed to sale tracking system the second piece that dispensaries deal with is the retail piece that might sit on top of that that actually runs your POS and does all the other traditional you know retail functions that you might see in any other type of establishment and so I that the comment I have comments about both and one of them is not state control but one of them is so there's things we can control and there's things we cannot control on the things we can control there's a very steep learning curve with fire track I presume it's the same with other software systems but I don't know and there's not there's no you know welcoming committee that comes in and teaches you how to use these things there's no one set selling her sharing with you all the super secret news that you have to make to ensure that your books and records are are aligning with what the state system missing so you sort of have to figure that all out on the fly in the meantime you're doing you know roughly thirteen thousand transactions a month so that is a very steep learning curve and is very very thin a margin for error on that stuff and support I I just same thing that you've heard before tech support is almost non existent it feels to me as though that is the part of the company that they invest the last in the least amount in and we're seven day week business so the fact that it's five o'clock on a Friday does not mean that we don't. The tech support we need tech support twenty four seven because if if that piece of the puzzle is not functioning then research we have to shut our doors we cannot complete the sale and so this the stakes are very high all that being said from the time that we opened in twenty nineteen to now we've got a lot better with using by a track understanding where problems might arise in understanding how to fix it we've you know communicated with the state and the people that we directly interface with a bunch of the different issues that we've seen and you know I can say that they've all been solved because some of them require a much higher level of attention then simply you know regulators who just say fix this well that implicates a bunch of software infrastructure that has to be hard coded back into it and and sometimes it I've actually been told from a by tech rap that well the contract says acts we are compliant with acts therefore we don't have to fix it which is. It is absurd in some instances so those are the things that we can kind of control we've got and we've gotten better but their issues the things we actually cannot control there are problems products that are supposed to be in our system will sometimes simply disappear. And your ways to you know try and troubleshoot that to get it back or we don't need anyone else but they will disappear even more frustratingly products will re appear that we have sold or manifested to something third party and you know that's very problematic when we are as highly regulated as we are you know connections to the system from from my building to the our system system or the by Traxxas Tim will simply be unexplainable a cut sometimes that means we have to shut our doors and then we get to play the game of phone tag to all the other stores throughout the state to say Hey have you guys been affected by this and and it's it's kind of hit or miss as to who is affected by this no real rhyme reason that I can tell but I mean it's an imperfect software there are lots of things that could be improved upon tech support is number one in my my impression and again I I have no insight into the actual face to face negotiations about this but my inside my impression is that they are not motivated to to change many of these things and absent some motivation I suspect will be stuck with some of these issues for the for the foreseeable future. Just a quick and I'll I'll say my reading other questions later and that other people get in the queue well what is the contract amount. About that is and I know. What are we paying them I I'd like to know that as well I'll be back in the late Mister I appreciate your indulgence all right of center Senator Leding recognized for a question. Thank you Mr chair of this question is for any or all of you as Mr paschal noted his opening statement this industry is still very new to have been up and running for about two years so just kind of curious about what are some of the biggest challenges facing the industry right now. From a cultivation side I think that I had on this a little bit earlier we don't really have any ability to interact with our end users and get feedback on our products and we have invested and continue to invest a lot of and to research and development and creating products that are you know able to better treat certain conditions so that combined without an ability to really educate our patients on what products we do offer and and and what our best to treat certain conditions this was one of the biggest challenges these for my organization. Yes I would occur that in where that comes from is there are some advertising restrictions and certainly I think the intent was that I don't think people wanted billboards come up and down the estate but as a result of some of the advertising restrictions it really limits kind of our ability to you know really conduct any type of commercial speech or communicate with with the patience and providing educational materials on yelp this is what this product is is used for and so it does make it very difficult with that respect. I'd like to add that I mean even things as simple as how to open the package we're required to have every product and child resistant packaging and and some of them are very difficult to open and dated with questions of how the heck do you get this thing opened things up things as simple as that and I mean the simple solution would be able to educate about our products on our website. I think some of the biggest challenges that the dispensaries face are is is simply the the the regulatory load I mean it we are a highly regulated industry the volume that. My parents Dorsey's and other other store C. is very high and so like I said that the the margin for error is very low in some of these regulations are there for very clear reasons it makes sense and and there's no you know I have no issue with any of those but there are some that were written into the law that don't really reflect how things have to transfer you know how how transactions have to occur in so dates date they make the industry further away from what a normal industry would would how it would function and so that just makes it's increase transaction costs increase you know all sorts of extra steps that you have to take just two simple things and then. It appears as we move from one legislative session to the next to the next of the next it's more of an additive approach to this industry we are adding new laws new regulations versus looking at the laws that are on the books and in evaluating whether they work or they don't work in so it's fine to add the laws and I'm you know if there is a need that I'm in favor of a bill but it does not seem as though we have sort of really addressed some of the ones that were originally put in place that don't that don't work on those those the biggest things that we face. A public way I in on that as well as per week usually police would you identify yourself the record who you represent absolutely Mister chairman and I apologize for rising late thank you for having me my name's Dan roda I'm the co founder and CEO of abacus what we are is a financial technology company that works with banks and credit unions to allow them to serve the cannabis industry we are in fact based here in central Arkansas and started the company here after the medical marijuana amendment was passed here we now do this in about a dozen states and so both responsive to senator Chesterfield prior questions about bio track and the question currently on the floor about pain points and difficulties in getting the industry off the ground and continuing us with the operation my specific pain point has to do with access to data what my company does is analyze financial data in order to give our partner banks a high degree of validation that the cannabis businesses that they work with I am except posits from are in fact operating compliantly with state law and in some states are California for example the data from systems like bio track in their competitors metric MJ freeway along with the other information from the state regulatory office is shared with any financial institution that wishes to provide financial services to the cannabis businesses in the state I will not only does Arkansas not have any so low both by a track in the department of health have made it very difficult for us to get access to that data we are on a creative and industrious people so we have developed other methods but I assure you Mr remind Mr Bannister gray here will tell you that sometimes those methods can in fact also provide difficulty operationally for their business as where we are having to request certain data be manually exported from the bio track system an email to us or sent to us via a secure. Server periodically I simply because the state was on willing to provide a mechanism to access this data even though they own and would be able to provide that the press of a button for no cost and because bio track for the reasons that were mentioned by my fellow panelists here you know with the the delays in support enquiries and other just mysterious happenings we can connect to get that data from his bio track instance in his bio track instance and his bio track instance but just like they have inventory that randomly disappears I have a connection to the by attract database from that dispensary or that cultivation facility that will also randomly disappear and I also can't get any a satisfactory answer on why this is happening from by attracts port they certainly don't view me as their customer and they also don't view these guys and their respective companies as their customer I do to the arrangement where they've contracted directly with the department of health so that's my perspective on the pain point there the one piece of good news I am here to share with the committee is that one difficulty we've not faced here in Arkansas unlike some other states in the early days of their legal cannabis program is one with banking and cash management we've not had of the instances of Lowery and other public safety issues that are attending to a a heavily cash based industry and the reason is because the vast majority of our states legal marijuana businesses do in fact have bank accounts they can put the money and and so I know there was uh perhaps some questions along those lines prior meeting here I'm primarily present here today to speak to that but wanted to speak to the current question as well thank you. Okay through center okay all representing me sir recognized. Thank you Mr chairman and first a comment to Mr wrote and then I get to my question I'm sure the technology committee launched a Program several years ago to try to get the state to be in a better position to share its data and be wiser about data use that program is ongoing and so hopefully as we go into the future business entities will have a easier time getting access to state data and that's ultimately one of the goals of that program so hopefully we'll get that my and my question is actually the Mr Rahman Senator from Conway to represent con way for you to be the guy to take on a little bit and actually my my curiosity was was picked when you talked about how you relate to the customers and just to kind of help me understand how that process works a little bit so as I understand it the doctor prescribes medical marijuana for the patient and then they come to your establishment and then do you help them decide based upon that diagnosis which strain which product to use how much does it is that something you all decide or is that something the doctor decides and if y'all decide how does your or what kind of training does your team get to help ensure that that's being done in the correct manner. Thank you for the question so it works a little bit different from that there is a private primary care physician that will diagnose the patient with some condition and if it's one of the eighteen conditions that is considered a qualifying condition under the under the amendment that patient can then go and have a either their primary care physician or another physician certify which is a little bit different from a prescription to certify that they have that condition that entitles them to have a medical card that they can bring to my staff which meant and gains in access so we call the you know the the room where we we actually do the dispensing it's a process is is it. Are the people that we employ a are all employed because they've you know you for better or so long stretch of Candace the understand how a lot of it works and they know the different strains and we communicate a lot with our cultivator friends here to understand what types of strange they're growing and and you know there are different cannabinoids that are more prevalent different strains different terpenes are more prevalent different strains and each of those chemical compositions will have different a slightly different effective on the patient and so a lot of it is just conversation we don't recommend dosages the the one thing we do recommend is that if you're new to the product you take it very slow and you figure out how your body tolerates it but if we if the process is not Hey I've got this particular disorder what do you have to treat this particular disorder it's more this disorder causes these types of symptoms whether it's you know what PTSD or pain you know what which of these different strains would be best for alleviating route to alleviate pain and this in related comes from learning about the lab testing because that becomes very important that will tell you what concentration of for example THC it might have ended or what concentration of the different terpenes that have different characteristics will come in it so it is you we certainly are not the the doctors are not prescribing dosages were not you know suggesting that they for their body weight they take X. amount it's more try this other patients have had success with it starts slow and and you know you you individually like to figure out as it gets more more now if there's a more complicated question or if there's more complicated condition that we have to address we also have a pharmacist consultant who is available you know essentially whenever we we can make appointments oftentimes we can make a direct call and they can take in some of that information and figure out. You know where they might want to steer clear of a particular strain or particular type of cannabis a particular method of ingesting but that's really for the more complicated cases honestly it's it's only happened a handful of times in my store I imagine it's more you know it's probably happened in other stores more but that's the basic process the foster. Yes represent Meeks can I add a little bit more on him each dispensary make it clear each dispensary has to have a pharmacist on call in case there are questions when a patient comes in we work with this legislative body last session to pass a law that requires each dispensary to put on their website and give each new patient I hand out with that pharmacist consultants contact information and of the pharmacist consultant that works with the most dispensaries is also a Conway resident Tiffany Keatley I think she does a lot fifteen of those but each dispensary has to have one a pharmacist on call if a patient has questions about medication okay current version of that and I'm new to a lot of the sauce on Massey's question is there any concern about a again this is my ignorance here of an overdose or any issues were patient took the cannabis product and had either interactions with medicines or been any kind of health issues that have arisen from is basically sounds like the patient is deciding what's best for themselves and so I'm just wondering are have there been any those type incidences or you know how do we guard against those with that is not then something that's happened as a result of any of our sales that or at least that we heard of I'm not aware of sort of on a global you know in a in a much broader scale of any thing like that happening I think it's always a concern when you sell any type of product that the patient themselves will abuse it or ever use an unintended way by I'm not aware of any overdose situation related to products that we sell to them now should a patient combined with other things that Purchase also I mean I. I'm not sure okay all right thank you thank you. Right and Senator English you're recognized for a question thank you very much so I didn't quite hear what you're saying but I have I'm still wondering about the finances in the banking and so do we have banks in this state right now that are accepting these dollars or a new couple years ago we didn't but do we now have yes ma'am you do that is correct and can you hear me OK yeah. A yes ma'am that is correct I had asked that two documents be circulated yeah I've got those two documents but then I can figure out well so how many do we have an yes ma'am allow me to translate the documents are looking at come from since and the first document is a piece of regulatory guidance issued back in twenty fourteen that recognizes the increased number of states that have passed some form of legal medical and recreational cannabis and advises financial institutions how they may treat those businesses as potential customers following that regulatory guidance some six or seven hundred financial institutions give or take and it sort of as inflows every quarter I have begun to serve the industry and that second document that I ask be handed out is the most recent update from San Santa where they tally this data the the data like I said it does have been flowing recorder and those six or seven hundred financial institutions keep in mind only represent about five percent of the chartered banks and credit unions in the country but then the message here is that it's not accurate to believe that the cannabis industry is on banked without access to financial services in fact the reality is that it is under backed there are only a limited number of financial institutions that work with the industry and some service availability can be limited as a result of the good news is here in Arkansas the vast majority of our state's licensed cannabis businesses I have bank accounts and have had them from the inception of their operation and for on Arkansas based licensed cannabis business I to paid or I state taxes the process is no different than any other business that operates in the state they simply log on to a tap the Arkansas taxpayer access point when their bank account press the button and M. A. C. H. debit transaction is initiated off from the department of finance and and Administration to their bank account to pay those taxes so that is the status quo here in Arkansas. Aw like any other like any other state that has legal cannabis hi there there are still some portion of the sales that are done in cash and you also see this and I any number of perfectly legal businesses as well such as convenience stores that do a high percentage of their sales and cash so there is still some cash management and cash a security that is a consideration for these operators but it is nowhere near the the scope and magnitude that might be fear would be the case we're we're these in where these businesses simply I'm able to get a bank account at all and I'm happy to go into further detail on that if you'd like they aren't able to get a bank account no they are they are in fact most payment with the credit card a credit card or credit cards are unfortunately generally still off limits to the cannabis industry vis a MasterCard discover and amex I have policies that if I may summarize basically state that as long as cannabis remains a federal schedule one substance they will not permit there's transactions on their network those in the people pay by check for what I at the dispensaries people are able to pay in three ways currently they're able to pay in cash they are able to pay the apt based methods that use a CH transactions which is a bank to bank transactions just like going into your online banking and doing bill pay and they are able to take debit cards which rather than the credit cards run on smaller regional networks that are a little more friendly to cannabis and so at the wholesale level I dispensaries are able to pay cultivators also primarily via a CH and that in terms of volume of cash would be the order concern as a retail purchase at a dispensary maybe a hundred dollars a wholesale transaction between a dispensary in a cultivator would be many thousands of dollars and so the the good news is that. Those are all of the vast majority of those are in fact being done electronically as well. Thank you. Okay represent Fortner you're recognized. Thank you Mr chairman I'm over here hidden behind the bill this is that uh money question of banking questions. you said the. My question I guess my first question is what percentage of the sales are cash cash we actually did our own analysis of this and it's approximately sixty percent at retail at wholesale that number is considerably smaller I don't have the data in front of me but I would venture to guess that is less than twenty five percent of the wholesale transactions are conducted in cash today okay thank you my next question is if. If there are limited Act if there is limited access to banking I know that there is access I'm glad for that How how can they take checks because you have to have a bank account you have to have your own bank account to accept checks or for the banks to accept them from you. How's that working. I'd just like to positing a check and any other bank account these can either be tendered at the teller window or deposited electronically locally or through a scanner and so the the common misconception is that in fact banks have to treat these accounts differently than other banks or than other types of accounts excuse me the reality is that a cannabis business can have a normal demand deposit account which is to say a business checking account at a financial institution there is just a significant compliance burden that's placed on that financial institution not the least of which is filing the reporting that constitutes the data in that document that I ask be circulated to all of you and so that reporting regime is is very laborious I'm my company's technology makes that easier for banks which is a big part of the reason they are willing to work with us but in fact just as a state licensed cannabis business here in Arkansas can sleep at night because they know that if they operate their business compliantly with state law the both state and federal guidelines is such that they're not going to have a federal prosecutor you know initiate charges against them that result in federal agents kicking down the door likewise there are financial institutions here and in fact in every state across the country that has a legal cannabis business that have made the same decision to begin working with this industry irrespective of the conflict with federal law knowing that if they comply with state law and comply with the regulatory guidance that's in front of you guys there that day two would not suffer any negative consequence and and in fact it is now been seven years since that twenty fourteen regulatory guidance was issued and and as you see there are some seven hundred banks that have reported voluntarily on a quarterly basis to the federal government these of the fence and that they are in fact serving the cannabis industry and there's of course been no prob. McCue show and I'm no negative action against the the charters of any of these financial institutions simply for serving the industry and so I just like they have just like these businesses can operate compliantly with state law and it weeks from now operate irrespective of the conflicting federal law our partner financial institutions operate in the same manner follow up Mr yes. One last question of the five hundred and ten banks that you say are those are in Arkansas five hundred ten that is a national figure I would venture to guess there are maybe half a dozen here in Arkansas that have some level of contact with the cannabis industry under reporting that into that data so there so there's twelve banks that they can that the gentleman can use in Arkansas that there are a handful and some have a greater degree of contact with the industry than others the data unfortunately in that report doesn't really differentiate between a bank that might have a customer who who owns a a secondary marijuana business that is to say it may be an accountant or consultants who does a large amount of work for the cannabis industry verses a dispensary or cultivator III who is in fact directly as we say touching the plant the data doesn't differentiate and so well they're probably you know at least a handful of financial institutions in Arkansas whose data is among that data set there the degree to which they are serving the industry does vary there are only a couple in fact that are serving the industry in in any big way. By which I mean I have multiple accounts and would be willing to take more so there federally insured these banks yes FDIC thank you yes. Okay representative love you're recognized for a question. It's to your left now he moved. What. Okay that's staff's fault right. Okay. If no the not back complement of my my question is that to robin you've mentioned about the small threshold you guys have for their what are some of these penalties and what it what what what what what is in the thing that what would cause an error in the industry and what. House defer those penalties if you got a date with them well I try not to think of these things in terms of what is it going to cost me to break this rule you know we I think almost to a person everyone that's involved in this industry did it with an intention to be as compliant as possible there's been too much money invested in every part of this business to ever you know violate the rules if at all possible ever violate the rules and so we will act the the the infrastructure that we have built the the the employees that we have hired or all calculated for the purpose of never having to violate the rules as best we can but understand that the volume that we sal you whether it's a dispensary or cultivator the volumes that we deal with are all you know meted out in one gram increments and so you have to be very very detail oriented to ensure that a small mistake you know with one gram or ten grams or whatever does not happen over over and over again create these very very large problems and and as to the to the cost. Yeah you know I am only aware of the types of you know finds that we is experienced and in in every instance where I felt like the the the regulators have come and notice an issue they've almost always been willing to work with us and only in the instance when it's really something that we cannot solve have we experienced a fine and all the signs of and you know have have borne some relationship to the severity of the crime you know that the crime that the rule violation you know what what what with the severity B. if you are intentionally breaking the law or intentionally flouting the rules I you know I can't say because we've we've our intent is always been to follow the rules but I expect that in the appropriate circumstance an intentional violation would would experience an extremely hi fine. Okay okay about another question this is for the financial so why would why would a bank not want to bank what what what what what their fears are are why would they not want to while not all the banks want to base product rules for banks and like any business it's primarily a cost benefit analysis and so the reality is that in order to comply with that regulatory guidance that's in front of you that actually does represent a significant costs for a financial institution and an order for that to make business sense for a financial institution to incur those costs which often requires working with a specialty technology companies such as mine you need to be able to to to achieve some level of business success by which I mean it probably doesn't make economic sense for a bank to go to all of the costs and steps necessary to begin serving the cannabis industry only the open one account or to they need to they need to again it's experience some success in opening up multiple accounts for the economics to work so the number one reason why the why banks are not serving the space is primarily a function of cost of the reason that the cost is significant is because of the compliance obligation I because you've you've got you know a forty one states that have now we realize some form of cannabis and each one has a slightly different regulatory structure for by National Bank to begin to serve the industry they would need to become comfortable with forty one regulatory structures and it changes every day and so the the intellectual bird and I and the technical burden I is pretty high there is also a reputational concern that will keep a large number of institutions away from servicing account of a space as well. Hodges if I can add to what my friend robin remind had to say I monitor all the anti medical marijuana commission meetings in the ABC of meetings and work closely with orally and her staff and I will say that her staff has been very good in the commission's been awesome in trying to work with our interstate eighty knowing that it's a new industry and they've tried to help educate and you know put us on the right path rather than penalize us and I just wanna say something I know Doorly gets raked over the coals in here often but I have had a very good experience working with she inner staff in the commission they have tried to be hopeful and not punitive. Okay thank you representative Hodges yes Mr gray. Our goal under HIPAA. as the the the cultivator does it have any idea who any of the patients are and so really robin I can answer the help of for dispensary question. This is the issue of of debate that as you can imagine a reasonable minds could differ but the way this is worded that I see is that a dispensary is not a healthcare provider we are not subject to any kind of hit the rules and regulations that being said I think because of the way that we have to maintain our records because of all the rules we end up being basically have a compliant by the way. If I may add to that please the way we view that as a software and technology company in the space as well it's unclear that have a applies directly today we anticipate that it or something like it may apply in the future and so we we approach to data security it with a helpful compliant framework in mind okay with that being said then when you hired employee you do it all ask them if they have a car. It is not right well it's not required that they be a patient in the system that actually business dispensaries and and you know purchases product however they are required to get a of what's called a writ card which is essentially the state issued card that comes after they've gone through an extensive background check by the state it authorizes them to work at that particular facility but it but it's it's a little it's different from the patient Kerr no we don't we neither asked are required that they be a patient in the. And so you do not do drug testing them Martin you don't drug test employees no Sir okay. Okay saying no other questions. We appreciate your being here today and and we look forward to touring one of the facilities here in the near future I'll get with the senator samples will set this up and If there's nothing else to come before us today we are chart.