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The mics take a breather, but the cannabis market doesn’t. We’re wheels up for MJBizCon and our High Spirits Morning Mixer on Thursday, and then straight to BevNET, while state and federal moves reshape the map from Texas to Virginia to Minnesota to California.

We start with Texas, where regulators approved nine new medical licenses in a historically tight program. It’s a modest step with big implications: recognition that demand is outpacing capacity, but who will be the winners? For operators eyeing long-term positioning, Texas remains a massive, underdeveloped prize where patience, compliance, and local partnerships can compound.

Minnesota faces a different pressure: the looming federal hemp THC ban embedded in a congressional minibus. The state’s hemp-derived THC market—thousands of retailers and strong consumer buy-in—could be gutted overnight. The governor is exploring rapid rulemaking, carve-outs, and potential court challenges to protect businesses until adult use retail is fully stood up. How Minnesota responds may become the national playbook for preserving economic activity amid federal whiplash.

Virginia looks ready to convert legalization on paper into real stores. A bill targeting adult use sales in 2026 would finally establish a regulated retail framework, address social equity, and balance political priorities after years of stalls and illicit market growth. If it moves, Virginia could become the first Southern state with full adult use, forcing regional recalculations and opening a high-potential market.

And California turns the screws on packaging. With a new top regulator and CalRecycle implementing SB54, brands must enroll in a PRO, report packaging at the SKU level, plan for recyclability and compostability by 2032, and meet aggressive plastic recycling targets. Expect cost shifts, supplier consolidation, and innovation in materials, especially for vapes and multi-layer plastics. The winners will treat compliance as strategy, integrating sustainability into brand and supply chain decisions.

Headed to Vegas? Come say hi at the High Spirits Morning Mixer on Thursday. If this breakdown helped you navigate the noise, follow, share, and leave a quick review—what state move should we unpack next?

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Episode Transcript

Ben Larson (00:00):
Hey everybody, Ben here.
I think Anna Ray is in Vegasalready.
Hope you all had a greatThanksgiving.
If you noticed we were quietlast week, yes, we took a break,
it was unannounced.
Like many of you, we took abeat to recharge.
Spend time with the family andprepare ourselves for what is

(00:21):
always one of the busieststretches of the year.
This week we're off againbecause the entire industry is
descending on Las Vegas for MJBizCon, us included.
Unless you're one of thosefolks posting on LinkedIn about
not attending MJ BizCon inVegas.
Anna Ray and I will beeverywhere.

(00:42):
And of course, we're hostingthe High Spirits Morning Mixer
on Thursday morning.
The one event people actuallywake up for in Vegas.
We can't wait to see so many ofyou there.
And then next week, the Virtosateam and I head straight to
Bevnet and Marina Del Rey.
So yes, uh, we are in deep inconference mode, holiday mode,

(01:05):
year end mode, whatever you wantto call it.
Let's just call it what it is.
We're on a little winter breakwhen it comes to high spirits.
But don't worry, we will beback before the end of the year
with a proper wrap-up episode.
A lot has happened, and evenmore is coming as we get ready
for 2026.
How about a little bit of anews roundup since you're here

(01:28):
already?
Texas.
Slow but meaningful expansionof medical access.
Texas regulators just approvednine new medical marijuana
business licenses, which is abig deal in a state known for
keeping cannabis very tightlyrestricted.
Here's why it matters.

(01:49):
Texas's medical program isnotoriously limited.
I think three licenses to date.
Low TAC only, small patientpool, very few licenses, like I
said.
Adding nine new operatorssignals acknowledgement that
demand is outpacing capacity, orat least fulfilling their word

(02:11):
of the most recent legislation.
And for national operators,looking at long-term
positioning, Texas remains oneof the largest untapped markets
in the US.
Oh, did I mention that thosenine licenses may have gone to
out of state MSOs?
It's incremental, it's notperfect.

(02:33):
Hey, but in Texas, incrementalis is meaningful, right?
For Minnesota, the governor isstrategizing around the
impending federal hemp THC ban.
Minnesota is in a uniquelyvulnerable position because they
pioneered a regulatedabove-board hemp derived THC

(02:57):
market ahead of full adult usecannabis, similar to how
Tennessee has a very structuredhemp marketplace.
That market is thriving.
Thousands of retailers, strongconsumer adoption, a model other
states have copied, and thefederal hemp ban included in the

(03:18):
congressional minibus would gutthat entire ecosystem
overnight.
That's why the governor isactively exploring options to
protect Minnesota businesses,including a state-level
workaround or exemption.
But it does call into questionwhat does that mean for the
supply chain that relies oninterstate commerce and

(03:38):
centralized manufacturing andall that good stuff?
Rapid rulemaking to preservethe market until federal clarity
arrives, potential courtchallenges depending on the
final federal language, whichI'm pretty sure it's kind of
final.
So maybe we'll see some courtcases from Minnesota.

(03:59):
And ensuring legacy hempbusinesses aren't wiped out
before adult use cannabis fullylaunches, which they're somewhat
related, but not fully.
So four years.

(04:43):
Political flip-flops and vetoesstalled implementation, leaving
Virginia with legalization onpaper only, while illicit market
activity has surged andlawmakers are facing increasing
pressure to create a regulatedsystem.

(05:05):
Go figure.
This new bill is expected tocreate a framework for retail
stores and tax sales,incorporate social equity
considerations, and potentiallybalance both Democratic and
Republican priorities ahead ofthe 2026 elections.
If it moves, it would makeVirginia the first Southern

(05:26):
state with a full adult useprogram a major milestone.
And finally, my home state ofCalifornia.
We have a new regulator, and wehave a new law.
California appointed a new topcannabis regulator tasked with

(05:47):
cleaning up an extremely complexprogram that has struggled with
tax burdens, illicit activity,local control issues, and
inconsistent enforcement.
Expectations are high.
But while the industry waswatching hemp taxes and
enforcement, Cal Recycle quietlybegan implementing SB 54, a

(06:12):
sweeping packaging law thataffects almost every cannabis
brand in the state.
Here's the detailed breakdown.
One, mandatory pro PROenrollment.
Brands must join the CircularAction Alliance and pay annual
fees based on packaging impact.

(06:34):
More fees.
Wonderful.
Two, packaging reporting.
Every SKU's packaging materialsand weights must be reported.
Deadline was novemberfifteenth.
Fines apply.
Get with it.
Number three, recyclablecompostable requirements.

(06:57):
By twenty thirty two, which Iguess seven years, okay, all
single use packaging must meetapproved recyclability or
compostability standards.
Fees escalate for slow movers.
Be interesting to see how thisimpacts the vape market.
I'm not sure where we're atwith recyclability on that

(07:18):
front.
Number four, 65% recyclingtarget.
Plastic packaging statewidemust hit a 65% recycling rate by
2032, forcing major materialshifts.
And number five, sourcereduction mandates.
Producers will be required toredesign packaging to use less

(07:39):
material and eliminateunnecessary components.
It is not proposed.
It is active, it's expensive,and it's going to transform
packaging, supply chains, coststructures, at least for the
next seven years.
So congratulations, California,you just got even harder to

(08:02):
operate in.
Alright, that's the news.
Not to end on a bad note.
We're really looking forward tothe next couple weeks, even
though we won't be spending muchtime on air.
We'll be spending time inperson.
We're wishing safe travels toeveryone heading to MJ BizCon or
Marina Del Rey next week.

(08:22):
We hope to see you at theMorning Mixer on Thursday, and
we'll be back before the yearends for one last episode to
reflect, reset, and close out2025.
We'll talk to you soon.