The Short Sweet Life of a Cannabis-Industry PAC

A PAC that donated exclusively to the Republican party, called the Federalist Freedom Fund, got all of its donations from the cannabis industry. Business owners and investors, and a couple of law firms representing the industry, contributed $187,000 to the PAC before it closed down in February of last year, six months after its creation, and all but two donations came in between September 21st and September 30th of 2017. Why it existed in the first place is not completely clear, in part because the PAC listed no contact information, mission statement, or website.

In August 2017, Republican congressmen Carlos Curbelo and Mike Coffman joined forces with the GOP’s Senate and House fundraising arms, the National Republican Senate Committee (NRSC) and the National Republican Congressional Committee (NRCC) to form the Federalist Freedom Fund, a joint political action committee. After the PAC closed, the donations were split between Curbelo, Coffman, and the NRCC and the NRSC, who received $39,095.75, $39,382.96, $41,249.84, and $55,610.41 respectively.

Curbelo is a Republican congressman representing Florida’s 26th district, in far South Florida, which includes Monroe County and part of southwest Miami-Dade County. Curbelo has supported the industry since 2015, his first year in office, when he voted in favor of a bill to allow veterans access to medical cannabis and another to prohibit federal spending on interference with state cannabis laws. In March 2017, one month after the PAC closed, Curbelo sponsored the Small Business Tax Equity Act, which would amend the IRS code to grant tax benefits to cannabis businesses. This year, Curbelo spoke out against Attorney General Jeff Sessions’ promise to crack down on cannabis businesses in states which have legalized its use, and has been vocal about his support for reforming cannabis laws on the federal level.

When it comes to money flowing from the cannabis industry to elected officials, more than one road leads to Curbelo and more roads lead to Curbelo than to other members of Congress. Curbelo’s re-election campaign accepted donations from industry leaders such as MedMen CEO Adam Bierman, who contributed $5,400, and Andy Williams, CEO of the Colorado dispensary chain Medicine Man, who contributed $1,800. Cannabis Wire recently reported that an immigration PAC founded by Curbelo called What A Country! received $69,000 in donations from the cannabis industry. What A Country! was founded, Curbelo said, to support candidates in favor of immigration reform, including amnesty for DACA recipients. However, most of the candidates who received donations from What A Country! hold anti-immigration beliefs, such as penalizing sanctuary cities and banning immigration from Muslim-majority countries.

Curbelo’s Federalist Freedom PAC partner, Mike Coffman, is a Republican congressman representing Colorado’s 6th district, an area that includes the eastern portion of the Denver-Aurora metro area. Why Coffman, who says he is personally opposed to the legalization of both medical and recreational cannabis, is receiving money from the cannabis industry is unclear. He voted against a ballot initiative in 2000 that legalized medical cannabis, and against another that legalized recreational use in 2012. “My personal views on marijuana have not changed,” wrote Coffman in a column in the Colorado Sentinel last June, “and if votes on these two questions were on the ballot today, I would still oppose both of these measures.” Coffman, however, says he supports the industry as far as his obligation to serve the voters of Colorado who approved those measures. He, too, has spoken out against Jeff Sessions’ promise to crack down on legal cannabis, arguing that federal interference violates the constitution. In May of  2017, Coffman introduced a bill that would prohibit such interference, called the Respect States and Citizens’ Rights Act of 2017.

Companies and individuals can donate to joint PACs, which can then transfer funds to a single candidate, circumventing donation limits. John Lord, owner of the sprawling medical and recreational cannabis chain LivWell, contributed $25,000 to the Federalist Freedom Fund, and also donated to Curbelo and the NRCC directly. Lord also contributed $5,000 to Curbelo’s immigration PAC What A Country! Of Lord’s $52,900 total donations this election cycle, $46,300 has gone to Republican PACs and candidates.

Why the tilt to the GOP, exactly, is unclear. And Lord is hardly alone.

Brendan Kennedy is the CEO and founder of Privateer Holdings, a Seattle-based cannabis investment firm. Privateer has raised $200 million in investments for cannabis businesses, $100 million of which came from multi-billionaire Peter Thiel. Privateer’s subsidiary Tilray is one of the largest cannabis manufacturers in Canada and recently announced plans to supply medical cannabis to more than 650 pharmacies throughout the country. Two days after Canada legalized recreational use cannabis sales last month, Tilray filed paperwork for its IPO, planning to offer 9 million shares priced between $14 and $16 per share, valuing the company at $1.4 billion. Kennedy gave $15,000 to the Federalist Freedom Fund. And all but $5,400 of Kennedy’s campaign donations this election cycle went to Republican candidates and PACs. The remaining $5,400 went to Democratic congressional candidate Maria Cantwell of Washington.

Scotts Miracle-Gro, which has invested hundreds of millions in ancillary cannabis businesses, contributed $25,000 to the Federalist Freedom Fund. The company is targeting the cultivation-side of the cannabis business; last year, Scotts Miracle-Gro purchased hydroponics equipment supplier Sunlight Supply for $450 million.

Many of the PAC’s donors, such as Nancy Whiteman, CEO of the Colorado-based edible cannabis company Wana Brands, have business interests in both Colorado and Florida. Whiteman donated $5,000 to the PAC. Wana Brands is a wholesale distributor of edible products to businesses in Colorado, Arizona, Nevada, and Oregon, and signed a licensing deal in May of 2017 with AltMed, one of thirteen businesses licensed to cultivate medical cannabis in Florida. John Lord’s LivWell has forty-three licenses to sell cannabis in Coffman’s home state of Colorado. According to The Denver Post, Lord had the most cannabis licenses in Colorado when recreational sales began.   

Donations from the Federalist Freedom Fund to congressional candidates have thus far exceeded those from major cannabis lobbying and political organizations, meaning the PAC could have substantial sway in Congress. The Federalist Freedom Fund has contributed more this election cycle to congressional PACs than the Marijuana Policy Project PAC, ($25,000), the National Cannabis Industry Association PAC ($68,300), and Congressman Earl Blumenauer’s PAC The Cannabis Fund ($41,000) combined.

None of the committees that joined to form the Federalist Freedom Fund, nor its donors mentioned in this piece, responded to our requests for comment.

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