News

Bud Brief | January 2022

Published on January 21, 2022

Based on discussions with ADOR’s Office of Economic Research and Analysis, ADOR continues to provide significant outreach and education to taxpayers resulting in previous filings being amended. They reinforced that the taxable sales and tax figures indicated below may not an accurate reflection of ongoing future activity and may include activity from prior periods. Also, information related to estimated sales are continuously adjusted on the ADOR’s website as figures are reallocated to the months that they are applicable. Figures provided below are as originally stated.

Adult-Use

View a list of approved marijuana establishments for adult use.

According to ADOR’s Office of Economic Research and Analysis, for the month of November, adult-use marijuana taxable sales reported were $62,412,916 with TPT and excise taxes collected of $5,230,498 and $10,833,674, respectively. Total adult-use marijuana sales reported and TPT and excise taxes collected year-to-date are $528,001,277, $44,533,436 and $92,997,963, respectively.

Medical-Marijuana Program

Arizona’s medical marijuana dispensaries closed the month of December 2021 with 10,562.33 pounds of product sold. This represents a 45% decrease in pounds sold compared to December 2020 (19,276.86). Total pounds sold for 2021 was 148,047.50 compared to the 211,556.62 of pounds sold in 2020. According to ADOR’s Office of Economic Research and Analysis, medical marijuana taxable sales for November 2021 were $62,890,469, with a total TPT collected of $5,278,966. Total medical marijuana sales and TPT taxes collected year-to-date are $703,803,193 and $58,916,171, respectively.

Arizona News

In December 2021, Curaleaf announced that it has agreed to acquire Arizona cannabis operator Bloom Dispensaries in an all-cash transaction valued at $211 million. The proposed acquisition includes four retail dispensaries and two adjacent cultivation and processing facilities. (Source: https://seekingalpha.com/news/12/28/2021).

In December 2021, Curaleaf announced an agreement to acquire Natural Remedy Patient Center, a Safford, Arizona, dispensary. In mid-2022, Curaleaf intends to relocate Safford retail store to a new flagship dispensary in Scottsdale. Under the terms of the agreement, Curaleaf will pay $12 million in cash and total share consideration of $1 million of subordinate voting shares of Curaleaf. (Source: https://ir.curaleaf.com/2021-12-23)

Arizona marijuana regulators received more than 1,500 applications from cannabis entrepreneurs hoping to win one of the 26 highly coveted social equity permits that will be up for grabs via lottery early next year. According to the Associated Press, the Arizona Department of Health will review all applications to make sure they’re eligible as social equity candidates, but an exact date for the lottery has yet to be determined. (Source: mjbizdaily.com 12-17-2021)

In April 2021 the Arizona Department of Health Services awarded 13 new Adult-Use cannabis retail licenses across eight rural counties. In December 2021, in a transaction facilitated by Highway 33 Capital Advisory, the license was sold establishing a benchmark for these rural cannabis retail licenses. (Source: mjbizdaily.com 12-14-2021)

Banking News

Although Rep. Ed Perlmutter (D-CO) is retiring from Congress at the end of this session, he says that he’s going to work to pass his marijuana banking bill before his time on Capitol Hill comes to an end. The congressman spoke recently about his decision not to run for reelection this November and his disappointment that, while the House has approved the Secure and Fair Enforcement (SAFE) Banking Act five times now in some form, the Senate has failed to advance it under both Republican and Democratic leadership. (Source: marijuanamoment.net 1-17-2022).

ASCPA Cannabis & Hemp Series
On January 26, 2022, Cody Hershey, President of Integrated Compliance, will present a 1-hour CPE titled Banking Challenges in the Cannabis Industry. Register for other webinars in the series here

Over the past several months, there have been several cannabis webinars including speakers like:

  • October 2021: Danielle Hernandez, Director of the Cannabis Practice and Agency Manager with Gilbert Insurance Group
  • August 2021: Brion Nazarro, President of the Association of Commercial Cannabis Experts and Josephine Giordano, Director/National Cannabis Practice Leader with BeachFleischman PC
  • June 2021: Representatives from ADOR and Melody Haddad, Tax Manager with BeachFleischman PC

For additional information on our Cannabis Special Interest Section activities, please contact Josephine Giordano, CPA, ABV, CFE, CFF, CBA, ASA, CDBV, CIRA, CICA, CTP, CCCE at jgiordano@beachfleischman.com or 602-792-5981.