Abby Kaufmann, Executive Director of the Nevada Chamber of Cannabis – Interview Series

When it comes to the everchanging and oftentimes burdensome cannabis regulations in the Nevada industry, few dedicated professionals both stay as up to date and inform their fellow Nevada cannabis professionals as Abby Kaufmann. During her time in the cannabis industry, Kaufmann has served in numerous incredibly vital roles, including three different roles with New Frontier Data, the data collection company that has published some of the most crucial research on industry trends and predictions. Currently, Kaufmann serves as Executive Director for the Nevada Chamber of Cannabis.

Tell me about yourself and what originally brought you into the cannabis realm?

Oh gosh, where to begin. I suppose my first introduction to cannabis was when I was in high school in North Carolina. I was class president and top of my class but I’ve always been an anxious person and the SSRI’s that I was on at the time made me feel numb. I immediately fell in love with the mental relief that the plant brought me. Throughout my adult life, I have always found cannabis to be a therapeutic and sustainable solution to my own mental health challenges

To my 16-year old self, California meant cannabis and that’s where I wanted to be. I got accepted to a handful of colleges in the state and was offered a half-ride scholarship to USC but begrudgingly stayed in state for financial reasons. After my freshman year at UNC Chapel Hill, I created a proposal outlining why my dad should use any college savings he had to send me to Oaksterdam Academy instead. It went about as well as you might imagine and, after that, I put my pipe-dream aside until about 2018.

What roles did you serve with New Frontier Data and why do you feel that the research and trends they publish about the cannabis industry is important?

When I decided I wanted to work in cannabis, I was acutely aware of the fact that I knew nothing about the actual industry. After scouring job boards to find a way to relocate to a legal market and enter the industry, I came across New Frontier Data and figured “what better way to learn about an industry than to work for a company that collects data and does research on it?”. I took a pay cut and joined the team as their first Customer Support Manager. Since this role touched on the technical side of their SaaS platform as much as the sales and marketing side, I became quite involved with every aspect of Equio. After some personnel changes mid-way through my time there, I did a quick stint as Product Manager before taking on the title of Director of Product Management. I still can’t code a line of anything in any language but I did learn a lot and am very grateful for my time with New Frontier Data.

What brought you out to Las Vegas? Because I know you originally lived in North Carolina, a very prohibitionist state in its own right, I wanted to know how you’d describe that similar culture shock that I felt when I moved here from Texas and I ended up living next to multiple recreational dispensaries in Vegas.

I jokingly call Nevada my “realistic California dream”. While I was working in operations and logistics for a start-up CPG brand, the infused beverage brand, Cann, won this traditional food & beverage competition called BevNet Live and, with the 2018 Farm Bill passed earlier that year, I saw that cannabis was increasingly mainstream and legalization was expanding. When I joined the team at New Frontier Data, I wanted to live in a legal state market but I was needed at their HQ in Washington, D.C.. I technically lived in Arlington, VA so I wasn’t eligible for the D.C medical program. 3.5 months after I relocated to the “DMV” area, a little global pandemic happened and I was stuck living and working from a studio apartment I couldn’t afford in a place I didn’t want to live to begin with. I eventually asked to stay remote forever and set my sights on Nevada. In October 2020, I masked up and flew to Vegas (for the very first time) and toured 20+ apartments in 3 days. After driving across the country alone with my dog, I picked up the keys to my apartment on December 5, 2020. I could not be more happy with my decision and can confidently say that home does mean Nevada.

Do you ever see a state as prohibitionist as North Carolina ever legalizing recreationally?

I can see all states eventually having some form of legal access to high-THC cannabis but, like most states, it will start with medical. With NC’s latest attempt to legalize cannabis in House Bill 253, this is only going to give access to patients with debilitating medical conditions, I don’t see much traction with further legalization until they start expanding the list of qualifying conditions. All I know is that my mom would be thrilled if North Carolina did legalize it for adult use because she knows that’s what it would take for me to move back home.

Because you’re one of the most devoted attendees of very crucial Cannabis Compliance Board meetings, what would you say are some of the most frequent issues mentioned by business owners and industry professionals at those meetings?

I’m glad you asked! 2024 has been unique in the sense that it has been the first year the CCB is operating under the Administrative Procedures Act (APA) and, as part of this process, in order to make the regulatory changes required by the bills that were passed in 2023, the CCB was required to host workshops (and provide ample notice of the workshops) to solicit input.

With these ongoing opportunities for regulatory discourse, business owners and industry professionals have provided numerous specific suggestions and, overall, the CCB has been fairly receptive to industry input during this process.

Broadly speaking, the high cost of regulatory compliance is the biggest issue – on top of the expenses associated with licensing and things like packaging, labeling and testing, a lack of clarity and specificity in the regulations frequently leads to unintentional violations and inconsistent enforcement which can be just as costly.

From your experience, what are some thoughtful ways that the Cannabis Compliance Board can be more considerate to the interests and overall financial health of cannabis businesses? Are there certain regulations that you’ve seen are particularly troublesome or costly for cannabis businesses?

Until our regulators and elected officials find a way to measure the success of the cannabis industry beyond the CCB’s contributions to the General Fund, I really don’t know how much consideration the agency is willing to give to the overall economic impact of its regulations.

The very first line of NRS 678A states that the cannabis industry is significant to the economy of the State of Nevada. It goes on to state that the continued success of the cannabis industry is partially dependent on the understanding that “a well regulated cannabis industry provides significant tax revenues to the State”. By singularly focusing on tax revenue as the metric of the CCB’s effectiveness, our current regulatory and statutory environment fails to consider the overall financial health of cannabis businesses.

One semi-related example: The Department of Taxation’s reporting on taxable cannabis sales is the main benchmark for industry performance. Yet, it includes tangible personal property transferred for value, and all other amounts subject to Sales or Use Tax, as reported by licensed cannabis establishments, making it appear that the industry is on the right track in 2024.

What roles have you served with the Chamber of Cannabis and why is the work of the organization vital towards the success of the Nevada cannabis industry?

I initially joined the Chamber’s Board of Directors after submitting an application as an Individual Member in 2022. Shortly after joining the Board, I was appointed to serve in the Officer position of Secretary to the Board of Directors. In my first year on the Board, I began participating in the Commerce Committee and mid-term was asked to take over as Chair of the Committee, which is when I really dove head first into understanding and unpacking the Nevada Cannabis Compliance Regulations (NCCRs).

As a volunteer-led organization, all of our Board Members and Committee Chairs have full-time jobs outside of the Chamber. The one exception is the Executive Director, which is now my full-time position. To ensure balanced decision making and separation of roles, I will be stepping down from my position on the Board after our 2024-2026 elections are complete.

One way to think of the Chamber of Cannabis’ work is in the context of the “entourage effect” theory, which suggests that cannabis products with a diverse array of natural cannabinoids produce a stronger experience than any single cannabinoid on its own. Similarly, our fundamental belief that the cannabis industry is stronger together. By bringing together business members across every sector, the Chamber fosters resources and connections to empower collective action and impact meaningful change.

How do you see federal cannabis rescheduling impacting or changing the Nevada industry?

The potential rescheduling of cannabis to Schedule III is a significant step in the right direction and would likely mean that cannabis businesses are no longer subject to the limitations in Internal Revenue Code Section 280(e). Outside of this, I anticipate little to no impact on Nevada’s industry for the foreseeable future.

From my understanding, the only federally recognized Schedule III cannabis will be that which is available by prescription as regulated and approved by the FDA, and this is only if/when the FDA decides it wants to take this on. Recognizing the possibility that, with the change in scheduling, the federal government could try to crack down on the state sanctioned and regulated cannabis businesses, this hasn’t been a priority with cannabis as Schedule I, which is considered more dangerous than Schedule III.

The current non-enforcement of state cannabis by the DOJ is thanks to the 2014 Cole Memo and, despite Jeff Sessions memo effectively reversing this in 2018, the Cole Memo has remained the primary rule of thumb to this day.

The 2014 Cole Memo led to FinCen issuing BSA guidance for banking “marijuana-related businesses” which is what financial institutions follow to this day. If FinCen were to issue new guidance in light of rescheduling, this might encourage more financial institutions to offer deposit services. However, the lack of cashless payments or access to lines of credit will not be addressed with Schedule III and cannabis loans will still be considered high risk.

Thank you for the great interview, readers who wish to learn more should visit the Nevada Chamber of Cannabis.