"The cannabis industry is its own best friend and worst enemy." How does a state start from scratch with a new cannabis or hemp program? Where does one even begin? There is enormous pressure to get it right and to create rules that not only align with the law and are implementable, but also make sense for the growers and founders who put these policies and rules into action. Florida has the potential to grow into one of the largest cannabis micro-economies in the U.S., and the Florida Department of Agriculture is laying the foundation. Holly Bell, Cannabis Director for the Florida Department of Agriculture is responsible for this huge undertaking and she joins Ross O'Brien and Maggie Kelly from Bonaventure Equity to provide insight into the rule-making process and shares thoughtful advice for entrepreneurs entering the cannabis and hemp spaces. Produced by PodConX Cannabis Capital - https://podconx.com/podcasts/cannabis-capital Ross O'Brien - https://podconx.com/guests/ross-obrien Maggie Kelly - https://podconx.com/guests/maggie-kelly Bonaventure Equity - https://www.bvequity.com/ Holly Bell - https://podconx.com/guests/holly-bell Cannabis, Office of Commissioner Nikki Fried - https://www.fdacs.gov/
"The cannabis industry is its own best friend and worst enemy."
How does a state start from scratch with a new cannabis or hemp program? Where does one even begin? There is enormous pressure to get it right and to create rules that not only align with the law and are implementable, but also make sense for the growers and founders who put these policies and rules into action. Florida has the potential to grow into one of the largest cannabis micro-economies in the U.S., and the Florida Department of Agriculture is laying the foundation. Holly Bell, Cannabis Director for the Florida Department of Agriculture is responsible for this huge undertaking and she joins Ross O'Brien and Maggie Kelly from Bonaventure Equity to provide insight into the rule-making process and shares thoughtful advice for entrepreneurs entering the cannabis and hemp spaces.
Cannabis Capital - https://podconx.com/podcasts/cannabis-capital
Ross O'Brien - https://podconx.com/guests/ross-obrien
Maggie Kelly - https://podconx.com/guests/maggie-kelly
Bonaventure Equity - https://www.bvequity.com/
Holly Bell - https://podconx.com/guests/holly-bell
Florida Department of Agriculture - https://www.fdacs.gov/
Holly Bell: [00:00:00] Okay. Hi, I'm Holly bell cannabis director for the Florida department of agriculture and my blunt truth about the cannabis economy is cannabis industry is its own best friend and worst enemy and causes a lot of its own problems.
Maggie Kelly: . Hello everyone. And welcome to cannabis capital the podcast. I'm your co-host Maggie Kelly here with the dist with the mostess Ross Bryan venture capital investor, and author of the book cannabis capital. How's my favorite Canadian this afternoon.
Ross O'Brien: I'm fabulous. Maggie. How's one of my top 100 favorite Americans.
Maggie Kelly: Top 100. I'll remember that
Ross O'Brien: Yeah, you bang it. I know a lot of people in very popular.
Maggie Kelly: Right, right. This will come back at you. So our guest today is the very knowledgeable Holly bell from the Florida department of agriculture. She is their cannabis director, but before we get started with today's interview, let's take a turn to the cannabis [00:01:00] economy, challenge listeners.
This is our weekly challenge that you know, and love to see if listeners can identify an industry or sector that is not impacted by cannabis legalization. Ross. Am I mistaken? Or are you still undefeated?
Ross O'Brien: No Maggie those words make me very happy. Yes, I am undefeated and intend to remain. So.
Maggie Kelly: Okay. Well, I don't know. I think this could be the week. Our challenge submission comes from Jessie in Washington, DC and her submission is arts and culture. A fantastic challenge. So what do you say to that challenge?
Ross O'Brien: Well, Hi Jessie, thanks for sending this in. Thanks for listening. Look, , let's reset why we do this, right? Which is that we believe that cannabis as a concept has reached the boardroom of every company period. And there is no one. Industry. It is a cannabis economy, which if you recall, Megan, I don't know if you know this.
I wrote a book called cannabis capital and in the book I defined the cannabis economy. [00:02:00] Maybe we'll come back to the book later. So one of the reasons why we believe this is a global macro economy is, goes back to culture, right? And cannabis has always been a part of our culture. And it's always been a part of artistic culture. If you think of musicians and artists throughout history, whether there's been prohibition or not, cannabis has always been present, whether it's been talked about explicitly part of people's personas, et cetera.
Now, when you look at the. Industry and how it's being impacted. Take outside of this, the creativity aspects, right. We're already seeing the, puff and paints and things where you can go get a group together and paint, . And they're using cannabis to get the creative juices flowing.
There's the, marijuana and mimosas. And look, it's been proven that cannabis stimulates the frontal lobe. . , the other one, I'll just bring into it as well as obviously we're seeing hemp hemp as a material for canvases and for paint brushes.
So [00:03:00] I think those are probably three touchpoints that are historically cultural. We're changing the way in which we interact with arts and there is material science that's being developed for the purposes of art. A lot of words, but I think there's only one way to sum this up. Maggie and that's one word undefeated.
Maggie Kelly: Undefeated. I agree. It pains me listeners. If you think you can submit a challenge to Ross and break this perfect record, please visit cannabis capital podcast.com to submit your challenge. And now onto the interview, featuring Holly bell cannabis director for the Florida department of agriculture. Holly, we are thrilled to have you on the show today. Before we get started, would you mind giving our listeners a little background on yourself?
Holly Bell: Sure. And thanks for having me. It's exciting to do this. So I am a retired banker and I did a very niche. Private banking. And that was in the entertainment field, which [00:04:00] guess what? All my clients were into cannabis. That's where I got exposed to it. And you see some of their names out on products now.
So, I had to learn how to bank the industry way back years ago, that led me to me commissioner freed that appointed me to this job where I am today. So that's kind of how I got to Florida. Got in the industry and learned a lot about banking, it finance credit cards, lending. Then I got into the regulatory side.
Once I got down here and created the hemp program for the state of Florida. And then I assist with the medical program in the edibles piece. So that's what got me into cannabis.
Maggie Kelly: So then can you tell us then jumping off from there? What exactly does the cannabis director for the department of agriculture in Florida? What does the cannabis director do?
Holly Bell: So day to day what I would call a quarterback for the hemp industry in the state of [00:05:00] Florida. So when I got down here, we didn't have a bill yet, but the farm bill had just passed. So we had to get with the legislative. To get a bill written, get it passed. Then the team at the Florida department of agriculture and consumer services or what we call F Dax was given the authority to regulate it.
So my team had to go out and write rules and we put together five rules. We regulate the industry every way possible, all the way from cultivation. To retailing it and everything in between up under one department. And I have three divisions that helped me with that. We are very blessed in Florida to have a large department in the ag group.
And we have law enforcement officers, marketing, agriculture, environmental services, department of plant industry, food safety. All of those groups are involved in day to day regulation of the program. And I kind of coordinate all of [00:06:00] that with.
Maggie Kelly: Can you tell us then coming up with those rules and those like how you develop that policy? That's it, that's a complicated process that people, go to school for years just to learn how to do so. Can you tell us how you developed those roles and those policies?
Holly Bell: Yes. Great question. Because in all honesty, the medical marijuana program down here still does not have the rules written and done five years later. So, we have a very talented team that was dedicated. We realized that to recreate the wheel, probably wasn't the best use of our time. So we went out and talked to the other states that had already done.
Pulled all their bills in studied them, looked at them as the bill was moving through the legislative process. So we were already thinking about the rules and what to do and met weekly to go over that. And everybody had certain tasks. So we [00:07:00] actually used a lot of information and feedback from other states that had already done it.
What did you do? What didn't go well, what would you change if you had a perfect world, how would you set this up? We took all of that information and put together our rules and that's why. We got it done in six months, we had to go out and workshop the rules, which is taking your rules, publicizing them, and going from venue to venue all over the state to give consumers.
And anybody else who wants to come a chance to speak up and tell us whether they agree with us or not, we take their feedback, go back and tweak the rules. And then we post the final rule. So, we were very lucky and I think one of the re we haven't had any challenges. One of the reasons we did is because we truly listen to industry feedback, and we truly went out to those other states and. know, if we, if you had to do this over again, how would you [00:08:00] do it? So through all of that, we've been very lucky and very blessed not to have any challenges or lawsuits.
Maggie Kelly: I think that's meaningful is actually speaking to the practitioners themselves, the people that are actually working within those constraints to see how frontline is actually handling it all and how they're adjusting
Holly Bell: It's funny. You say that because I frequently get this said to me, I answer my own phone. I call people back. I asked for feedback, you can complain to me all day long, but bring a solution right after that complaint. And cause I want to know how to fix it. I'll listen to you, but we're going to move forward.
And I frequently, this. is the first time I've ever worked for government. I frequently get told, I can't believe you call me back. And I said I get paid with state tax dollars. That's my job. I thought that's what I was supposed to do. And they all laugh at me. So it's a lot of fun every day.
Maggie Kelly: Yes. I have spent the better part of a decade working in [00:09:00] public service for municipal government and higher education. And I will tell you that yes, you're unique.
Holly Bell: You understand?
Maggie Kelly: It is true. So in what you just shared with us, you talked about the bill moving forward and legislation, and then the actual rules themselves.
So I think it might be beneficial for our listeners. There is a difference between what elected officials pass in terms of bills and laws. And then when we're talking about the day to the day today, adhering to those laws, that's a whole set of rules that have to be developed and implemented to, adhere to the legal side of something.
So can you talk about that breakdown a little bit for the benefit of our listeners?
Holly Bell: Absolutely. And that is a fabulous question. I didn't understand how fabulous it was until I started go out speak and everybody just kept saying, you've got to change this. And I said, I, I can't change that. Yeah, you can. You can. So it made me [00:10:00] realize I need to go back to a school house, rock mode. We all remember that I'm just a bill on Capitol hill.
So I insert now this little civics lesson in my speeches. And I tell everybody, so here's my lane. I'm a regulator, I'm a state employee. My job was to do what the elected officials passed in their bill. Their job is to pass a bill and then they delegate. To a state agency that state agency, which is F Dax in this case, then rights rules.
So think about the bill as your outline and the rules are your chapters of the book and the detail of every day. Who, what, why, how, when, where is this going to be regulated? The only thing I can change are the rules that detail anything that's put in. can't touch that. I must follow that [00:11:00] whether I like it or not, or believe in it or not, because it's been delegated to me as law by the legislative body.
So they are the only ones that can change something. Once it goes into a bill and becomes what we call statute,
Ross O'Brien: Well, holly, one of the things I'd like to dig into and learn more about is it strikes me that you're in a very unique role with multiple. Constituents to manage. You've got the voters , and patients in Florida, for example, you have different departments that you've talked about earlier within government and different organizations, and then you have the business community.
And so I'd like you to talk a little bit about. W, what have you learned in managing those different centers of influence? How do you balance that? What are the types of things? Cause you have a unique set of experiences in both finance and now public policy as well.
Holly Bell: Yeah, so. Most things go awry in life. I'm learning now. And I am 60, just turned 60. I'll tell everybody that because [00:12:00] they publicize my age down here is because of bad communication or miscommunication. People are talking over each other. They're not listening to each other. So the biggest challenge that I have had is to understand each group, understand their motivation or why they're, they're having the passion or.
Needs that they have and try to bring everybody to a table and get them to talk in it. I guess if I have to say my job is a whole lot of mediating moderating on a daily basis of, I think what they really meant was this and what you really want is this. So I think we could come together and do this.
Would that make everybody happy? And I do a whole lot of that on a daily basis. Didn't expect that. But once I started doing that, our program down here started to flourish because they all started to understand, oh, we really are on the same team. We're not [00:13:00] fighting against each other. We all kind of want the same thing.
We're just saying it a different way. So I do think that's been one of the successes of our programs too, because we spend a lot of time. My team does doing that with all the communities and all the participants.
Ross O'Brien: And so Holly, when you think about success, how do you define success? , what does success look like to you? , and what are those indicators that, things are working.
Holly Bell: So success for me in this program was first of all, being able to get our rules done. First it was getting a bill, getting our rules done, not having any lawsuits, then actually being able to show revenue numbers. How much gross revenue is this industry doing in the state of Florida? How many jobs have we created?
How much tax revenue are we generating? How much is it growing? Am I benefiting consumers, are they being helped? All of those things are things [00:14:00] we look at on a weekly basis to see how we're doing.
Ross O'Brien: So one of the perspectives that we have Holly, as investors, we have a lot of connections in DC and we were, I was personally involved in some of the process of the safe banking act, et cetera. My takeaways over the last few years. And I'd love to hear your, endorsement or contradiction to this.
But my takeaway is in particular, seeing the voting as it was happening in DC is that cannabis appears to largely be one of the only bi-partisan issues in government today.
Holly Bell: I concur. We pull in Florida over 70%. And when our hemp bill went through the legislative process, It got unanimous votes all the way through it's it is not, it is very much supported by both parties. So I would totally concur with that.
Maggie Kelly: Can you What does this, the current [00:15:00] state of hemp and cannabis look like in the state of Florida, because every state's a little different. There is medical marijuana there's the hemp industry in Florida. There's recreational use, which is not legal in the state of Florida.
So can you kind of give us a, sort of a broad picture of what legalization looks like in the state of Florida?
Holly Bell: So the current state in Florida is the us. We have a very thriving medical cannabis program with hundreds of thousands of. Patients on the registry. We have 22 permit holders. We probably have capacity to do 18 to 19 more permits down here.
And in the medical program, it has been fraught with litigation and there was a Supreme court ruling, Florida that finalized the challenge between vertical integration versus horizontal. And they supported vertical integration. So that's what we'll continue [00:16:00] to have here in Florida. Now they should be able to open up anywhere up to 22 more permits here in Florida.
I think that will fill up very quickly. There are numerous people who want to apply for that. The hemp industry. Is thriving and growing rapidly. The big area where that is going to grow is going to be on the industrial side, where you have more uses. We've really kind of hit a great.
stride on what I call the essential oils.
Or the wellness products and that's thriving doing well, but we're kind of hitting a little bit of market saturation there. And now they're starting to swing to the industrial side. We have a towel company here in Florida hotel company. We have some construction. We have a house made out of hemp creed.
We have a hempcrete producer. We have bedding being made. We're a huge. The state. So they're using hemp bedding [00:17:00] for horses and the list is going on and on of what they're doing, we have a bait, great space program. They're looking at using hemp fiber for the space electrical connectivity in medical bandages.
Packaging looking to replace styrofoam, all kinds of things that we're starting to see get a startup going here in Florida. There all the waiting for that one big thing, and that is adult use. And I do think that is coming. We have several bills filed this session, which will start in January to legalize it down here for adult use.
We'll see how far they get. If that happens, what you're going to see is the hemp industry will pivot to cannabis as well. And you will see a lot of those farmers do that. A lot of the manufacturing plants, and then you'll see some security for the [00:18:00] current medical providers under the. Medical program that will ensure they get to keep their license and have So many dispensaries I believe, but it will hopefully open it up to some other horizontal integration for others to get in.
Ross O'Brien: So Holly you talked about the licenses and we have, I get this question all the time about Florida. What would you say to the listeners out there that are thinking they'd like to get in the process to get one of these new licenses? What's the timeframe? How competitive is it? What are the standards of expectation in order to have a reasonable probability that they can do business?
Holly Bell: Under the medical program.
Ross O'Brien: Yeah.
Holly Bell: So I think we're anywhere from three months to a year to them starting to take applications for those, they recently released that the fee has gone up to 146,000 for application and the application parameters have changed a little bit. [00:19:00] Made them a little more intense.
I think it'll be fierce competition, but they'll vet through those really quickly and get them out the door. And I do believe that in this industry, the one thing that I will tell people over and over and over again is trust. But verify. You really should get assistance to write your application.
Cause that's a lot of non-refundable money if you can't get it back. So hire a good person to write your application or assist you in that or good attorney. And when you're vetting, those people are interviewing. Make them give you referrals, make them tell you how many applications they've written, make them tell you how many they want.
Make them tell you how many they lost. Those are all valid questions that in any good writer for an application will tell you.
Maggie Kelly: that sounds a lot like advice. We give our [00:20:00] entrepreneurs when they're sitting across the table from an investor, have your questions ready?
Holly Bell: Yeah. Sadly, one of the things I deal with here, because we are an consumer services, I get the complaints of people that have been ripped off and given their money for what they thought was a great cannabis investment. And it only turned out to not be so trust the.
Maggie Kelly: Trust, but verify that's the hashtag for this episode, you previously just reference the vertical integration and horizontal. Can you explain the difference for our listeners who might not be aware?
Holly Bell: Absolutely. So vertical integration means that the entity that has given the permit must do everything. They must grow it. Extracted, they must manufacture it. They must dispense it. So they are responsible for every single thing from growing it to dispensing it to the patient, huge [00:21:00] capital drain and queue, huge capital need to do that.
Then you have horizontal integration and that means that anybody can get in, in any point of the process. It's open Colorado's one of those California's and other the big debate in Florida was we got medical cannabis through an amendment on ballot. The ballot was written with, or, but when the elected officials wrote it, they wrote and so the, or would have created horizontal integration, which was really the intent of the voters.
The elected officials chose to do it their way So, I think we haven't seen that one here is my prediction.
Ross O'Brien: Holly, this is super interesting and you're right on the front lines of , which will be we think, and I'm sure you would agree. One of the largest markets on the planet and the state of Florida When you think about our listeners out there in the finance world, the business world, what are the things you'd like them to take away?
Are there [00:22:00] things that we can do in industry to be a creative, to the successes that you've laid out?
Holly Bell: So great question. And what I would say is this, if you're a resident of Florida, the first thing I need you to do, if you're listening is call your elected. And let them know how you feel about cannabis and why in try to take the emotion out of it and be factual and especially give them some statistics.
And what I tell people, anytime you're talking to the person across the table, you got to ask yourself what motivates them to help me get a yes. So bring that data to the table with your elected official, then. That will help us move the adult use issue forward in the state of Florida. Like I said, we pull over 70% of residents that want it.
That would be a huge financial benefit to this state. It is [00:23:00] Florida has. Lovely beaches, but what most people don't see on the insight is the great agriculture. We are the perfect combination for an adult. You stayed and a thriving, industrial hemp program where we then could also be bringing in capital to do infrastructure, to make wood products.
Hempcrete fabric. Paper products. The list goes on and on anything. We see that in the room we're sitting in can pretty much be made from him that would also help our hemp industry. So that would be my number one. Ask is call your elected officials, get involved.
Maggie Kelly: Many things to Holly bell cannabis director for the Florida department of agriculture. Thank you for giving us insight into the legislative policy and regulation of the cannabis economy, especially in the state of [00:24:00] Florida details covered in this episode can be found in the show notes. And remember, if you have a cannabis economy challenge, please visit cannabis capital podcasts.com .
And find us next week with a new episode of cannabis, capital the podcast.