Gov. Lujan Grisham announces special session for redistricting, appropriating COVID relief funds will be next week

New Mexico Gov. Michelle Lujan Grisham officially announced on Wednesday that she will call the state Legislature into a special session next week to approve new legislative, congressional and Public Education Commission districts. In addition to redistricting, lawmakers will also be called to appropriate federal COVID-19 relief funds. 

In a statement on Wednesday, Lujan Grisham said she is confident the Legislature will work collaboratively and diligently to finalize new district maps so that all New Mexicans are fairly represented. 

“A fundamental part of our American democracy is ensuring that all voters are represented, and the redistricting effort will make sure that the right of all New Mexicans to vote is complemented by fair representation through their elected officials,” Lujan Grisham said. “I look forward to a productive and collegial session and know lawmakers and legislative leadership will as always carry out the people’s business thoughtfully and respectfully, in a way that honors this important work.” 

Updating district maps is a process that takes place every ten years, on the heels of the federal census. This year, thanks to a new law, the redistricting process began with a citizen redistricting committee that approved several different recommendations for the Legislature to consider. But, the Legislature is not required to accept any of those recommendations.

NM Cannabis Control Division considers requiring union agreements as part of licensure

As part of the process to set up a recreational-use cannabis industry in New Mexico, the state’s Regulation and Licensing Department and it’s Cannabis Control Division held a public rulemaking hearing on Wednesday regarding residual solvents in cannabis manufacturing and requiring employers to work with labor unions. The proposal to require cannabis businesses to enter into a labor peace agreement with a labor union, as a condition of state licensure, did not receive much support during the hearing. 

Out of the handful of people who testified during the hearing, only one person spoke about allowable solvents used to manufacture cannabis extracts and only one person spoke in favor of the labor peace agreement proposal. 

The labor agreement proposal, if approved by RLD Superintendent Linda Trujillo, would require employers to enter into an agreement with a “bonafide labor organization that is actively engaged in representing or attempting to represent the applicant’s employees,” and that agreement would have to be “an ongoing material condition of licensure.”

But the proposal would also prohibit a labor union from organizing protests against the company. 

“For purposes of this section, a labor peace agreement between a cannabis establishment and a bona fide labor organization includes protecting the state’s interests by, at a minimum, prohibiting the labor organization from engaging in picketing, work stoppages, or boycotts against the cannabis establishment,” the proposal reads. 

Timo Serna, who said he was in favor of requiring labor agreements during his testimony and that he plans on opening a cannabis microbusiness with the hopes of expanding, argued that prohibiting strikes and walk-outs strips the rules of any effectiveness. 

“That basically takes away all the power that the employees have and being a part of a union becomes largely symbolic, because all that’s governing that is pieces of paper at that point,” Serna said. “There’s nothing else that is going to ensure that employees’ voices are going to be heard.”

Besides the one comment on solvents, all of the other participants argued that mandating a labor union agreement as a condition of licensure is a regulatory over-step by the department. 

Duke Rodriguez, the CEO and president of Ultra Health, one of the state’s more prolific medical cannabis producers, argued that not only is a required labor agreement an overstep but that it is illegal and hinted that it would likely open the department to a lawsuit.  

“This mandate is punitive to a new industry,” Rodriguez said. “How would other industry professionals respond if labor peace agreements were mandated for every license RLD currently manages? There would be an uproar.”

Rodriguez added that Ultra Health is “committed to workplace well-being” and that starting next year the company will start paying its 300 employees at least $15 per hour. 

Kristina Caffrey, a lawyer for Ultra Health also spoke about the legality of mandating labor agreements.

Legislative committee gives state finance authority the greenlight for cannabis business loans

An interim legislative committee on Tuesday approved a state-run loan program for small cannabis businesses. The decision was approved by the New Mexico Finance Authority Oversight committee with a 9-2 vote. 

The program will be overseen by the state’s finance authority and will be funded by the Economic Development Revolving Fund. According to a presentation from the authority’s CEO Marquita Russell, there will be about $5 million from the revolving fund made available for qualifying businesses. Each loan, Russell told lawmakers on Tuesday, would be limited to $250,000 and terms would be limited to five years. Applicants to the loan program would need at least a conditional approval for a cannabis microbusiness from the state’s Regulation and Licensing Department with a business plan that shows three years of financial projections.

Emails show exchanges between plaintiffs, employees and RLD that helped lead to whistleblower suit

Next week, a New Mexico state district judge is slated to hear arguments for and against a group of state employees adding a Whistleblower Protection Act claim to an already pending lawsuit against the state’s Regulation and Licensing Department. 

The initial suit, filed by four Cannabis Control Division employees, claims that the department and the Cannabis Control Division violated a state personnel code by moving their work location from Albuquerque to Santa Fe. Included in the four employees’ new complaint are claims of retaliation and alleged inaction by the department when the employees reported what they said was an illegal cannabis grow operation. 

The hearing is scheduled for Dec. 1. Now, after reviewing documents obtained through a public records request, NM Political Report has learned which company RLD and its Cannabis Control Division deemed the company to be in compliance after being accused of having too many plants. On July 12, 2021, RLD received a tip, via email, that medical cannabis producer Budding Hope was growing “over 6,000 plants illegally.” The person who sent the email, whose name was redacted by the department, followed up twice within a week with more specifics.

NM issues first cannabis cultivation license

A New Mexico-based cannabis company announced this week that it received the first cannabis cultivation license earlier this month from the New Mexico Regulation and Licensing Department. 

In a statement from president and CEO of Mother’s Meds, Tony Martinez, the company was awarded a cannabis production license by RLD on November 1, 2021. In the statement, Martinez attributed the company’s “hard work, due diligence, and adaptability,” along with the “business friendly attitude” of San Juan County for Mother’s Meds getting the first production license, outside of the 34 legacy producers that carried over from the Department of Health. 

Martinez said Mother’s Meds, which is doing business as Lava Leaf Organics, will not likely hire many employees, but instead plans to establish contracts with other professionals. 

“My least favorite part of business is placing a value on another person’s efforts and talents; this model allows people more control over their destiny and to work with us, not for us,” Martinez wrote in a statement. “I believe this will allow our community to attract and retain more talented professionals than our competitors.”

A spokesperson for the state’s Cannabis Control Division confirmed on Wednesday that the department issued Martinez’s company a license, but added that there is still a pending background check.  

“Mother’s Meds has been issued a cannabis producer’s license and that license will go into effect as soon as all background check requirements are met,” division spokesperson Heather Brewer said in a statement. “The Cannabis Control Division is excited to start issuing licenses and looks forward to public announcements and celebrations of new businesses as the Division works to stand up a thriving adult-use cannabis industry in New Mexico.” 

Martinez said his company “will continue to comply with all CCD rules and regulations.”

Martinez, along with his brother and father unsuccessfully applied for a production license through DOH in 2015. Prior to the Cannabis Regulation Act, which went into effect earlier this year, medical cannabis businesses were licensed by DOH.

NM high court: Legislature, not governor, has authority over federal COVID-19 funds

The New Mexico Supreme Court, in a ruling from the bench, ordered Gov. Michelle Lujan Grisham to stop using any unspent federal COVID-19 stimulus money without approval from the state Legislature. 

New Mexico Supreme Court Justice Michael Vigil, after a brief deliberation by the justices, read the ruling. 

“The court grants standing to the petitioners on the basis of great public importance,” Vigil said. “One, the court determines that a writ is appropriate in this case, and the court will order that a writ of prohibition and mandamus, prohibiting the governor and the state treasurer and all other state officials subject to their authority from transferring, encumbering, committing or appropriating any additional funds out of the state [American Rescue Plan Act] account in the state treasury absent legislative appropriation.”

The court’s decision was the culmination of weeks of court filings in a case filed by two state senators. Democratic State Sen. Jacob Candelaria of Albuquerque and Republican Sen. Greg Baca of Belen jointly filed a petition with the state’s high court, arguing that the governor overstepped her constitutional authority by appropriating federal funds without legislative oversight. 

Candelaria told NM Political Report that the state supreme court “Ultimately did the right thing,” by placing the responsibility with the Legislature instead of one person. “As a citizen of this state, it gives me great comfort to know that decisions about this money are going to be made through a transparent open and public appropriations process and not behind closed doors where the governor gets to consult with her political favorites on how to dole out these funds in her political interests,” Candelaria said. “That would have been a really dangerous precedent for New Mexico.”

Four other Democratic state senators joined the case as intervenors, echoing the argument that federal funds, such as the COVID-19 stimulus money, should be controlled by the Legislature.

Las Cruces store owner charged with felony cannabis distribution

An owner of a CBD store and gift shop in Doña Ana County pleaded not guilty earlier this week to a fourth-degree felony charge of unauthorized cannabis sales. Jason Estrada, who is one of the owners of Speak Easy in Las Cruces, filed his not guilty plea with a state magistrate court on Nov. 9, in response to the felony charge filed in September.  

Estrada is likely the first person in New Mexico to be charged with illegally selling cannabis under the recently passed Cannabis Regulation Act. 

Growing Forward, the collaborative podcast between NM Political Report and New Mexico PBS, spoke with Estrada in August, just after the New Mexico Regulation and Licensing Department sent him a cease and desist letter, asking him and his partners to stop giving away cannabis with the purchase of a shirt or sticker. 

Estrada told Growing Forward that after he and his partners received the letter from RLD, they transitioned back to selling legal hemp products like CBD. 

“We 100 percent stopped and we’re just a CBD store,” Estrada said. “One of the best CBD stores in the state. I will say that as well.”

But according to court records, the Doña Ana County Sheriff’s office alleged that Speak Easy did not stop after the letter from regulators. 

According to an affidavit from Doña Ana County Metro Narcotics Agent R. Holguin, undercover agents entered Speak Easy in August and purchased three different cannabis products without purchasing a shirt. 

“The items purchased by the undercover agent(s) consisted of: 1) 5 pre rolled cigarettes containing marijuna, 2) a small container of THC wax, and 3) approximately 3.6 grams of marijuana flower,” the affidavit read. 

According to the affidavit, officers had the products tested at a state-approved cannabis testing lab and that all three products tested positive for THC, the psychoactive substance in cannabis. 

In a press release, Estrada’s lawyer, Matthew Madrid, said his client has been in full compliance with RLD’s cease and desist letter since he received it.“The decision to comply with the Cease and Desist Order was based, in large part, on communications between Speak Easy and the Cannabis Control Division,” Madrid said in the statement.

Bernalillo County considers indoor-only cannabis consumption areas

As soon as next month, the Bernalillo County Board of Commissioners will vote on a zoning ordinance change that specifically addresses cannabis establishments in the county. Since New Mexico’s Cannabis Regulation Act went into effect in June, municipalities and counties across the state have been crafting their own ordinances to regulate where, and in some cases when, cannabis establishments can operate. Related: ABQ city council rejects most of mayor’s cannabis zoning proposals

During a commission meeting on Tuesday, Bernalillo County Zoning Administrator Nicholas Hamm presented the proposal that already received unanimous support from the county zoning commission. Besides requiring a level of odor mitigation, the proposal would also prevent cannabis consumption areas from being outside. Hamm told commissioners that the idea behind prohibiting outdoor consumption, even at a licensed facility, is to keep cannabis smoke away from the general public.

Four Democratic state Senators ask to join NM Supreme Court case over federal funding

Four more New Mexico lawmakers will likely be a part of oral arguments in a New Mexico Supreme Court case regarding whether the governor or the legislature can appropriate federal relief money. 

State Senators Jerry Ortiz y Pino, George Muñoz, Joseph Cervantes and Daniel Ivey-Soto, all Democrats, filed a motion with the state’s high court on Wednesday, asking the justices to allow them to file an amicus, or friend of the court, brief. In the proposed brief, the four lawmakers, who are representing themselves, argued that Gov. Michelle Lujan Grisham’s take on appropriating federal COVID-19 relief money goes against the state constitution and that Lujan Grisham’s legal counsel is misrepresenting case-law. 

“This is a constitutional case that affects all two million citizens of New Mexico and that concerns the making and implementation of public policy decisions at the highest levels of New Mexico state government,” the proposed brief reads. “The Court’s decision will impact future cases involving the expenditure of public money through legislative appropriation.”

Earlier this year, Democratic Sen. Jacob Candelaria and Republican Sen. Greg Baca filed a petition with the state supreme court asking the justices to order Lujan Grisham to hand over appropriation duties to the Legislature. In response, Lujan Grisham’s lawyer cited a New Mexico Supreme Court case from 1974 and argued it set a precedent for the governor to decide how to spend federal relief money. In State ex rel.

Second in command at RLD leaving

After just several months serving as second in command of the New Mexico Regulation and Licensing Department, John Blair announced on Tuesday that he is leaving his position as the deputy superintendent of the department. 

In addition to regulating many industries in the state, RLD most recently took on regulation of cannabis after the Cannabis Regulation Act went into effect in June. 

In an email announcement, Blair praised Gov. Michelle Lujan Grisham for the opportunity to help set up the Cannabis Control Division and his former colleagues for the work they have done. 

“I’m grateful to Governor Lujan Grisham for allowing me to serve in her administration and to help her both legalize adult-use cannabis and stand up the regulatory and licensing framework for this emerging industry,” Blair wrote. “It’s been my great honor to be a part of Team RLD and to work with the dedicated public servants I’ve been lucky enough to call colleagues and friends.”

Blair didn’t specify why he was leaving but said he would announce what’s next for him in the coming weeks. 

Blair has worked numerous political and policy jobs including numerous years for U.S. Sen. Martin Heinrich’s office and for New Mexico Secretary of State Maggie Toulouse Oliver. Morse recently Blair ran for office to replace U.S. Sen. Ben Ray Lujan when Lujan left his previous U.S. House seat to run for Senate. 

NM Political Report received numerous tips since last week that Blair was preparing to leave his position and that former Lujan Grisham staffer Victor Reyes will take Blair’s spot. An RLD spokesperson confirmed that Reyes will take over as deputy superintendent of RLD. “The entire team at the Cannabis Control Division is sad to be saying goodbye to Deputy Superintendent John Blair, but we wish him all the best in his next adventure,” RLD spokesperson Heather Brewer told NM Political Report.