The cannabis industry is increasingly becoming Texas-sized, with operations located in many different parts of the world. However, there is a place where such a sector is not as large as Texas. In fact, this place is the state of Texas. Compared to other states where medical cannabis has been regulated, Texas has been lagging behind places like California or Colorado. “Texas has, without a doubt, been a follower in the adoption of medical cannabis as a safe and legal option for people who are suffering from specific medical conditions,” Morris Denton, CEO of Compassionate Cultivation, says. “Our state government is a conservative body, and it is largely driven by conservative leadership. Even if the majority of the population supports medical cannabis, our political leaders have not truly caught up with their constituents.”
Medical cannabis in Texas
The first medical cannabis legislation passed in Texas in 2015, and allowed its use only to those people suffering from a rare form of epilepsy. This bill also put a limitation on the THC percentage per weight, plus it had to have a minimum amount of 10% by weight of CBD. This created a 20:1 ratio of CBD to THC that had demonstrated success with people suffering seizure activity.
Morris Denton, CEO of Compassionate Cultivation Center
When the law was passed in 2015, the state had to determine who is going to regulate that law. Whoever is given the responsibility, they have to create and implement the rules that would govern the new industry. “It took a bit for the state to figure out who was going to regulate the industry,” Morris points out. “After appointing the Department of Public Safety as the regulator, the DPS released the license application in early 2017 and said that they were only going to award three licenses. That didn’t diminish the interest in the industry as they received 43 applicants.
“The DPS created a team of people and divided the applications into 10 sections. Then, the team judged the application in an anonymous fashion, and ultimately provide an overall score as a reflection of all the sections. We got the second highest score, and our license was awarded in May 2017, which allowed us to start building out the facility.”
Growing cannabis for the Texas market
The facility where Compassionate Cultivation Center grows cannabis is a warehouse with five grow rooms: one veg room, and 4 flower rooms. “At the same time, we are vertically integrated,” Morris points out. “Which means that we are active in the processing, manufacturing, testing: basically, all elements of the cannabis supply chain, including distribution.” On top of that, Compassionate Cultivation has big plans ahead. “We also have 25 acres of land where we will be building a hybrid greenhouse for our next gen operation,” Morris says. “On a technology level, greenhouses can be equipped in such a way that you can have control equal to what you’d have in an indoor setting. Additionally, the operational cost is overall lower compared to an indoor grow; considering that we will also be using lighting by Fluence by OSRAM, the cost will go down even more.”
Setting up a cannabis operation has not been an easy endeavor, Morris points out, as there are a few things to be aware of that characterize Texas as a land. “Even though it might sound counterintuitive, there is an abundance of aquifers here, and these contain millions of gallons of high quality water. Thus, as a cannabis company in Texas, you have to look for a plot of land sitting on top of one of these aquifers. Then, you have to look for access to reliable infrastructure: Texas is an extremely large state. Therefore, you want to be anywhere close to this infrastructure so that you have access to power, internet, and so on.”
Not only that, as the proximity to infrastructure, and even more cities, is indispensable. “You need to be somewhere close to a nice size city: in order to run a vertically integrated cannabis business, you need a variety of people to operate. You don’t only need growers: our workforce is very diverse. We have agronomists, biologists, chemists, and analytical people,” Morris says. Issues related to the workforce have been arising throughout the cannabis industry. That is why Morris and the Compassionate Cultivation team has decided to use a different approach. “We decided that we were going to find people that were experts, not necessarily in cannabis, but in large-scale manufacturing, horticulture, retail, distribution and more. We found people with great degrees in agriculture, or that have managed a professional farm, and that could grow at scale.”
Only for Texas
This diverse and qualified workforce combined with the unique position Compassionate Cultivation has achieved, allowed the company to develop a model that fully focuses on Texas and makes this one of its strengths. “We have never wanted to venture into other states – also because Texas is big enough, but mainly because we don’t want to be distracted by anything,” Morris says. “100% of our efforts are here in Texas: we want to remain the leader and the gold standard for companies here in Texas. As the state expands its medical cannabis program, we will grow alongside.”
In 2019, the legislature did just that as they expanded it to include other conditions. And since those conditions would benefit from other ratios beyond the 20:1 that worked so well for people suffering from seizures, they eliminated the 10% CBD minimum, but kept the THC cap. “This would allow us to create a variety of ratio-based formulations including our 3:1 and 1:1 products,” Morris explains. “It also enabled a larger population of prospective patients to safely and legally gain access to medical cannabis.”
So while Texas may have started its medical cannabis efforts later than other states, it may not continue to be a follower for much longer as another legislative session starts in January of 2021. And with the significant shortfall of tax revenue due to the impact of the corona virus looms, the state’s political leaders will have to look for ways make up for those losses or will be forced to dramatically cut its overall budget. Perhaps a legal cannabis market can help solve some of those challenges.
For more information:
Compassionate Cultivation Center
12701 Lowden Lane, Building 501 Manchaca, TX 78652
512-614-0343
info@texasoriginal.com
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