Shamia Fagan and Retail Taxes

The biggest news in the Oregon cannabis market so far in 2023 is that of Shamia Fagan receiving $10,000 per month from a company owned by Rosa Cazeras and Aaron Mitchell, the owners/operators of La Mota, arguably the second largest vertically-integrated cannabis company in Oregon, after Nectar Markets. Since this discovery was made by Willamette Weekly, the entire industry has faced a serious shake-up.

La Mota owed tens, if not hundreds, of thousands in back taxes to the State of Oregon and yet, were facing no imminent penalties at the state-level. This while smaller operators were being threatened with license revocations and suspensions for similar offenses with substantially smaller dollar totals owed. Shamia Fagan, as the Oregon Secretary of State, oversaw OLCC and how these offenses were tracked. While she claims any conflicts of interest were disclosed, her immediate resignation after the discovery of this arrangement would suggest otherwise. Federal authorities have stepped in to investigate

In the wake of Fagan’s departure, Governor Tina Kotak issued a mandate to OLCC instituting a new policy that all cannabis retail licensees would need to verify their tax compliance status when they attempt to apply for a new license or seek a license renewal. Any licensees out of compliance will be required to get current on their taxes before OLCC will proceed with any licensing actions. This action is currently controlled by an emergency rulemaking which means it is temporary but will have a full rulemaking process with input from the industry before becoming a permanent part of the regulations.

While many in the industry met his proposal with outrage, it should come as no surprise that this would be the policy choice by OLCC and the Governor. Oregon’s regulations have established a system where only cannabis retail licensees are responsible for collecting taxes from consumers and reporting those taxes to the state. If the retailers are failing in their duty to hold those taxes in trust until being paid to the Department of Revenue, OLCC has very little reason to allow their licenses to continue operating.

If you believe your license is at risk under this new policy and are in need of assistance, give me a call or shoot me an email: 503-420-5033; [email protected]. We have already helped others overcome this issue and will be happy to assist you.
Matthew Cleary

Disclaimer: The contents of this blog is considered an advertisement under CA law. The information in this blog post (“post”) is provided for general informational purposes only, and may not reflect the current law in your jurisdiction. No information contained in this post should be construed as legal advice from Cultiva Law, PLLC or the individual author, nor is it intended to be a substitute for legal counsel on any subject matter. No reader of this post should act or refrain from acting on the basis of any information included in, or accessible through, this Post without seeking the appropriate legal or other professional advice on the particular facts and circumstances at issue from a lawyer licensed in the recipient’s state, country or other appropriate licensing jurisdiction. Mat Cleary [email protected]

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