Marijuana Business Magazine - April 2018

on how many members are positively impacted by the change.” Here are lessons Smith has learned – including those tied to dealing with con- flict, responding to criticism, partnering with other groups, balancing friendships with business decisions and structuring a board – and what he hopes to do to posi- tion NCIA for long-term success. Facing the Music NCIA represents a wide swath of the marijuana sector, boasting roughly 1,530 cannabis-related businesses as members. Smith co-founded NCIA in Decem- ber 2010 with Steve Fox, the former director of government relations for the Marijuana Policy Project (MPP) and today the director of a cannabis lobbying and advocacy firm in Washington DC. Troy Dayton, Steve DeAngelo, Brian Vicente, Jill Lamoureux, Dale Sky Jones, Etienne Fontan, Rob Kampia, Bob Selan and Erich Pearson were all members of NCIA’s founding board. Over the years, the association has grown and matured, and with it so has the amount of scrutiny and skepticism about the way it’s being led. Smith’s critics, such as Khalatbari, have targeted his leadership style. “I consider Aaron Smith a very good friend of mine and would do just about anything for him,”Khalat- bari wrote in a letter to the NCIA board when he announced plans to leave. “But, putting on my NCIA director hat, I haven’t been happy with how he’s handled conflict during my time as a director here.” Khalatbari was specifically disap- pointed with how Smith and the NCIA board handled Kampia and sexual misconduct allegations lodged against him. Khalatbari and other critics say the board was slow to act in response to the allegations. MPP, for example, severed ties with Kampia more than a month NETWORKING PAYS THE BILLS A consistent criticism leveled against the National Cannabis Industry Association is that the trade group has shifted its focus away from federal lobbying efforts and become more of a networking organization. A key mission of NCIA is to change federal marijuana policy, particu- larly the lack of cannabis banking and section 280E of the federal tax code. The latter has been the bane of law-abiding cannabis businesses for years, because it often results in plant-touching companies paying steep tax bills to the Internal Revenue Service. To date, however, neither issue has been solved. And after nearly eight years of lobbying, fundraising and paying membership dues to NCIA, some cannabis industry executives are losing patience. Executive Director Aaron Smith fields that complaint often. “It’s unfortunate that things move as slowly as they do,” he said. “But that’s how it works.” Smith instead shifts the blame to congressional leaders inWashington DC. “We’re seven years in and we’re still fighting for 280E and banking because Congress hasn’t done much in general.” Jessica Billingsley, chief operating officer and co-founder of Denver software company MJ Freeway, contends that lobbying is one of the functions that NCIA does well. She pointed to the strong turnout for Lobby Days in 2017. The annual Washington DC gathering brings NCIA members to Capitol Hill to lobbymembers of Congress and raise money for such advocacy efforts. “The name NCIA has good cachet on Capitol Hill,” said Billingsley, who sits on the NCIA board. “We have built a good, recognizable brand on Capitol Hill, and we need to make that work and work well. It’s important to all of us in the industry.” Smith, for his part, said the lobbying-networking situation is more complicated than it appears. “Over the years we’ve evolved,” he said. “We’ve diversified the services that we’ve provided to members.” Smith said it’s true that networking is now a big objective. But he added: “We’ve never lost focus on the government-relations efforts.” Helping industry professionals connect with one another is impor- tant, in Smith’s mind. “People are coming into the industry now for different reasons,” he said. “We had to meet their needs by providing a networking platform.” Smith also said such activities help bankroll the advocacy works, noting that conferences and events attract new members, help with fundraising efforts and increase brand awareness. “Year after year we’ve significantly increased our DC operation because of other revenue sources we’ve found,” he said. NCIA generated $1.68 million in revenue from membership dues in 2017, up 36% from the previous year. Event revenue more than doubled, to $893,978. “The networking and other functions of NCIA are the profit center,” Smith said, adding that the proceeds “don’t line the pockets of the board or me.” – Bart Schaneman Kayvan Khalatbari is a Denver marijuana consultant and former NCIA board member. 54 • Marijuana Business Magazine • April 2018