The town of Hancock, Maryland is headed to mediation with multi-state cannabis company Trulieve over the profits of its 5% equity stake in the company, the Washington Post reports. The town, in 2015, entered into the unique agreement with Harvest Inc., in exchange for a medical cannabis license; however, Trulieve acquired Harvest this year in a $2.1 billion deal.
During a recent Facebook chat with residents, Town Manager Michael Faith said the town and Trulieve disagree “on what constitutes a profit,” prompting the mediation.
Steve White, then-chief executive of Harvest and now president of Trulieve, told the Post that Hancock “will receive what we have agreed accounts for a 5% equity interest in the business” and “they will receive more money if the entity in Maryland does better.”
In an email to the Post, Faith said the town has received a total of $703,193.96, with a $500,000 payment made in July 2021. During one of the town’s prior negotiations with Trulieve, a former mayor said, Hancock asked for $50,000 in annual payments, and, according to Faith, payments of $50,000 were made in July 2021 and March 2022.
The town has also lost about $600,000 plus interest in federal grants due to the deal – the government reclaimed the funds over concerns about giving tax dollars to a town that is involved in a federally outlawed enterprise, namely the cannabis trade.
Hancock officials have not provided an estimate of what they believe they are owed by Trulieve. The mediation is set for August 30.
Get daily cannabis business news updates. Subscribe
End