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Missouri hearing on 60,000 recalled marijuana products to begin

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Jason Sparks is an Oklahoma man who almost single-handedly created the distillate that led to Missouri regulators’ decision to pull more than 60,000 marijuana products off the shelves in August and revoke the license of Robertsville-based Delta Extraction.Now, he’s the star witness in a hearing scheduled to begin Monday morning, where Delta will try to convince the Administrative Hearing Commission to reverse its license revocation and allow it to sell its product in Missouri.In the days leading up to Monday’s much-anticipated hearing, the state and Delta Extractions filed hundreds of documents detailing the investigation into marijuana products the state has deemed illegal and the company is aggressively arguing against.Among them is the eight-hour testimony Sparks, who the state’s attorney called one of its “most important witnesses.”Delta Extraction contracted Sparks’ company, SND Equipment Leasing, to make the distillate — or a THC concentrate that goes into the vape cartridges and edibles.When he first began in March 2022, Sparks was making the distillate only for the marijuana brand Conte, a Oklahoma-based company.Sparks’ wife, Tania Conte, owns Conte. As an out-of-state company, Conte can only make its products at a Missouri licensed manufacturing facility that can legally obtain marijuana.But in the spring of 2023, the supply for marijuana distillate was low across the state and Sparks began making large amounts that Delta sold to about 100 other Missouri manufacturers.The heart of the case is what’s in the distillate.Sparks extracted a small amount of THC from Missouri-grown marijuana, which the state heavily regulates. Then he added a THC oil that was extracted from hemp, a product that is completely unregulated.The state says Sparks’ testimony is important because it speaks to one of their biggest concerns — health and safety. Sparks testified that he can’t recall where he bought his hemp-derived THC oil or if it was tested before he added it to the Missouri marijuana oil.“It’s such an unregulated market that it’s not even a second thought,” Sparks said, of the hemp product. “I know that’s frustrating for, you know, the state…that’s truly how it’s been running for years.”However, the company will argue that it’s not illegal to add intoxicating hemp products to marijuana because hemp is legal.Sparks’ testimony and those of Delta’s leaders also clearly show that the company had been making the product since 2022.It’s unclear how much the state knew about the production of one of the top-selling distillates in the state. Delta’s attorney, Chuck Hatfield, said several documents show that state compliance officers knew what the company was doing long before the recall in August.He said Missouri didn’t specifically ban adding hemp-derived THC-A to marijuana products until the state’s final rules went into effect on July 30.“Internal emails show that Compliance Officer Heather Bilyeau believed Delta’s use of THCa was lawful, prior to the July 30 rule change,” Hatfield told The Independent on Friday.Jason Sparks

Exhibit X

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Missouri Division of Cannabis RegulationA photo of Jason Sparks’ extraction equipment was among hundreds of documents state marijuana regulators submitted to the Missouri Administrative Hearing Commission as part of marijuana manufacturer Delta Extraction’s appeal of its license revocation.

Sparks testified that during the week he worked as a manager for Conte Oklahoma, where he oversaw the production of the products and customer relations.In January 2021, Sparks started his own company in Missouri to rent cannabis extraction machinery to companies and produce distillate on the weekends, according to state business registration records.For a brief time, he said in his testimony, Sparks contracted with another manufacturer, Heya, to make the same hemp-marijuana distillate at the center of the Delta recall.Heya, which currently has four marijuana manufacturing licenses, was also producing Conte products.After Conte and Heya parted ways, the leaders of Delta Extraction saw an opportunity and asked Sparks and Conte to enter a partnership, which began in March 2022, according to testimony from a Delta owner, Jack Maritz.Ever since that time, the distillate used in Conte products was made exclusively by Sparks on weekends, as was Delta’s top-selling bulk distillate the company later sold to other manufacturers.And according to records state investigators obtained, the majority of the THC in the distillate came from the hemp-derived THC-A oil — which the state doesn’t regulate — and a very small amount of Missouri-grown marijuana.Missouri requires that marijuana is tracked from the time the seed is planted all the way until it goes into a final product. No one from Delta monitored the distillate production, Maritz testified.Sparks purchased all of the oil made of THC-A, which is a cannabinoid that has to be heated to produce a high. Delta had no knowledge of where he bought it, Maritz said, and Sparks said he didn’t keep records of that.Oftentimes, Sparks testified that he paid with cash or traded his extracting services for the THC-A oil and relied on verbal agreements. That’s common practice in the industry, he said.“You build up a network of relationships that you know are solid people,” Sparks said, “that you know care about the product.”Sparks said he has no record that his suppliers tested the oil before he got it. But Delta’s team would test the final products and input them into the state’s tracking system called Metrc.When sold on its own, the distillate was not required to be tested, Maritz said, but they did test it to ensure the quality.The cost to make the hemp-marijuana mix was much less expensivecompared to 100% Missouri-grown marijuana, both Maritz and Sparks testified.Sparks said this practice is not an anomoly.“People are switching farms to grow THC-A hemp,” he said. “Nobody wants to deal with the marijuana. First of all, it’s too uptight and it’s not federally legal, so nobody wants to mess with it anymore. So everything literally is going to hemp.”Maritz said Delta leaders believed the state understood what they were doing and had given them permission when they approved their “standards of procedures,” or details of the processes they used.InversionThe state’s Division of Cannabis Regulation is accusing the company of inversion, or illegally importing marijuana product from out-of-state and adding it to Missouri-grown marijuana products.Hatfield said the division never communicated that adding the hemp product was against the rules until the company’s license was suspended on Aug. 2.In an interview with The Independent, Hatfield pointed to an email that Adam Whearty, a compliance team supervisor with the division, sent two days before Delta’s suspension, which was uncovered during the appeals process.Hatfield said it shows that Whearty and compliance officer Heather Bilyeu — who was Delta’s main contact in the compliance office — were confused about whether what the company was doing was allowed.“Heather thinks they found a loophole in the [emergency] rules, prior to 7/30, as does not think THC-A fell into the category of not being able to be used,” until the final cannabis rules took effect on July 30, Whearty wrote. “Heather and I are concerned about what we were to tell [Delta] about modified product in their inventory…”However, during the appeals process, the state has argued that the emergency rules filed on Jan. 20 prohibited the practice.Carole Iles of the Administrative Hearing Commission sided with the state in an Aug. 29 order. The only thing the cannabis regulating agency added to this line in the final rules, she wrote, was the clause “such as THC-A …”“We agree with the department that language added to the permanent rule … did not change the requirement of the emergency rule that THC in marijuana products could only be derived from marijuana cultivated by a Missouri-licensed cultivation facility,” the order denying a stay on Delta’s suspension states.Delta’s use of the hemp THC-A was not the only reason for revocation, Amy Moore, the director of the Division of Cannabis Regulation, has previously said.“While Delta Extraction’s use of out-of-state cannabis in our regulated system has been well-publicized and is a critical issue, [the Division of Cannabis Regulation] also found numerous other violations of rules at this facility,” Moore said in a press release in November.The division also said Delta did not properly maintain video surveillance footage or have necessary safeguards to prevent intrusion at the facility. The division argues that Delta falsified product tracking records and that regulators could not ensure the product was properly tested.In a November letter to the state’s attorney, Hatfield countered that the company did test the product in compliance with the law.Delta also agreed to pay for retesting of any Delta product, Hatfield wrote in the letter, as well as to destroy all the product in its facility in order to reach a settlement with the state.“Should the parties not reach an agreement, Delta intends to challenge the Department’s authority to regulate hemp-derived products,” Hatfield’s letter states.The courts will not entertain a legal challenge against the state until Delta Extraction’s appeal process is completed, a judge has already ruled.Missouri would then be among several states where companies are challenging the state cannabis regulators’ authority to regulate hemp. Unlike marijuana, hemp has very little psychoactive properties naturally — which is why it was taken off the federal controlled substance list in the 2018 farm bill.But since then, businesses have been in a race to create ways to produce the most predominant psychoactive active element in marijuana, delta-9 THC, using the hemp plant.On Sept. 8, a federal judge in Arkansas granted a preliminary injunction in a lawsuit against the state, saying that hemp-derived cannabinoids, like THC-A, are protected under the 2018 farm bill.“Should Delta succeed in that challenge,” Hatfield wrote, “the industry would be free to engage in bringing in industrial hemp products from out of state for use in marijuana products.”The company released a statement to The Independent that Delta “is eager to defend its reputation” during the hearing.“We are confident that the facts presented will show the revocation of our license was unwarranted,” it states, “and reveal the inconsistencies and overreach that have characterized [the division’s] process.”This story was originally published in The Missouri Independent, part of the States Newsroom.

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Laclede’s Landing is moving from nightlife hub to neighborhood

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Laclede’s Landing has cycled through many identities throughout the history of St. Louis. Now, some people involved with its redevelopment in recent years hope the landing’s next one will be as a residential neighborhood.The small district tucked directly north of the Gateway Arch National Park has quietly undergone a massive redevelopment with more than $75 million pouring into the rehabilitation of many of the historic buildings at the landing.“We are starting to feel that momentum, especially in the last really 60 days. Things have drastically changed around here,” said Ryan Koppy, broker and owner of Trading Post Properties and the director of commercial property for Advantes Group.Advantes alone shouldered the rehabilitation of six of the historic buildings, which now sport a mix of apartments and retail or office space, he said. Four of those buildings are completed, and of the 119 apartments available, about 90% are filled, Koppy said.“It just shows you what kind of demand we do have for the area,” he said. “We’re separated from downtown a little bit, and for the tenants, their local park where they’re walking their dogs, it’s a national park.”

Sophie Proe

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St. Louis Public RadioInterior of the Peper Lofts at Laclede’s Landing on Aug. 16

Another 40 apartments are set to come online next year along with some retail space, Koppy said. He added he’s noticed a wide range of people who are considering and moving into the newly refinished apartments.“It’s very mixed, surprisingly,” Koppy said. “We have a lot of young professionals, maybe on their second job out of [university], we have some empty nesters too.”Part of the newfound momentum comes from a new market, the Cobblestone, and coffee shop, Brew Tulum, opening recently and bringing more foot traffic to the area, said Brandyn Jones, executive director of the Laclede Landing Neighborhood Association. She added that more apartments are set to come online within the next few months.“We have a great riverfront area here and so there are plans in the works to activate those spaces, bring people in,” she said.That could be more daytime events, like a farmers market, music festivals (one of which is happening this weekend) or just bringing in food trucks to Katherine Ward Burg Garden, Jones said. It’s a departure from the identity the district held a few decades ago as a hub for nightlife and entertainment.“That’s part of what connects so many people to Laclede’s Landing,” Jones said. “It’s important to tell the story of where we’re evolving. It won’t be what it was in the same exact way, but it will still be fun, and it can be fun early morning, midday or late night.”It’s a view shared by Koppy.“It’s grown up, it’s a bit mature,” he said. “We’re not going to have 3 a.m. bars here anymore because we have residents here.”Koppy added that Advantes is joined by other developers working to rehabilitate buildings in the district.“We all work in unison,” he said. “If I get a call and [a client is] asking for something and maybe the square foot doesn’t really match up with what I have available, but I know it matches up over there, they’re getting a very warm welcome and introduction.”

Sophie Proe

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St. Louis Public RadioRyan Koppy looks out the window of Brew Tulum Specialty Coffee Experience on Aug. 16 at the Cobblestone on Laclede’s Landing in downtown St. Louis.

This push toward making Laclede’s Landing a residential neighborhood also comes alongside broader conversations about the future of downtown St. Louis more generally as it looks to move away from a dependence on office space. While the city as a whole continues to lose population, downtown added about 1,700 people between 2010 and 2020, according to U.S. Census data.“It’s been wonderful timing to have all that going on, that stress that you’re not just in downtown to work has been critical to part of this rejuvenation and energy down here,” Jones said. “Sometimes people forget Laclede’s Landing is part of downtown, really the original downtown.”And success in the small district could spread beyond its small confines and potentially serve as a model for success, Koppy added.“My idea is, if we could get all the great things of St. Louis coming in through here, we can eventually spread that,” he said. “We understand we can’t change the whole world, but we’ll just make the effort to try and change the world around us.”

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St. Louis barbecue festival Q in the Lou canceled

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The largest barbecue competition and tasting festival in St. Louis, Q in the Lou, has been canceled. The event was planned for Sept. 6-8, but organizers decided to cancel it due to poor ticket sales and insufficient corporate sponsorship.The traveling festival had low attendance in Denver last week, said Sean Hadley, a festival organizer.“We made the tough decision to cancel Q in the Lou,” said Hadley. “We’re seeing a lack of support … it’s just not there.”The traveling event first came to St. Louis in 2015 and drew hundreds of people to downtown St. Louis for barbecue, live music and a “major party.”“It shut down out of the blue … I’ve gone every year,” said Scott Thomas, local chef and food blogger. “It’s brilliant. You could take a tour of some really amazing barbecue restaurants and competition barbecue guys all in one place.”In a late July news conference, city officials touted Q in the Lou as a significant tourism draw and a boost for downtown revitalization.“Bringing a signature national festival back to downtown St. Louis … is making us stronger,” Greater St. Louis Inc. CEO Jason Hall said then.Less than a month later, ticket holders from every festival stop learned they’d be refunded. On Monday, organizers privatized the Q in the Lou website and deleted its social media accounts.Conner Kerrigan, a spokesperson for Mayor Tishaura Jones’ office, said city officials are disappointed the festival won’t be back this year.“St. Louis knows how to throw a festival … bringing people together to celebrate our culture is one of the things we do best as a city,” Kerrigan said in a statement. “Should Q in the Lou try to come back next year or any year after that, they’ll have the support of the Mayor Jones administration.”

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Alton’s Jacoby Arts Center likely to relocate permanently

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The Jacoby Arts Center, a staple of Alton for many in the Metro East community, will likely permanently move out of its downtown building at the end of September.Its departure and relocation from the historic building that the arts center has called home for the past 20 years has created a tense situation for not only the arts center’s supporters but also the local development company working to revitalize Alton’s downtown that owns the building.“It’s an unfortunate situation,” said Chad Brigham, the chief legal and administrative officer with AltonWorks, the real estate company owned by another prominent local attorney working to develop the town. “I wish there wasn’t misunderstanding and disappointment in the community. It’s difficult sometimes to clarify that.”When news of the likely departure spread in June via a letter from the Jacoby Arts Center to its supporters, an outcry on social media quickly followed. Some assumed it would be the end of the arts center.“There’s a lot of feelings right now that I think are more about the building itself than there are about the Jacoby Arts Center,” said Valerie Hoven, vice president and treasurer of the nonprofit arts center’s board.For supporters of the Jacoby, moving from the building and likely never returning will be a sad affair. Exactly what’s next for the arts center remains unclear. However, Jacoby board members believe this will not be the end of the organization. It will likely look different though.

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St. Louis Public RadioThe Jacoby Arts Center earlier this month in downtown Alton

Sophie Proe

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St. Louis Public RadioThe Alton-based Jacoby Arts Center features more than 75 St. Louis-area artists and their work.

The history of the buildingFirst dubbed the Madison County Arts Council, the nonprofit arts center renamed itself after the Jacoby family gave it the current building in 2004. AltonWorks founder John Simmons purchased the Jacoby Building in September 2018, according to property records from the county.Managing the large building, at 627 E. Broadway, became too expensive for the Jacoby Arts Center. In 2018, the organization approached Simmons to purchase it, said Dennis Scarborough, a past president of the board and a downtown business owner.“Of course, it sounded really, really good,” Scarborough said of Simmons’ purchase. “He took over the insurance, property taxes, all those kinds of things that were really, really getting into our budget, and he rented it to us at a fair price.”The two parties entered into a lease agreement initially for five years. Since then, Simmons has spent more than $1 million in upkeep, taxes, insurance and more on the building. The lease has been extended twice until the end of September this year.Over the six years, Jacoby paid $1,500 per month, which covered a portion of the utilities.“It’s been wonderfully generous of AltonWorks,” Hoven said.Because the building is aging and needs repairs, Brigham with AltonWorks and those connected to the arts center have long known the Jacoby Arts Center would need to relocate — at least temporarily.

Renovations on the Jacoby building will begin this fall. They’ll include modernizing the aging building, repairing the old elevator and putting in apartments on the second and third floors.

News of the likely departure and controversyRenovations will begin this fall. They’ll include modernizing the aging building, repairing the old elevator and putting in apartments on the second and third floors.In May, it became clear that a preliminary proposal for the arts center to return to the building after renovations finished in 2026 would not work for them, Hoven said.She estimates the first floor and basement of the Jacoby Arts Building span roughly 20,000 square feet.

Chad Brigham is a business and legal adviser for AltonWorks.

AltonWorks’ initial idea floated to the arts center would only provide 2,553 square feet, according to both Hoven and Brigham. While the board calculated the price for the new space to be at least triple the current payment, Brigham said there was never a specific price discussed.“No discussion in terms of actual rent price,” he said.AltonWorks didn’t make a specific rent offer because the organization doesn’t even know itself, Brigham said.In addition to cash from John Simmons, there will be loans, tax increment financing and state tax credits to cover the $20 million in building renovations. The entities financing the cost of renovations will also help determine the rent when the construction is complete, Brigham said.Regardless, the price required to return will be too much for the arts center to pay, Hoven said. Also, the organization would like to maintain the many programs it offers to the community — a rentable event space, a dark room and a clay studio, for example — in the future.“For us to really meet the needs of the community and be sustainable, we need a space where we can offer some of those programs — the artists’ shop, and other spaces that offer some kind of income as well — so that we can continue to give money back to the community,” she said.AltonWorks offered at least two other locations as possible alternatives from their vast stock of buildings along Broadway to house the arts center during the roughly 18 months of construction. Those alternatives came with similar deals requiring the Jacoby to cover only utilities, Brigham said.“We did put in a great deal of work behind the scenes in trying to find an interim solution,” Brigham said. “We wanted to find a place for them to go, where it was easy for them to continue programming, whether it’s 100% of it or some portion of it, that would work for them.”Initially, the arts center hoped to keep the basement during the renovations, Hoven said. When it became clear the preliminary offer to return was for much less space than the arts center anticipated, the letter to the community was sent.“The letter that came out was merely showing our surprise,” Hoven said. “Don’t misinterpret it as panic. Don’t misinterpret it as desperation.”

Sophie Proe

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St. Louis Public RadioA smorgasbord of radios are displayed at the Jacoby Arts Center in Alton.

The commentary on social media was passionate. Some critics of AltonWorks said the organization has good intentions but hasn’t executed those plans. Others said Jacoby hasn’t planned well enough for the future.For Brigham and the AltonWorks team, some of the criticism has been disappointing.“I thought that there were some decent solutions. Were they perfect? No, but they were very, I thought, very good solutions,” he said. “And the fact that it has come to the point that it is right now is a bit hurtful.”AltonWorks remains committed to the arts, Brigham said. John Simmons remains one the largest donors of the Jacoby Arts Center, Hoven and Brigham said.“I don’t think there’s ever been a question of our support of that organization — of our affinity for that organization,” Brigham said. “While some of the events were unfortunate, some of them were encouraging. The entire community rallied around the Jacoby Arts Center. That’s a good thing. It’s a good thing to have a love for the arts like that in a downtown community.”Sara McGibany, the executive director of Alton Main Street, an organization aimed at preserving the town, said AltonWorks should be commended for its vision. In many ways, her organization and AltonWorks share a vision for a thriving downtown.Even though AltonWorks hosts public meetings, McGibany believes the current situation lacks true community engagement.“We really think that if AltonWorks can get past some of the communication hurdles — and harness the community’s passion and shift to more of a bottom-up decision-making process that centers on community input — then we can turn around the growing sentiment of distrust that’s happening now,” McGibany said.Scarborough, the past board president and downtown business owner, echoed the praise for Simmons and his support of the Jacoby Arts Center. With the Jacoby likely moving, the future looks bleak, though.“It’s a community arts center that does a lot of good work,” Scarborough said. “The community is going to suffer, and they’re going to be missed by the community if they’re not there.”

Eric Lee

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St. Louis Public RadioShalanda Young, director of the federal Office of Management and Budget, talks to Illinois U.S. Rep. Nikki Budzinski, D-Springfield, during a tour of a construction project by AltonWorks last April in Alton. AltonWorks, who is building the LoveJoy Apartment Complex is receiving over $1 million in federal funding.

What does the future hold?AltonWorks will continue forging ahead with its ambitious plans to revitalize Alton. The organization hopes to conclude construction on the Wedge Innovation Center, which will have a restaurant, retail and co-working space, this fall. Lucas Row, a mix of apartments and retail space, is scheduled to be completed next spring.The remainder of the arts and innovation district, currently named after the Jacoby, will also move forward.“I believe in two years it’s going to be a much different place,” Brigham said of Alton. “It’s going to be thriving. It’s going to be new businesses, new tenants — and it’s going to be a nice proof of concept for what you can do in a small community like that.”The Jacoby board recently formed a strategic planning committee. Its task: figuring out what’s next for the arts center. The committee will reevaluate what space the Jacoby needs, what programs it wants to offer to the community and how they want to make that a reality.Keeping the arts center is essential for board members like Hoven. In her experience, it’s been a place where local aspiring artists get their start.“Art is one of the only ways to show your true authentic self,” Hoven said. “And there’s more people than I realized who do not get that opportunity every day.”The Jacoby will shut its doors to pack over the next month. Hoven said she’s optimistic the board will have concrete plans by the end of September when their lease officially ends.“Alton is such a fabulous and supportive community,” she said. “We still have lots of great options, so that the Jacoby Arts Center will continue to thrive in Alton and beyond.”

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