The Guardian Data Systems Blog

Our Perspectives on the Cannabis Industry

Election 2016: The Momentous Year Cannabis Won!

The election is barely over and already this year is being called a landmark year for the  Marijuana Reform Initiative. Nine states had initiatives on the ballot for their citizens to vote on and only one did not live to see its fruition. The other 8 of those states made their mark on history and passed their prospective cannabis programs of recreational cannabis and medical alike.

wood-and-cannabis-leafNevada went legal! And so did California – no surprise there, and Massachusetts and Maine…

What is surprising is that Arizona did not legalize marijuana. The initiative was rejected by over 52% of the vote. But that is pretty close and a sign that the state is pretty equally divided. Maybe it’s a good thing it didn’t pass. Many believed that it was poorly written and created a monopoly on the industry. Laura Ciscomani is a volunteer with Arizonans for Responsible Drug Policy who feels that Proposition 205 was “in direct contradiction with Arizona’s constitution in our anti-trust and monopoly laws.” Opposition felt that it didn’t have enough regulations set for testing THC levels in users and set no limits for legal amounts in the blood. Maybe this is an opportunity for Arizona to go back to the drawing board and write a more comprehensive law that people can get behind.

Florida, North Dakota and Arkansas all passed medical marijuana initiatives and Montana finally rolled back the crippling restrictions on their already existing industry.

montana-flagMontana voters, who have had a medical marijuana program since 2004, passed Initiative 182 by a vote of 56-43. This measure repeals the heavy restrictions that went into effect earlier this year effectively crippling the state’s medical marijuana program.  The restrictions required review of any physician who prescribed marijuana to more than 25 patients per year and limited dispensaries to three registered patients. The Montana Medical Marijuana Act requires providers to obtain licenses, will call for lab testing by certified labs and outlines provisions for providers to hire employees who would handle cultivation, dispense and transport medical marijuana.

Arkansas Medical Marijuana Amendment of 2016 made Arkansas the first southern state to pass a medical marijuana use program.

arkansas-marijuanaThe Alcoholic Beverage Control Division will oversee the program along with a medical marijuana commission that will soon be established. The new program will allow patients with  a number of specified ailments to be prescribed medical marijuana for their treatment. Some of the diagnosis include, cancer, HIV/AIDS, hepatitis C, amyotrophic lateral sclerosis (ALS), Tourette’s syndrome, Crohn’s disease, ulcerative colitis, post-traumatic stress disorder (PTSD), as well as  glaucoma, severe arthritis, fibromyalgia and Alzheimer’s disease.  It also includes a provision stating that an employer may not hire or fire personnel based on their use of medical marijuana. It was also written with a residency requirement where a majority of the stakeholders of a new business license must have lived there for the last 7 years. It’s not going to be a huge market with a limit of only 40 dispensary licenses and 8 cultivation licenses, but it is a big step forward in the right direction for the southern state.

Florida also passed a medical marijuana measure.

florida-could-legalize-both-medical-and-recreational-cannabis-in-2016The “Use of Marijuana for Debilitating Medical Conditions,”  will be the new medical program that passed by a landslide vote of over 71%. The biggest change from the old program is that licensed dispensing organizations can now grow and distribute medical marijuana derived from the whole plant. Under the Compassionate Medical Cannabis Act of 2014, they were only allowed to prescribe the low-THC products to terminal patients. It allows a licensed Florida physician to prescribe the treatment for what they determine are “debilitating medical conditions”.  Those conditions are defined in the Amendment as “cancer, epilepsy, glaucoma, positive status for human immunodeficiency virus (HIV), acquired immune deficiency syndrome (AIDS), post-traumatic stress disorder (PTSD), amyotrophic lateral sclerosis (ALS), Crohn’s disease, Parkinson’s disease, multiple sclerosis, or other debilitating medical conditions of the same kind or class as or comparable to those enumerated, and for which a physician believes that the medical use of marijuana would likely outweigh the potential health risks for a patient.” The new program will be overseen by the state Department of Health (DOH).

North Dakota passed their very own marijuana legalization initiative called the Compassionate Care Act.

north_dakota-state_sealThe condition outlines in the Act include: cancer, HIV, AIDS, Hepatitis C, amyotrophic lateral sclerosis, post-traumatic stress disorder, Alzheimer’s, dementia, Crohn’s, glaucoma, epilepsy, and chronic pain. The state Department of Health (DOH) will run the program and will also be tasked with adding new conditions to the list. “Compassion Centers that must run as non-profits will be the dispensaries. They will be required to follow strict rules that forbid pesticide use, have the required security systems in place, as well as individual plant tracking protocols. Up to three ounces of usable marijuana could be dispensed to a patient every 14 days and they are allowed maintain a home cultivation as long as the patient’s home is farther than 40 miles from the nearest dispensary. Under those circumstances they would be allowed to cultivate eight plants within a locked cultivation site and it may not be within 1,000 feet of a public school.”

Four more states passed initiatives for the legalization of the recreational use of marijuana bringing the total now up to 8 legal states. Nevada and California completes the west coast and  Maine and Massachusetts lead the reform movement in the east.

Nevada new recreational use law takes effect on Jan. 1, 2017 but it will be another year before they see the opening of any new dispensaries.

nevada flagThe Department of Taxation will be handling the regulations and has been given 12 months to adopt rules and regulations and set up the infrastructure and is required to start accepting applications on or before Jan 1, 2018. According to the measure, “licenses will only be given to existing medical marijuana establishments for 18 months after the Department begins to receive applications for recreational marijuana establishments.”  106 licenses will be awarded with the number being given to each county based on its population. There is no mention of caps for cultivation businesses. A 15% excise tax will be imposed on all cannabis sales, and that is on top of any state and local sales taxes that already exist or will be created. Estimates from New Frontier Data predict that Nevada’s cannabis market will grow to nearly a half billion dollars by 2020. In Nevada, legalizing recreational use does not do away with or change the existing medicinal marijuana program. The medical program will run alongside the recreational program, and the rights of patients remain unchanged by the new law.

mass-weedUnder the recreational law, an adult over 21 will be allowed to possess 1 ounce of cannabis or ⅛ ounce of concentrated cannabis. It will be illegal to consume any marijuana in a public place or while driving a car. Department of Taxation will also be tasked with enforcing restrictions on advertising and any signage and advertising. Businesses must be more than 300 feet from a daycare, playground or “community facility”. A community facility includes places such as public parks and swimming pools as well as youth centers and places of worship.

Since all the states in the northeast are already running very successful medical programs, seeing Massachusetts and Maine pass both of their measures so easily is a strong indicator of how the course will go for all of New England. It isn’t hard to foresee that many more states will soon be leaning this way after seeing how well it’s working in these two states.

Massachusetts’ new initiative will create both a Cannabis Control Commission and a Cannabis Advisory Board to regulate the recreational use of cannabis.

A 3.75% excise tax will be imposed and collected on top of the 6.25% sales tax. Individual cities will also be able to add additional tax up to 2 percent. Individuals will be able to keep up to 10 ounces at home and cultivate a maximum of 6 plants for personal use. Once again, there will be no public consumption allowed.

maineUnder the new recreational provisions in Maine, even though the Department of Agriculture, Conservation and Forestry (DACF) will be the authority that oversees the program, regulating the number and location of establishments will be left up to the local municipalities.

Adults will be able to keep up to 2½ ounces for personal use and cultivate up to 6 plants. Just like Massachusetts, they are required to create regulations and implement an independent testing program. They must test for harmful chemicals, poisons and toxins, and also for residual solvents, dangerous molds and mildew as well as harmful microbes and pesticides. Testing must also verify THC levels.  The measure sets 2 tiers of cultivation, under 3000 sq ft and over 3000 sq ft. But there cannot be more than 800,000 sq ft of canopy. Maine will be permitting Social Clubs and a 10% tax will be imposed on all adult use sales.

California is arguably the most important state to pass regulation for recreational use of marijuana.

seal-of-caThe state has tried to before and it has been a long time coming.  The Adult Use of Marijuana Act will go into effect on Jan 1, 2018 and authorities will begin accepting applications. In the fashion of many of the other states to pass cannabis use for recreation, adults in California will now be able to be in the possession of one ounce of marijuana and cultivate 6 plants for their own personal use. The Act creates 19 new sets of license types, which are broken down by type of grow and size. They will include licenses for indoor, outdoor, and greenhouse cultivations (called “mixed-light”), and small and medium sized (which would be the same size as their medical cannabis equivalents) but it also creates a new “large” license designation. California holds 12 percent of the entire nation’s population and is 3rd in the world in GDP (Gross Domestic Product). There is no doubt that California’s marijuana industry is likely to be one of the, if not the, biggest in the country.  The new regulations will impose a 15% excise tax on all marijuana sales that will no doubt have a humongous economic impact on the state. It is commonly believed that California is the state to watch for lawmakers around the country and this vote to legalize cannabis won’t be overlooked.  It is likely to create a situation that will be difficult that is difficult to be ignored by the federal entities. Chairman of Marijuana Majority, Tom Angell, had this to say about California’s Yes vote: “California is the sixth-largest economy in the world and is hugely culturally influential. Most importantly, this vote will dramatically accelerate the end of federal marijuana prohibition.” In an interview with Bill Maher just a few days ago, President Barack Obama admitted that it won’t be able to be ignored simply for the fact that navigating the web of different laws between each state or even county is going to start being so convoluted that they are going to have to stand up and start looking at the issue differently and realize their current approach is just not working.

Arcview Market Research pointed out in their report “State of Legal Marijuana Markets” that the legal marijuana market is projected to reach $7.1 billion by the end of this year alone.

Mark Malone, executive director of the Cannabis Business Alliance, feels that the outcome of yesterday’s election “…reinforces the will of the people to overturn prohibition.”

Some interesting legislation also passed in Colorado where they already have a thriving legal cannabis market.

What is being called a “Social Use” program where the Neighborhood-Supported Cannabis Consumption Pilot Program (NSCCPP) was passed to allow business to open a public place for consumption. Ultimately the idea is to provide a social yet safe place for consumers to gather but that will also be private.  The initiative also give the Denver cannabis industry the opportunity to engage more fully with their community and work together to help navigate a legal cannabis world.  Cannabis consumers must seek out and basically receive approval from a city-registered local community group before acquiring a permit. That group would then be able to give input on how they operate. Before, people were only supposed to consume cannabis in their private residence, but there was rampant use right out in public. This will allow people to be in social situations but keep the use away from the general public, and ultimately lower exposure to non-users and possibly minors.

Leave a Comment

No Comments