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As Nevada rolls toward 2nd year of recreational marijuana, pot legalization in other states all over the map

Michelle Rindels
Michelle Rindels
Senator Tick Segerblom standing in front of a cash register

Nevada may be cruising smoothly toward its second year of legalized recreational marijuana, but the outlook for cannabis is vastly different in states across the country.

Early adopter states such as Colorado and Washington are pulling in big bucks — they’re projected to have annual recreational sales of $1.2 billion and $900 million respectively — but are bracing for growth to level off in the near future. Meanwhile, states such as New Jersey that kept out pot altogether because cannabis opponents were in the governor’s mansion are facing new possibilities under incoming leadership, and other states that have legalized it are moving at a snail’s pace to get dispensaries open because of officials’ resistance or logistical hurdles.

In spite of uncertainty in the executive branch and a lack of progress in Congress, 64 percent of the U.S. population lives in a state where marijuana — either recreational or medical — is now legal. Some observers believe marijuana legalization is an inevitability.

“Trump and Sessions raised their hackles, but I think marijuana is on its own momentum streak,” said Will Adler, director of the Nevada-based Sierra Cannabis Coalition. “I do think it’s its own thing. The more states that have marijuana, the more people travel to these states and see that it’s not on fire.”

Heather Azzi, senior campaigns counsel at the Marijuana Policy Project, asserts that marijuana is less dangerous than alcohol and as more people see that, prohibition laws seem “nonsensical.” She believes there’s only one direction to go — toward more legalization — and thinks the federal government can’t realistically stem the tide.

“As far as the federal government is concerned, their ability to really stop this is extremely limited,” she said. “They simply don’t have the ability under law to require a state to make marijuana illegal or require law enforcement officers in the state to enforce marijuana laws against individuals or businesses. So it leaves them with only the federal law enforcement officers who are capable of coming in and enforcing federal law, and they just don’t have many of them.”

According to projections from Marijuana Business Daily, American cannabis retail sales nationwide are expected to grow from around $4 billion in 2016 to anywhere from $11.9 billion to $17.1 billion in 2021.

Here are some takeaways from the marijuana legalization map:

Next in line

The 2016 election — with its presidential contest fervor — was a boon for marijuana legalization. Of nine efforts to pass recreational marijuana or medical marijuana, all but Arizona’s recreational initiative succeeded, and that loss came by a margin of fewer than three percentage points.

West Virginia was the only state to make a stride toward greater cannabis access in 2017 when it legalized medical marijuana through the Legislature.

“We were very happy in 2017,” said Kevin Sabet of Smart Approaches to Marijuana, an anti-legalization group. Opponents applied pressure in places such as Vermont, meeting with their elected officials and saying they didn’t want the smell of pot and didn’t want to bring a Colorado atmosphere to their state, he said.

“2018 is certainly a more challenging environment,” he added.

So what’s next?

New Jersey is one of the biggest potential “gets” for marijuana proponents in the near future. Republican Gov. Chris Christie was a staunch opponent of pot, saying earlier this year that legalization proponents are “crazy liberals” who are willing to “poison our kids” if it brings in new tax revenue.

Christie warned that legalization would be the first priority if the state elected a Democratic governor — something it did resoundingly by choosing Phil Murphy in November. With a veto threat out of the way once he takes office in January, the state could be the first to legalize recreational marijuana through the Legislature.

The New Jersey market would be a coup for legalization because it not only has 9 million residents, but more than 20 million people — including those in New York — live within a few hours’ drive. The market could potentially be worth $1 billion.

Michigan, which is expected to have a recreational marijuana measure on the 2018 ballot and could be the only state in that position that cycle, is another potential get. The state, with a population of 10 million, has had medical marijuana since 2008 and could be the “Colorado of the Great Lakes” region, leading the way for surrounding states to take the plunge.

“When we get something done in a region it tends to spread a little bit so that’s always helpful,” Azzi said. “There are a few states nearby that could consider something like this in the future after it’s enacted in Michigan such as Ohio.”

Other possible wins for recreational marijuana: Rhode Island, where a push to legalize recreational marijuana was unsuccessful in the Legislature in 2017, and Vermont, which passed a marijuana measure through the Legislature before seeing it vetoed by Republican Gov. Phil Scott this spring.

The Marijuana Policy Project says it is devoting significant resources to legalizing marijuana in eight more states by 2019. In addition to Rhode Island and Vermont, it is trying to build coalitions and lobby in legislatures including Connecticut, Delaware, Illinois, Maryland, New Hampshire and Texas.

States that could open to medical marijuana include South Dakota and Utah, as well as the southern states of Missouri and Oklahoma. MPP says it is advocating for medical marijuana-related bills in Louisiana, Nebraska, South Carolina and Texas.

But getting marijuana legislation through a statehouse is no easy feat. Lawmakers can be loathe to go on the record in support of marijuana, and lobbyists can kill or water down bills in ways they can’t through the initiative process.

“It’s hard to vote yes when you feel this drug’s been illegal for 70 years. A lot of people will tell you after medical and recreational have come in how supportive they are,” Adler said. “People at the ballot box are easier to influence.”

Smooth and rocky starts

Nevada started recreational marijuana sales six months before it was legally required to do so and has made more money than it projected. It has already seen $88 million in recreational sales in the first three months of adult-use legalization, and is expected to see $250 million to $300 million in sales in the first year.

“I think Nevada is viewed as a model by the rest of the country. Nevada was able to implement this law faster than any other state has,” Azzi said.

But not all states are off to such a strong start.

California, which has a market potential of about $4.5 billion to $5 billion a year and is supposed to begin marijuana sales on Jan. 1 after legalizing it on the ballot in 2016, is widely expected to have a bumpy start even though it has had legal medical marijuana for 20 years.

Adler said Nevada’s smooth start came about for several reasons: the state had learned from others’ mistakes in creating its medical marijuana program, the governor didn’t resist implementation after voters approved recreational marijuana and Nevada took a more top-down, uniform approach to regulation than other jurisdictions.

Gov. Brian Sandoval opposed recreational marijuana during the campaign in 2016, explaining in an interview with Nevada Independent Editor Jon Ralston on Tuesday that he believes it’s a gateway drug based on the cases that came before him when he was a federal judge. But once it had passed, he included tax revenue from recreational marijuana in his budget proposal — an early signal that he would cooperate with getting sales up and running.

“The voters of this state approved it overwhelmingly and once that was approved, I essentially sat down with my staff and the director of the Department of Taxation,” he said. “I wanted to make sure that it was regulated, that it was strictly regulated, that it was respected and that we have a regulatory regime that was something that others would copy, just like we do with gaming regulation.”

California, by contrast, left much of the decision-making to locals at the county level after legalization in 1996, leading to confusion about whether state or county law supersedes and a legal gray area. As the pioneer of marijuana, Adler says, the state government didn’t want to get its hands dirty with the substance and didn’t exert as much control early on.

The state — more than 10 times Nevada’s size — is now struggling to reconcile its existing medical marijuana market with a recreational market by Jan. 1, and many local governments aren’t expected to have the necessary regulations ready for sales to start by that time. By contrast, medical marijuana dispensaries in Nevada didn’t start opening until 2015, and were developed up to a high standard that meant they didn’t have to change much to add on recreational sales.

Other states that are behind schedule include Massachusetts, which has a market potential of $650 million to $750 million. It’s expected to have some recreational stores up and running by mid-2018, but there’s also a significant push to slow down implementation with local-level moratoriums.

Maine could have a market about the size of Nevada’s — $250 million to $350 million a year — but is behind schedule after Republican Gov. Paul LePage vetoed a bill that laid out a framework for regulating retail stores. A moratorium on recreational sales expires on Feb. 1; the Legislature could address the legal limbo when it reconvenes in January.


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