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Smoke Signals 1/20-1/27 

Oregon Cannabis Law & Green Gold Rush vs. Mom & Pop


The Oregon Legislature will consider some important changes to the cannabis market in the short legislative session that starts Feb. 1.

Perhaps the best change for cannabis businesses would be one that would allow cannabis to be grown and processed in the same facility. This change would greatly lower costs for cannabis businesses, since only one location, and no transportation, would be required to take cannabis from seed to a usable product for wholesale. Given that there is no public policy reason to separate growing and processing, this bill should help ensure that legal cannabis stays price-competitive with black market cannabis.

Next, the best change for medical marijuana patients would be one that would let medical dispensaries sell a wider range of non-smoked products such as edibles and THC oil. This would give medical marijuana patients in Oregon a similar range of products available to medical marijuana patients in other states without any negative consequences.

Another proposed change that would benefit medical marijuana patients would allow patients to purchase cannabis products at recreational stores tax-free. Again, without any public policy reason to tax these products to be consumed as medicine.

Medical marijuana patient advocates are also lobbying for a delay on the impending limits on the number of plants that medicinal growers are allowed to grow. Beginning March 1, medical growers in residential areas are limited to 12 plants (with rural growers limited to 48 plants).

Advocates fear that patients' access to their medicine will be limited due to these restrictions, coupled with the fact that recreational cannabis sales will not ramp up until the OLCC approves business licenses, which is expected to begin fall 2016. Advocates want lawmakers to delay the growing restrictions until September, but so far no such proposal has been introduced.

Perhaps the best change for out-of-state millionaires is a proposed repeal of the residency rule for recreational cannabis business owners. Currently, would-be owners of cannabis businesses in Oregon must prove that they have lived in Oregon for at least two years before being eligible for a business license.

Repealing the rule would allow for a flood of investment in Oregon's cannabis industry from all over the country and even internationally. Oregonians would be able to purchase products such as Willie Nelson's "Willie's Reserve" and "Leafs by Snoop" from Snoop Dogg (now Snoop Lion). The increased competition would also lower prices, furthering the stated purpose of the law of eliminating the cannabis black market.

However, patient advocates say repeal of the two-year residency rule would push mom-and-pop businesses out of the market and could even push medical dispensaries out of the market entirely. That outcome would have a negative impact on some local economies in Oregon, but lower prices through consolidated production seems inevitable in the newly-legal cannabis industry, as is the case in other industries. The upside is that this would likely lead to lower prices for cannabis consumers.


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