Marijuana task force recommends giving current MMJ businesses a one-year quasi-monopoly?
Of recommendations made this week by the Amendment 64 task force, one allowing pot tourism received the most attention. As a result, a controversial piece of advice has gotten short shrift. To whit: The panel suggests that only current medical marijuana businesses be allowed to apply for recreational shop licenses for the first year after regulations take effect. Would that create a quasi-monopoly?
According to Sederberg, the licensing issue came up in the context of recommendations about vertical integration -- the requirement that retail outlets also grow their own product. This model is currently in place under state medical-marijuana regulations, which state that centers must grow at least 70 percent of their own cannabis; the other 30 percent can come from other vendors.
Sederberg notes that "there was a bunch of back and forth" about vertical integration "at the work-group level and in the regular framework of the task force." The arguments in favor of the approach include consistency -- "that we shouldn't change systems right away, and allow a period of time for the transition" from medical marijuana to the recreational kind, "so we don't have to find ourselves with a whole new system.
"Also, there was talk of diversion," he goes on, "and how right now, adding a number of new cultivation facilities that didn't have a retail facility associated with them could led to incentives for someone to divert if they didn't have an ability to sell their products to any retail stores."
As for the arguments against vertical integration, Sederberg says opponents at the task force level talked about how "it's not a natural market to require something like that. And some of the smaller store owners said they didn't want to go through the expense and difficulty of operating a cultivation facility." Moreover, "some people just thought that it's generally inefficient."
How about the theory that vertical integration gives current medical-marijuana businesses an unfair advantage over competitors, by making it much more expensive and complicated to get into the business?
Continue for more about the task force's licensing recommendations.