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Opinion: Maryland’s best chance for an equitable cannabis market

A technician inspects the leaves of cannabis plants growing inside a controlled environment. Photo by Konstantinos Tsakalidis/Bloomberg Creative via Getty Images.

By Don Murphy

Named a top federal cannabis lobbyist by Politico, the writer served in the Maryland House of Delegates from 1995 to 2003 and is a four-time Republican National Convention delegate. He is the original lead sponsor of the Darrell Putman Compassionate Use Act, the first Republican-led medical marijuana bill to become law. He is currently the director of government relations for the Marijuana Leadership Campaign and can be reached at [email protected].

Twenty years after the passage of the Darrell Putman Compassionate Use Act (Maryland’s first medical marijuana law), voters passed a ballot measure in the fall to fully legalize marijuana for adult use. Question 4 asked, “Do you favor the legalization of the use of cannabis by an individual who is at least 21 years of age on or after July 1, 2023, in the State of Maryland?” As predicted in a previous op-ed, legalization passed by a 2-1 margin with over 1.3 million votes, making it more popular than any of the state’s constitutional officers.

Marylanders overwhelmingly voted to make cannabis legal. They voted to end the failed and senseless war on cannabis and to stop arresting, prosecuting and incarcerating people for simple possession of a plant. They didn’t vote to make it highly taxed, highly regulated or highly subsidized. Unfortunately, if past is prologue, what voters want and what they get will be two different things.

If Maryland follows the lead of the 19 other states with adult-use cannabis, the regulations will be complicated and cumbersome, serving as self-inflicted barriers to entry for the very people advocates believe should benefit most. Additionally, the potential sin-tax revenue that advocates of legal cannabis promise will be too much for lawmakers to reject.

Tapping that goldmine comes at a cost. Highly taxed legal cannabis competes poorly with non-taxed, non-regulated, street cannabis. Legislators have options when crafting Maryland’s commercial cannabis market. If they look out for themselves, lawmakers will impose the highest tax possible and appropriate those funds to vote-getting projects and programs in their respective districts.

Those taxes will hurt the nascent industry while benefiting the illicit market. If lawmakers take care of their well-heeled friends and a crop of six-figure lobbyists, they will limit the number of licenses, just as they do for medical. Those licenses are worth millions but are unattainable by even the above-average Joe. Capping licenses also invites the type of corruption we witnessed firsthand in our medical program.

Since the implementation of the Controlled Substances Act in 1970, the illicit market has worked just fine for most consumers. Many would be happy if the status quo continued without the threat of arrest for either party. Purchasing decisions are based on a mix of price, quality and convenience. Taxes, fees and regulations don’t improve quality or convenience and only serve to keep price-conscience buyers in the illicit market.

The better option would be for our elected officials to look out for the little guy and the consumer by creating a free market system where the state lightly regulates the product and not the people. Cannabis is a plant, it’s not plutonium. Getting a license to grow, process and sell cannabis should not be more difficult than any other crop and it should be regulated accordingly.

When it comes to cannabis, let Maryland be the Free State we purport to be. Will there be a pot shop on every corner? No. There’s not a vegetable stand on every corner, and we consume way more corn than cannabis.

A recent study suggested that the state should permit at least 300 dispensaries to supply the new legal market. By way of comparison, that would be similar to the number of McDonald’s (280) and Starbucks (274) in Maryland. Rather than create artificial limits based on a random study, legislators should follow the lead of these billion-dollar brands and let consumers dictate the number of dispensaries and let local zoning dictate their location.

If the state wants to create a more equitable market, it could cap the number of licenses any one person could hold for the first couple of years and then increase the cap giving operators a chance to grow over time. Minority participants (like everyone else) don’t expect a guaranteed outcome, they just expect a guaranteed chance.

Rather than twist themselves in knots trying to design a market that reflects the demographics of the state, legislators simply need to give all those who want to participate an equal opportunity by lowering all government-imposed barriers to entry.  Some of these cannabis businesses will succeed, some will fail. Success should be based on one’s ability, not one’s means or connections. Lawmakers shouldn’t be picking winners and losers, they shouldn’t make implementing the will of the people more difficult than it needs to be and they shouldn’t be subsidizing it either.

It doesn’t have to take another 20 years before voters actually get the adult cannabis market they voted for. Whenever that happens, they’ll open up an app, place an order, and have it delivered, just like a pizza.