Marylanders Will Have To Wait For Their Legal Weed

Nugs Marylanders
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Marylanders this election were motivated by a historic governor’s race, but also by another headline-grabbing item on their ballot: legal recreational cannabis. Polls showed more than 70% of residents supported the measure, so it was no surprise Maryland voters approved Question 4 on their ballots last week, a referendum that allows people 21 and older to possess, use, and grow small amounts of marijuana.

So what does it mean for Marylanders, and when can they expect to legally buy weed in the state?

The law officially goes into effect in July 2023, but it pushes the complex task of setting up and regulating the new industry to the General Assembly, so it could be years before Marylanders see its recreational marijuana industry up and running.

“There are a lot of unanswered questions about cannabis legalization in Maryland, even after the referendum,” says Del. David Moon, who represents parts of Montgomery County and sits on the workgroup designed to iron out marijuana legalization policy in the House of Delegates.

Legalization of recreational weed has been a long time coming for Marylanders, which legalized medical marijuana eight years ago. (In last week’s election, Maryland was one of five states across the U.S. that put the question of marijuana legalization to the voters, and one of only two states to approve it, alongside Missouri.) But it will take time for the state to create the framework to license and regulate the new industry and allow for a market to sell recreational cannabis. And possibly an even bigger hurdle is avoiding the equity issues that plagued the start of the state’s medical cannabis industry – shutting out the very communities that legalization intended to help.

What Question 4 does – and doesn’t– do
The referendum voters approved last week does not immediately make recreational use of marijuana legal for Marylanders. What the referendum does is trigger a bill – House Bill 837 – to go into effect. Earlier this year, the General Assembly passed two pieces of legislation, one that put the question of legalization to voters, and House Bill 837, which would be instituted if Marylanders approved the referendum.

Under the text of the bill, starting on January 1, 2023, possession of small amounts of cannabis will become a civil rather than a criminal offense, punishable by a $100 fine for up to 1.5 ounces, or $250 for possession of more than 1.5 ounces and up to 2.5 ounces. (Possession of anything more than 2.5 ounces will be punishable by up to a $1,000 fine, or six months in jail.) On July 1, 2023 possession of up to 1.5 ounces of cannabis will be fully legalized. Residents will also be allowed to grow their own plants, as long as they are out of public view. (Smoking pot in public will still be illegal.)

House Bill 837 does include provisions aimed at addressing some of the equity issues–including a community reinvestment fund that would take the tax money from marijuana sales and funnel it into communities harmed by the war on drugs. But it stops short of setting up a regulatory framework, meaning the sale of marijuana without a license is still illegal, punishable by up to three years or a fine up to $5,000. That will be up to lawmakers to hammer out in the next General Assembly session.

“What’s left unanswered – and that is a lot of what we’re going to talk about in January 2023, and a lot of what the cannabis workgroup has been talking about in these interim meetings – is things like licensing, and how exactly, we’re going to issue these licenses, who’s going to get them, and whether we’re going to be able to do that in an equitable manner,” says Moon, who chairs the criminal justice committee on the work group.

The state’s decision to put the question of legalization on the ballot without setting up a clear framework for selling mirrors what’s playing out regionally.

In D.C., voters approved Initiative 71 in 2014, which legalized personal use, possession, and home cultivation of marijuana — but not its sale. Thanks to the Harris Rider, a long-standing congressional prohibition, D.C. cannot tax or make money from recreational marijuana. Meanwhile, giving away small amounts of marijuana remains legal in the city, giving way to what some call a gray market of “gifting” vendors – or businesses that sell something like a sticker or digital print and with that sale provide a “free” gift of marijuana. (D.C. officials had plans to crack down on the gifting operations earlier, but put those efforts on pause in September.)

In Virginia, Democratic lawmakers and former Gov. Ralph Northam pushed through legalization legislation in 2021. While the bill was initially slated to go into effect in 2024, Northam expedited the legalization timeline to July 1, 2021, leaving the question of regulation and licensing to be ironed out later – and that still hasn’t happened. (Virginia, unlike D.C., prohibits gifting operations.)

Federally, marijuana remains classified as a Schedule 1 controlled substance – or a drug with no current medical use and a high potential for abuse – so federal law prohibits its sale and distribution, and doctors cannot prescribe it. (Heroin is also a Schedule 1 drug.) When President Joe Biden announced in October that he’d be pardoning federal marijuana possession charges, he also pledged to work with his cabinet on reviewing marijuana’s federal scheduling – although it’s unclear what tier marijuana would fall on, and the final decision would come from the Drug Enforcement Administration.

Moon says that the motivating factor to get the question to Marylanders this year was not so the state could quickly begin taxing and making money from the sale of cannabis, but instead to stop unnecessary arrests, policing, and criminalization of cannabis and cannabis users – which disproportionately impacts Black residents. While Black and white residents use cannabis at similar rates, arrest rates are 2.1 times higher for Black people as for white people in Maryland.

“The referendum and the accompanying law, by and large, were about criminal justice reform, and eliminating criminal penalties on personal use of cannabis in Maryland,” he says.

As a part of the legalization bill (House Bill 837), cases in which possession of cannabis was the only charge would be automatically expunged and anyone incarcerated for cannabis possession could petition for resentencing – one pillar of the lawmakers’ expressed emphasis on equity in the rollout of adult-use cannabis. The bill also calls for the creation of a community reinvestment fund, which would take a portion of the tax revenue created from marijuana sales and funnel it back into Marylanders communities most harmed by the war on drugs.

Failures of the past inform the present
Hanging over the future of the state’s recreational market are the early stumbles of its medical cannabis industry, which, when it launched in 2017, initially excluded the state’s Black entrepreneurs and growers.

The state legalized medical marijuana back in 2014, but it took years for the industry to get off the ground. By 2017, when Maryland finally issued its first licenses, not a single Black-owned business landed one – in a state where Black residents make up nearly one-third of the population.

“It was a lot of hiccups, and that made the process very disorienting,” says Mercedes Teasley-Dorsey, who along with her husband Tre’Von Dorsey, applied for a medical growing license in 2019 and got denied. “Even for those of us who’ve been in business for a long time and were able to overcome all of the technical and application-based hurdles, it was definitely a confounding experience. It wasn’t very clear, the communication was not clear.”

There were a number of hurdles for smaller and minority-owned businesses. When applying for a license, applicants had to have a business team set up, a property locked down, proof of capital, and other prerequisites that, the Dorseys say, pose as barriers to entry. For small business owners without access to a lot of money and resources, getting in the door or securing investors was difficult, coupled with the often confusing and bureaucratic process of submitting applications.

In 2018, in an attempt to rectify the disparities in who was benefitting from the new cannabis market, the General Assembly passed a law requiring the Maryland Medical Cannabis Commission to issue nine growing licenses and 13 processing licenses taking race into account – but that did little to solve the problem. Across the state, fewer than 43 percent of the 92 dispensaries in the state are owned by Marylanders of color. (Nationally, the numbers look similar: 81% of cannabis business owners are white.)

“We’re cutting out a lot of ingenuity and a lot of special talent by creating such fierce parameters, restricted parameters,” Dorsey-Teasley says. “We understand the importance of medical cannabis and that you need to have a team that’s ready, you need to have a business plan and everything. I just feel like if it’s the social equity round, understanding the social economic status of the groups that you’re targeting for that round, you would either allot more time or resources, so that you can actually see us win – so that you can see black people and brown people win.”

The couple went on to found CEED, a social platform that pools together resources for Black entrepreneurs breaking into the cannabis industry – connecting people with information that would’ve helped them in demystifying the process. With the passage of Question 4, Tre’Von Dorsey says he expects that same bureaucratic application system to exist in some form, but hopes that lawmakers learn from the exclusions in the medical industry. (Already included in the language of the legalization bill is a business investment fund that is designed to provide minority-owned and women-owned cannabis businesses with access to grants and loans.)

“I think they’re gonna figure out what they did wrong,” he says. “They’re creating more financial help for minorities, I think that’s one of the biggest issues that they heard – there’s a gap that we have to face. And the majority of that is financial.”

Meanwhile, according to an American Civil Liberties Union study that assessed marijuana charges from 2010 to 2018, Black Marylanders were 2.1 times more likely to be arrested for marijuana possession than white residents, despite national statistics suggesting that people of all races use marijuana at similar rates. In Prince George’s county, where the Teasleys live, Black residents were 2.4 times more likely to be arrested on charges related to marijuana possession and in Montgomery County, 3.2 times. In Virginia, a Washington Post analysis last month found that one year post-legalization, police in the state are still more likely to arrest Black residents on marijuana related charges. Despite making up 20% of the commonwealth’s population, Black people made up 60% of marijuana cases in general and district courts.

The devil is in the (legislative) details
When the lawmakers return to Annapolis for the next legislative session in January, Moon says he expects the remaining questions about taxation, regulation, and licensing to come in one large omnibus package, while other criminal justice reform measures related to marijuana may come as single bills throughout the session. For example, Moon says he wants to push through more legislation that would “clean up the criminal code,” and get more nonviolent cannabis offenses to have jail-time removed.

“In all likelihood, we’ll focus on clear, narrow legislative goals like equity in licensing,” Moon says. “The big licensing debate will be likely in a giant omnibus bill.”

The lawmakers need to figure out exactly how they’re going to issue licenses, how many they’re going to issue, and who is going to be eligible. And as is the case in many large pieces of legislation, lawmakers are conducting several studies to guide their decision making. As dictated in the language of the bill, the state will undertake a disparity study to identify where the medical market failed, and a public health study to investigate risks of marijuana use, like impaired driving and teen-use.

Meanwhile, the workgroup has held interim meetings in the past year, with the most recent sessions concerning the social equity piece of legalization, and another dealing with which bodies within Maryland’s state government will oversee the adult-use industry.

Last month, the heads of the state’s Alcohol and Tobacco Commission and the Maryland Medical Cannabis Commission provided a joint presentation to workgroup members about how the two agencies would work together to regulate recreational use. William Tillburg, the head of the MMCC, says that employees from his commission will likely move over to ATC and manage the licensing process. At the beginning of November, the group heard from the Network for Public-Health Law on a “social equity toolkit” with recommendations on how that licensing structure could work.

“The piece that’s missing presently is a piece related to the application process,” Tilburg says. “That’s because we don’t know yet what the market will look like.”

“We’re not looking for a handout
Tillberg says that some of the groundwork has already been laid in the bill’s language for more equitable licensing, like providing application training, financial assistance in the form of loans or business grants, and conducting outreach about cannabis opportunities to small and minority-owned businesses.

“I’ve worked in the cannabis space as a regulator for almost five years now, and it is a central focus of states across the country, many licenses and ownership are held by corporations or white males,” he says. “There is a lack of diversity, and when you sort of juxtapose that against the individuals in the communities that were adversely impacted by the criminalization of cannabis…it doesn’t look the same.”

And as the work continues on for lawmakers, advocates who pushed to get Question 4 on the ballot are similarly dedicated to making sure officials make good on their promises.

Kevin Ford Jr., the CEO of Uplift Companies, an organization that works to increase diversity in the cannabis business, worked throughout campaign season to educate Marylanders on the question of cannabis legalization, says he’s going to keep advocating for a market that gives all Marylanders – not just those with an economic advantage from the start – a chance to make their way in the burgeoning industry.

“Most Marylanders are unaware of what we even voted for just now,” Ford says. “And this doesn’t guarantee that we’ll have a seat at the table, to give input on what our industry will look like, nor does it provide us any guarantee of equity.”

Ford Jr. saw first-hand how exclusionary the medical industry was when he applied for a processing license and was denied, and wants the General Assembly to knock down some of those barriers he faced. Namely, he wants the state to implement something like a “conditional license” in the adult-use arena, where entrepreneurs can receive a pending license before they’ve secured property and financing.

“Maryland has required so much information on these applications that you can tell you’re really canceling out an entire group of people,” Ford says. “I think folks tend to get caught up on this whole buzzword of social equity, many legislators look at social equity as a handout. Obviously, we’re not looking for a handout, what we’re looking for is opportunity [and] the only way to offer equal opportunity is by offering everybody the opportunity to fail.”