Marijuana industry waits as state regulators gear up

Filed Under: Other News

By Colin A. Young
As the state builds its regulatory framework for the new legal marijuana industry, businesses and entrepreneurs are chomping at the bit to do business here and attorneys around the state are helping businesses navigate the nascent regulatory maze.
The regulatory body that will set most of the rules for the industry, establish a licensure process and decide which companies will be approved for licenses does not exist yet, but state officials expect retail sales of cannabis to begin in July 2018.
Foley Hoag partner Kevin Conroy and associate Jesse Alderman, who helm the firm’s blog on the intersection of marijuana and the law, held a webinar to discuss where implementation stands now, what businesses can expect from the licensing process and what they will be keeping an eye on as the regulatory structure is built out.
“The finish line is clear, but the course to get there is not yet known,” Alderman wrote on the blog. “We have eight short months until applications are due, although what those applications will require, how far along in the painstaking local zoning process applicants must be, how clear of an advantage licensed medical operators and applicants will have, and much more has been left to regulations from the new Cannabis Control Commission.”
The governor, treasurer and attorney general are required to appoint the five-member Cannabis Control Commission by September 1, a deadline that Conroy said he expects the constitutional officers to meet.
“This is going to happen quickly and there have been media reports that there may be some difficulty in finding CCC members,” he said. “I think I will be surprised if all the elected officials don’t appoint very good people by September 1.”
Once that body is up and running, it will have its work cut out for it, Conroy and Alderman said. The CCC is required to promulgate initial regulations on roughly three dozen topics by March 15, 2018, and then must begin accepting licenses for retail, cultivation and manufacturing facilities by April 1, 2018. It can begin issuing licenses on June 1, 2018.
“The law does not say that the Cannabis Control Commission has to issue licenses by June 1, 2018, it says that it may. But this is a real open question,” Conroy said. “I expect that the Cannabis Control Commission is going to have every intention of meeting the wishes of the Legislature here, however they’ve got some tight deadlines … and so I think the Cannabis Control Commission is going to have to move quickly, it’s going to have to schedule a significant number of meetings.”
The CCC will also have to coordinate with the Department of Public Health to oversee a transfer of the state’s medical marijuana program from the auspices of DPH to the oversight of the CCC. That transfer of responsibilities, personnel and funds is required to take place no later than Dec. 31, 2018. But because money and expert knowledge is involved, Conroy said he expects that transition to happen “well before” the end of next year.
“My expectation, without knowing the members of the CCC, is that it’s likely that transfer is going to take place sooner rather than later,” he said. “I expect that the CCC is going to want to obtain access to the good people at DPH who have got expertise in governing a marijuana system, and I think they’re going to want to get access to those folks as quickly as possible, as well as access to the funds that DPH administers for cannabis.”
Alderman and Conroy said they will be watching closely as the CCC works to establish regulations on marijuana packaging and marketing, edible product potency limits, the establishment of craft cannabis cultivation cooperatives and other issues.
They also singled out the Cannabis Advisory Board as worth keeping an eye on. The CAB is a 25-member board that is intended to advise the CCC on regulations and policy. Its members have already been appointed, but until the CCC is seated the advisory board has no one to advise.
“We’ll be curious to see the role that this board takes. Essentially, per the legislation, their duty is to provide recommendations on regulations and policy that the Cannabis Control Commission will consider and adopt. There is a pretty diverse range of viewpoints on that board, ranging from advocates for marijuana policy reform to a local police chief who was a very outspoken opponent of adult use,” Alderman said. “So we’ll see if this board is able to reach clear and cogent consensus and we’ll see if their recommendations are then adopted.”

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