The Fight for Cannabis in Ohio Isn’t Over
Possible Roadblocks Ahead After Ohio Cannabis Legalization
We are closing 2023 on a busy note in the state of Ohio , and the start of 2024 is looking to continue that trend of increased cannabis activity. Following the November elections which saw Ohioans vote to approve an adult-use market through Issue 2, questions have been raised about roadblocks, because there’s a potential for quite a few changes in the weeks and months ahead.
We’re tackling all the latest news on the current roadblocks in Ohio and where businesses may be required to shift their thinking.
What’s Developed Across the Ohio Legislature?
Ohio law allows for lawmakers to make substantial changes to modify voter-approved initiatives. Despite the fact that over 57% of Ohioans voted in favor of cannabis via Issue 2, nearly all Republicans lawmakers issued rebukes for the approval of it and have vowed to make changes. Opponents of Issue 2 include Governor Mike DeWine, House Speaker Jason Stephens, and Senate President Matt Huffman.
New Proposal Calls for Cannabis Limits, Penalties, and Business License Caps
Some Senators have called for a sweeping new proposal, which has been swiftly condemned by cannabis industry advocates in large part thanks to limits on home cultivation, newly implemented criminal penalties, and the elimination of not just social-equity provisions for business licensure, but also a de facto ban on cannabis concentrates. There would also be a statewide cap on adult-use licenses, which was not included in Issue 2. Thankfully, this proposal was not voted on as the House adjoined for the year.
Democratic House Minority Leader C. Allison Russo said there was, “misalignments between the House and the Senate and the governor on some key points.”
The Probability of Legislative Changes Weakens Over Time
Right now, Issue 2 remains intact. As more time passes, the more difficult it will be for the state to change course, as legislative business is scheduled to resume in the capital city of Columbus next month and the sale of cannabis in the adult-use market is expected to begin before next fall. From our experience, this is a relatively quick turnaround time for a medical state to embrace adult-use cannabis legalization.
Home Cultivation and THC Limits May Hinder Market Potential
With a key December 7 deadline passing, home cannabis cultivation and possession of cannabis is now legal. As detailed above, this doesn’t mean we’re completely out of the woods just yet on what the state of cannabis in Ohio might look like.
One of the “key points” as identified by Russo relates to a Senate-proposed THC-potency cap which is, currently, “inconsistent” with the state’s medical laws. There is currently a 35% THC-potency cap on plant materials and a 70% cap on manufactured cannabis products. This is much more restrictive in similar, new adult-use marketplaces and could potentially remain at this same rate or even become more restrictive for the adult-use marketplace.
Severe changes to THC limits could hinder the adult-use market and reduce the anticipated $2 billion in sales after the first year alone.
In addition, cultivation of cannabis is being further questioned. While individuals now can home cultivate upwards of six plants per adult (12 per household), this, like THC-potency, could be amended by state lawmakers. Governor DeWine just last week said allowing home cultivation in conjunction with other elements of Issue 2 was “a recipe for disaster.”
Issue 2 and Ohio Cannabis Overall Could Change: Don’t Get Too Comfortable
As it stands, Issue 2 will allow for individuals to posses up to 2.5 ounces of cannabis. The state has nine months from the election to set up a legal system for cannabis purchases and there is going to be a 10% tax on cannabis sales. Revenue from these taxes will be divided between administrative costs, addiction treatment, and social equity and jobs programs. Again, what is standing now may change. While we are feeling more and more hopeful with each passing day that this may not happen (especially thanks to lawmakers in the House), determined enough lawmakers in the Governor’s office and the Senate may try to deploy tricky tactics to get their way.
Start Planning Your Ohio Cannabis Business Now with Trusted Consultants
From a business standpoint, this means staying on top of the regulations and changes to the cannabis landscape over the months ahead to address any changes which may suddenly pop up. It’s crucial to begin the business planning and financial modeling process with trusted consultants, while being amenable and flexible with changes as they may emerge. Before you know it, the application window will be opening up and it’ll be time to put your best foot forward to secure your place in the lucrative Ohio market.