New Mexico’s cannabis laws have been hailed as some of the most advanced in the country, but there is no such thing as a perfect law. Regulators and future marijuana business operators ran into some issues that were not properly addressed in the laws as the market took its first steps. Now lawmakers are looking to make changes before adult-use cannabis stores open on April 1.
Last month, New Mexico’s Cannabis Control Division (CCD) announced that it was temporarily implementing a plant limit increase for marijuana growers in the state to address anticipated shortages. Growers can now grow twice as many plants as the Cannabis Control Act (CRL) allows.
“The Division has reviewed demand estimates provided by cannabis industry applicants and licensees,” Director Kristen Thomson wrote in documents filed with the state Public Records Board, as reports NM Political Report. “The projected market demand shows that the demand for regulated cannabis will increase year on year as more and more cannabis consumers move from the illicit to the regulated market. The supply of medical cannabis will be increasingly threatened without an adequate supply of plants.
The only problem is that he left out micro-enterprises – cannabis businesses that grow and sell 200 plants or less at a time. Given lawmakers’ stated intentions to support small businesses and level the playing field, the announced rule change appears to go against the spirit of the law by penalizing micro businesses and rewarding large corporations.
But the fault seems to lie with the wording of the law and not with the CCD. Factory limits for microproducers have been set at 200 by the CRA and regulators cannot override the law. “In the spirit of promoting social equity and ensuring that our micro-producers have the best possible opportunities, CCD wants to see this definition changed,” said division spokeswoman Heather Brewer.
The agency can get its way. Last month, Senator Linda Lopez and Representative Andrea Romero introduced Senate Bill 100. If passed, the bill would update some CRA definitions and change a few rules, including increasing the production limit for micro-businesses from 200 factories to 1,000.
“That doesn’t mean every micro-grower will want to grow 1,000 plants,” Brewer said. This means that temporarily doubling factory boundaries would no longer give large corporations and out-of-state companies a market advantage over small producers.
The bill proposes a number of other welcome changes to the CRA. One of those changes is a new provision that would allow companies that already operate in the medical cannabis market to employ workers as young as 18. It would come as a relief to many employees who were hired under the Lynn and Erin Compassionate Use Act – the state’s medical cannabis law – which allows companies to hire employees who are at least 18 years old. year. These workers should be laid off since the CRA requires employees to be 21 or older.
Another big relief could come from entrepreneurs who want to participate in the adult cannabis market but have already obtained a liquor license. Under the CRA, “A licensee may
conduct any lawful activity or any combination of lawful activities on authorized premises; provided that the licensee is not a licensee within the meaning of the Liquor Control Act.
Presumably, lawmakers intended to prohibit businesses from opening establishments that sell both cannabis and alcohol on the same premises. The wording effectively prohibits all liquor licensees from conducting lawful activities in a cannabis store, possibly including purchases as a consumer. SB 100 would completely remove the language seen in this line that refers to the Liquor Control Act. It would also remove language that prohibits cannabis business licensees from selling alcoholic beverages and replace it to explicitly prohibit licensees from “co-locating any licensed cannabis and alcohol-related activity.”
If enacted, the changes would allow an enterprising entrepreneur to open a cannabis dispensary and a bar that serves alcohol as long as they are on separate premises.
The bill also proposes to require cannabis license applicants to submit to an extensive state and federal criminal background check and submit their fingerprints to the Department of Public Safety (DPS) for coordination with the FBI. By linking with the federal law enforcement agency, CCD will be able to access applicants’ criminal histories in New Mexico and other states as well. The DPS would be responsible for compiling and providing the data to the CCD.
If enacted, SB 100 should resolve many of the unexpected issues that have surfaced in recent months. The governor has reportedly signaled support for the bill, and none of the changes appear to conflict with the spirit of the original law. It also appears that the industry stands to gain from the changes and it is unclear if the parties involved would have anything to lose if they were implemented.
If the law passes, the micro-producers will certainly be better off, but they will not be able to make up for the time they will have lost. Every day that passes is another day when big companies are able to put plants in the ground while small companies can only sit idly by and watch. This has already been happening since the end of January, and it might be difficult to calculate exactly how much potential profit is lost by micro-enterprises during this period. If it seems to be the result of a simple blind spot during the drafting of the bill, it should not be overlooked.
The current 30-day legislative session in New Mexico ends at noon on February 17.