Estimates nationwide suggest if marijuana were legal, much of the profit gained by medical retailers and black-market criminals would disappear.
That worries Glenn Peterson, the owner of Canuvo, a Biddeford medical-marijuana dispensary. He also serves as president of the Maine Association of Dispensary Operators, a trade group made up of five Maine dispensary owners.
Peterson said his group is concerned that the bill could “eliminate the medical marijuana industry” in Maine.
“I tend to be libertarian,” he said. “On the other hand, I am quite protective of my dispensary.”
Paul McCarrier, a lobbyist for Medical Marijuana Caregivers of Maine, an advocacy group for state-licensed caregivers who grow marijuana for small groups of medical patients, said his group is opposing the bill. McCarrier said it would favor dispensaries through licensing requirements, which could regulate small-time growers out of existence.
“The scope of protections for the individual to cultivate for themselves is too limited,” he said.
The head of a national group that has supported the Maine bill and similar proposals nationwide says his organization has run into opposition to legalization from medical-marijuana groups in other states.
Allen St. Pierre, executive director of the National Organization for the Reform of Marijuana Laws, or NORML, said that “probably the most vexing thing that we’re facing right now ( in pushing for legalization ) is not the government or law enforcement agencies,” he said. “It comes from, oddly put, anti-prohibitionists versus anti-prohibitionists.”
The Maine bill to legalize marijuana, sponsored by Rep. Diane Russell, D-Portland, is a sweeping measure. Chiefly, it would allow those 21 and older to possess 21/2 ounces of marijuana and six plants.
It also would license cultivators, producers of products containing marijuana, retailers and laboratories, giving preference for licensing to officials at existing dispensaries.
David Boyer, Maine political director for the Marijuana Policy Project, a nationwide group backing Russell’s bill, said the provision to give preference to existing dispensaries was partially due to a drafting error in the bill, and he and Russell are open to amending it. Boyer has been lobbying legislators to support the bill.
Peterson said his group is lobbying for dispensaries to be granted automatic cultivation, retail and production licenses. He said it wouldn’t oppose the bill then.
McCarrier said it isn’t clear whether caregivers are on the same plane as dispensaries in the bill.
Russell’s bill would assess a $50-per-ounce tax on cultivators, 75 percent of which Russell has said she wants to divert to the state’s General Fund. Under her plan, the rest would go toward substance abuse programs, marijuana research and implementing the act.
Only two states, Colorado and Washington, have legalized marijuana, and they did so in 2012 referendum votes. Marijuana possession is illegal under federal law, so even states with medical-marijuana programs are running afoul of that law.
In those states and others, legalization efforts ran into patches of opposition from medical-marijuana groups as well.
St. Pierre suggested that’s because of economic protectionism: Simply put, when marijuana becomes legal, consumption will go up and prices will fall sharply.
McCarrier said it’s not about protecting money, but protecting “the ability for caregivers to continue to operate.”
Peterson said he sells marijuana for $360 per ounce; McCarrier said caregivers sell for between $175 and $250 per ounce. Street prices could be higher or lower.
A paper by a group of marijuana researchers published this month in the Oregon Law Review says the American marijuana market is a $30 billion industry annually. But modern farming techniques could supply that demand for “hundreds of millions of dollars.”
So, the paper says, most of those billions could be captured by businesses or states, but “only if competitive pressure does not drive prices down.”
Peterson said he has hundreds of thousands of dollars invested in his operation, and he’s not sure what would happen to it under legalization.
“I have no investors. I don’t take a salary,” he said. “But that’s what you have to do to have a program in this state.”
Medical marijuana wouldn’t be taxed at $50 an ounce, according to Russell’s proposal, and Boyer said he doesn’t want to affect the medical system “in any bad way.”
Still, “it’s kind of an evil trade-off,” Peterson said of the tax on recreational marijuana. “You can have it legally, but it’s going to cost you.” Russell has said the price drop after legalization would more than make up for the tax.
On taxes, a fine line would have to be walked to turn the average consumer to the new, recreational market. If the marijuana tax is too high, people will likely seek the black market or a doctor’s recommendation for patient status, say many working on tax proposals in other states.
Colorado and Washington are establishing regulations for their legal programs. They are seeking to establish a tax system that strikes those balances.
According to The New York Times, Colorado is considering excise and sales taxes of up to 30 percent combined on recreational marijuana. In Washington state, the Times said three levels of taxes will be levied on producers, processors and retailers. Consumers will pay a 44 percent effective rate.
The $50-per-ounce rate has been discussed in other places. California considered a bill that would use that rate in 2009, and lawmakers effectively killed it in 2010.
Beau Kilmer, a drug policy researcher for the RAND Corp., a nonprofit think tank, said there are a number of ways that regulators could tax marijuana, including per ounce and by the plant’s chemical makeup.
However, it’s too early to tell what would work best, so Kilmer suggests flexibility in the tax system.
“If large barriers are created to changing the taxes, it’s going to make it a heck of a lot harder to update them based on new research,” he said.
That lack of clarity makes Boyer, of the Marijuana Policy Project, wonder why some are opposing Russell’s bill so soon, before a legislative committee gets to amend it.
“I’m a little disappointed that some people are jumping the gun on this bill before it’s a final bill,” Boyer said. “I think everyone would benefit from ending marijuana prohibition.”
McCarrier said that philosophically, he could support legalization, but “the devil’s in the details.”
Peterson also said he could support the right plan, but “I would not want to do anything that disrupted the medical side of things. It really puts a death knell to the program.”
For St. Pierre, the NORML director, the schism is particularly divisive for the overarching cause of his group for years — totally legal marijuana.
“For me, it is a necessary but fascinating footnote in history that some of the most active opposition is oddly coming from those who are fellow travelers of the road, shall we say — those who enjoy and use marijuana, be it for medical reasons or recreational,” he said.
Source: Morning Sentinel (Waterville, ME)
Copyright: 2013 MaineToday Media, Inc.
Author: Michael Shepherd