Cannabis regulators step up recreation program under tight deadline | 406 Politics

Rules or no rules, sales of recreational cannabis begin January 1 in Montana. And after nearly two decades of ramifications for poor regulations initially put in place for the medical marijuana industry, the Montana Department of Revenue wanted to get it right this time around – with just six months to get it all done.

The deadline created a pressure cooker environment, in which the department just finalized its last set of business rules on December 22, two weeks before sales start.

“It’s going to be very tight,” Cannabis Control Division administrator Kristan Barbour said in an interview in November. “Our preference would be to set up this program with rules surrounding it, because it will go live (January 1) whether the rules are there or not.”

Voters made the Department of Revenue the new overseer of the state’s entire cannabis industry when they passed Initiative 190 in November 2020. The initiative set July 1 as the deadline for transfer Montana’s medical marijuana program, previously under the state Department of Health, to the Department of Revenue.

During the last semester of this year, the Barbour division expanded for the new recreational system while incorporating the medical program. While the lawmakers’ bill set the general framework for the state’s cannabis program, it was up to the revenue department to write specific rules to implement everything.

Preparing for the new market has meant balancing the intention of lawmakers with the response of industry when crafting these rules. Internally, the division has also developed its IT systems and tested its new licensing software, the nuts and bolts that will keep industry and government on the same page.

“Once we can trigger this and see what we’ve built, hopefully we can look back at the citizens of Montana and they say ‘I feel good voting for I-190’,†said Barbour.

Suppliers who spoke to the Montana State News Bureau for this story said the last-second rule changes have created some uncertainty. But they appreciated the new division which has boots on the ground and was responsive to their feedback during the rule-making process, given the choppy waters the medical marijuana industry has endured over the course of time. of its 17 years of history.

Voters in Montana first approved medical marijuana in 2004. The market quickly turned into the Wild West, with little to no regulation from the state’s health department. In 2011, lawmakers – responding to federal raids on some state dispensaries – passed a law limiting providers to three patients, ending access to drugs for 93% of patients, and decimating the market across Montana. .

The state Supreme Court upheld the law in early 2016, but voters overturned it later that year with Initiative 182. In the years that followed, the state continued to elaborate further. of rules through the legislature and the Department of Public Health and Human Services, sometimes causing controversy in the industry.

Twenty-two full-time employees of the Department of Health’s former medical marijuana program migrated to the Department of Revenue when it took over in July. By mid-November, the Cannabis Control Division had hired 29 of its 34 full-time staff allocated by the legislature. And there are a lot of new faces in the division; a licensed technician has been part of the program since the emergence of the medical market, “but other than that there’s a lot of freshness,” said Barbour.

“We are a number with a lot of different backgrounds coming from different directors and different subject matter experts,†said divisional assistant administrator Erin Ducharme. “We all get together and discuss how decisions are going to be made or the most important rules to follow when. It’s really a collaboration in our division based on the fact that we all come from so many different directions. . “

Behind the curtain of the Department of Revenue, much of the Cannabis Control Division’s efforts have focused on converting vendors to its new licensing system, a more centralized version of the device used by the Department of Health. of State. Bringing in this old data and moving hundreds of vendors, dispensaries, manufacturers, growers and labs to the new system is a difficult task in a short period of time, said management analyst Andrew Hoffman.

“We really work on behalf of (the vendors) and try to make this all work for everyone,†Hoffman said.

With all eyes on recreation, the Cannabis Control Division has identified 83 vendors who will remain medical when the clock turns to a new year. Devin Keller is a division supervising inspector who has been in regular contact with suppliers throughout the transition to Revenue Department oversight, and said he’s interested to see who decides to sell cannabis to companies. recreational or adult use and who decides to keep their business medical.

“Really, if they’re a former medical marijuana licensee in a ‘green’ county, the world is theirs when it comes to marijuana,†Keller said. “People who decide not to do it, it’s going to be interesting to see how it all goes.”

In public view, the rule-making process has been risky. The revenue department has worked with sometimes conflicting information from the legislature and an industry that speaks out when regulations can make or break their livelihoods. In making rules, the ministry attempted to clarify things that were not defined in Bill 701, the comprehensive Cannabis Regulation Bill passed in the last session.

The industry strongly rejected the first parameters proposed on advertising. These suggested rules would have required all signage to be black and white and include a warning label in characters at least 10% of the largest font size, among other restrictions. The division, after an emphatic rebuke from producers in the public commentary, reduced many of those restrictions when the advertising regulations were finally passed.

Lawmakers have also banned recreational cannabis stores from selling hemp. By extension of the hemp ban, the Cannabis division released a proposed rule that bans dispensaries from selling cannabidiol products, most commonly a non-psychoactive component derived from hemp widely known as CBD. Lawmakers argued the rule strayed too far from legislative intent, but planned to clarify the matter with a follow-up bill in the 2023 session. As a result, the division was able to turn the tide and clarify that suppliers could still sell CBD products.

“Our rules have been quite controversial,†said Barbour. “And I think it’s only because there are so many. It’s not ideal for a state government to throw 15 rules in one package.… There are also loopholes in the draft. of Law 701.… Some of these unresolved details, we’re trying to answer. “

Lawmakers and vendors, however, praised Barbour and his team for staying fluent on a tight deadline with the information they had to work with.

“I was very impressed with DOR,” said Joanna Barney, general manager of Sacred Sun Farms at Four Corners, noting that several staff from the Cannabis Control Division had come to their facilities to hear them directly. . “They were extremely receptive to our comments.”

It’s a different relationship than providers had with the state’s health department, said Barney, who has been given little power for much of his time regulating the industry to enforce laws. put in place by the legislature. Suppliers who operated non-compliant sometimes suffered no consequences, while others who operated within the rules paid huge costs, she said.

In the months after the Revenue Department took office, Barney remained involved in the rule-making process, just as she did during the session when lawmakers juggled three different bills on cannabis and dozens of amendments, sometimes voting on the whole, an unwieldy bunch in a day.

“The rule sets were a good reflection of what happened during the session,†said Barney. “It was a dense bill and a lot of changes to follow.”

The sheer volume of information in departmental legislation and rules explains how the state has grown along with industry since the federal raids about a decade ago. Barbour said that despite the sprint of the past six months, the division has the strength of its staff’s enthusiasm for the job.

“It’s a reward for the type of people that this program has attracted and who have been here kind of in the ditches as it has transformed over the years,†said Barbour. “There is nothing in marijuana that has remained stable… and I think that says a lot about their character of being flexible and fluid in this environment.”