2020, for all of the wrong reasons, will not be easily forgotten. Even for the cannabis industry, despite many states declaring operators an “essential service” at the start of the pandemic, this year brought uncertainty and financial hardship as investors remained on the sidelines for the majority of the year, and as any stimulus plans neglected the industry somewhere on the Isle of Misfit Toys.
In any case, 2021, coming on the heels of an election season that saw New Jersey, South Dakota, Mississippi, Arizona and Montana all pass various adult-use cannabis or medical cannabis measures, portends a brighter future for the industry as a whole. So go ahead and crank our Holiday Playlist if you’re looking to feel jolly, and let’s take a look at a few things to keep an eye on in the new year.
Detroit adult-use cannabis
The Motor City is opening up for adult-use cannabis in the first half of 2021. We covered this pretty extensively in the above link, but Detroit’s legal cannabis market is shaping up to be rather robust and was built with Detroiters in mind –a minimum of 50% of all licenses in each category are going to Detroit residents. To recap:
- 75 retail licenses
- 35 consumption lounge licenses
- 35 microbusiness licenses
Additionally, the following are unlimited categories
- Grower
- Processor
- Secured transporter
- Safety compliance facility
- Marijuana event organizer
- Temporary marijuana event
California: Be prepared for Prop. 65/new municipalities opening up
This is unique to our clients and colleagues in California’s cannabis market, but be ready for the changes to your products and packaging/labeling with new Prop. 65 designations for Δ9-THC.
Why? The changes to Δ9-THC are particularly onerous for obvious reasons to all in the industry, but CBD operators need to be keenly aware of these changes due to the thorny matter of Prop. 65 having no minimum threshold for THC in those products. That is a vulnerability.
Also, in more positive news: more and more municipalities will be opening in 2021 to bridge tax revenue shortfalls due to the pandemic. Get in touch if you’ve got questions about new markets in California or elsewhere.
New Jersey (and the East Coast emerges)
New Jersey voting to legalize adult use on November 3 was very significant for a few reasons. Primarily, it set in motion the Garden State’s path to an adult-use cannabis market starting next year. But we’re not anticipating the adult-use licensing window opening immediately or even necessarily in the first half of 2021. Still, it’s patently obvious what an opportunity New Jersey represents due to its location, sizable population, and population density.
The other important factor with New Jersey’s legalization move is that it will be forcing other states within immediate proximity to it: New York, Connecticut, Pennsylvania to all seriously consider legalizing recreational cannabis within their boundaries or face uncomfortable and unpleasant conversations around enforcement and lost tax revenue.
With Vermont quietly legalizing sales back in October. And with other states such as New York, Virginia, Rhode Island, and even South Carolina looking at adult use or medical paths, the eastern seaboard rapidly, in the course of months, has gone from humdrum to ripe with potential.