Maine gets it right when it comes to legal weed, while California and others are struggling

Colorado’s biggest success came with the legalization of cannabis. They reduced the black market, introduced reasonable taxes that made the products competitive to the consumer, and capped income so people felt they were getting a “deal.” By comparison, California was the cookie monster of greed – wreaking havoc in the industry and hurting small businesses and the financiers they ostensibly wanted to help. The failed New York rollout has paved the way for over 1,500 unlicensed stores run by quick-thinking entrepreneurs who sell products at a premium. Maine, known for its no-nonsense common sense, seems to provide a current example of how to run a successful program.

Maine’s rugged individualism complements a burgeoning industry. Governor Janet Mills appointed John Hudak. He comes to Maine from the Brookings Institution, where he served as Associate Director of the Center for Effective Public Management and as a Senior Fellow in Governance Studies. For the past decade, John has led Brookings’ research on cannabis policy, regulation, implementation and policy. Hudak, well respected in the industry, had the opportunity to review how states have implemented their programs.

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Legal recreational marijuana sales increased 94% in 2022 from 2021. And the illegal market is down 64%.

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Hudak and this team are taking a holistic approach to legalizing marijuana in the state. By comparison, California viewed legal marijuana as a pure revenue opportunity and didn’t think about how to build another thriving industry. Granted, there have been some dubious players like MedMen, but the majority are small companies trying to cash in on the largest U.S. market. A glut of flowers coupled with high taxes has thrown the industry into turmoil. New York, a competitor to California in terms of market size, couldn’t decide what they wanted and scraped all plans at the last minute and implemented a partial plan, resulting in a significant loss for existing legitimate retailers. Meanwhile, in New York City alone, weed is expensive at the 1,500+ unlicensed retailers. Instead of fixing the basic problems, NYC is instead conducting “raids” and closing retail stores until they can reopen a day or two later. The Green Market Report states: “Following New York Gov. Kathy Hochul’s renewed crackdown on unlicensed cannabis sellers across the Empire State last week, few in the legal community expressed optimism that the directive would have the intended effect, and several predicted this.” The unregulated market would simply pivot instead of giving up.”

In a first win, the Maine Office of Cannabis Policy (OCP) modified its contract with Metrc, the inventory tracking provider of the Adult Use Cannabis Program (AUCP), to implement lot tracking for growers.

Tracking cannabis from seed to sale serves as the basis for government regulation. It enables a secure supply chain that prevents both diversion (regulated market product is sold on the illicit market) and reversal (illicit supply entering the regulated market). It also allows the state to take steps to protect public health and safety. OCP considered these important aspects of inventory tracking and examined the potential challenges and benefits of a lot tracking system.

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Hudak shared his thoughts on where they are going: “Cannabis regulations should be designed to provide patients and consumers with safe, reliable and consistent cannabis. However, these regulations need to be as efficient as possible to meet public expectations for the supply chain, public health and public safety. At the same time, regulations and taxes on cannabis must not be so overwhelming that the legal, regulated market cannot compete with and outperform the insecure, unregulated illegal market. There will be tensions between regulators and the regulated, but honest, well-intentioned and good faith conversations between regulators, industry and other interested stakeholders must work together to strike a (sometimes difficult) balance.”