Some cities are inadvertently supporting illegal cannabis sales, new report says

Through Johanna Skopl

Leafly has published a unique report detailing the unintended and harmful consequences that occur when local communities choose not to legal and regulated cannabis sales.

The report, developed in partnership with Whitney Economics, a global leader in cannabis and hemp business consulting, data and economic research, highlights the adverse consequences of abandonment and examines why local regulations, not local bans, are the way forward. to deal with cannabis.

Participation in legalized sales would benefit the entire community

After legal cannabis is allowed in a state, numerous legalization laws allow municipalities to enact specific regulations in cities and counties. That means they can choose whether or not to sell cannabis.

According to the Leafly report, “Rather than judiciously regulate legal sales, it is increasingly common for executives to reject legalized sales outright, with unintended consequences that effectively create an economic sanctuary for illegal street vendors to continue in business.”

Leafly’s opt-out report found that local leaders who choose not to sell cannabis harm their communities by:

  • Indirect encouragement of adult consumers to buy illegal products
  • Endangering public health by allowing untested products to circulate
  • Perpetuated illegal sales to local youth
  • Turning away from local jobs and tax revenues
  • Continuing the lost war on drugs

Bruce Barcott, the report’s lead author and Leafly Editor-in-Chief, said: “This report shows that legal, regulated cannabis stores are putting illegal marijuana dealers out of business.

RELATED: Why are so many municipalities opting out of their state’s adult cannabis market?

“Concerns over local cannabis stores could prompt elected officials to ban cannabis businesses in their cities. But adults in every community are already buying and enjoying cannabis, legal or not.” he said. “The cannabis-abandoning cities and counties are essentially voting to keep their local illicit marijuana markets in business.”

Photo by Ozge Yagmur/EyeEm/Getty Images

The situation of opt-out cannabis sales in some US states

After four years Legal Cannabis In California, illegal street vendors still meet more than 50% of the state’s adult consumer marijuana demand, and it’s no coincidence that 62% of the state’s communities have decided against regulated retail sales.

More recently, in New Jersey, which began selling legal cannabis last April, 71% of municipalities have banned the sale of legal, state-regulated cannabis. “That has left few legal options for the state’s adult consumers. With just one store for every 358,000 people, illegal street vendors still control more than 80% of the marijuana market,” according to Leafly.

In New York, which will soon start selling legal recreational cannabis, 50% of all municipalities have decided to opt out. The New York Cannabis Control Board (CCB) recently issued regulations allowing home cultivation for MMJ patients and caregivers with ID.

RELATED: NYC mayor says he won’t crack down on illegal weed sales, tells Big Apple to light up and enjoy

“Today, nearly 45% of Americans live in a state legal for adult use. If upcoming legalization measures are approved in November’s election, half of all Americans could live in a legal cannabis state by 2023,” the Leafly report continued. “In any new rule of law, local officials are called upon to regulate cannabis in a way that is appropriate for their community. The exit isn’t a vote against marijuana — it’s a vote for illegal dealers.”

Cannabis SalePhoto by OlegMalyshev/Getty Images

reporting methodology

The data in Leafly’s 2022 Opt-In Report “comes from a variety of public and private sources. Unless otherwise noted, data cited by Leafly and Whitney Economics represents market conditions as of July 1, 2022. Cannabis sales and active license numbers are dynamic. We have chosen July 1, 2022 as a fixed date to ensure the completeness of the data from all countries examined.”

According to the message:

  • The number of legal cannabis stores per capita was derived using public licensing data released by state cannabis regulators. The state’s population is current as of the 2020 United States Census.
  • The percentage of cannabis sales captured by the legal market “was derived by comparing each legal state’s annual cannabis sales to that state’s total market estimate,” the authors said.
  • TME is defined as the value of all cannabis sales in a calendar year, regardless of the legal status of the product.

Concluding, Beau Whitney, co-author of the report and founder of Whitney Economics, said: “Access and taxes are the keys to customer migration to the legal market (…) And right now we are seeing illicit cannabis sales bolstered by opt-out cities and counties.”

This article originally appeared on Benzinga and has been republished with permission.

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