Liquor Commission’s cannabis legalization bill met with skepticism

If New Hampshire were to ever legalize the retail sale of cannabis, Paul Morrissette would be well placed to participate.

The New Hampshire resident is co-owner of East Coast Cannabis, a dispensary just across the border in Eliot, Maine, where cannabis retail is legal. The store sees a lot of business across the New Hampshire border; legalization could allow easy expansion into the Granite State, Morrissette says.

But a bill this year to legalize marijuana and allow consumers to purchase cannabis products from state liquor stores has drawn criticism from cannabis advocates within the industry. And if the bill passes, some vendors like Morrissette say they wouldn’t be interested in growing cannabis in the state.

“We are totally indifferent to what they do with this bill,” he said in an interview. “We would be one of the main people hired for the state to farm because we farm for our stores and others.”

The reaction from Morrissette and others laid bare frustrations with the bill, House Bill 1598, which passed the House, 169-156, after a lengthy debate on the floor of the House Thursday. Sponsored by Rep. Daryl Abbas, a Republican from Salem, supporters touted the bill as an approach that could bring revenue to the state, curb potential cannabis commercialization, and prove palatable to Gov. Chris Sununu and a skeptical Senate.

But cannabis stakeholders and legalization advocates say the state-run model would be too controlling and unworkable. Some argue that it would be better to kill the bill than to pass it. Others argued instead for House Bill 629, which would legalize the possession and home cultivation of cannabis plants in the state, but would not include retail provisions. This bill was passed in the House in January.

“It’s high time for New Hampshire to stop being a prohibition island,” wrote Karen O’Keefe, director of state policy for the Marijuana Policy Project, a national advocacy group, in testimony to lawmakers. . “But it’s important that the bill to replace Prohibition actually works.”

HB 1598 is the latest in a series of recent attempts by the New Hampshire House to find an approach to cannabis legalization that can win Senate support.

The bill would legalize the possession and consumption of cannabis for all residents 21 and older. And it would allow the New Hampshire Liquor Commission “to regulate and administer the cultivation, manufacture, testing, and retail sale of cannabis throughout the state” and allow cities and towns to limit or prohibit the number of cannabis establishments within their borders.

Unlike previous years’ bills that created a regulated market and tax regime for retail cannabis, the bill would only authorize the commission to sell the products in state stores. Proponents say it’s a key selling point.

Proponents say the state could reap useful revenue gains from this approach, arguing that up to $30 million a year would accrue to the state if the bill passes. Fifty percent of that money would be used to offset cities’ contributions to the statewide education property tax; 30% to help repay the debt of the state pension system; 10% to drug and alcohol treatment programs, and the remainder to first responders and behavioral health programs.

“This is a win on all counts for all citizens of New Hampshire,” said Rep. Tim Lang, a Republican from Sanbornton. “All pleas are supported.”

And Sununu, a longtime opponent of marijuana legalization, expressed some openness to the bill’s wording, but said it would depend on assessing the data, including the overdose death rate. state opioids.

“I think the original bill was very well crafted and I still give a lot of credit to Daryl Abbas of Salem,” Sununu said at a March 23 press conference. “He worked very hard to design the right bill. If we ever have to, this is probably the right structure to have. But at the end of the day, it has to be about results.

But stakeholders like Morrissette say giving the Liquor Commission the power to be the state’s sole vendor would be inefficient and could create headaches for growers. Since federal law prohibits the transfer or sale of cannabis across state lines, any supplies for state stores should come from start-up growers in the state.

Yet with only one buyer for their products — and no ability to sell across state lines — these companies could be stuck with state-set prices, Morrissette argued, a departure from other states. which allow competition to stabilize prices. The Liquor Commission indicated that it would try to set prices low to compete with other states; Morrissette said that could mean producers would be forced to operate at low profit levels.

“They’re going to set the price they’re going to pay for it,” he said. “Not me. My cost doesn’t matter. My profit margin doesn’t matter. I have someone who wants to maximize profits in retail stores, and the less he buys, the better it is and worse than me.

The situation around cannabis differs from the Liquor Commission’s monopoly on hard liquor sales, opponents of the bill also say, because multinational companies and brands cannot sell cannabis products.

Meanwhile, the single-source model could mean state-owned products are slow to innovate and individual stores would not be flexible enough to respond to changes in grower supply, he said.

“It’s not like a tomato plant,” he said. “I can’t say until I put the seed or clone in the ground how much I’m going to get for the weight of this plant, and whether the state actually needs it in their store.”

Supply and demand inaccuracies with state liquor stores could force growers to destroy their products.

Opponents also took issue with the bill’s exclusion of edible cannabis from the list of products that can be sold by the Liquor Commission. Sununu has expressed his opposition to allowing the sale of edibles in the state. Morrissette counters that the edibles are popular among older shoppers who prefer them as sleep aids to cannabis flowers that need to be smoked, and he warned that shoppers would simply cross state lines to buy the edibles wherever they want. are legal.

Meanwhile, medical cannabis advocates argue that state control of the market could undermine existing “alternative treatment centers,” which distribute medical cannabis.

“It creates a new, separate system with no interaction with the medical cannabis program,” said Matt Simon, director of public and government relations at Prime ATC, an alternative treatment center in the state. “They will attract patients; they will deter being a registered patient and buying from ATCs.

Proponents of the bill pushed back against concerns, arguing that the state-run system was the best way to maintain oversight, collect revenue and keep the cannabis market in check in the state. And they warned that the alternative — legalizing private retail cannabis sales and taxing them — could lay the groundwork for a sales tax in the state.

Abbas took the floor to criticize a proposed amendment that would allow private companies to sell cannabis and be taxed under the state’s Meals and Rooms Tax.

“By imposing a room and meal tax on cannabis, which is not a room or meal, you are essentially starting to convert that room and meal tax into a full retail sales tax,” Abbas said. . “It’s the beginning.”

Others said the Liquor Commission format, while not the ideal approach for all, was the best option for the cannabis switchover in 2022, given Sununu’s comments.

“Do I like the state involved here? Hell no, I don’t,” said Representative Al Baldasaro, a Republican from Londonderry, addressing the House. “But do you want to know something? You do not have the choice. Either you want marijuana or you don’t. You can’t have the whole pie. We have to take a small piece at a time.

Aurora J. William