Pot taking root? Region grapples with marijuana regulations, legalization talk

By Greg Bassett, Richard Crumbacher and Dave Ryan Delaware State News
Posted 5/9/21

As Delaware’s General Assembly is poised to continue debate on legalizing recreational marijuana this session, the Delmarva region is seeing changes in how it is regulating the drug.

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Pot taking root? Region grapples with marijuana regulations, legalization talk

Posted

As Delaware’s General Assembly is poised to continue debate on legalizing recreational marijuana this session, the Delmarva region is seeing changes in how it is regulating the drug.


After three hours of discussion and public comment in March, Delaware’s House Bill 150 was approved by the Health & Human Development Committee. An amendment was proposed regarding product safety and the bill now awaits action in the House Appropriations Committee.


The measure would legalize marijuana for recreational use, allowing individuals age 21 and older buy up to 1 ounce of marijuana from licensed retail stores. The legislation would establish a 15% tax, though retailers would otherwise be able to set their own prices.


Using marijuana in public or a vehicle would remain against the law, and employers would still be able to make their own policies prohibiting usage. Additionally, municipalities could pass ordinances preventing marijuana facilities from operating within their borders.


Delawareans would not be allowed to grow their own cannabis.


While legalizing marijuana for recreational use hit a wall in Maryland’s legislative session, the state’s medical marijuana industry is blossoming, with more than $1 billion in total retail sales since it was made legal on Dec. 1, 2017.


What’s more, the second billion dollars is anticipated to take half that time to reach, if the current trends continue. In 2020, quarterly sales were $115 million, nearly double the 2019 rate of $60.5 million.


Sales in the first quarter of this year were more than $135 million, Maryland Medical Cannabis Commission Executive Director William Tilburg said in a report published in April by the Baltimore Business Journal.


The increasing sales are the result of more patients being certified for the treatments at a greater number of dispensaries. Doctors’ orders are required for the certification — these were up from about 87,000 in late 2019, to more than 125,000 in January of this year.


The number of dispensaries has grown by about 10%. As demand increases, some licensed growers are trying to keep up by increasing production.


Medical marijuana is used to treat chronic or debilitating diseases and conditions including, but not limited to, glaucoma, Alzheimer’s, Crohn’s, post-traumatic stress disorder (PTSD), anorexia and seizures.


The Maryland Medical Cannabis Commission develops policies, procedures and regulations to implement programs that ensure medical cannabis is available to qualifying patients in a safe and effective manner. The Commission oversees all licensing, registration, inspection, and testing measures pertaining to Maryland’s medical cannabis program and provides relevant program information to patients, physicians, growers, dispensaries, processors, testing laboratories and caregivers.


Delaware legalized medicinal marijuana in 2011 and that industry has been growing. But pro-marijuana groups have expressed differing opinions on the recreational pot bill.


At a hearing last month, representatives from Delaware’s medical cannabis industry lauded efforts to increase legal access to marijuana but said the way H.B. 150 goes about it would be detrimental to their businesses.


“The proposed bill would visit violence upon the economic well-being of those who have chosen to take a material stake in this state,” said David White, chief legal officer for Fresh Delaware, a Newark compassion center. That company was joined by fellow medical marijuana companies Columbia Care Delaware, CannTech and EzyCure in voicing its concern.


But Zoe Patchell, executive director of the Delaware Cannabis Advocacy Network, said she believes those representatives want their businesses to be protected at the expense of consumers and other Delawareans looking to make money off marijuana.


“It’s basically an oligopoly that’s being sponsored by the Delaware medical marijuana program,” which exists under the Department of Health and Social Services, she said at that time. “They want the General Assembly to protect their private business interests and arbitrarily reduce the amount of competition in the market.”


Rep. Edward Osienski, D-Newark, the bill’s primary sponsor, has said the bill would not affect the medical marijuana industry.

In the wake of compassion centers’ opposition, groups have protested at two Delaware sites.


The patient-led group, headed by Frankford resident Lillyanne Ternahan, rallied at Columbia Care in Rehoboth April 24 and then at the company’s Smyrna location April 30.


A release from the group said medical marijuana patients are seeking improved access and lower prices that adult-use legalization would bring with the increase in market competition. “Patients remain outraged that the compassion centers testified against the legalization bill. They believe the dispensaries are opposed for more nefarious reasons, such as maintaining the market control they already possess,” the release stated.


Recreational use stalls in Maryland


During the recently completed 2021 General Assembly session in Maryland, lawmakers who hoped to legalize recreational marijuana were forced to abandon their efforts.


Legislation in the House and Senate that would have created a legal marijuana industry failed to clear the committee level.


Among the concerns was that the measures were rushed and might have created headaches for both law enforcement and health care officials.


Lawmakers are planning to bring the issue back in 2022. The delay was a blow to advocates of legalization, who believed they had broad public support for the measure.


“With the legislature unwilling to take up legalization this year, the focus now shifts to laying the groundwork to pass legalization in 2022,” said Olivia Naugle, a legislative analyst with the Marijuana Policy Project.


The proposals to legalize cannabis in Maryland focused heavily on social equity and on helping communities that have been harmed by the drug’s criminalization.


Both bills included automatic expungement for past criminal charges related to marijuana possession below the amount that would have been legalized.


The bills also would have set up funds to help “social equity applicants” — people from communities that have been disproportionately affected by marijuana criminalization — enter the legal market.


But there were some areas of disagreement and concern that became clearer as the session went on and the bills received committee hearings.


The debate included questions about the tax rate for legal cannabis, whether there should be caps on the number of production licenses, how to incorporate social equity applicants into the industry and whether full legalization would jeopardize the state’s existing medical marijuana program.


The health precautions put in place during this session also added challenges to the passage of a complex piece of legislation.

Recent polling found that two-thirds of Maryland residents support legalizing recreational marijuana — the highest number to say so since the poll from Goucher College began measuring opinions on the topic in 2013.


Local businesses


In Dorchester County, CULTA has been active in recent years with a successful growing operation. Sunburst Pharm Dispensary in Cambridge has been in operation more than a year with a variety of products.


CULTA was founded in 2015 by Mackie Barch and Matt Bickel.


“CULTA is a vertically integrated cannabis company that cultivates, extracts, processes, distributes and retails cannabis and cannabis-related products,” the company’s website says. “CULTA proudly grows all its own cannabis in processing facilities in Cambridge and sells product in its flagship Baltimore dispensary. CULTA products are also available in dispensaries throughout the state.”


Sunburst Pharm on Meteor Avenue in Cambridge is a retail dispensary offering a variety of products. Most sales are of extracts of the plant itself, such as oils — smoking is not always recommended.


“We understand how difficult it can be to start a new medical regimen,” the company’s website says. “We’ve made it our mission to make shopping for medical cannabis simple. Our cannabis consultants are well versed in our extensive stock of top rated cannabis products and can help you get acquainted with consumption methods, dosage, and more.”



At a Dorchester Chamber of Commerce event in January 2019, Sunburst Pharm CEO Darryl Hill said, “You have to understand that it’s a medicine. It’s a very viable product and a very useful product.”


“This isn’t necessarily about kids getting high. This is real medicine,” he said.


It’s not just about getting high and feeling better. Now that research into the properties of cannabis is legal, discoveries are being made of the therapeutic uses of the plant.


So though tetrahydrocannabinol, the well known psychoactive “THC” can calm a mood and reduce pain, sophisticated growers can genetically engineer a strain of marijuana that does not contain that compound. Or if a patient does not want the enhanced appetite marijuana sometimes creates, products are available that do not make a patient overeat.


Requests to both from the Banner for further information were not answered.


Acknowledging that there is resistance to the use of cannabis products, Mr. Barch reminded the Chamber members that up to the start of the pharmaceutical industry in the mid-19th century, the world depended on plants’ curative properties.


“They have a place in medicine,” he said. “I ask people to have an open mind.”


At the same event, Mr. Barch said, That could have gone elsewhere, but some towns weren’t interested. “I went to Crisfield, a lot of places, and was told, ‘We don’t want you,’” he said.


It was Crisfield in particular that a couple from Ohio identified, along with Princess Anne, as a good place to do business.


Nkechi Iwomi, founder and CEO of Element Consulting Services, along with her husband Ted Bibart started Element MD, a limited liability company which on Oct. 1 received pre-approval from the Maryland Medical Cannabis Commission (MMCC) to process cannabis.


A former biofuels manufacturing plant in the Princess Anne Industrial Park which was last used as a distillery was identified as a potential location, and town commissioners in December amended park regulations to allow its sale for this kind of business.


Mr. Bibart said the medicinal properties from raw cannabis would be infused into alternative products and sold to licensed medical marijuana dispensaries, of which none are located in the county.


“You wouldn’t know there was anything going on in that building different than anything that happened with the previous use,” he said, referring to the distillery, which closed in 2019. “We are in the healthcare business at the end of the day, we are creating medicine for people” and in Maryland that makes it an essential business.


“We’re here to be good neighbors,” he said, calling the secured building on Progress Lane “a perfect opportunity for this.”


The sale of the property to Phoenix Real Estate Holding LLC of Dublin, Ohio, was finalized in January and renovation is ongoing.


While working on its Princess Anne site, Element MD also had eyes on Crisfield, where the mayor and City Council advertised last fall for requests for proposals for the sale and reuse of the former Carvel Hall cutlery manufacturing plant on Crisfield Highway.


Ultimately three proposals were received, including one from Element MD to turn the 70,300-square-foot building into an indoor greenhouse to grow medical marijuana.


By a 3-2 majority, City Council in March approved selling the building to Element for $200,000 pending state approval and the final details to be negotiated over 60 days. While not possessing a cultivation license, one is pending assignment by the MMCC.


If successful, Element proposes to employ 35 to 40 people projecting revenue of $28 million per year and turning the 23-acre brownfield into a property to be valued at over $9 million. Mr. Bibart also sees up to 1.7 MWh in electricity generated for the greenhouse through solar panels placed on the ground and roof of the building.


Confident about their investments in Somerset County, Mr. Bibart and his wife have since closed on a waterfront residential property near Princess Anne. They said last fall that their business has the full support of state Sen. Mary Beth Carozza, and the University of Maryland Eastern Shore is poised to conduct cannabis research.


“Our industry is only growing,” Mr. Bibart said, calling this “a family business” with investors that are also “very interested in the community.”


Public use


For a time last year, Wicomico County appeared poised to become just the second jurisdiction in Maryland to crack down on marijuana use in public.


In spring 2020, the County Council heard an appeal from Sheriff Mike Lewis and State’s Attorney Jamie Dykes, who wanted county leaders to implement a measure that places medical marijuana in the same enforcement arena as alcohol.


A 2019 Maryland Court of Appeals ruling essentially made possession of medical marijuana in small doses subject to civil regulations. Alcohol misuse, as always, can be prosecuted under criminal laws.


“People are consuming marijuana on our highways and our sidewalks,” said Ms. Dykes, whose office is tasked with prosecuting drug offenders. “From a public safety perspective, this should not happen.”


Sheriff Lewis said that, currently, someone can be pulled over speeding along the bypass while smoking marijuana in their car, but they would face only minimal punishment. A person driving the same way, but found to have an open container or be consuming alcohol in the vehicle, would face criminal charges.


“It is a criminal offense to have an open container or drink in a vehicle,” Sheriff Lewis said. “To have marijuana, it is a civil offense, if you have less than 10 grams.”


The sheriff also decried the different structure regarding possible fines.


“You are issued a criminal citation for alcohol — if you don’t pay, your license is suspended,” he said. “Marijuana is a civil fine — if you don’t pay, there are no penalties at all. It’s just unfair, it’s just unfair.”


Ms. Dykes said nothing in the legislation would govern medical marijuana use within a person’s home.


“From a public safety perspective,” she told council members, “I urge you to act now.”


The council, however, took no action on the request. With the lack of a measure coming out of the 2021 General Assembly, the matter is expected to be raised before the County Council later this year.


Possession of recreational marijuana passes in Virginia


In April, Virginia lawmakers signed off on amendments that make the possession of small amounts of recreational marijuana and homegrown plants legal in the state in July as opposed to 2024.


Gov. Ralph Northam proposed changes to House Bill 2312 and Senate Bill 1406, which passed earlier this year during the Virginia General Assembly’s special session. The bills legalized marijuana possession and sales by Jan. 1, 2024, but marijuana legalization advocates and Democratic lawmakers lobbied to push up the date for recreational possession.


Adults age 21 or older will be able to legally possess up to 1 ounce of marijuana if they don’t intend to distribute the substance. Marijuana cannot be used in public or while driving, lawmakers said. Virginia decriminalized marijuana last year and reduced possession penalties to a $25 civil penalty and no jail time for amounts up to an ounce. In the past, possessing up to half an ounce could lead to a $500 fine and 30 days in jail.


Individuals can also cultivate up to four cannabis plants without legal repercussion beginning July 1, with punishments ranging from misdemeanors to jail time if over the limit. The plants would need to be labeled with identification information, out of sight from public view, and out of range of people under the age of 21. Marijuana retail sales still do not begin until 2024.

The amendments passed along party lines in both chambers.


Capital News Service contributed to this report.