The legalization of cannabis appears on Ohio’s 2015 November ballot under Issue 3. Will Ohio be the next state to legalize cannabis for adult use and the first state to legalize it without having first legalized it for medical use? We’ll soon find out, as Ohioans head to the polls Tuesday, November 3rd.
On Tuesday, Ohioans will be able to decide whether or not to amend the State’s constitution to allow adults 21 or over to purchase, possess and grow marijuana for medical and personal use through a regulated market.
Generally, off year elections yield a low turnout among younger voters, an essential voting bloc for the passage of Issue 3. The ability of ResponsibleOhio, the organization behind Issue 3, to mobilize young voters in an off-year election will likely make or break Issue 3. New Frontier, the cannabis industry’s “big data” provider, predicts the initiative will pass, however, they also caution that it will be a tough road ahead to implement.
Giadha De Carcer, Founder and CEO of New Frontier believes, “Issue 3 on the November ballot will likely pass. However, even if Ohio voters choose to legalize cannabis, the state would still face significant hurdles establishing a regulated market. All other states that have legalized adult use to date had previously passed marijuana laws at least 10 years prior to legalization. Ohio’s lack of experience will create a steep learning curve for the state.”
There are several key issues New Frontier addressed in their latest report, “Ohio: Forging a New Path to Marijuana Legalization”:
1. ResponsibleOhio’s Tax Revenue Projections Are Likely Inflated
At the heart of the conflict is a discrepancy between what ResponsibleOhio projects revenues to be in Ohio versus what New Frontier estimates. New Frontier placed those revenues at nearly half a billion dollars lower than ResponsibleOhio. For voters who consider the positive fiscal gains for Ohio to be critical, may find that the $1.88B in revenue by 2020 to be disappointing. Bottom line: while there may be other reasons to vote for Issue 3, the windfall from legal cannabis may not be as large as projected.
2. There Will Be A Steep Learning Curve Which Could Eat Up Many Fiscal Gains
This is a process that requires understanding and according to Giadha De Carcer, Founder and CEO of New Frontier, Ohio does not have the experience regulating marijuana that other states, where marijuana is legal, have. Unlike other states, medical marijuana has never been legal. This means that Ohio has no pre-existing infrastructure or regulatory framework.
3. Issue 3 Could Create a “Marijuana Oligopoly”
The amendment would limit producers to 10 growing companies, which is not a free market system. This puts the entire supply side of the industry into the hands of a few very wealthy investor groups and individuals that include pop star, Jessica Simpson’s ex-husband, Nick Lachey, NBA star Oscar Robertson, NFL player Frostee Rucker, and two Cincinnati-based relatives of the late President William H. Taft.
4. Issue 2 Could Invalidate Issue 3
Both Issue 2 and Issue 3 are showing strong support in polls, and this poses a major conflict. Issue 2 would make implementation of Issue 3 nearly impossible. If Issue 2 were to pass, it would not block the legalization of marijuana, however, it would likely block the constitutional amendment that would support this.
The success or failure of Issue 2 plays a strong role in how Issue 3 would be implemented. If successful, Issue 2 would remove the monopolistic feature, but also open the legal doors that would undermine Issue 3. The issue at stake between Issue 2 and Issue 3 is to prevent the monopoly growing culture that is found within issue 3, which would limit production to just ten growers. According to New Frontier, the legalization process would be argued in and out of court, and that process could take months if not years.
To learn more about Ohio Issues 2 and 3, as well as other issues related to the legal cannabis industry, visit www.frontierfinancials.com.