What Will Legal Cannabis Look Like in Maryland?

Almost a decade after medical marijuana was first legalized in the state, Maryland has finally agreed to bring an adult-use cannabis market into the mix. A recent bill was proposed to iron out the details of the state’s impending legal market, and Maryland’s House of Representatives has already approved its language.

Passing with a 103-32 vote, the proposed bill now sits with the state’s Senate, determining regulation details for a new market expected to commence by July 1. This will bring Maryland into the Northeastern cannabis fold, expanding possibilities and creating new opportunities for the region’s unique industry approach.

A brief history of cannabis in Maryland

2014 was a big year for marijuana in Maryland. Not only was possession of the plant decriminalized, but a medical cannabis program was legalized to cater to Old Line State citizens in need.

The Maryland Medical Cannabis Commission (MMCC) was established as a state-funded organization that has ensured medical cannabis remains available for qualifying patients throughout the past decade.

Like many other states, Maryland took a while to establish their medical program. However, by 2017, over 550 healthcare providers were licensed and ready to hit the ground running with medical cannabis prescriptions. Those same operators will be granted license priority when the time comes. Their medical licenses will be automatically transformed into dual licenses on July 1 (as long as they’ve paid the required fee).

And for everyone else, there will be a few standard regulations to keep in mind if you’re hoping to do canna-business in the Old Line State.

Proposed regulations for Maryland’s impending legal market (according to the current Senate bill)

Assuming the proposed bill passes the Senate, the below regulations would apply to Maryland’s adult-use cannabis market:

• For the first fiscal year (starting this summer), adult-use cannabis will be taxed at six percent. That tax is slated to increase by one percent yearly, maxing out at ten percent in 2028. Medical cannabis patients will remain exempt from this fee.
• Thirty percent of that tax revenue would be designated for a community reinvestment fund – for at least the first ten years of operation. An additional 1.5 percent would go to localities, with another 1.5 percent going to counties, 1.5 percent to a Cannabis Public Health Fund, and a final 1.5 percent to the Cannabis Business Assistance Fund.
• The Maryland Alcohol, Tobacco, and Cannabis Commission will be responsible for industry regulation, and the subsector Division of Cannabis Regulation and Enforcement would focus on issuing and reviewing business licenses.
• Social equity applications would be open for anyone with 65 percent business ownership and, at least five of the past ten years, lived in unfairly impacted areas.
• A Capital Access Program will also be established, bringing low-interest loans and unique business opportunities to social equity operators.
• For medical dispensaries that form “meaningful partnerships” with social equity operators (including mentorship, training, or shared business space), $5 million would be up annually for grant grabs.
• Medical cannabis patients could grow up to four plants at home.

Requirements for starting a canna-business in Maryland

The details of Maryland adult-use licensure still need to be ironed out, but here is what we know so far:

• The proposed bill will cap the available licenses at 300 dispensaries, 200 delivery services, and 75 growers.
• Micro licenses would become available to applicants: a.k.a. licenses that allow operators to open for business on a smaller scale.
• A number of licenses would be made available for on-site consumption businesses (like restaurants, lounges, or cafes) – but anyone who owns one of these licenses would be prohibited from holding any other type of cannabis license.

Predictions for Maryland’s adult-use cannabis market

Although the industry is still waiting for regulations and guidelines to be clearly established, national experts are already making market predictions. Maryland seems to have some strong potential as a contributor to the Northeastern U.S. cannabis scene.

The state’s existing consumers already hold a pretty notable reputation: they’ve been purchasing more cannabis per dispensary trip and per month than the average national consumer for the past year. Maryland consumers are also four percent more willing than the rest of the nation to pay more money for a product that is guaranteed to be of higher quality.

With this in mind, Maryland’s adult-use sales alone are slated to reach about $1 billion within the first 20 months of operations. The state’s medical program is also presumed to keep climbing in sales and participation.

If you’re interested in becoming a Maryland cannabis operator, there are many upcoming opportunities for success within the state. Make sure to attend the Lucky Leaf Expo Baltimore on July 21 and 22 at the Baltimore Convention Center. This business-to-business conference and trade show is jam-packed with education, networking, and fun. You won’t want to miss out.