The cannabis industry in Montana is scrambling to get its infrastructure up and running. The state has just over a month left before recreational sales on July 1, 2018 start. In order for businesses to sell their products legally, they need the proper permits from local officials, as well as stores ready with inventory and trained staff members who are fully aware of how the new law will work.

Montana's cannabis industry is scrambling to finalize details before recreational sales begin



In less than two months, recreational cannabis sales will begin in half of Montana’s counties. Regulators and merchants alike are rushing to settle last-minute details before the deadline on January 1st.

At Missoula’s Greenhouse Farmacy, it’s another busy morning. The staff at the dispensary is pre-weighing and packaging dried bulk marijuana flower for sale in individual aluminum containers from a huge plastic storage container.

“It’s like though I’m on a hamster wheel.” Greenhouse Farmacy co-owner Brian Monahan describes it as “continuous.”

He claims that the cannabis sector is competitive even in the best of conditions, but that it is much more so now that recreational sales are on the horizon. Monahan is preparing his medicinal marijuana store to enter the new market for the first legal recreational cannabis sales to people aged 21 and above. Monahan anticipates a threefold increase in sales next year. He’s increasing manufacturing, changing floor designs, adding new sales kiosks, and enhancing parking facilities to be ready.

“It’s almost like a marathon runner nearing the finish line.” It’s like, ‘Just a few more kilometers and it’ll be there.’

Last year, the majority of Montanans voted in favor of legalizing recreational marijuana. While it will be allowed to consume it across the state, it will only be lawful to sell it in half of the counties where voters passed the ballot item that authorized adult usage.

As a result, marijuana sales may vary from county to county.

“I believe what we’re hearing from local governments is a genuine desire to ensure that they have control over their specific region in accordance with what their constituents want to see,” says Kristan Barbour, the director of the state revenue Department’s Cannabis Control Division.

“As we’re seeing from many towns right now — Billings, Missoula — they’re debating how to govern those companies or how many stores they want to allow.” “As a result, we’ll always remember that local governments override what the state allows,” Barbour adds.

During recent municipal elections, counties were given the option of enacting local marijuana sales taxes and restrictions governing where marijuana stores may be located. Three counties made the decision to do so.

On top of the state-mandated 20% tax, voters in Missoula, Park, and Yellowstone counties will see a 3% municipal tax on recreational marijuana. A tax hike on medicinal marijuana was also authorized in Park and Yellowstone counties.

According to Aaron Smith of the National Cannabis Industry Association, Montana’s soon-to-be patchwork approach to marijuana sales isn’t unusual. As the new system takes shape, he argues, clashes between politicians, regulators, and the sector are to be anticipated.

“It’s not at all special.” There are a lot of complicated difficulties to resolve. As has been the case in other states, mistakes will be made along the road. What matters is that the voters’ will be carried out, and I believe Montana is on course to do so.”

Legislators recently asked the Treasury Department to review a draft law governing who may operate in cannabis stores.

Another provision in the statute regulating adult-use cannabis sales prohibits licensees from selling CBD products on their premises. This regulation is also being re-examined.

According to Pepper Peterson of the Montana Cannabis Guild, the implementation of rules for this new business has been a “interesting journey.”

Despite his dissatisfaction with the state’s early regulatory efforts, Peterson believes the new sector will be profitable, with commercial prospects and millions in tax revenue windfalls in the so-called “green counties” where recreational marijuana sales will soon be permitted.

“I believe the opt-out counties will approach the Legislature in 2023 and say, ‘We want some of that darn money.’” That’s something we’re going to battle against. If you don’t participate, or if your county doesn’t have sales, you shouldn’t be eligible for any of the funds.”

Aaron Smith of the National Cannabis Industry Association says:

“What we’re seeing is that when those jurisdictions see the tax income moving next door, they decide they want a piece of that pie and begin amending their own regulations.” In Montana, I expect to see the same thing happen over time.”

The recreational marijuana business in the United States is expected to reach $20 billion in the near future, according to trade associations.

According to a research conducted by the University of Montana Bureau of Business and Economic Research, Montana’s nascent recreational cannabis business might generate over $200 million in sales next year.

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