THE BLOG

Will 2016 Be the Year of Cannabis?

01/13/2016 02:25 pm ET | Updated Jan 13, 2016
  • Alex Thiersch Managing Principal of Salveo Capital, an investment firm funding companies in the legal cannabis space

The prospects of legal cannabis in 2016 have come a long way in the last two years. In 2014 the cannabis industry exploded when legal sales of cannabis for personal use began in Colorado and Washington State, the Rohrabacher amendment finally passed in the House of Representatives, and the sky did not come crashing down. It seemed like the floodgates opened as business interests began to take notice and the gains of that year (74% market growth in 2014 according to the ArcView Group) bled over into 2015. Last year Oregon, Alaska, and the District of Columbia legalized personal use as well, and medical sales began in Minnesota and Illinois. Not all was rosy, of course, noting the stalled medical legislation in Pennsylvania and the failed campaign to legalize personal use in Ohio. Despite these setbacks soaring sales brought increased media attention, and legalization advocates across the country began preparing for a 2016 push. Looking forward, 2016 could be the biggest year legal cannabis has ever had in the United States.

State Action

California

In 1996 California became the first state in the nation to legalize medical cannabis. Today, even as a medical-only state, it still sits as the single largest legal cannabis market in the country. Twenty years after legal cannabis sales began the Golden State is set to open the market for legal personal use. Legalization by ballot measure is so widely expected that last year the Lt. Governor issued his own recommendations for what state regulation should like in a fully legalized California. With medical cannabis sales totaling roughly $2 billion in the state, what will this market look like when it's completely open?

Nevada

Nevada has been making a push to become the center of this new cannabis market in the last couple of years. Medical cannabis dispensaries in the state honor patient cards from many other states, and unlike many other places it's rumored that if full legalization passes there might be no residency requirement for business ownership. Additionally, several public officials have come out in open support of legal cannabis including Congresswoman Dina Titus delivering the opening remarks at the Marijuana Business Conference and Expo in Las Vegas last year. In November citizens in Nevada will head to the polls to determine exactly where the state will fit in the nation's cannabis industry.

Vermont

Presidential candidate and current Vermont junior Senator Bernie Sanders has publicly stated that cannabis should be completely removed from the Control Substances Act, and introduced legislation in the Senate last year to that effect. The rest of Vermont's government seems to agree as the state could be the first in the country to legalize via the legislature. A bill was already floated last year with some support, and the state's Governor called for legalization in his State of the State address earlier this month.

Rhode Island

Rhode Island is the other state that many believe could see legalization via legislature in 2016. A bill was introduced last year, but the 2015 session was adjourned without a vote. The bill is likely to be resurrected this year with some support.

Maine

Support for legalizing cannabis for personal adult use in Maine is right around 65%, which means proper campaigning and the right language would make for almost sure passage in November. Separate efforts from the Marijuana Policy Project and a more grassroots organization merged last year placing all support for legal cannabis in the state behind one ballot initiative.

Florida

A comprehensive medical cannabis ballot initiative with only one main financial backer received 57% of the vote in 2014, which was short of the 60% supermajority needed to pass. The same bill will be up for vote again this year with more backing, and a more organized campaign making it likely that Florida will have a wider medical cannabis presence than the very limited bill passed by the legislature last year.

Pennsylvania

Medical cannabis in Pennsylvania was halted in 2015 by one man. A bill for a comprehensive medical cannabis program had enough votes to pass in the legislature, and had the support of the governor, but the committee chair refused to release the bill to the floor for a vote. Many believe the bill will be introduced again in 2016, and while it will be more restrictive than others in the nation it will be a place to start.

National Action

Of course there's plenty set to happen at the national level in 2016 as well. As states embrace legal cannabis many Congressional Representatives from those states. We'll probably see Dana Rohrabacher's amendment on the 2017 spending bill, for example, as it has been for the past three years. Senator Ron Wyden's Small Business Tax Equity Act - an attempt to normalize cannabis businesses in the eyes of the tax code - and Senator Jeff Merkley's Marijuana Access to Banking Act - to make it easier for banks to service cannabis businesses - are still in committee as is the Rand Paul-led CARERS Act which essentially legalizes medical cannabis at the federal level.

Of course the big news federally is this year's Presidential election, and virtually every serious candidate now at the very least supports the continuation of allowing states to make their own cannabis laws. This, of course, reflects the huge popularity of medical cannabis among the population at large and in swing states in particular.

With so much opportunity on the horizon, while 2014 will probably always be remembered as the tipping point, 2016 might truly be The Year of Cannabis.

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