The (Unjust) Constitutional Basis for Restrictions on Commercial Marijuana Licenses in Missouri
In November 2018, Missouri voters selected by an overwhelming margin the Amendment 2 medical marijuana ballot initiative. This Constitutional reform created an entire system of personal and commercial medical marijuana licensing which has been the focus of significant controversy after almost 90% of applicants were denied applications for cultivation, manufacturing, or dispensary licenses due to onerous restrictions in the Amendment 2 framework (now Article XIV of the Missouri Constitution).
These restrictions are largely misunderstood. Many individuals and entities believe these restrictions exist solely through the discretion of the Department of Health & Senior Services and the bureaucrats charged with implementing Article XIV. This is false. The reality is that the restrictions on licensing are based on the text of Article XIV. The Article XIV drafters intentionally made this a difficult and confusing task so as to hide their intent; one has to read carefully and link several parts of the text to understand this.
The text of Article XIV provides (Section 1, Subsection 3, Paragraphs 15-17) first that licenses may be limited:
(15) The department may restrict the aggregate number of licenses granted for medical marijuana cultivation facilities, provided, however, that the number may not be limited to fewer than one license per every one hundred thousand inhabitants, or any portion thereof, of the state of Missouri, according to the most recent census of the United States. A decrease in the number of inhabitants in the state of Missouri shall have no impact. (16) The department may restrict the aggregate number of licenses granted for marijuana-infused products manufacturing facilities, provided, however, that the number may not be limited to fewer than one license per every seventy thousand inhabitants, or any portion thereof, of the state of Missouri, according to the most recent census of the United States. A decrease in the number of inhabitants in the state of Missouri shall have no impact. (17) The department may restrict the aggregate number of licenses granted for medical marijuana dispensary facilities, provided, however, that the number may not be limited to fewer than twenty-four licenses in each United States congressional district in the state of Missouri pursuant to the map of each of the eight congressional districts as drawn and effective on December 6, 2018. Future changes to the boundaries of or the number of congressional districts shall have no impact.
Further, Article XIV (Section 3, Subsection 1, Paragraph h) provides that the Department of Health & Senior Services shall:
(h) Establish a system to numerically score competing medical marijuana licensee and certificate applicants, only in cases where more applicants apply than the minimum number of licenses or certificates as calculated by this section, which scoring shall be limited to an analysis of the following....
In ranking applicants and awarding licenses and certificates, the department may consult or contract with other public agencies with relevant expertise regarding these factors. The department shall lift or ease any limit on the number of licensees or certificate holders in order to meet the demand for marijuana for medical use by qualifying patients.
This last part is important because it contains the functional criteria for raising the limit on marijuana licensees above the minimums set by Article XIV -- "in order to meet the demand for marijuana for medical use..."
This means that to justify allowing more commercial marijuana licenses than the minimums, the Department has to make a determination that the demand for "marijuana for medical use" is not being met by the initial allocation of licensees. On a functional basis, this presents two significant problems:
1) this determination can only be really made after all licenses are certified and operational (time frame ~ at least a year after the program opens)
2) this requirement puts DHSS in the position of functionally deciding what the market quantity & price of medical marijuana should be (central control of the market)
The drafters of Article XIV intended for these limits to exist. In late 2018, New Approach Missouri campaign consultant Jack Cardetti participated in an open forum about medical marijuana initiatives sponsored by the University of Kansas City Young Republicans. At about the 1:02:00 mark in this video, Mr. Cardetti justifies the cap on marijuana licenses in Amendment 2: "Why put a limit at all on there? ...It's because of what's called the Cole Memo from the USDOJ...If you follow these different rules and regulations we won't go after you...one of these is oversupply. They don't want more being produced than is going to be legally consumed...There has to be some kind of cap...". This is an astonishing claim coming from a campaign that is directly challenging the federal prohibition on marijuana after at least two other states (Oregon and Oklahoma) had established free market commercial marijuana licensing programs.
To summarize, Article XIV establishes commercial marijuana licensing minimums, then creates an elaborate and onerous ranking system, and finally restricts the allocation of further licenses to arbitrary determinations that can't happen until the program has been in operation for a substantial amount of time.
We at the Crossing Paths Political Action Committee are working hard to remove these corrupt and unAmerican restrictions on economic opportunity from the Missouri Constitution. For more information, email email@example.com.