Summary and opinion by John Fouts.
At this time, 23 out of 50 states, plus Washington DC have legalized marijuana for either medicinal or recreational use. That is nearly half of the country. Puerto Rico, a US Territory has also declared support for cannabis legalization. 86% of Americans live in a state where it is okay to use cannabis in some form or fashion. With sales expected to be above $20 billion within under 4 years, the market is becoming more and more competitive. In 2012, Washington and Colorado were the first two states to legalize cannabis for adult use. Sales have increased 30% per year since then in these states. To keep the numbers rolling – in 2014, 92% of all marijuana sales were related to medicinal use, but market share fell to 47% for that segment.
Businesses are not the only ones happy about the explosive growth of the industry. According to the Denver Post, Colorado recognized tax revenue of over 130 million dollars, and Washington collected over 250 million dollars in tax revenue. The next President of the United States will be able to make a decision to make or break the industry. Let’s hope it is to make it all work seamlessly – at the federal and state levels!
While there are some areas where concerns exist such as electricity usage to grow cannabis well, there seems to be more pros than cons. Electricity makes up 50% of the wholesale cost of cannabis, and the electricity used to grow cannabis accounts for 1% of all electricity used in the United States!
My Opinion: Is 2016 a tipping point year for the industry? I do not think it will be. It is, however an election year, and controversial topics always get more coverage during election years. Whether you are an advocate of cannabis use for medical or legal recreational use in the United States or not, it is difficult to ignore the progress being made on the political front. So while I do not believe 2016 to be a year in which there is no possibility of regression in terms of statute, I do think many states will make moves toward allowing medicinal use at a minimum. The Supreme Court case of Oklahoma and Nebraska v. Colorado scheduled to be heard on 3/5/2016 makes me on edge. The court could easily wipe out the legal cannabis industry. I do not think this will happen due to the previous ruling in 1969 when the Marihuana Tax Act of 1937 was found to be unconstitutional unanimously and cannabis was declared legal before Nixon worked with the DEA to classify it as a schedule I substance. The future is always uncertain. Until federal law can be adjusted to not be in conflict with state laws presently in place, I think there will remain a great deal of uncertainty in terms of the risk of doing business in the cannabis industry. I believe a tipping point will be achieved after a change at the federal level is made. It is my sincere hope that federal law will be changed to reflect the changing shift of opinion by the majority of United States citizens. The majority now supports legalization in our country, and it is time for the peoples’ voices to be heard.
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