Passage of one or more of the medical marijuana proposals on the Nov. 6 ballot will create a new industry in Missouri for entrepreneurs who want to grow, process, test and sell smoking and edible products.

Those interested will need to have a large cash investment to start, both for license fees and to establish their businesses. They will also have to wait to see which of the three plans for licensing and regulation is approved. If more than one passes, the size of the majorities and the way they are written will determine which one takes effect. Missouri would be the 32nd state to legalize medical marijuana.

Those regulatory differences are among the main points of controversy between the three campaigns. Over the next month, Missourians will see an escalating war of words in an unusual three-way battle in which the object will be as much to depress the “yes” votes on other proposals as it is aimed at outright defeat of competitors.

Voters will see the measures as Amendment 2, Amendment 3 and Proposition C. Explaining which one rules is like describing playoff scenarios late in a sports season.

If one amendment passes and the other fails, it will take effect regardless of whether Proposition C passes. If both amendments pass, the one with the most votes wins. Proposition C will be law only if it passes and both amendments fail.

That makes supporters of the two amendments the most antagonistic toward each other, with backers of Proposition C soft on their differences with Amendment 2 and making similar attacks on Amendment 3.

Amendment 2, an initiative from New Approach Missouri, has roots in the groups that have long advocated for relaxation of marijuana laws. Amendment 3 is being financed by Springfield doctor and attorney Brad Bradshaw through a committee called Find the Cures. Proposition C’s campaign is called Missourians for Patient Care.

Columbia attorney Dan Viets, president of the campaign’s board of directors, said Amendment 3 is designed to put Bradshaw in charge of deciding who gets a license and how the tax money raised by sales is spent.

“The important point is that anybody who wants a license is going to be at the mercy of Brad Bradshaw and his gang of four,” Viets said.

Bradshaw, in turn, charges in commercials that Amendment 2 is a cover to make black-market pot growing and sales impossible to prosecute.

“Amendment 2 is a get out of jail free card,” Bradshaw says in one commercial.

He also is firing back at Proposition C.

Amendment 2 can function as well as Proposition C and may be compatible, allowing both to take effect, said Mark Habbas, spokesman for Proposition C.

“The Bradshaw Amendment is the one that scares everybody because you have one guy who created this thing and could be the drug czar of the industry,” he said.

Business basics

Amendment 2 has the cheapest application and license fees and is the only proposal allowing outdoor growing and home-grown marijuana so consumers can bypass retail purchasing. It is also the only proposal that does not have a mechanism for local votes on whether to allow growers and dispensaries in a political subdivision.

It requires a minimum of 24 dispensaries per congressional district, or one for each county in the Fourth Congressional District, which includes Audrain, Boone, Cooper, Howard, Moniteau and Randolph counties.

“Amendment 2 is completely centered around what is best for Missouri patients,” campaign spokesman Jack Cardetti said. “That is the real difference here. We wanted to make sure cancer patients, epilepsy patients and others have access to safe, responsible marijuana.”

Amendment 3 allows the largest minimum number of growing and dispensary licenses. It requires at least two dispensary licenses for every 20,000 residents of a county and at least two in counties with fewer than 20,000 people. That would allow Boone County at least eight dispensaries, with most surrounding counties eligible for two to four dispensaries.

A local government can request more licenses and, by a ballot measure passing with a majority vote, ask that no cultivation or dispensary businesses be established. The vote is not binding on the Board of Biomedical Research and Drug Development, created by Amendment 3 as the licensing agency and dispenser of tax revenue to medical research activities.

“They could have the vote but ultimately the discretion would be with board,” Bradshaw said in an interview.

“I wouldn’t see why they wouldn’t,” Bradshaw said when asked if he expects the board to honor local bans.

Proposition C has the smallest minimum number of dispensaries and fees set between those charged for Amendment 2 licenses, the cheapest, and the costlier Amendment 3 licenses. It allows a binding local vote banning dispensaries but requires a two-thirds majority to pass.

The regulatory schemes established by each proposal offer licenses for cultivation, testing, edible and infused product manufacturing and retailing. Each gives licensing responsibility to a different agency. Amendment 2 gives the job to the Department of Health and Senior Services. Amendment 3 creates the research board. Proposition C makes the Division of Alcohol and Tobacco Control in the Department of Public Safety the licensing authority.

The division already supervises the distribution and sale of regulated products, Habbas said. That experience means it can move quickly to implement the law.

“You really have no idea how important the regulatory compliance measures are and the need to be under the proper authority in the state of Missouri,” Habbas said.

Who gets licenses

With potentially hundreds of licenses available, each proposal tries to set limits on ownership, both on the number of licenses and participation by investors from outside the state.

The loosest residency and outside investor rules are in Amendment 2. To receive a license, a sole proprietor would have to be a resident of Missouri for one year and a business entity would have to be at least 50 percent owned by Missouri residents of at least one year. Each cultivator could have three licenses and each dispensary could have five.

“I expect there will be a lot who will try” for licenses, Viets said. “It is really fundamentally like any other business.”

Amendment 2′s rules mean a lot of out-of-state investment will flow into Missouri and the rules are silent about limiting ownership of multiple business entities, each with the maximum number of licenses, Bradshaw said. The major backers of Proposition C are former beer executives and by using the agency they know will have an advantage, he added.

“That is a bunch of retired alcohol executives, they know the people there, and they are going to have the monopoly,” he said.

There are no guarantees with using existing state regulators to run the program, Habbas said.

“Nobody in the state of Missouri knows how the division is going to allocate licenses,” he said.

Amendment 3 has the strictest residency and ownership rules. A sole proprietor must be a resident for three years and a business entity would have to be at least 70 percent owned by state residents of three years. It allows cultivators three licenses for large establishments and five for small establishments growing with a research purpose. Dispensary owners could have five licenses but no more than 50 percent of the licenses in any county.

Because Amendment 3 puts Bradshaw in charge of selecting the first research board, he will control who gets licenses, Habbas said.

“If there is any initiative that almost monopolizes or can guarantee licenses, it is Bradshaw’s” he said.

Amendment 3 allows more cultivators and more dispensaries than either of the others, Bradshaw said. It requires at least half of the licenses to go to applicants who meet the basic regulatory requirements and the rest to go to operators who will participate in research.

“If there are no disqualifying offenses, a person will get the license,” Bradshaw said.

Under Proposition C, only operators who receive cultivation licenses will be able to operate dispensaries, up to three locations for each growing operation. It will require the largest investment to participate in the market.

The plan is to have a verifiable product, Habbas said.

“It is a vertically integrated model that puts responsibility on the grower to provide good, clean cannabis to the patient,” he said.

SOURCE LINK: columbiatribune.com