Joe Veldon: Take the Best From the West and Leave the Rest

Heady Vermont Cannabis Op-Ed
Commentary 1 Feb 2016
 The draft bill ( S.241 ) coming out of the Judiciary Committee this past week and approved 4 ~ 1, goes a long way in addressing many of the complex issues involved with this industry as well as providing conscience responses to Governor Shumlin’s concerns about creating a regulated cannabis market in Vermont.  Our legislators should be commended for encouraging Vermonters from all walks of life to explain what they feel a regulated market should look like.

Passionate testimony was given across the state where two common themes emerged: how this market needs to be inclusive to regular Vermonters, and that steps need be taken to minimize Big Agribusiness’ influence over Vermont’s cannabis industry.

Many good things are in this bill: from its deliberate and measured rollout to its size and residency requirements to earmarking large percentages of revenue to key social costs like education and treatment programs and increased funding for law enforcement and first responders.  Regulating the “Vermont Way,’ including helping our farmers, developing a tiered system of production and developing a branding campaign, were all topics that were discussed at length.

Hey, at least they spelled 'Vermont' right?  Pic via High Times

Hey, at least they spelled ‘Vermont’ right?  Pic via High Times

Where this bill falls short legislatively is in its approach to eliminating the illicit market.  We seem to have chosen the Washington State model, which is an odd choice in that it’s recognized as having one of the worst rollouts, and it’s heavily taxed, severely restricted programs have caused a myriad of problems.  The most glaring being the six month backlog of supply.

Vermont shouldn’t be in the business of trying to set artificial supply and demand quotas as we as a state are neither savvy or nimble enough to keep up with the ever fluctuating prices on the illicit market.  Washington tried and has made a mess of it.  We have to remember that this market is subject to the same market forces that govern every other industry, and with little interference it’ll determine the correct amount of growers/dispensaries/customers necessary.

I’m confused why we went with this model when better ones exist.  Oregon went ‘adult-use’ this past October, and while it saw the same initial surge in demand as Colorado, it got none of the same coverage and has few of the same problems.  I think we should model our law after Oregon’s where the industry is overseen by the Liquor Control Commission and as long as you meet requirements similar to acquiring a liquor license you are allowed to be permitted.  Towns and municipalities would still be able to opt out (and on a side note, they should have to do so by town meeting day 2017) but let the market and people’s ambitions be our ceiling.   In Oregon, as was expected,  there was an initial flurry of applications but we are already seeing market forces taking control.  The better growers and dispensaries are rising to the top while the less well thought-out business plans are falling by the wayside – Just like it happens in every other industry!

This bill falls short of the “Vermont Way” because it excludes the vast, vast majority of us!  This bill doesn’t meet the Governors demand that it eliminate the illicit market because it only includes approximately 0.01356% of us.  

Probably not the original use of, the 'Vermont Way'...

Probably not the original use of the ‘Vermont Way.’

By only allowing a small number of cultivators/dispensaries we’re effectively giving larger operations a hand up over the small farmer by the state’s need to maximize revenue from such a small number of applicants.  Instead of excluding the vast majority of Vermonters – which by all accounts currently has a larger population of illicit growers than would be allowed under this program – we should be including them.  I’m no economist, but it seems to me that if we can include this population of growers and give them the opportunity to sell their crop for a fair price, it would create a big incentive for them to sell into the regulated market instead of the illicit one.  There would be no reason to take the risk and continue to deal on the illicit market if a fair, safe alternative was available.

So, if there is less cannabis available on the black market, wouldn’t that drive prices up?  And if prices rise on the illicit market, that gives the regulated market a real chance to generate the appropriate tax revenue while still undercutting the illicit market.   

This program inexplicably excludes our population of farmers who should have help, if wanted, in converting their sought-after properties into cannabis production, not be forced to compete against well-financed agribusiness interests.  Being inclusive of all Vermonters while tapping into the already established “Vermont Brand” will give our state the ability to show the rest of the nation how a regulated cannabis market can be implemented smartly and deliberately.  It will also give us the very real opportunity to be a leader in eliminating the illicit market.  Let’s take this already good bill, tweak it so that it better reflects the will of us Vermonters and show the rest of the nation how a regulated cannabis market can be a benefit to the entire state.

Joe Veldon is a Vermonter who currently works in the legal cannabis industry as a cannabis breeder and cultivation consultant with clients in multiple states with regulated medical and ‘adult use’ markets.  He has participated in several community forums across Vermont to freely share his perspective and industry experience in the hopes of bringing the best aspects of regulation to Vermont.

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