Marijuana Business Magazine November December 2018

MARKET AT A GLANCE Main measures Measure 91 (authority to license and regulate businesses) and House Bill 3400 (unified medical and recreational framework established requirements for testing, packaging, labeling, etc.) Year passed Measure 91: 2014 HB 3400: 2015 Business regulations The rules in effect for recreational sales are extensive, covering all aspects of operations for all licensees, including use of pesticides, extraction methods, trans- portation, lab testing, hiring, security, recordkeeping, packaging, labeling, zoning, insurance and advertising. State tax requirements 17% state tax paid at point of retail sale Sampling of state licensing & application fees Application Producer, processor, wholesaler, retailer and lab: $250 License Producer: $3,750 (Tier I), $5,750 (Tier II), $1,000 (Micro Tier I), $2,000 (Micro Tier II) Processors, wholesalers, retailers and testing labs: $4,750 What to watch • Concerns about the state's legal cannabis entering the black market led regulators to reduce purchase limits for medical marijuana patients from 24 ounces per day to 1 ounce per day. The rules went into effect Aug. 24 and will expire in six months. Oregon’s MMJ industry has suffered since the state legalized adult-use cannabis, and the move could further exacerbate the market’s decline. • In response to federal law enforcement pressure, officials in Oregon have taken several steps to curb illegal marijuana production. The measures include citing licensed cannabis businesses for failing to comply with the state traceability system, cracking down on unlicensed trafficking operations and inspecting outdoor cannabis harvests. Oregon - Recreational Oregon’s recreational cannabis industry is plagued by oversupply, a problem faced by many states with adult-use markets but one that’s especially pronounced in the Beaver State. As of August 2018, more than 1,100 cultivators were licensed to grow cannabis in the state – a 55% increase from August 2017. To curb production and prevent excess marijuana from flowing into the black market, regulators announced in August that new applicants looking to get into the state’s recreational industry – including cultivators, processors and retailers – would have to wait at least a year for a license. Though the supply glut has caused both wholesale and retail cannabis prices to fall, Oregon is on pace to exceed the $404 million worth of adult-use marijuana sold in 2017. For information about cannabis regulations in other markets, order the Marijuana Business Factbook 2018 at November/December 2018 • Marijuana Business Magazine • 169