North Dakota isn’t Colorado or California. It’s not even Oklahoma.
Respect for North Dakota’s conservative identity is paramount if the state’s voters – who rejected adult-use cannabis legalization measures in 2018 and 2022 – are to be convinced to legalize cannabis this Election Day, campaigners believe.
“I don’t want us to be Oregon or Washington or Colorado,” where legal marijuana has flourished in a way conservatives might believe to be unchecked, said Steve Bakken, chair of the campaign to pass Measure 5, the third legalization measure to appear on the North Dakota ballot in six years.
North Dakota and Florida are the two Republican-leaning states where voters will consider ballot measures on Nov. 5 to legalize a recreational cannabis market.
Neighboring South Dakota also will vote on adult-use legalization, though that measure does not allow for regulated sales.
Wins in red states would mark significant milestones for the U.S. marijuana legalization movement.
And there would be positive implications for future federal reform, as more Congressional lawmakers would represent states with regulated adult-use cannabis.
Limited new marijuana business opportunities
A transformation into one of the more laissez-faire states for marijuana businesses was always unlikely in a state where 76% of voters lean Republican.
This political reality meant Bakken and the mostly medical marijuana industry-funded Measure 5 campaign had to tailor a vision of legalization to suit North Dakota voters’ sensibilities.
As such, “this is extremely conservative,” Bakken, a former mayor of Bismarck, told MJBizDaily. “This gives all the power to the state.”
In contrast to liberal coastal states or even Oklahoma or Missouri – adult-use sales in the latter are on pace to exceed $1.4 billion in 2024 – Measure 5 also creates relatively few new business opportunities.
That means North Dakota – where fewer than 10,000 registered medical marijuana patients generated about $21.6 million in annual sales at eight licensed dispensaries last year, according to state data – likely will remain a small adult-use market.
For comparison’s sake: The “average” adult-use retailer in New York City generates roughly $8.1 million in annual sales, according to one government estimate.
If voters approve Measure 5, adults 21 and older will be allowed to possess:
- Up to 1 ounce of cannabis.
- 4 grams of concentrates.
- “No more than 300 milligrams of an adult-use cannabinoid edible product.”
Home cultivation is limited to no more than three plants under Measure 5, which would go into effect 30 days after the election.
Separately, the measure calls for state regulators to set up a licensed system for adult-use cultivation and sales no later than Oct. 1, 2025.
That regulated market would be limited to:
- 7 manufacturing licenses, which allow cannabis cultivation and manufacturing.
- 18 cannabis retail licenses.
Measure 5 also limits vertical integration, with ownership capped at one manufacturing permit and no more than four stores statewide.
Individuals and ownership groups also would be forbidden from having an “ownership interest” in more than one retail location within 20 miles of another, according to the text of the initiative.
Medical marijuana businesses support legalization
Existing medical marijuana businesses in the state contributed almost all of the nearly $540,000 raised in support of the measure, campaign finance records show.
Top donors include GR Holdings OH-ND, an affiliate of New York-based marijuana multistate operator Curaleaf Holdings, which contributed $300,000 to the campaign and operates four of the state’s eight MMJ dispensaries, and Pure Dakota, which contributed $236,309 to fund the measure and operates three dispensaries, according to records.
In contrast to other states, Measure 5 does not guarantee first-mover status to existing MMJ businesses, though lawmakers could make that change.
In a statement emailed to MJBizDaily, Keaton Murphy, Curaleaf’s senior vice president/Central Region, noted the “tremendous movement at both the national and local level in support of cannabis reform, and we hope to see North Dakota’s ballot initiative pass to legalize adult-use cannabis in the state.”
“We are excited for voters to have a say in increasing access to legal, regulated cannabis for adults across the state and look forward to the results in November,” she continued.
Though the measure does not call for a special excise tax on adult use, legal marijuana transactions would generate $7.2 million in sales-tax revenue, according to an official state analysis.
And unlike previous legalization efforts, Measure 5 dedicates cannabis tax revenue to “schools and first responders,” Pure Dakota CEO Casey Neumann noted.
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Polling uncertain, but Donald Trump a factor?
Recent polling conducted by the North Dakota News Cooperative shows what advocates believe is a competitive but winnable contest, with 45% of respondents in favor of the measure and 40% opposed.
Another 15% are undecided.
Though opposition spending has yet to materialize, according to campaign finance records, those against Measure 5 include law enforcement, business groups, public health organizations and the Catholic Church.
But at least one factor might add some unpredictability in a state that preferred Donald Trump over Joe Biden by more than 2-to-1 in 2020: The Republican Party’s 2024 candidate for president endorsed Florida’s adult-use legalization initiative last month.
“I’m guessing that’s going to sway at least some undecideds, or at least have some bearing on their thoughts,” said Bakken, the Measure 5 campaign chair.
“With us being a really heavy Trump state, if you’re a big Trump fan, why are you undecided?”
Chris Roberts can be reached at chris.roberts@mjbizdaily.com.