South Dakota rejects recreational marijuana ballot measure

South Dakota voters on Tuesday rejected a ballot measure seeking to legalize recreational marijuana for the third straight election cycle.

With 92% of the vote counted as of 11:30 a.m. CT Wednesday, the measure was failing 52% to 44%, according to the Associated Press.

Initiated Measure 29, funded by South Dakota’s medical marijuana industry, would have expanded on an adult-use legalization initiative approved by voters in 2020 that was later declared unconstitutional by a state judge.

To avoid a similar fate, Initiated Measure 29 aimed to legalize marijuana possession and small-scale home cultivation for adults 21 and older but failed to establish any regulatory framework for recreational sales – a stark departure from nearly every other cannabis-legalization referendum.

Where marijuana is legal in the United States

South Dakota operators disappointed

John Mueller, CEO of Missouri-based Greenlight Dispensary, which operates three stores in the state and has another in the pipeline, called the failed ballot measure “a missed opportunity.”

“South Dakota will continue to miss out on the economic and public safety benefits that come with a regulated adult-use cannabis market,” Mueller told MJBizDaily in an emailed statement.

“The illicit market will persist, depriving the state of tax revenue and leaving consumers without tested, regulated products,” he said, adding that Greenlight remains committed to the South Dakota medical marijuana market.

According to a state presentation to lawmakers, South Dakota is home to:

• 38 licensed marijuana cultivators.
• 18 licensed cannabis product manufacturers.
• 68 licensed dispensaries.
• 2 licensed independent testing labs.

Referendum history

In 2020, South Dakota became the only state to legalize medical and adult-use marijuana simultaneously.

In that year, 54.2% of voters approved an amendment to change the state constitution to legalize recreational cannabis while requiring lawmakers to legalize medical marijuana and hemp sales by April 1, 2022.

On the same ballot, nearly 70% of voters also approved a measure legalizing medical marijuana in the state starting on July 1, 2021.

Republican Gov. Kristi Noem, an outspoken critic of marijuana reform, immediately challenged the will of the voters and directed a state official to file a lawsuit challenging the amendment.

A Noem-appointed state judge later agreed the initiative violated South Dakota's single-subject rule, but the medical marijuana program was allowed to proceed.

Voters in 2022 rejected a follow-up measure that adhered to the single-subject rule - and, like IM 29, would have legalized possession and home cultivation - by a margin of 53%-47%.

Chris Casacchia can be reached at chris.casacchia@mjbizdaily.com.