Maine voters legalized recreational and medical marijuana nearly three years ago. Yet the roll-out process has been slow, especially on the recreational side, in part because Maine has given licensing authority to both the state and local municipalities, adding an increased burden on those seeking licensure and an extra layer of red tape.
Maine’s Marijuana Legalization Act (the “MLA”) contains a comprehensive regulatory scheme with detailed licensing provisions. Yet it also permits municipalities to create their own rules, including licensing rules. City officials from Portland, Maine’s largest city, only recently proposed such rules. Portland’s rules would create nine license categories (tier 1 cultivation (500 square feet of canopy space), tier 2 cultivation (2,000 square feet), tier 3 cultivation (7,000 square feet), manual manufacturing, high-hazard manufacturing, medical-use retail, recreational-use retail, small-scale caregiver, and testing). The rules cap recreational-use retail licenses at 20 and mandate a 250 foot buffer between stores. Retail licenses will be awarded on a “first qualified-first licensed basis.” Application fees are $50 for a small-scale caregiver license and $500 for everything else. Annual license fees range from $250 for a small-scale caregiver license to $10,000 for a recreational-use retail license. No mobile sales, deliveries, mail-order sales, or other remote sales are permitted, although small-scale caregivers can still provide marijuana by delivery.
Maine’s decentralized regulatory approach does not appear conducive to an efficient market. Most state cannabis programs have detailed rules and regulations at the state-level, and oftentimes those are burdensome enough. A marijuana business seeking to operate in Portland, Maine would have to not only go through the state license process, but then also go through the detailed local licensing process. But we will wait and see before passing judgment. Perhaps the red tape looks more foreboding than it will actually be or perhaps we have gotten past the hard part, and now that both the state and its largest city are moving forward, we will see the recreational market expand rapidly in Maine.
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