Applications are now open for companies interested in becoming legal marijuana producers licensed by the state of New Mexico.
A day after the state published the final rules for cannabis producers, the Cannabis Control Division announced on Wednesday that interested parties can now use an online application portal to start the process.
"We're open for business," said Linda Trujillo, Superintendent of the Regulatory and Licensing Department, in a press release. "Starting today, companies and entrepreneurs can use our optimized online system to submit their application to become a producer in New Mexico's growing cannabis industry."
Regulators touted the modernization of the application process, as potential producers in the state's existing medical cannabis program had to fill out several paper forms to apply.
"The Cannabis Control Division is committed to empowering the adult cannabis industry and maintaining our nationally recognized medical cannabis program in a way that supports businesses, consumers and communities," said Trujillo. “CCD has invested time and resources in developing an easy-to-use application system so that manufacturers can get to work faster. And for the safety of consumers and workers, our robust accountability protocols ensure licensees are always compliant. "
The portal launches several days before the mandatory September 1 deadline in which regulators can begin accepting applications.
After submitting an application, regulators have 90 days to make a decision.
Adults 21 and older can currently own up to two ounces of cannabis and grow up to six full-grown plants for personal use under a law passed earlier this year, but officials were still tasked with regulating the commercial market to develop. So far, only the rules for producers have been published on the New Mexico Register, and they went into effect immediately on Tuesday.
Rules for retailers, testing facilities and other cannabis sectors are still being developed and must be finalized by January 1, 2022 before the April sales start.
"The Cannabis Control Division is committed to making the licensing process as simple as possible while complying with the law and ensuring the integrity of the New Mexico cannabis industry," said Trujillo. "We look forward to working with licensees to build an industry we can all be proud of."
Most of the new regulations for manufacturers concern licensing requirements, public safety, patient access and social justice.
For example, the Cannabis Control Division said it will ensure that 50 percent of marijuana producer licensees meet their social justice standards and support communities hardest hit by the war on drugs.
It will also "solicit public input to the creation and implementation of a social and economic justice plan" and draw up that plan by October 15 by a member of a disproportionately affected community and propose incentives to promote social and economic justice for applicants, licensees and employees the cannabis industry. "
The rules published on Tuesday in the New Mexico Register cover a lot of territory for producers. It sets out rules for licensing, safety requirements, the recall and disposal of cannabis products, the transportation of marijuana, and testing for quality assurance.
A key focus is also on ensuring that patients continue to have access to cannabis even after the market has opened to adults.
According to the rules, marijuana stores must "make reasonable efforts to sell at least twenty-five percent of their monthly cannabis sales to qualified patients, primary caregivers, and mutual participants."
If there is a cannabis shortage for patients, regulators would be empowered to take certain steps, such as:
There have been some concerns as to whether New Mexico has the capacity to produce enough marijuana to meet recreational market demand while serving patients.
Nonetheless, regulators are optimistic that they are moving in the right direction to ensure a smooth introduction of the market for adult use while protecting the state's medical cannabis program.
John Blair, deputy superintendent of the New Mexico regulator, told KOAT that while there may be an initial spike in sales as the market opens up to consumers, there are provisions in the Legalization Act to ensure that regulators "oversee and ensure can say that "Every company builds, sells and produces a certain percentage of cannabis in order to maintain the strength and integrity of the medical cannabis industry."
There is no limit to the number of business licensees that could be granted under the program or the number of facilities a licensee could open, although regulators could stop granting new licenses if an advisory committee determines that "the market balance is inadequate ".
Cannabis purchases include a 12 percent excise tax on top of the state's regular sales tax of 8 percent. Starting in 2025, the consumption tax rate would increase by one percent each year until it reaches 18 percent in 2030. Medical marijuana products that are only available to patients and carers would be tax exempt.
Local governments can't completely ban cannabis companies like some other states have allowed. However, municipalities can use their local building codes to limit the number of retailers or their distance from schools, daycare centers, or other cannabis businesses.
Polls have shown that voters in New Mexico are ready for the policy change. A poll published in October found that a strong majority of residents are in favor of legalization with social justice provisions, and around half support decriminalization of drug possession in general.
Governor Michelle Lujan Grisham (D) finally approved the cannabis legalization law in April, thereby achieving an important goal of her government. She had to call a special session to make sure lawmakers did their job after failing legalization during the regular session.
During the special session, a separate, supplementary bill was also passed, repealing convictions legalized under the Marijuana Legalization Act and signed by the governor. According to this, courts must start resuming qualified cases within 30 days of the law coming into force on January 1, 2022.
Regulators set up a website to provide information about legalization before the governor even signed the law.
Lujan Grisham has included the legalization of cannabis in her 2021 legislative agenda and has spoken repeatedly about the need for legalization as a means of stimulating the economy, especially amid the coronavirus pandemic. She said during a state affairs speech in January that "a crisis like the one we experienced last year can be seen as a loss or a challenge to rethink the status quo – be ambitious, creative and brave".
Additional pressure to end the cannabis ban this year came from neighboring Arizona, where sales officially began in January after voters approved a legalization initiative last year. In northern New Mexico is Colorado, one of the first states to legalize adult use.
The New Mexico House passed a legalization bill in 2019 that included provisions to place marijuana sales primarily in state stores, but that measure died in the Senate. Later that year, Lujan Grisham formed a working group to look into the legalization of cannabis and make recommendations.
Last May, the governor signaled that she was considering actively fighting lawmakers who blocked her legalization bill in 2020 on the legalization bill on her desk.
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Photo courtesy Mike Latimer.
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