On Tuesday, November 7, Ohio voters passed Issue 2 by a sweeping 14-point margin to legalize marijuana for adult use in the Buckeye State. Ohio will now become the 24th state in the country to regulate adult use marijuana, and marks the tipping point where now more than 50% of citizens in the United States will live in a jurisdiction with regulated adult use sales.
Frantz Ward Cannabis Practice Chair Tom Haren, who served as the spokesperson to the Issue 2 campaign, said “marijuana is no longer a controversial issue. Ohioans demonstrated this by passing State Issue 2 in a landslide. Ohioans are being extremely clear on the future they want for our state: adult-use marijuana legal and regulated.”
Issue 2 will automatically become law on December 7, at which point possession of up to 2.5 ounces of marijuana in plant form or up to 15 grams of marijuana in extract form will be decriminalized. The Ohio Department of Commerce, which already regulates Ohio’s medical marijuana program, will then begin its rulemaking process to implement adult use regulations within 9 months.
Here are the top things to know as Ohio implements its new adult use program:
- The Department of Commerce is charged with issuing commensurate adult use licenses to existing medical marijuana licensees at their current locations, as well as additional adult use dispensary licenses to cultivators and independent dispensaries;
- In addition, the Department must issue up to 40 new Level III cultivation licenses and up to 50 new adult use dispensary licenses with a preference to social equity applicants;
- The Department must begin accepting adult use license applications by June 2024, and must issue these adult use licenses by August 2024;
- Issue 2 preserves the status quo for Ohio employers, who are not required to accommodate the use of marijuana in their workforces, and who can continue to keep zero-tolerance drug policies in place;
- Localities can “opt-out” of allowing adult use dispensaries in their jurisdictions, though there are processes in place for residents to put any decision to opt-out up for a local referendum;
- Under Issue 2, there will be a 10% tax in addition to local sales taxes at the point of sale of adult use marijuana to a consumer, which revenue will be distributed as follows:
- 36% to a Host Community Cannabis Fund which will go to local governments that have adult use dispensaries in their communities;
- 36% to a Social Equity and Jobs Fund;
- 25% to a Substance Abuse and Addiction Fund; and
- 3% to the Department to cover general administrative and enforcement costs;
Ohio legislators technically can modify Issue 2 once it becomes law. But, with a margin of victory this substantial, expectations are that legislators will be unable to make major changes or to repeal Issue 2.
If you are interested in acquiring licenses in Ohio’s adult use program, applying for one of the new social equity licenses, or if you have questions about expanding your current business now that Issue 2 has passed, please contact Tom Haren, Keenan Jones, or any other member of the Frantz Ward Cannabis Practice.