Midterms 2022: Middle America Ponders Pot Reform

When the dust settles after the midterm voting on November 8, we’re assured of seeing an expanded legal market in the U.S. for marijuana.

For investors, the equation is simple: When legalization occurs, it creates more customers, more sales, more profits…and higher share prices.

In November, voters in five states will consider cannabis legalization, and in one state an initiative to legalize psychedelics possession is on the ballot.

What’s especially noteworthy to me is that most of the states deciding on cannabis legalization are socially conservative “red states,” further evidence that marijuana reform is a popular and bipartisan issue. Middle America is embracing Mary Jane.

Even if they’re personally opposed to marijuana use, shrewd politicians can read the polls. They also can count the tax dollars that marijuana generates. The anti-pot prohibitionists are fighting a losing battle.

WATCH THIS VIDEO: 10 Political Catalysts for The Next Marijuana Bull Market

As election day looms, public opinion polls auger well for all of these initiatives. Here’s a round-up.

  • Arkansas, Issue 4: Marijuana Legalization

Under the proposal, adults 21 and older could purchase and possess up to one ounce of cannabis from licensed retailers. Home cultivation would not be allowed.

According to a recent analysis, Arkansas could see nearly $1 billion in annual cannabis sales and more than $460 million in tax revenue over five years if voters approve legalization.

The measure also would make revisions to the state’s existing medical cannabis program that was approved by voters in 2016, including a repeal of residency requirements to qualify as a medical marijuana patient in the state.

  • Maryland, Question 4: Marijuana Legalization

Through an act of the legislature, Maryland voters will decide on a marijuana legalization referendum at the ballot this year.

Voter approval of the measure would trigger the implementation of a separate bill to establish regulations for the program.

Here’s the text of Question 4 that will go before voters:

“Do you favor the legalization of the use of cannabis by an individual who is at least 21 years of age on or after July 1, 2023, in the State of Maryland?”

If the referendum passes, the purchase and possession of up to 1.5 ounces of cannabis would be legal for adults. The legislation also would remove criminal penalties for possession of up to 2.5 ounces.

Adults 21 and older would be allowed to grow up to two plants for personal use and gift cannabis without remuneration.

Past convictions for conduct made legal under the proposed law would be automatically expunged, and people currently serving time for such offenses would be eligible for resentencing.

  • Missouri, Amendment 3: Marijuana Legalization

If passed, the amendment would accomplish the following:

Adults 21 and older could purchase and possess up to three ounces of cannabis. They could also grow up to six flowering marijuana plants, six immature plants and six clones if they obtain a registration card.

The initiative would impose a 6% tax on recreational cannabis sales and use revenue to expedite automatic expungements for people with non-violent marijuana offenses on their records. Remaining revenue would fund veterans’ health care, substance abuse treatment, and the state’s public defender system.

Regulators would be mandated to issue about 150 microbusiness licenses through a lottery system, with priority given to low-income applicants and people who have been disproportionately harmed by drug criminalization.

  • North Dakota, Measure 2: Marijuana Legalization

The measure would allow adults 21 and older to purchase and possess up to one ounce of cannabis, four grams of marijuana concentrate and flower produced from up to three plants grown for personal use.

Under the measure, the cannabis must be stored in the same location in which the plant was cultivated. The state’s 5% sales tax would apply to cannabis products.

State health regulators would be tasked with setting up rules for the program and supervising licensing for marijuana businesses.

Regulators would have until October 1, 2023 to promulgate rules regarding advertising, labeling, packaging, and testing standards.

  • South Dakota, Measure 27: Marijuana Legalization

South Dakota voters approved marijuana legalization at the ballot in 2020, and they’ll get another opportunity to do so this November after that earlier initiative was invalidated in court.

In 2020, South Dakota Constitutional Amendment A was a cannabis legalization initiative that passed with 54% of the vote. The measure would have legalized recreational marijuana in South Dakota effective July 1, 2021.

South Dakota Measure 26 was an initiative to legalize medical cannabis. Amendment A and Measure 26 appeared on the same ballot. Measure 26 passed by a 70% margin.

However, despite these substantial winning vote margins, private anti-marijuana groups immediately challenged the legalization measures in court, on legal technicalities. The state’s Republican governor, Kristi Noem, threw her support behind the legal challenge. Noem is a religious conservative who remains implacably opposed to marijuana legalization, regardless of what the voters have to say about it.

The state Supreme Court ultimately invalidated the 2020 vote on procedural grounds, ruling that the measure violated the state Constitution’s single subject rule.

To avoid that sticking point, the 2022 initiative omits the previous version’s provisions that dealt with taxes and regulations, leaving those decisions up to the legislature.

Measure 27 would allow adults 21 and older to purchase and possess up to an ounce of cannabis. They could also grow up to three plants for personal use.

  • Colorado, Proposition 122: Psychedelics Legalization

This landmark measure seeks to legalize possession of psychedelics such as psilocybin (the psychoactive ingredient in “magic mushrooms”) for adults 21 and older and also allow “healing centers” where psilocybin can be administered for therapeutic purposes.

Called “The Natural Medicine Health Act,” here’s what Proposition 122 would accomplish if approved by voters:

Possession, use, cultivation and sharing of psilocybin, ibogaine, mescaline (not derived from peyote), DMT and psilocyn would be legalized for adults 21 and older, without an explicit possession limit. There would be no recreational sales component.

Under the proposal, the Department of Regulatory Agencies would be responsible for developing rules for a therapeutic psychedelics program where adults 21 and older could visit a licensed healing center to receive treatment under the guidance of a trained facilitator.

Editor’s Note: To discuss a wide range of issues related to marijuana and psychedelics, I’m holding a special Town Hall on November 1, so be on the lookout for an invitation in the coming weeks!

In the meantime, I urge you to read my new book: The Wide World of Weed and Psychedelics. My book provides specific, actionable advice on how to pick the best pot stocks. Click here to order your copy.

John Persinos is the editor-in-chief of Marijuana Investing Daily. You can reach him at: mailbag@investingdaily.com

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