David Dishman: Comparing marijuana industries in Colorado, Oklahoma
Oklahoma has medical marijuana, but everyone knows neighboring Colorado is the real hotbed for cannabis with its nearly decade-old industry and recreational legalization.
Well, at least that’s what we think. In reality, Oklahoma in many ways has a more accessible industry, with lower tax rates and fewer regulations.
I spent the past year covering Oklahoma’s medical marijuana industry in depth for The Oklahoman. From the first seedlings, to the rapid rise of patient licenses, to the explosion of sales and tax revenues in the industry — I’ve written about all of it. I’ve toured grow facilities with warehouses full of weed, I’ve seen processing equipment used to extract thousands of dollars worth of THC and I’ve browsed the products sold in dispensaries across the state. It’s been incredible to witness from an academic viewpoint as an entire industry based around medical marijuana boomed right before my eyes.
This Christmas, I returned to my home state of Colorado to visit family. During my trip, I stopped in at a Colorado dispensary to see what similarities and differences exist in a state known for its recreational marijuana use, something Oklahoma hasn’t approved. I expected that while Oklahoma has seen growth in its marijuana industry, the products, market and number of dispensaries would pale in comparison to a state with already nearly a decade's worth of maturation.
The dispensary I visited is in Lafayette, Colorado, where I found how wrong I was to make such an assumption. The products offered, the ease of access to the marijuana and the amounts available hardly differed between states despite one allowing recreational use. Tax rates assessed on products, and the level of scrutiny on purchases were both greater than Oklahoma.
Before I even stepped foot inside the dispensary, I had to do something that seems insane in Oklahoma right now — I had to get online to find one. They weren’t seemingly on every corner and in every shopping center. I found out later this is because different cities and counties have taken different zoning approaches and limited the number of businesses from one city or county to the next. I didn't notice two in the same strip mall, like we are beginning to see in some parts of Oklahoma.
The setup in the Colorado dispensary I visited was the same THC-infused-cookie cutter layout similar to most dispensaries I’ve visited in Oklahoma. An atrium led to an inner room where products were stored in glass cases and made available for purchase. Branded shirts, hats and beanies were for sale in addition to the marijuana products, much like popular dispensaries across Oklahoma.
Consumers filed in and presented an ID in the atrium like you would at a bar. Recreational users just need to be 21 or older. Medical users can show their medical cards. In Oklahoma, a similar system is often in place where a medical card is checked before being allowed into a back room to browse products.
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Why have a medical card if you can purchase the product recreationally? Well, medical purchases are taxed at a much lower rate, similar to Oklahoma. In Oklahoma, medical marijuana sales are taxed at the normal city and county sales tax rate, plus an additional 7% assessed on all medical marijuana products.
The marijuana products sold in store include edibles, ointments and salves, and of course, bud, or flower as it's sometimes called. Fewer strains of flower were available at this dispensary than what I usually see in Oklahoma dispensaries. A budtender (sales employee) told me edibles and other products tend to be more popular among consumers, and I know profit margins can be higher for manufactured products. It made me curious to see whether Oklahoma’s industry eventually will shift toward a higher volume of sales for those products as well, with consumers showing greater interest in consuming THC in other ways beside inhalation.
What a customer purchases, and how much, is recorded using a unique customer ID number in a computer system, according to the budtender. This is used to prevent overselling to a customer, as Colorado has recreational and medical purchasing limits. Oklahoma has limits to how much an individual can have in his or her possession, but there is no central system to track how much someone is buying.
Another difference is Colorado’s seed-to-sale tracking system used by government regulators to ensure products sold in stores are made and processed in Colorado. Oklahoma recently passed laws requiring a more stringent tracking system, but throughout most of the first year, there was little capability to check to make sure products sold in Oklahoma were grown in Oklahoma. Many Oklahoma business owners complained a black market developed as products were shipped in from out of state to meet Oklahoma’s growing demand. Many complained this marijuana came from states like Colorado and California, which had more established industries.
Speaking of Oklahoma’s demand, I had to correct an employee in Lafayette as to how big the industry has already grown in Oklahoma. He knew it was booming, but was unaware the state now has more than 200,000 medical marijuana cardholders, which is nearly 5% of the state’s entire population.
This employee posed a rhetorical question: Why wouldn’t a state allow recreational use if there is already such a high rate of medical use?
What he didn’t seem to realize was Oklahoma’s medical industry in many ways allows for greater access to marijuana products with lower tax rates.
Oklahoma doesn't have any list of qualifying medical conditions needed to obtain a medical marijuana license. Doctors simply recommend a patient for a license, but do not prescribe the medical marijuana. If a patient has his or her license, he or she can purchase products in an Oklahoma dispensary. This can be bud, edibles, tinctures or anything else the consumer desires. This patient license is valid for two years before the patient needs to apply for a renewal from his or her doctor.
Colorado is often cited as a model state for a marijuana industry, but Oklahomans should consider the consequences of seeking to reflect our neighbor's rules. If supporters fight for recreational use in Oklahoma, consumers might see increased taxes and tighter regulations like Colorado. If Oklahoma's medical marijuana industry is as functionally accessible as Colorado's recreational industry with lower taxes, do marijuana users really want to legalize recreational use?
For those seeking additional revenues from the industry, that might be exactly what is desired. For many non-users, the additional state revenues could be the justification needed to vote for medical marijuana legalization. If even more money is to be made, could those same voters choose to support recreational marijuana?
It wouldn’t be impossible to imagine a political fight unfolding where proponents of marijuana use fight against legalization of recreational marijuana, while those who oppose the substance but would enjoy additional state revenues might support it.
Depending on how you look at it, the “grass” isn’t always greener on the other side.