NEW TRIAL: Storm Nolan, owner of Fort Smith's River Valley Relief cultivation facility, filed a motion for a new trial this week.

For the first time in Arkansas history, a constitutional amendment to legalize recreational marijuana in Arkansas will appear on the ballot in November. 

Voters have the chance to make Arkansas the 20th state in the country and second in the South (after Virginia) to legalize marijuana for adults. 

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What will the amendment do? 

Known as the Arkansas Adult Use Cannabis Amendment, the measure would amend the state constitution to legalize recreational marijuana use for adults 21 and older. The measure would also increase the number of dispensaries and cultivators from the current limits imposed by the Arkansas Medical Marijuana Amendment passed by voters in 2016. 

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Arkansas voters legalized medical marijuana that year by a vote of 53.11% to 46.89% and with a winning margin in 38 of the state’s 75 counties. 

That amendment allowed for a maximum of 40 dispensaries and eight cultivators and allowed patients to obtain a medical marijuana card if they had one or more of 17 qualifying conditions. 

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The state Medical Marijuana Commission has issued all eight cultivation licenses and 38 of the 40 dispensary licenses. The commission is prohibited by a court order from issuing the remaining two dispensary licenses. 

This year’s recreational marijuana amendment would increase the maximum number of cultivation facilities to 20 and increase the maximum number of dispensaries to 120.

The eight existing cultivation facilities would be granted Tier I cultivation licenses and would be allowed to cultivate as many cannabis plants as they wanted, as they are allowed to do now under current medical marijuana laws. 

The additional 12 cultivation facilities will receive Tier II licenses and would only be allowed to cultivate up to 250 cannabis plants. Eddie Armstrong, chair of Responsible Growth Arkansas, described these smaller cultivation facilities as being similar to micro-breweries. The Tier II licenses would be awarded through a lottery system similar to what the state Alcoholic Beverage Control division uses to award liquor licenses. 

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The owners of the 40 medical marijuana dispensary licenses would be allowed to keep those licenses and would be granted a second dispensary license. An additional 40 licenses would be awarded through a lottery system.

The existing medical dispensaries would be able to sell to both medical and recreational consumers, but the new dispensaries would only be able to sell to recreational consumers, according to Responsible Growth counsel Steve Lancaster. 

The amendment would eliminate the taxes on medical marijuana and institute new taxes on recreational marijuana. Patients currently pay a 6.5% sales tax and a 4% privilege tax on medical marijuana purchases. Dispensaries also pay the 4% privilege tax when they make purchases from cultivators. 

Under the new amendment, recreational marijuana purchases would be taxed with a 10% supplemental sales tax that consumers would pay on top of existing state and local taxes. The 4% privilege tax would be eliminated. 

The tax revenue would be earmarked for certain purposes. According to the amendment, 15% of the new tax revenue would fund a stipend for certified law enforcement officers, 10% would support the University of Arkansas for Medical Sciences and 5% would support drug courts, with the remainder going to the state’s general revenues. 

The amendment would not allow consumers to grow their own plants, and it would not expunge any prior marijuana-related convictions. 

A recreational marijuana initiative that will appear on the ballot in Missouri in November would expunge certain nonviolent marijuana-related convictions. A recreational marijuana initiative in Oklahoma, facing challenges at the Oklahoma Supreme Court, would also provide a pathway for the expungement of some previous marijuana convictions. 

Supporters 

The amendment is sponsored by Responsible Growth Arkansas, an industry-backed group that has raised more than $4 million since the group was formed about a year ago. 

In November, the state’s first five cultivators chipped in $350,000 each to kickstart the effort. Those five – Natural State Medicinals, Osage Creek Cultivation, BOLD Team, Good Day Farm Arkansas and the company that owns Revolution Cannabis – contributed a total of $1.75 million early on, then doubled down with more donations in the following months. 

Many of the state’s dispensaries chipped in as well. The owners of Plant Family Therapeutics in Mountain Home, The Source dispensary in Rogers and Acanza dispensary in Fayetteville donated more than $50,000 each, just to name a few. 

A corporation called Ozark REA LLC of Sherwood donated $150,000 in August to increase its total contribution to $175,000. 

Responsible Growth Arkansas  is chaired by Armstrong, a former state legislator from North Little Rock who is the CEO of Cannabis Capital Group, which consults with groups wanting to pursue licenses in the industry. 

The group is represented by a team of lawyers from Little Rock law firm Wright Lindsey Jennings. That group includes Steve Lancaster, who has been the face of the campaign in recent months as the effort became bogged down in legal arguments and court cases. Lancaster officially filed the group’s 192,000 signatures with the secretary of state in July. The group’s most recent financial filing with the state Ethics Commission showed it raised $605,000 in August.

The group’s first TV ad debuted in late August as well, highlighting the portion of tax revenue that will fund a stipend for law enforcement. The ad characterized the amendment as “a vote to support our police” and only mentioned cannabis once when it said the amendment will “safely legalize the sale of cannabis to adults 21 and older.” 

Arkansas Democratic gubernatorial nominee Chris Jones said in August he supports the measure and would push for additional criminal justice reforms related to marijuana if he is elected. Libertarian nominee Ricky Dale Harrington Jr. also stated he supports the amendment. 

Opponents

The amendment has plenty of opposition. 

Two groups, Safe and Secure Communities and Save Arkansas from Epidemic, formed ballot question committees to oppose the amendment. 

Governor Hutchinson publicly stated his opposition in early August when he urged the Arkansas Municipal Police Association to “stand firm” in its opposition to legalization, according to news reports. Hutchinson predicted sponsors would try to sell the initiative as something that was good for law enforcement before Responsible Growth debuted its first TV ad promoting the tax revenue dedicated to law enforcement. A former U.S. attorney and the former head of the federal Drug Enforcement Administration, Hutchinson told the crowd marijuana is a “harmful drug,” the report said. 

Safe and Secure Communities is funded by $1.25 million from Little Rock chicken magnate Ron Cameron and $750,000 from Illinois Republican megadonor Richard Uihlein. 

In September, Hutchinson reiterated his opposition to the amendment in a tweet and linked to the website of Safe and Secure Communities. Since then, Arkansas Sens. Tom Cotton and John Boozman have also made tweets against the amendment and linked to the website of Safe and Secure Communities. 

Cameron has a history of donating to Hutchinson’s campaigns, dating back to at least 1996, according to Open Secrets. 

Uihlein has also been involved in recent Arkansas campaigns, contributing more than $2 million to a political action committee that supported Jake Bequette in his unsuccessful attempt to unseat Boozman in the Republican primary for the U.S. Senate in May. 

Cameron and Uihlein also contributed to a political action committee that supported Will Jones in his successful race for prosecutor in the Sixth Judicial District (Pulaski and Perry Counties) against Alicia Walton. Save Arkansas from Epidemic was formed by Little Rock attorney AJ Kelly and David Burnett, chief of police of Fairfield Bay. The group has not listed any financial contributions but did intervene in the Supreme Court case and offered an affidavit from Kevin Sabet, a former advisor to Presidents Bill Clinton, George W. Bush and Barack Obama.  

A third group, Family Council Action Committee, was formed in August by Tom Lundstrum of Elm Springs, Jerry Cox of Little Rock, Reg Hamman of North Little Rock and Ruth Carney of Hot Springs. The group reported its only monetary contribution is a $78,600 donation from Cameron. 

The official web page of state Rep. Robin Lundstrum says her husband’s name is Tom and lists the same P.O. Box that Tom Lundstrum listed on Family Council Action Committee’s filing documents. Cox is the founder and president of Family Council, a conservative lobbying group that its website says promotes “traditional family values” that are “reflected in the bible.” Carney was elected mayor of Hot Springs in 2014 and served until she resigned in 2017. 

Marijuana advocates in opposition 

In an unusual twist, two outspoken opponents of the legalization effort are two of the state’s most prominent advocates for marijuana: David Couch and Melissa Fults. 

Couch wrote the medical marijuana amendment that voters approved in 2016, but he does not support the Responsible Growth amendment that he believes is too favorable to the industry. 

Couch summarized his opposition succinctly. 

“In simple layman’s terms, it’s an attempt by the current licensees to monopolize the marijuana market for their own benefits and would be detrimental to consumers and patients. Period,” Couch said. 

Couch’s biggest complaint is that while the amendment adds 12 new cultivators, those cultivators will be so limited in what they can produce that they won’t even be able to begin to compete with existing growers.

The addition of 12 new Tier 2 cultivation licenses is “deceptive,” he said, because those growers would be limited to growing 250 plants. Couch estimated that all of the Tier 2 cultivators combined would not be equal to one of the existing cultivators because he estimated that all of the existing cultivators are growing more than 3,000 plants.  

“I call that eye candy,” he said. “They crafted this entire amendment to make it appear as if it was somewhat fair when, in fact, it is not,” he said. 

Fults, a longtime marijuana advocate, sponsored a separate amendment this year but did not garner any financial contributions and dropped the effort before the signature deadline. 

Fults said she will work to put a recreational marijuana amendment on the 2024 ballot if the Responsible Growth measure is defeated by the voters. 

If the measure passes, it will be virtually impossible to change, she said, because it is unlikely an effort could come together with enough funding to make a change to the constitutional amendment. 

Fults expressed concern that medical marijuana patients will be left behind under the Responsible Growth plan. She said she fears there would not be enough cultivators to supply the number of consumers, which she estimated at 300,000. Fults said she is also concerned cultivators will focus on producing products with high THC and not on producing lower THC products that might be more suitable for some patients. 

But, for a marijuana advocate, isn’t some form of legalization better than none?

“Something is not always better than nothing,” she said. “This is worse than nothing.” 

Fults said an activist like herself would be better qualified to write a recreational marijuana amendment than business owners in the industry.  

“An activist, I think, is better qualified to write an amendment that is good for everyone in the state than someone who is writing it for greed,” she said. 

A recent poll suggests the measure has a good chance of passing. A poll of 835 likely voters conducted this month by Talk Business & Politics and Hendrix College found that 58.5% of voters support the amendment and 29% oppose it. The share of voters who support the measure grew from a previous poll in February that found 53% of voters in support.