The Evolving Cannabis Industry: a 2019 Year-End Review

2019-cannabis-year-in-review

2019 was an eventful year for cannabis. With states tackling new legalization efforts, developing already existing industries, and adjusting to federal hemp legalization, the cannabis industry has continued to evolve and establish itself throughout the United States.

Here are some of the biggest developments we saw this year.

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The state of hemp

One of the biggest cannabis-related stories this year was the end of hemp prohibition. For many years, hemp existed in a legal gray area that wracked its producers and consumers with uncertainty over what could be done—and what couldn’t. The 2014 Farm Bill allowed limited production, predominantly for research purposes. That proved to be marginally beneficial for the farming community in some states, but not others.

The 2018 Farm Bill, signed at the end of 2018, allowed for much more expansive programs and effectively legalized the crop, allowing each state to determine whether hemp may be produced and sold within its borders. So far, every state except Mississippi and Idaho have passed laws to create hemp programs.

The 2018 Farm Bill does not allow for production of hemp until states submit a “State Plan” to the United States Department of Agriculture. The USDA stated it will not review state plans until the department promulgates regulations, which should occur before year-end 2019. The demand for hemp has built to a point where the crop has become the new kale. With fewer restrictions on hemp than cannabis, some legal cultivators hopped aboard the hemp train into the new future. The fate of this new industry will be played out next year, but the seeds of its success were planted in 2019.

Illinois’ rec-use leadership

In June 2019, Illinois became the eleventh state to legalize recreational cannabis and the first to do so through legislative action. Kudos to the state for building a social equity program into the recreational licensing structure.

Illinois has yet to promulgate regulations, but many local jurisdictions have begun discussing pathways to approval for recreational licenses. The state-license application period begins December 10, 2019, and the deadline is January 20, 2020. Applications for facility types other than recreational retail will be released early in January 2020.

Sales of recreational cannabis are set to begin January 1, 2020.

Michigan recreational expansion

Michigan legalized recreational cannabis in November 2018. In July 2019, the state’s newly formed Marijuana Regulatory Agency released emergency regulations for the recreational industry. Michigan also implemented a social equity program.

Rec application forms became available October 3, 2019; the state began accepting applications November 1.

Colorado delivery, social consumption

Although Colorado was the first state to allow operation of a regulated recreational cannabis industry, the state has not significantly updated its laws since that momentous day. By comparison, California has added license categories including events, delivery services, and social consumption.

In 2019, Colorado expanded its industry by passing bills that authorize delivery services and social consumption in places called “marijuana hospitality establishments.” The hospitality establishments are expected to begin operating in 2020. Delivery permitting for medical marijuana centers will begin January 2, 2020; medical marijuana delivery permitting for transporters and all retail operations will begin January 2, 2021.

Missouri deluged with license applications

Although an unlikely candidate for legalization, Missouri approved medical marijuana in November 2018. The state’s application period, which closed August 19, 2019, drew more than 2,163 applications. According to the Department of Health and Senior Services, 1,163 of them were for dispensaries. Only 192 will be chosen, but the strong showing of interest demonstrates Missouri is more than ready for the industry.

Massachusetts expanded industry

Massachusetts significantly expanded its recreational program in 2019, increasing the number of licensed stores from five at year-end 2018 to twenty-three in October. The state also issued proposed regulations that would allow for social consumption and delivery. Under the social-use program, up to twelve communities may host cannabis establishments where adults ages 21 and older may consume cannabis on site. Deliveries will be allowed for Economic Empowerment Priority applicants, social equity program participants, and microbusinesses with a delivery endorsement for an initial period of two years.

Overall, the future looks bright for the cannabis industry. Although there certainly will be trials and tribulations in 2020, the industry’s momentum is strong and will only continue to accelerate next year. 


Dylan-Sheji-CannaRegs web MGmagazine

Dylan Sheji, Esq., is legal team manager at CannaRegs. He earned a doctor of jurisprudence degree from the University of Colorado, Boulder, where he focused on topics related to cannabis law and interned with several cannabis law firms. Sheji joined the CannaRegs team as a legal research analyst in 2017. He has hosted several webinars about topics related to cannabis and hemp, from in-depth looks at state-specific systems to general issues and concerns that affect the hemp industry.

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