Marijuana regulation experts discuss what should be taken into account for newly legal states. Pictured: In this file photo, John Pham, of Kind Enterprises, takes a photo of a mature marijuana plant in a flowering room in the company's facilities in Boulder County, Colo. These plants are in the final stages of cultivation. (Paul Aiken, The Daily Camera)

Five immediate concerns for states with new marijuana laws

Several states have legalized marijuana in 2016. What's their next step? Seasoned pros in Colorado break down the top priorities.

Hey, Arkansas, California, Florida, Maine, Massachusetts, Montana, Nevada and North Dakota, you just adopted some new marijuana laws.

So what now?

The Cannabist chatted with the state of Colorado’s marijuana czar, Andrew Freedman, and policy expert Mark Slaugh, whose firm iComply works with governments drafting marijuana regulations, about some of the biggest and unique challenges facing a newly legalized state.

First steps

“They should form something similar to the Amendment 64 task force,” Freedman said, referencing the coalition formed after the passage of Colorado’s adult-use marijuana initiative in November 2012. The state had to create a brand-new set of rules for regulating the modern world’s first recreational marijuana sales that began Jan. 1, 2014.

The task force’s members represented a variety of government agencies, as well as legal, business and community interests.

“This was not something that was unanimously thought of as a good idea,” said Freedman, who serves as the Colorado director of marijuana coordination. “But if you bring everybody together to talk it through, you can have a good vision of what it’s supposed to look like.”

Tracking programs essential

Now there are going to be “literally hundreds” of issues that need to be addressed via law, and some — like the popularity of edibles and lack of information and education around consumables — will catch regulators by surprise, Freedman said. However, a “seed to sale” system should be one of the first critical elements of a new marijuana law to be put in place, he noted.

“You’re going to need to be able to keep track of every plant, seed to sale, and realize if there’s a weakness in your closed-loop system, someone’s going to try to exploit it,” he said.

Beyond the cannabis cultivation facilities and pot shops, that includes accounting for other logistical challenges such as where the marijuana is stored if it’s being shipped overnight and the driver gets tired.

People will ask for flexibility and some flexibility will have to be granted, he said, however, the more that flexibility is provided, it’s no longer a closed loop, he said.

Don’t count on guidance from the feds

Marijuana remaining illegal on the federal level (yet fairly hands-off from an enforcement perspective for now) does present some interesting wrinkles for regulators.

Banking is much harder to come by, the pesticide regulations set are up to the state rather than the (Environmental Protection Agency),” Freedman said.

By not having legitimate banking, that’s just one more tool that state regulators cannot rely on in tracking and tracing aspects of the industry and ensuring that proper safety precautions are put in place, he said.

Additionally, rules that typically would land under the U.S. Food and Drug Administration fall in-house for state regulators, he said, noting topics such as potency, refrigeration and safety of edibles.

And it will take a good bit of legal analysis into all aspects of the process to make sure that there are protections in place from criminal prosecution, he said.

Observe best practices elsewhere, implement with a local focus

Colorado, with its groundbreaking marijuana laws, has served as a mentor to municipalities, states and countries around the globe on all aspects of marijuana regulations. But it’s a very fluid process, Freedman said.

“This is still an experiment in its infancy to the extent to which we’re all laboratories of democracy,” he said. “We are not saying we have the monopoly on the right ways of doing things.”

Do what makes sense for the respective state, he said.

While some legal marijuana states and territories such as Puerto Rico have used Colorado’s regulations as a framework, it’s not a simple plug-and-play, Slaugh said.

“While things sound great in policy, they get enacted very differently,” he said.

Education is critical

Not only is the regulation of medical and recreational cannabis new territory, but there’s also a steep learning curve about the plant itself, Slaugh said.

“Certainly the research is still coming in on a lot of that,” he said. “And yet, a lot of the time it’s regulated like it’s nuclear waste, like it’s the most dangerous thing on the planet.”

Regulators will have to be quickly brought up to speed in areas such as cultivation and manufacturing requirements, the varietals of the plant, cannabis compounds THC and CBD, the economics, accounting for the black market and how that affects legal market dynamics, he said.

The marijuana industry spans areas such as manufacturing, agriculture, food production, retail and research, so “how do you integrate that is a really big issue,” Slaugh said.

“A lot of people helping set this up are not going to be actual marijuana industry members, so people will need clarity,” Freedman said.