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Recreational pot sales could fire up before April deadline

Under New Mexico’s new recreational cannabis law, commercial sales can begin by April 1, 2022. But state officials hope to let sales start earlier. (Adolphe Pierre-Louis/Albuquerque Journal)

Copyright © 2021 Albuquerque Journal

SANTA FE – New Mexico could allow recreational cannabis sales to start before an April 2022 deadline, a top state official said recently.

But that could depend on the pace of adopting new rules that will govern the state’s new recreational cannabis industry – and whether court challenges slow down the process.

The first proposed rules dealing primarily with marijuana producer license and plant fees were released Tuesday, about a month before a cannabis legalization bill takes effect.

The rules mark New Mexico’s first official steps toward creating a cannabis industry framework after a legalization bill was signed into law by Gov. Michelle Lujan Grisham in April.

Regulation and Licensing Superintendent Linda Trujillo, a former state lawmaker whose agency is tasked with implementing adult-use cannabis, said the rules were crafted with input from other state agencies and existing medical cannabis producers.

“But today’s proposed rules don’t mean the conversation is over,” Trujillo added in a statement. “Through public comment, public hearings and ongoing conversations, we will continue to strengthen these rules to ensure the best possible outcomes.”

Specifically, the proposed rules unveiled Tuesday would set the cost of both producer and retailer licenses at $2,500 annually.

Licenses for cannabis consumption areas, or designated places where adults can smoke, eat or drink cannabis products, would also cost $2,500 annually under the draft rule.

In addition, the proposed rules call for a three-tier system for cannabis producer plant limits – with a maximum of 4,500 mature plants. Larger-scale producers would face slightly higher per-plant fees than smaller producers.

Plant count limits have been a controversial component of New Mexico’s medical cannabis program, with the current limit for licensed producers set at 1,750 plants.

Duke Rodriguez, CEO and president of Ultra Health Inc., the state’s largest medical cannabis producer, expressed concern Tuesday over the proposed limits and what evidence was used to set them.

“The model being proposed seems to advocate smallness in aspiration and doesn’t reflect the robustness that will be needed to achieve the 11,000-plus jobs and several hundred million-dollar cannabis industry,” Rodriguez told the Journal.

New Mexico will become the 17th state to legalize recreational cannabis for adult users once the new law takes effect June 29.

After previous proposals stalled at the Roundhouse, lawmakers passed a legalization bill during a March special session that was called by Lujan Grisham.

Starting next month, the new law will allow for possession of up to 2 ounces of cannabis – or equivalent amounts of cannabis extract – and personal production of no more than six mature marijuana plants per adult.

However, the deadline for beginning commercial sales is not until April 1, 2022, to give state officials time to craft the rules that will govern the cannabis industry.

If things go smoothly, Trujillo said, she’s hopeful sales could start even sooner, although she did not specify a target date.

“Our goal would be to take it live with commercial sales before April 1,” Trujillo told reporters last week.

She also said the agency would move quickly to hire top-level staffers for the department’s newly created Cannabis Control Division.

And roughly a dozen positions will be shifted over from the Department of Health once the new law takes effect, Trujillo said.

Meanwhile, New Mexico officials drafted the proposed rules after consulting with various state agencies, including the Environment Department and the State Engineer’s Office. They also worked with officials in Colorado and Washington, two other Western states that have already legalized recreational cannabis for adult users.

Some of the proposals are highly technical – such as a video surveillance camera requirement and a mandate that unused cannabis be ground into soil or compost.

More rules related to New Mexico’s cannabis legalization rollout are expected to be released in the coming weeks and months, with each set of new rules triggering a public comment period.

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