Medical marijuana firms lead donors for legal weed campaigns

Nov 2, 2022, 9:46 AM | Updated: 10:34 am
Jeremy Baldwin tags young cannabis plants a marijuana farm operated by Greenlight, Monday, Oct. 31,...

Jeremy Baldwin tags young cannabis plants a marijuana farm operated by Greenlight, Monday, Oct. 31, 2022, in Grandview, Mo. Marijuana growers and sellers in Missouri and several other states are helping fund campaigns as voters decide whether to legalize recreational sales in upcoming elections. (AP Photo/Charlie Riedel)

(AP Photo/Charlie Riedel)

JEFFERSON CITY, Mo. (AP) — The call went out from leaders in the medical marijuana industry: Money was needed for a Missouri ballot initiative to legalize recreational cannabis for adults. Their colleagues responded.

Marijuana farms, manufacturers and retailers provided millions of dollars that footed a petition drive to put the proposal on the November ballot and promote it to voters. The deep-pocketed outpouring highlighted the depth of the emerging industry’s roots in the traditionally conservative state, as well as its tremendous potential for growth.

All told, marijuana legalization campaigns have raised about $23 million in five states — Arkansas, Maryland, Missouri, North Dakota and South Dakota. The vast majority of that has been in Arkansas and Missouri, where more than 85% of contributions have come from donors associated with companies holding medical marijuana licenses, according to an Associated Press analysis of the most recent campaign finance reports.

The biggest donor is Good Day Farm, which describes itself as the “largest licensed medical cannabis producer in the South” with facilities in Arkansas, Missouri and Louisiana. It gave a combined $3.5 million to legalization campaigns in Arkansas and Missouri. And when the Missouri campaign needed help gathering petition signatures, Good Day Farm paid an additional $1 million directly to the firm circulating the petitions.

“It’s kind of the cost of doing business, I guess,” said Alex Gray, chief strategy officer at Good Day Farm. “This is something that is a positive for the industry, but it’s also a positive for the state.”

Licensed medical marijuana businesses affiliated with Greenlight have given a total of about $1 million to legalization campaigns in Arkansas, Missouri and South Dakota, according to the AP’s analysis.

If the ballot measures pass, Greenlight CEO John Mueller said he expects to “easily double” a workforce of about 370 people at Greenlight-affiliated cultivation farms and dispensaries in Arkansas, Missouri, South Dakota and West Virginia.

“Obviously, your consumer base goes up when you go to adult use,” said Mueller, a self-described activist who encouraged industry colleagues to contribute to the legalization campaigns.

Provisions in the proposed constitutional amendments in Arkansas and Missouri would give established medical marijuana licensees a leg up in the new recreational marketplace. But Mueller said the measures don’t merely enrich the industry.

“It’s more jobs, more tax revenue — get it off the black market,” he said.

Marijuana legalization efforts elsewhere have not eliminated illegal dealers. California voters approved recreational marijuana use in 2016 following a $36 million campaign for it, and the first retail stores opened in 2018. Yet a vast illegal market remains — more than double the legal sales, by some estimates.

Medical marijuana was authorized voters in 2016 in Arkansas and North Dakota, in 2018 in Missouri and in 2020 in South Dakota. Like elsewhere, it took a while to get the programs up and running. But in less than two years since Missouri’s stores opened, medical marijuana dispensaries have reported about $500 million in sales.

The Arkansas campaign to legalize recreational marijuana for adults has raised over $13 million, including more than $8 million in October alone, while the Missouri effort has raised more than $7 million. Campaigns in other states have raised less than $1 million each. Maryland’s initiative has been particularly low-profile, raising a little over $300,000 amid presumed broad public support.

In Arkansas and Missouri, resistance has come from an unusual alliance of public safety groups, social conservatives opposed to legalization and some marijuana advocates who believe the ballot initiatives are still too restrictive.

The Arkansas opposition is the best funded among the states. Uline CEO Richard Uihlein and Mountaire Corp. CEO Ronald Cameron each contributed $1 million to the Safe and Secure Communities campaign committee. Its ads have asserted that legalizing marijuana for adults will cause a spike in traffic fatalities and illegal use by youths, among other things.

Other critics contend the Arkansas measure is structured to benefit only a limited number of dispensaries, noting it lacks provisions allowing adults to grow marijuana at home or expunging past convictions.

“This amendment is not a start,” said Melissa Fults, executive director of Arkansans for Cannabis Reform. “It is a brick wall.”

Missouri’s legalization measure — which does expunge many past marijuana arrests and convictions — has drawn opposition from Pro-Choice Missouri. The abortion rights group said it backs cannabis legalization and expungement as “an issue of reproductive justice” but believes the measure doesn’t do enough to address the historic harms from the “racist criminalization of cannabis.”

A total of 19 states have legalized recreational marijuana for adults since voters in Colorado and Washington state first approved ballot measures in 2012. Those early efforts were heavily funded by wealthy individuals, such as former Progressive Insurance CEO Peter Lewis. Tech billionaire Sean Parker, the first president of Facebook, ranked among the top donors to California’s legalization campaign.

But philanthropic funding for legalization campaigns has fallen as the marijuana industry has risen.

“The philanthropists who really got this movement off the ground” are either are “ready to move on to other issues or they don’t think it’s their place to support this movement, given that the industry is now mature and many of these businesses are making a lot of money,” said Matthew Schweich, deputy director of the Marijuana Policy Project, a nonprofit advocacy group based in Washington, D.C.

Schweich moved to South Dakota to run this year’s legalization campaign. The Marijuana Policy Project also is providing staff support for the North Dakota campaign. But it isn’t as deeply involved Arkansas and Missouri, where there are greater industry resources.

New Approach, another D.C.-based drug policy group, has directed more money to psychedelic mushrooms than to marijuana this year. It’s poured $4.2 million into a campaign to make Colorado the second state, after Oregon, to allow adults 21 and older to use hallucinogenic chemicals found in some mushrooms.

Meanwhile, New Approach has contributed a total of around $700,000 to marijuana legalization campaigns in Missouri, North Dakota and South Dakota. As the medical marijuana industry has grown, the organization has refined its targets.

“Our focus in recent years has been on initiatives in traditionally red states, in part because that is what we see as the most effective way to continue to move toward broader acceptance of cannabis policy reform,” said New Approach Chief of Staff Taylor West.

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Learn more about the issues and factors at play in the midterms at https://apnews.com/hub/explaining-the-elections. And follow the AP’s election coverage of the 2022 elections at https://apnews.com/hub/2022-midterm-elections.

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Associated Press writer Andrew DeMillo contributed from Little Rock, Ark. Harjai, who reported from Los Angeles, is a corps member for the Associated Press/Report for America Statehouse News Initiative. Report for America is a nonprofit national service program that places journalists in local newsrooms to report on undercovered issues.

Copyright © The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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Medical marijuana firms lead donors for legal weed campaigns