Cannabis Report Card - June 2021
by THE UTAH BEE
The Utah Bee grades western states on the success of moving cannabis from the illegal black market to legal, regulated use, which is important for public health and safety. Cannabis is plentiful in the western continental United States, given that it is legal in every western state, except Utah (medical only) and Idaho and Wyoming (fully illegal). Because some state grow laws are quite liberal and the highway system functions well, black market cannabis flows toward states where consumer access is limited by convenience, price, and variety, factors identified in a Utah Bee survey of 125 medical cannabis users as the most significant determinants of consumer behavior. It is important to note that the cheapest and best cannabis in the United States is in the West, with high-quality cannabis costing 30-50% less in the western states.
Market share of legal cannabis outpaces the growth rate of illegal cannabis. Yet, the total amount of cannabis moving through the black market still dwarfs the amount of cannabis moving through the regulated markets. To shift cannabis purchases from the illegal market to the legal market, each State’s regulatory scheme must create a market that competes favorably with the black market in terms of convenience, price, and variety. Using those 3 factors, the Utah Bee grades western states on the attractiveness of their legal, regulated markets to consumers.
Arizona receives a C. Arizona has a low number of dispensaries and, as a result, high costs and average variety. The situation for consumers in Arizona should improve, whereas voters passed an adult use law in 2020 that allows possession of 1 ounce and home grow of 6 plants.
California receives a D. It hurts to give the cannabis-pioneering state such a low grade. Though cannabis is plentiful in California, high taxes, high costs, and local bans create a very uneven market with relatively few dispensaries selling cannabis at much higher prices than the black market. To move to the legal, regulated market, many consumers would face significant travel and financial burdens. Despite (or, in part, because of) its high tax rates, California collects less cannabis tax revenue per capita than 5 other western states, demonstrating the State’s failure to move cannabis sales to the legal, regulated market. It is estimated that California’s black market is three times the size of its large regulated market.
Colorado receives an A. Colorado has generous home grow provisions and a large number of dispensaries per capita (rounding out the top 3 just behind Oregon and Montana). The State’s trifecta of convenience, price, and variety account for Colorado bringing in more cannabis tax revenue through the regulated system than any other state on a per capita basis.
Idaho receives an F. Western producers and sellers know the only option for Idaho consumers is to buy cannabis on the black market. Note: in 2021 the Idaho Legislature attempted a constitutional ban of cannabis. The attempt failed.
Montana receives a B-minus. Montana moves into adult-use with an abundance of dispensaries from its existing medical-cannabis program. The State’s adult use law allows for home grow, which will improve access on top of a program that has done well to attract legal use and tax revenue in the medical cannabis market, because of good prices and variety. The attractiveness of the legal, regulated market could be hindered by local-control provisions that allow counties to opt out of the program.
Nevada receives a B. While Nevada gets high marks for convenience (including drive-thru service), price, and variety, it stumbles a bit on its convenience and price scores due to an unimpressive number of dispensaries.
Oregon receives an A-minus. Policymakers and law enforcement officers in surrounding states might not appreciate the liberalness of Oregon cannabis laws, but Oregon consumers do, enjoying the most convenience, best prices, and best variety of any state. Coupled with generous home grow provisions, cannabis consumers have plenty of reason to use the legal, regulated market (and allow Oregon cannabis to move to more states with lesser offerings).
Utah receives an F. As western producers and sellers are well aware, the only option for Utah consumers to buy cannabis outside the black market is through the State’s medical cannabis program, which has the fewest dispensaries per capita in the Nation and the worst prices and variety in the West. For the few consumers who do qualify for Utah’s medical program, the price of flower is $100-200 more per ounce than on the black market.
Wyoming receives an F. Western producers and sellers know the only option for Wyoming consumers is to buy cannabis on the black market. Note: they do have a CBD-only law, with cultivation.
Washington receives an A. Washington earns top marks for convenience, price, and variety. Unsurprisingly, Washington’s well-regulated cannabis program brings in more tax revenue than all other states, except Colorado.
