Yesterday was another landmark day in Oregon cannabis. Early sales of recreational marijuana commenced (at 12:01 a.m., in many places) and reports from around the state were positive. In most places, recreational pot was selling for between $10 to $20 per gram, depending on strain and quantity sold.
Much of the news in the weeks leading up to early sales centered on how cities and counties would manage the roll out, whether by adopting new zoning rules, adopting time, place and manner restrictions, or by opting out of early sales all together. We saw a little of everything.
Portland, the city with 148 licensed medical marijuana dispensaries, made a mess of it. Portland set forth draft rules requiring city licensure for all local dispensaries, which is well and good, except that the rules were badly written on a couple of key issues and re-drafted and then re-drafted again at the 11th hour, again badly. It was gruesome and hard to look away.
At one point, the city threatened to fine dispensaries for participating in early sales before 7 a.m., or after 9 p.m., yet the City had not yet even drafted applications for these dispensaries to sell any marijuana, at all. Then, the city backtracked on its threats, focusing on the fact that its rules imperiled the eventual viability of existing dispensaries. The City ultimately decided to hold its nose and pass the bad rules, take applications in December, and probably change the rules again in 2015. It was a bad hour for a jurisdiction that had shown leadership on marijuana over the past few years, and the City should be seriously questioning whether the Office of Neighborhood Involvement is competent to work in this space.
Elsewhere, things were better. Some cities, which had enacted restrictive marijuana zoning laws in the past, elected to do nothing and simply watch early sales play out. The City of Hillsboro was one such locale. The fact that Hillsboro’s restrictive zoning has resulted in only three licensed dispensaries to date in a well populated jurisdiction was likely a boon for each of those dispensaries today, which were able to sell recreationally with little competition.
Downstate, at least 28 Lane County dispensaries began selling recreational marijuana today, including 15 in Eugene, six in Springfield, four in Cottage Grove and one each in Florence, Oakridge and Veneta. Reports of sales were brisk. East of the Cascades, things were slow as usual. Of the 286 licensed medical marijuana dispensaries in the state, only 30 are east of the Cascades, and 16 of those are in Bend. The City of Bend did not ban early sales, but almost all of eastern Oregon has opted out of recreational marijuana sales entirely.
As we have written, early sales are especially great for Oregon dispensaries and residents alike, as all transactions are tax free until January 4, 2016. At that point, a 25% sales tax will ensue and run through the end of the temporary sales program, which is December 31, 2016. By then, the Oregon Liquor Control Commission (OLCC) will have issued licenses for recreational dispensaries, and those sales will also be underway (taxed between 17% and 20% under House Bill 2041).