Oregon Marijuana: Strikes and Gutters in Klamath, Grant and Deschutes Counties

Oregon cannabis
Unless you consume cannabis

On Tuesday, Oregon briefly shared the national spotlight with Kentucky as the states held presidential primary contests. In 35 of 36 counties, registered Oregon Democrats chose Bernie Sanders, who promotes federal legislation to de-schedule cannabis entirely, over Hillary Clinton, who favors its reschedule. For our perspective on what each path would mean for cannabis nationwide, see our analysis here or here. (On the Republican side, presumptive party nominee Donald Trump prevailed as expected. He has yet to take a coherent position on marijuana.)

Of course, most Oregon voters were not selecting a candidate on the sole basis of marijuana policy; and, in addition to the presidential primary, both Democrat and Republican voters weighed in on a host of local politicians, officials, judges and ballot measures. Two of those measures related to cannabis: Klamath County Measure 18-105, allowing state licensed medical and retail marijuana facilities; and Grant County Measure 12-58, allowing local residents to “engage in all legal marijuana uses and activities under state law.” Unfortunately, both measures failed.

We have written extensively on the curious Oregon system of allowing cities and counties to opt out of marijuana related activities, including in our most recent post on the Oregon Ban Wagon. If you are just catching up, the basic idea is that an Oregon city or county can opt out of nearly all recreational pot activity by administrative fiat if the city or county voted 55% or more against Measure 91, Oregon’s recreational marijuana initiative. If the city or county voted less than 55% against Measure 91, or for the Measure, it can adopt an opt-out ordinance which will only stand if approved through a local vote. (At latest, those votes must be taken in the next statewide election, this November). Finally, if a county opts out, that action does not apply to its “incorporated” cities, and vice versa.

Klamath and Grant Counties had opted out, but local pot boosters campaigned to reverse those decisions by working hard to get Measures 18-105 and 12-58 authorized in time for the May elections. In December, we wrote about that process in Klamath County, which had voted 56% against Measure 91 but also now has 788 registered medical marijuana growers. Grant County, on the other hand, is a sparsely populated home to just 7,745 citizens and we hadn’t held out much hope for a ban reversal. Given Tuesday’s developments, and unless Klamath or Grant county activists can win some hearts and minds (and raise another ballot measure), local pot entrepreneurs seem to be out of luck.

Despite these setbacks, the Oregon cannabis industry won a big victory last week when Deschutes County Commissioners rescinded that County’s opt out. Deschutes County, which is located in Central Oregon, is home to 2,231 medical program growers and is undisputedly one of Oregon’s leading counties for cannabis activity. While we always understood the Deschutes County opt-out to be temporary to allow the Commissioners to gather information, last week’s result was a great relief to many of our clients. Those individuals may now proceed into the Oregon Liquor Control Commission’s recreational program unfettered, so long as they comply with pending county regulations.

In all, Oregon continues to be a great state for marijuana entrepreneurs and investors, notwithstanding the occasional, localized setback– most of which occur in the eastern part of the state. For anyone interested in learning more about the Oregon structure and opportunities it presents for in-state and out-of-state investors, we are hosting a webinar next Wednesday, May 25, which will cover all the bases.