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Prop 207 Passed. What Happens Next?

The practical repercussions for the marijuana industry in Arizona.

Arizona Proposition 207, which legalizes the cultivation, distribution, and sale of cannabis, passed the 2020 election with over 60% of the vote. The opposition of those aged 65 years older (despite the fact that many of them grew up in the 1960s) was not enough to halt the overwhelming enthusiasm of the public and the Arizona marijuana retail business community.

Legalization is here. What comes next for marijuana retail?

“Qualified early applicants” is a term that is frequently being used to describe the dispensaries that will gain crucial access to open recreational shops before anyone else. So, who are these qualified early applicants?

There will be approximately 145 recreational licenses to be disbursed by the Department of Health Safety. These licenses will be issued to “an entity seeking to operate a marijuana establishment in a county with fewer than two registered nonprofit medical marijuana dispensaries” and “A nonprofit medical marijuana dispensary that is registered and in good standing with the Department of Health”. Any remaining licenses will be allocated through a random selection or lottery system.              

Suppose that the Arizona Department of Health Services does not get around to sending out those licenses, fret not, on or before April 5th, 2021, medical marijuana dispensaries will legally be permitted to sell recreational marijuana to adults, until the new licenses are distributed.

It’s a big win for medical marijuana dispensaries as the recreational marijuana industry in the state begins to take shape. It’s no wonder the top five donors who contributed to support Proposition 207 were all businesses in the medical marijuana industry. Nearly $5.5 MM in contributions was raised by the Smart and Safe Arizona PAC in the push to pass Proposition 207. In the coming months, we will see and experience a shift in the business culture surrounding marijuana in the state of Arizona. The Resolute team will remain at the forefront of knowledge in the field, and update as developments arise.

About the Author

Tanner Tuohy brings his analytical and assessment skills to Resolute as a Director. He supports the Solutions Team in a variety of aspects throughout the company, including forensic accounting, consulting, business development and more.