Marijuana in N.H.

Sununu cannabis non-negotiables? 15-store cap, ban on lobbying by licensees

BY: HADLEY BARNDOLLAR - NOVEMBER 28, 2023 1:29 PM

After months of meetings and listening to various testimony from experts and community members, the legislative commission studying state-controlled sales of cannabis completed its work, without a recommendation. 

As the commission studying a state-run model for cannabis sales prepared to wrap up its duties on Monday, two new apparent non-negotiables were introduced on behalf of Gov. Chris Sununu: a 15-store cap to start and a ban on lobbying and political contributions by any licensee.

David Mara, Sununu’s adviser on addiction and behavioral health, said: “We are adamant about that number, 15. We don’t want to see a proliferation of what’s happening in other states.”

Originally, the commission discussed limiting the number of cannabis franchises to the number of liquor stores in the state, of which there are 67. But the governor’s office appeared to cut that number this week.

Mara said retail sales are “something we’ve got to move slowly on” with the safety of citizens at the forefront.

“Perhaps in the future, the Legislature could always change that,” he added. “… After this thing gets up and running, then more could either be added or deleted in relation to how things progress.”

After months of meetings and listening to various testimony from experts and community members, the legislative commission studying state-controlled sales of cannabis completed its work, without a recommendation. The group voted, 7-2, to send a report to the Legislature on its activities, but not to recommend one way or another what potential legislation in 2024 should look like.

A state-run cannabis model, which would be the first of its kind in the country, is the only one Sununu says he will sign into law. As envisioned, the model would use a franchise system. The New Hampshire Liquor Commission would oversee products, marketing, and the layout of retail stores, but individual stores would be run by individual owners, who would hire their own employees and be responsible for their own profitability. The stores would be able to sell only products tested and approved by state officials.

Asked by the Bulletin if the 15-store cap and ban on lobbying by licensees were in fact non-negotiable for Sununu, his office said: “The governor is open to discussing a franchisee-based system, but the success of such a model is in the details. The governor has been clear that any system meet his outlined framework – or be met with a veto.”

On Monday, without saying whether she supported or opposed the 15-store cap, Sen. Rebecca Whitley, a Hopkinton Democrat, expressed concern with the last-minute introduction. She viewed it as “procedurally problematic” because the commission would not be able to gather public input on the topic since its work was concluding.

“It feels very rushed and a little inefficient to have spent months and months on this language, the various issues, and then the very last meeting, the very last half hour, to raise these pretty substantial issues,” Whitley said.

Sanbornton Republican Sen. Tim Lang told commission members a store cap is “not new ground,” as the state has done something similar with its alternative therapeutic centers (ATCs) and charitable gaming, “to determine the impact” as new industries gain a foothold.

“It’s already been the model we’re using with therapeutic (cannabis) now,” he said, noting eight ATC locations are allowed in the state.

Paul Morrissette, a New Hampshire resident who is a part owner of East Coast Cannabis, a dispensary just over the border in Eliot, Maine, cautioned the commission that 15 stores would not generate the amount of tax revenue the state is predicting. He said each store would have to make “$2 to $3 million” each month in sales.

“You’re setting up the Liquor Commission potentially to fail by limiting the number of stores they start out with,” Morrissette said.

In contrast, Massachusetts has more than 300 recreational cannabis stores while Maine, as of May, had more than 120.

The second item raised by Mara on behalf of Sununu was a ban on lobbying and political contributions by any cannabis licensee in the franchise model. The proposal merited nearly unanimous pushback because of First Amendment concerns.

“The worry here is that we don’t want to create a big tobacco atmosphere here in New Hampshire,” said Mara. “We don’t want it to be where a lot of money is being thrown around.”

Frank Knaack, policy director for the ACLU of New Hampshire, said he understood Mara’s concern about influence, but “I do think, though, we have potential First Amendment issues with this.”

Rep. Tim Cahill, a Raymond Republican, agreed.

“We don’t limit the opportunity to lobby for the gambling establishments that have licenses, or any other kind of licenses,” he said. “I think this might possibly set a bad precedent.”

Darryl Abbas, chairman of the commission and a Salem Republican, argued that individuals receiving state licenses to operate an establishment would be doing so voluntarily, knowing what goes along with the license.

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Originally Published by New Hampshire Bulletin.

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