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Trump, Hilary, and… Cannabis?

By Karina Masolova

With election day fast approaching, there’s another vote Americans are preparing to make. Nine states have ballot measures for cannabis legalization—a sector worth $60–100 million in licensed retail sales in 2015, according to TLL estimates.

Although we’ve reported on the state of licensed cannabis products and accessories throughout the year—with 2016 expected to be the big breakout year for sales—remember that this fledging market is still quite immature. At the state level, five states will consider adult use measures, and four will consider medical cannabis; more measures will be brought at the municipal level.

Thanks to federal regulations, licensors must make deals for cannabis consumables with concentrations of over 0.3% THC on a state-by-state basis. And in fact, dealmakers should spend time on developing different contracts given each state’s retail tax rates and packaging requirement; roughly identical products can have 100–300% markups across different state lines. Furthermore, royalty fees cannot be collected on licensed sales. Instead, most contracts provide for a flat fee per sale to be paid to the licensor. But related accessories such as vape pens, pipes, grinders and tins cans have no such prohibitions, and they’re often viewed as a safer area for brands to move into. Sales figures are notoriously difficult to pin down for branded goods, as many deals are co-branded, function as marketing partnerships or operate in an essentially legal gray zone.

While the first brands to make forays into the market have been musicians, celebrity chefs and personalities like Whoopi Goldberg are expected to generate the largest chunk of sales. These extensions also function to normalize cannabis consumption. Branded products emphasizing luxury, convenience, and natural health and safety benefits are generating the most growth. Nationwide, 40% of legal cannabis consumers are aged 25–34 years-old, 21% are 18–24 years-old and 15% are 35–44 years-old, according to And only 55% of buyers are male.

Here are the states where voters will decide on the latest markets open to business. See the current state of cannabis legalization here—we’ll be updating it after the election season.

  1. Arizona: Would legalize recreational usage with retail sales incurring a 15% tax.
  2. Arkansas: Two competing ballot initiatives would both allow medical marijuana.
  3. California: For recreational use. In addition to packaging, marketing, and other restrictions, proposes a state excise tax of 15% on retail sales and state cultivation taxes.
  4. Florida: Medical marijuana initiative would limit use to certain diseases.
  5. Maine: Proposal would allow for recreational usage with a 10% tax on retail sales.
  6. Massachusetts: Would permit recreational usage for adults over 21 years old. Retail sales would be subject to the state sales tax (6.25%) and an additional excise tax of 3.75% (total 10%, with possibility of separate city or town taxes of up to 2%).
  7. Montana: Aims to expand medical marijuana access after a previous ballot initiative was limited by the state legislature.
  8. Nevada: Ballot vote would allow for recreational usage with 15% excise tax on top of existing 4.6% sales tax.
  9. North Dakota: Would legalize medical marijuana for certain diseases.

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