Is Medical Marijuana a Legitimate Industry?
May 1, 2021
Determining what makes medical marijuana a legitimate industry is complex. Fortunately, our guide is Sara Presler (consultant for The Mohave Cannabis Company) who is leading the industry’s ethics and legislation. As she puts it, “working in marijuana is this total pioneer experience” and we’re ready for her to take us through the weeds — pun intended.
The Broken Business Laws Behind Making Medical Marijuana a Legitimate Industry
Most of the medical marijuana tax code has been drafted around the idea of it being illegal or illicit activity and the fact that it’s illegal on a federal level. Therefore, everything that happens in cannabis law takes place within the rigid confines of the state, and is still subject to all federal legalities and restrictions on top of that, including “a tax code designed to be punitive, rather than promotional to deem medical marijuana a legitimate industry,” notes Presler.
The Cost of Banking on Cannabis
Banking is becoming the main barrier between what makes medical marijuana a legitimate industry.
Unlike other businesses, health-related marijuana companies are forced to act cash-only making it incredibly difficult to provide proof of legitimate sales like we normally see through digital transactions. In return, health-related marijuana companies are limited to working with state-based credit unions, which creates a number of logistical and operational discrepancies.
“Until we have safe banking on a national level, we’re going to continue to see the challenges that are taking what’s a totally legitimate industry that is absolutely legal on a state level, continue to foster an environment of illegitimacy,” said Presler.
Is Resistance to Mainstream Regulation Associated with Risk?
In order to fully understand where some of the challenges are in the industry, we have to first understand how these businesses operate. As mentioned, they are operating on a state-by-state basis, but not every state is the same. There are two different ways that licensing happens:
- Top-Down – meaning it’s a state-based licensing environment, where there are generally a limited amount of available licenses. With the top-down approach, there’s a single set of rules to follow and a limited number of licenses to have a controlled market for a highly regulated industry.
- Local Community Bottom-Up – in this licensing environment, the City licenses a certain number and type of cannabis license. From there, the applicant works in the local community to gain all the needed local permissions and controls. Finally, the application works its way up to the state level for official approval.
What it comes down to is: this lack of coordinated structure is the main driver of resistance to making medical marijuana a legitimate industry.
Can We Expect Congressional Movement and Change on a Federal Level?
We’re seeing very reputable professionals on a national and global scale join boards of directors for some of these larger cannabis companies. Every day we’re watching more and more reputable industry connections happen, whether that’s infused alcohol or even bath bombs, where there’s alignment with a cannabis company.
That is the first major step that the industry is waiting and advocating for. The more that people are talking about and working toward drafting this type of legislation, the more effective it will be at teaching others to break through the bias-based barriers the medical marijuana industry is facing.
“I think it’s just a matter of time until we start to see these types of ventures unfold,” said Presler. “We’re starting to see the cracks in the system. As soon as we see the main systemic cracks open, likely starting with banking for example, once you free up the money, you free up the business.”
Topics covered in this article are based on a recent episode from the HealthCare Huddle Podcast — hosted by Michael Zervas and produced by Encompass Medical — simplifying the business of healthcare. Find show notes, and listen to the full episode HERE or using the player below.
About Episode 8
In her conversation with Michael, Sara Presler (consultant for The Mohave Cannabis Company) plunges into the tricky legal machinations of marijuana acceptance and its main street challenges. You’ll learn some unique statistics and gain an important perspective on the future of marijuana and its legality, as well as its researched health benefits.
Special Thanks & Credits:
Sara Presler works as a consultant for The Mohave Cannabis Company and is a leading voice in Cannabis ethics. She helps write some of the legislation concerning marijuana’s legal usage in many states. The former mayor of Flagstaff, AZ now likes to think of herself as the Mayor of Marijuana. Learn more about Sara HERE and at www.mohavecannabis.com/about.
About HealthCare Huddle Podcast
Simplifying The Business Of Healthcare — Health Care Huddle is a show focused on distilling best practices from subject matter experts across a myriad of disciplines so that listeners may make the health care system better for all stakeholders involved. For more information, visit encompassmedical.com and subscribe to the podcast at Apple iTunes, Overcast, Google, or wherever you get your podcasts.