Bill aims to place sideboards on recreational marijuana

Opponents fear bankruptcies, low tax revenue

A worker touches plants at a cannabis greenhouse at the growing facility of the Tikun Olam company on March 7, 2011 near the northern city of Safed, Israel. In conjunction with Israel's Health Ministry, Tikon Olam are currently distributing cannabis for medicinal purposes to over 1800 people in Israel. (Photo by Uriel Sinai/Getty Images)

Glenn Broughton grew his medical marijuana business from a small storage shed to an operation that employees nearly 30 people, and if he’s shut down, he said he’ll go bankrupt.

“I’ve never been so scared in my life of what is going to happen to me at a pen-stroke,” said Broughton, who operates in Missoula, Lolo and St. Regis.

The business owner testified Wednesday before the House Business and Labor Committee against House Bill 568. The bill would allow roughly 115 marijuana dispensaries in the state — or not more than one per 10,000 people in a county, but 10 maximum — compared to the 355 medical dispensaries that are currently open.

Provided by the Montana Department of Public Health and Human Services.

No members of the public spoke in favor of the legislation.

In November, voters passed a bill that legalizes recreational marijuana by 57 percent, and the Montana Department of Revenue anticipates accepting license applications in October.

Sponsored by Rep. Lola Sheldon-Galloway, R-Great Falls, the bill would limit dispensaries to be no closer than 1,000 feet from a school, daycare, place of worship, park or playground. It also would limit dispensaries to one per 10,000 residents in a county or up to 10 dispensaries maximum in one county.

“The people of Montana have asked us to have recreational marijuana in our state,” Sheldon-Galloway said. “My bill is just asking for some sideboards.”

Opponents, though, argued the sideboards would “squash the little guy” and favor massive operations flush with cash over smaller homegrown businesses. They also said the prohibitions go too far to realistically implement.

Sam Belanger, who said he read Montana’s marijuana legalization bill from cover to cover, told the committee he didn’t think the location restriction of 1,000 feet as the crow flies — rather than 500 feet and on the same street — would work in cities and towns.

“It eliminates almost all viable options for any dispensary in the state inside municipalities,” said Belanger, of Ronan.

Kate Cholewa, a cannabis advocate who has worked on related legislation in Montana, said the math simply doesn’t pencil out. When medical users were “tethered,” or tied to a specific provider, she said a business with 200 customers could make a good living.

With proposed limits, providers would have six times those customers. She also wondered who would be deciding who gets the the small number of licenses that would be available if the bill is enacted.

“This is just an invitation to problems and corruption,” Cholewa said.

Pepper Petersen, president of the Montana Cannabis Guild, said one of the reasons he helped draft Initiative-190, the legalization bill, is that recreational marijuana can generate tax revenue for the state.

“Most of that coal economy is gone. We need a replacement for that money,” Petersen said.

He estimated the revenue for state coffers could hit nearly $100 million a year for both recreational and medical marijuana. A study from the Bureau of Business and Economic Research at the University of Montana estimated a 20 percent tax on recreational marijuana could result in $43.4 million to $52.0 million a year from 2022 to 2026.

As part of her argument in favor of the bill, Rep. Sheldon-Galloway pointed to the relatively high use of marijuana among Great Falls middle and high school students compared to the state average. In Alaska, she said school suspensions for marijuana increased 141 percent after legalization.

Chuck Holman, though, said Montanans don’t want more regulations, and Cascade County needs to deal with its own problems.

“That county needs to address it themselves,” Holman said.

Wednesday, the committee heard a separate bill related to medical marijuana, House Bill 582.

Sponsor Rep. Robert Farris-Olsen, D-Helena, said he brought the bill forward because one of his constituents told him she lost her job because of her use of medical marijuana for a debilitating condition.

He said the bill wouldn’t allow the use of medical marijuana on the job, but it would prevent an employer from barring a person from using medical marijuana off the job for a medical condition.

Several opponents argued the bill wouldn’t make sense for industries where employees operate heavy equipment or must have a CDL, a commercial driver’s license. Jason Todhunter, with the Montana Logging Association, said logging is a highly hazardous industry, and some employers choose to conduct drug testing.

“This would muddy the waters on what we could check for,” Todhunter said.

The committee did not take action on either bill on Wednesday.

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Keila Szpaller
Keila Szpaller is deputy editor of the Daily Montanan and covers education. In Montana since 1998, she loves hiking in Glacier National Park, wandering the grounds of the Archie Bray and sitting on her front porch with friends. Before joining States Newsroom Montana, she served as city editor of the Missoulian, the largest news outlet in western Montana. She worked there from 2006 to 2020. As a Missoulian reporter, she was named a co-fellow by the Education Writers Association to report on a series about economic mobility; grantee of the Society of Environmental Journalists for a project on conservation from the U.S. to Africa; and Kiplinger Fellow in Digital Media and Public Affairs Journalism. She previously worked at the Great Falls Tribune and Missoula Independent, and she earned her master’s in journalism from the University of Montana. She lives in Missoula with her husband, Brock, who is also her favorite chef, and her pup, Henry, who is her favorite adventure companion. She believes she deserves to wear the T-shirt with this saying: “World’s most mediocre runner.”