Business group to challenge Arizona’s recreational marijuana effort

So they’re crafting their own version of the initiative in hopes that lawmakers who share similar sentiments will put theirs on the 2020 ballot as an alternative.

“We’re pro adult use,” said Mason Cave, a member of the advisory board, which is composed of some independent dispensaries, consultants and suppliers. “We just think there’s a better way to do it than what the initiative has proposed.”

Issue No. 1: Who gets to sell the drug.

As originally crafted, the Smart and Safe Arizona Act would have not just limited the number of licenses to about 130 but reserved virtually all of them to the companies — and some multistate corporations — that already are allowed to sell medical marijuana to patients.

A slightly revised version filed this past week adds 26 “social equity” licenses to the mix, with provisions for additional shops in rural areas with no dispensaries or just one.

But Cave says his members still find that lacking, calling it a “drug cartel-ish approach to the whole situation.” That, he said, isn’t fair to others.

“They basically removed the green rush and the idea of being able to go out and start your own business in this wonderful new industry,” Cave said, keeping it to themselves.

The initiative is being financed largely by several major multistate players in the marijuana industry, including Curaleaf and Harvest Enterprises, both of which already have multiple dispensaries in Arizona.

But Stacy Pearson, a spokeswoman for the campaign, argued that giving the initial licenses to existing medical marijuana dispensaries and the overall limits both make sense.

On the former provision, Pearson said it ensures that if voters approve recreational marijuana in 2020 there will be a network of shops already in place and already regulated by the Arizona Department of Health Services for customers.

As to the limits — one for every 10 pharmacies in the state — Pearson argued that would keep Arizona communities from looking like sections of Denver, with marijuana shop after marijuana shop.

“Folks don’t want it everywhere,” she said of dispensaries. “They want them discreet and limited.”

But Cave said that is a manufactured fear, pointing out that existing Arizona law limits where dispensaries can be located to certain non-residential zones.

“It’s very difficult to find sites that work currently for zoning medical marijuana,” he said.

So how many licenses does Cave and his group think should be allowed?

He has no answer, saying it should be “somewhere between 126, which is probably too few, and one on every street corner.” That detail, said Cave, is still to be worked out.

“But it’s not the right thing to do to say, ‘This is better and we’ll control all the licenses and not have one on every corner,’” he said. “I think that’s a little disingenuous.”

Those limits in the initiative also have caught the attention of Rep. Isela Blanc, D-Tempe.

Blanc said she is studying the revisions and understands that there are opportunities for some new licenses. But she isn’t sure that goes far enough.

“It’s still a form of monopolization of an industry,” she said.

Cave said his organization has other issues with the initiative.

One is the 16% tax on sales. Backers say the $300 million a year that would be generated would help fund community colleges, public safety and health.

But Cave said a levy that high could be counterproductive.

“We’re watching what’s going on in Colorado with the black market,” he said, with a certain amount of marijuana still being sold outside the legal dispensary system because it is cheaper.

And Cave questions whether it makes sense to have the Health Department regulate the dispensaries and, more to the point, police the sales to ensure that minors are not able to purchase the drug. He said it might make more sense to put those responsibilities into the Department of Liquor Licenses and Control, which already does similar enforcement to prevent alcohol sales to minors.

Blanc, like Cave, wants the measure crafted by the Legislature. But she is hoping that lawmakers agree to enact the plan themselves rather than, as Cave prefers, simply putting an alternative on the 2020 ballot alongside the other initiative.

She conceded that convincing some of her colleagues to legalize recreational marijuana could prove difficult. But Blanc said she believes that as lawmakers study the issue — and as they see repeat polls showing strong public support for adult use — they will recognize that it makes more sense for them to craft a program they find acceptable.

“If we don’t do it, Arizonans will,” she said.

And there’s something else.

If there are flaws or tweaks needed in a legislative plan, changes are possible, requiring a simple majority of the House and Senate along with the governor.

But the Voter Protection Act of the Arizona Constitution says that anything approved at the ballot needs a three-fourths vote of the Legislature to alter. And even then, changes are permitted only if they “further the purpose” of the original measure.

Attorney General Mark Brnovich said he recognizes that distinction and believes that if there is to be recreational use of marijuana it should be under rules approved by lawmakers — and subject to alterations.