There will be no more cannabis lotteries in Connecticut until at least the end of the legislative session, state officials have confirmed, with no firm plans on any lotteries in the future.
“At this time, a second lottery round has not been scheduled as the legislature continues to consider potential changes to the lottery process and social equity criteria,” said Department of Consumer Protection spokesperson Kaitlyn Krasselt. “Any statutory changes will be incorporated into the lottery process prior to the department conducting a second lottery round. Once a future lottery is scheduled, the details will be announced by the Department of Consumer Protection.”
Newly named DCP Commissioner Bryan T. Cafferelli said during a recent interview with Hearst Connecticut Media that, “It would not be prudent to proceed until the close of the legislative session.”
Though Cafferelli said DCP was waiting on legislation, neither state Rep. Jason Rojas, D-East Hartford, nor Deputy House Speaker Rep. Juan Candelaria, D-New Haven, both of whom proposed cannabis-related legislation and were instrumental in crafting the state’s cannabis market, were aware that such a decision had been made.
“It’s not something that they’ve shared or expressed with me,” Rojas said of DCP. “I haven’t heard that yet.”
The state has so far issued 35 retail licenses for recreational cannabis, according to state data. There are also medical cannabis dispensary licenses and hybrid licenses, allowing the sale of both medical and recreational cannabis.
There are currently 13 active recreational cannabis dispensaries in Connecticut.
The state legislature is currently mulling several pieces of legislation that could alter how cannabis license lotteries are run, including lotteries for cannabis retail, cultivation, and food and beverage manufacturing.
Rojas said that while he was not aware DCP had decided to halt cannabis lotteries until at least the end of the legislative session in June, he said “I can understand why they might want to do that.”
“Legislation is going to change in the next month or two,” he said. “The last thing they’d want to do is go out with something that is then going to potentially impact the status of an applicant.”
Candelaria said a halt in the lottery process would “ensure that we’re not saturating the market with a bunch of cultivators and retailers.”
“I think it’s wise just to move cautiously to see how the market and the demand is that we can run another lottery for the people to really take up and take advantage of applying for a license and hopefully getting the license through the lottery,” he said.
One bill being considered, proposed by Rojas, would limit the number of times a single applicant can enter the lottery. When the first cannabis lotteries were announced there was no such limit, and at least two companies, Slap Ash, Inc. and Jananii LLC, each spent more than $200,000 to submit more than 800 lottery entries.
That, Rojas said, should change.
“We want to come out with one application per applicant,” he said.
Candelaria said that the current setup could mean that the wealthiest applicants could be more likely to get a license.
“You want to be sure that the process is transparent and fair and equitable for everyone,” he said. “Right now, it’s not because someone that does not have the economic means cannot put in 20 applications. They won’t be able to afford it.”
But the fix is not as simple, Rojas said, as limiting each applicant to one application. Some larger companies are funding multiple smaller ventures run by different individuals, and Rojas said future lotteries would have to take those complexities into account.
“There is some complexity to that because of the way that some applicants are actually funded,” he said. “It would take a lot of additional work and effort and time for the department to go back and review all the background information, so it’s about who we apply that rule to that really complicates things given the complexity of how some of these businesses are financed.”
Candelaria said part of the intent may be to not crash the market, forcing prices down if there is more supply than there is demand.
“One thing you want to do is issue all these licenses and then all these people won’t be able to sell their their material to consumers because what you know that will drop down the price on the products, and in my own personal opinion that will create a little issue with moving the products within the state,” he said.
Rojas also said the state should be “cautious in how many licenses we put out there based on what we’re seeing in other states.”
“I think Massachusetts has (300) or 400 dispensaries. I think that’s proven to be way too many, which has all sorts of ramifications for sustaining the integrity of the program,” he said. “There are signs out there from other states that we should be attentive to and being careful with how many licenses we do put out there.”
That does not, he said, mean there should be no more licenses issued in the state.
“Is there a need for more? There absolutely is a need for more,” Rojas said. “The question becomes, how many? That needs to be informed by the experience of other states and what we’re seeing even with the early rollout of adult use.”
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