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Weed On The Ballot: 5 States Consider Cannabis, And One Is 'A True Toss-Up'

November 3, 2020 8:00 am
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Weed On The Ballot: 5 States Consider Cannabis, And One Is 'A True Toss-Up'

These days, there is a lot of focus on which states are red, blue, purple or likely to switch in the presidential election. 

Benzinga Cannabis is zeroing in on "green" states.

Voters in New Jersey, Arizona and Montana — where there are existing medical cannabis markets — are considering the legalization of adult-use.

Mississippi may potentially become a new market for medical cannabis, and there are two ballot initiatives in South Dakota that seek to legalize both medical and adult-use.

While there are plenty of "what if" scenarios to consider when it comes to determining the next president, our sources seem confident in their predicting how cannabis reform will unfold in the five states. 

Meital Manzuri, of Los Angeles-based of Manzuri Law, predicts that most of the cannabis ballot initiatives will pass. 

"The American people are overwhelmingly in favor of legalizing medical and adult marijuana use," she said.

"Voters see how well legal cannabis works, from both usage and taxation standpoints, in other states. Ultimately, there will be a tipping point when a forward-thinking administration seriously takes this up at the national level.”

Here's a closer look at what's at stake Tuesday:

The Certain One: New Jersey

"I am almost certain it will pass in New Jersey, and this is the most important state in my view," said Alan Brochstein, founder of 420 Investor and New Cannabis Ventures. 

"Legalization in New Jersey is very likely to spur neighboring states to move forward through the legislative process."

New York, for example, may follow up with legalization in 2021.

"Many of the existing medical operators are publicly traded, and several of them also might benefit from the domino effect as well given their operations across the East Coast," Brochstein said. 

Curaleaf Holdings Inc. (OTCQX:CURLF) and Acreage Holdings Inc. (OTCQX:ACRDF), which has two stores in the Garden State, will benefit from a "recreational vote," he said. 

The Likely Ones: Arizona, Montana 

"Arizona is hard to handicap, but it seems likely to pass," Brochstein said. "This is a very established medical market with no caps on production, so it is likely to be a quick and successful transition to adult-use if it passes."

Kris Krane, founder at 4Front Ventures, is confident in Arizona as well as Montana.

During the most recent episode of the Benzinga Cannabis Hour, Krane said that while Montana is a "redder state" than Arizona, both have been polling "well north of 50" when it comes to being in favor of recreational cannabis.

"What we've seen across the country is when a state has a fairly robust medical marijuana market and the public is accustomed to having cannabis commerce in their communities, they are more open to voting for full legalization," Krane said.

"You have a long-standing medical marijuana industry in both Arizona and Montana."

Just about 52% of Arizona voters opposed a rec vote in 2016, keeping it medicinal only.

But to its credit, Arizona is now the largest medical-only market in the United States, Krane said.

"You can't drive through Phoenix without seeing billboards for dispensaries and medical cannabis products," he siad. "So I think we're on very solid footing in Arizona and Montana."

The Confusing One: Mississippi

Mississippi's medical marijuana initiatives are polling north of 70.

The Magnolia State also has two competing initiatives on the ballot, which has created some confusion as to what's on the line. There's Initiative 65, which is supported by some 230,000 Mississippians, and Initiative 65A, which "took all the teeth" out of the first, but has state legislator support.

"The one that gets the the higher vote total will win, which we think will be the citizens initiative (Initiative 65) because they've had a lot more money behind their campaign," Krane said.

It's worth noting that a survey conducted by FM3 Research found that likely voters supported Initiative 65 over the competing bill, 52% to 23%.

The Toss-Up: South Dakota

Passage of cannabis reform in South Dakota "would be a milestone" given that the state is traditionally "red," Brochstein said.

While each of the other states are expected to see some form of marijuana reform pass, the Mount Rushmore State will likely be the only outlier of the bunch. The proposal also doesn't have Gov. Kristi Noem's support. 

Still, Krane calls it "a true toss-up."

"If I had to place a bet on it, I would bet that we don't win that one," he said, citing how there is no medical marijuana system there and, because there's medical on the ballot, a portion of the population will likely decide "let's go slow" and vote for medicinal only.

"My guess is when this all comes in, we probably lose that one somewhere in the 46 to 48 range," Krane said. "But I hope I'm wrong."

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