As New Mexico’s Regulation and Licensing Department works toward finalizing rules for non-medical cannabis sales, some unfinished business remains when it comes to the state’s medical cannabis program.
A state district judge last week ordered RLD, the New Mexico Department of Health and the governor’s office to either change their policy for medical cannabis patient purchase amounts or present a compelling argument for not doing so.
“Respondents’ purchase limitations violate equal protection principles because they will subject New Mexicans with debilitating medical conditions who are dependent on medical cannabis to lower purchase limitations than persons who purchase cannabis from the recreational (and taxed) market,” read the writ of mandamus signed by Second Judicial District Judge Benjamin Chavez. “Respondents’ unlawful rules also attempt to impose an illegal tax on any medical cannabis purchases in violation of the Cannabis Regulation Act.”
The Cannabis Regulation Act, which went into effect on June 29 and is the framework for sales expected to start next spring, allows purchasers to buy up to two ounces of cannabis at a time. But the state’s Department of Health, which is RLD’s medical cannabis counterpart, has maintained that a DOH policy limiting medical cannabis purchases to roughly eight ounces in a 90-day period takes precedence over the new law.
For years, New Mexico cannabis patients have been limited to 230 “units” in a rolling 90-day period. DOH rules define a unit as one gram of dried cannabis “flower” or 200 milligrams of cannabis extract or concentrate. Under the new law, however, non-medical cannabis purchases are limited to two ounces for each transaction. The new law also doesn’t limit how many purchases a person can make in a day. So, theoretically, a person could make eight trips to a cannabis dispensary in one day and purchase twice as much as a medical cannabis patient can in a three-month period.
That disparity is presumably what brought medical cannabis patient Jason Barker to file a petition in state district court. Financially backed by medical cannabis producer Ultra Health and represented by Jacob Candelaria, who is also a New Mexico state senator, Barker asked Chavez to order the state departments to allow medical cannabis patients the same purchase amounts as non-patients. The argument, which Chavez ultimately agreed with, was that the state is effectively discriminating against medical cannabis patients by limiting their purchases to a fraction of what will be allowed when non-medical cannabis sales begin next year.
Chavez ruled in favor of Barker, but also gave DOH, RLD and the governor’s office until Sept. 20 to respond to the court ruling.
Earlier this year, a group of medical cannabis producers asked for clarification from the state on medical cannabis purchase limits. The department heads jointly issued a letter in response, saying that until adult-use sales begin, medical cannabis patients are limited to the 230 units in a 90-day period. But even after non-medical sales start, if medical cannabis patients want to purchase more than what’s currently allowed, they will have to purchase it as recreational-use cannabis, the letter stated. Recreational-use sales are required by law to start no later than April 1, 2022 and the only real difference between medical-use and non medical-use cannabis is taxes. Non medical-use cannabis is now tax-free, whereas gross receipts taxes and a new cannabis excise tax will be applied to non medical-use cannabis.
It’s unclear how either department will respond to the order and a spokesperson for DOH said the department will not comment on pending litigation.
Candelaria, however, slammed the state.
“I hope DOH and RLD will now come into compliance with the law, instead of further litigating an issue they will eventually lose in an attempt to impose an illegal tax on medical cannabis patients,” Candelaria said in a statement to NM Political Report. “It’s also unfortunate that taxpayers have to foot the bill for these agencies’ actions that continue to violate the rights of New Mexico’s 120,000 plus medical cannabis patients.”
An often vocal critic of Democrat Gov. Michelle Lujan Grisham, Candelaria, who is also a Democrat, said he’s ready to push back if the state decides to further litigate.
“If the Lujan Grisham administration chooses to continue litigating this issue, we will see them in court and will fight tooth and nail to make the court’s order permanent,” Candelaria said.
Ultra Health’s president and CEO, Duke Rodriguez previously told NM Political Report that his company offered financial support for Barker’s case. Rodriguez has long been a vocal critic of DOH and how it ran the state’s Medical Cannabis Program, including the department’s plant limits for medical cannabis producers. In another lawsuit against the state, and financially supported by Ultra Health, the parent of a medical cannabis patient convinced a state district judge to order DOH to increase cannabis production limits from 450 plants to the current 1,750 limit.
But new rules from RLD, that are expected to be finalized any day, will allow producers to have up to 8,000 flowering plants and under certain circumstances, up to 10,000 flowering plants. One concern from some current medical cannabis producers and many medical cannabis patients is how, or if, medical cannabis producers will balance providing cannabis for the more than 120,000 medical cannabis patients in the state, while also ramping up production in anticipation of non-medical sales next year.
If the state decides to allow medical cannabis patients the same purchase amounts as non-medical consumers, it will likely end up facing Rodriguez in court again. Rodriguez has been a long-time advocate for eliminating plant limits altogether, in favor of a market-driven approach.
If the two departments decide to further argue against increasing the purchase amounts for medical cannabis patients, they will be required to make their case in court on Nov. 2.