Voters rejected legalizing recreational marijuana in the bellwether state. Here’s what it means for federal legalization and pot’s green wave.
By Will Yakowicz, Forbes Staff
In a major defeat for cannabis legalization, Florida voters have rejected Amendment 3, which would have legalized recreational marijuana for adults 21 and older. The amendment, which failed to get the 60% voter support it needed to pass, could have been the start of a new green wave across the country.
The Sunshine State is already home to the country’s largest medical marijuana market, $2 billion (annual sales), but it missed the opportunity to become the first red state in the South to launch an adult-use market. Florida, which has a population of 20 million people and attracts more than 140 million tourists every year, was expected to swell to a $6 billion cannabis market by 2026 if Amendment 3 passed, according to marijuana sales data firm Headset. Voters will have to wait another two years before cannabis can get back on the ballot.
The night’s biggest loser is Tallahassee-based Trulieve, which spent $145 million backing Smart & Safe Florida, the organization running the Yes On 3 campaign. The campaign raised a total of $153 million, according to campaign contribution data from the Florida Department of State Division of Elections.
The night’s biggest winner is Florida Governor Ron DeSantis, who had declared war on the cannabis ballot measure and spent an estimated $50 million of taxpayer money on radio and television ads to successfully convince enough voters to vote “no.” Ken Griffin, the hedge fund billionaire who moved his firm Citadel to Miami from Chicago in 2022, had also come out against legalization. Griffin, a Florida resident, donated $12 million to the Vote No On 3 campaign. And in an op-ed published in the Miami Herald earlier this year, Griffin cautioned voters not to repeat the mistakes of states like California, Colorado and New York, all of which have legalized recreational cannabis.
“No one wants the effects of widespread legalization of marijuana,” Griffin wrote, “skyrocketing crime, suffering among children, a decline in the quality of life in Florida’s vibrant neighborhoods—but Amendment 3 would make it inevitable.”
The Amendment received more than 57% of the vote, a strong majority, but not enough to surpass the 60% threshold required in the state of Florida. The measure even had the backing of former President Donald Trump.
Brady Cobb, the son of one of Florida’s most prolific pot smugglers of the 1980s, who started his own legal marijuana company called Sunburn Cannabis in 2021, calls the failure of Amendment 3 a big blow to the state’s marijuana economy and the national momentum of legalization. “Politically, it’s a bad moment—this is going backwards,” says Cobb, whose company generated $30 million in revenue this year from its 13 medical marijuana dispensaries. “This is going to be perceived as very negative by the whole industry.”
Shanita Penny, the co-executive director of the Coalition for Cannabis Policy, Education, and Regulation, says the failure of Amendment 3 will “signal a slowdown in the momentum” of legalization. “We will continue to see the illicit market control this space,” says Penny.
Emily Paxhia, the cofounder of San Francisco-based cannabis hedge fund Poseidon, which has invested in many companies with a large presence in the state, says she is not downtrodden. The companies operating in the nation’s $30 billion economy spread across 38 states have grown accustomed to roadblocks while operating in an industry that is still federally illegal. “The industry is used to getting knocked down,” she says, “we will keep standing back up.”
Despite the defeat of Amendment 3, Paxhia believes there is hope on the horizon. A lawsuit filed by legendary litigator David Boies and other attorneys at Boies Schiller Flexner is still in play. The lawsuit against Attorney General Merrick Garland on behalf of several cannabis companies in Massachusetts, is seeking to challenge the federal prohibition of marijuana and the government’s ability to interfere with state-regulated cannabis programs.
Among Boies’ arguments is that the federal government has abandoned its goal to outlaw and eradicate marijuana with the Controlled Substances Act, and that states have the right under the Commerce Clause to police and regulate their own economies without federal oversight. The next argument before the court is scheduled for early December.
In addition to the Boies case, the Drug Enforcement Administration has scheduled a hearing on the recommendation to reschedule marijuana from Schedule I, the same category as heroin and LSD, to Schedule III that same month.
Florida is not the only state where marijuana is on the ballot on Election Day. Voters in three other states, Nebraska, North Dakota and South Dakota, are also casting ballots on legalization measures. Nebraska voters will decide whether to legalize medical marijuana; North Dakota, where medical marijuana is already legal, voters could legalize recreational cannabis; South Dakota, another medical marijuana state, also have the chance to legalize recreational weed.
David Culver, the head of policy at the U.S. Cannabis Council, says the industry will try again in the Sunshine State. “This isn’t the end in Florida,” he says, “it’s just the beginning since we’ve now seen how strongly the push for legalization resonates in the state.”
As for the presidential race, whoever wins the White House will be in favor of changing the nation’s laws around cannabis. Both Kamala Harris and Donald Trump have said they support marijuana reform. Harris has pledged to federally legalize cannabis while Trump said he supports rescheduling and easing banking restrictions.
MORE FROM FORBES
Source link
