The marijuana industry was delivered a series of major victories this week at the state level, and it is bullish about opportunities at the federal level under the Trump administration as well.
Cannabis legalization ballot initiatives were approved in several states on Tuesday. Florida, Montana, Arkansas and North Dakota voted in favor of medical initiatives, and recreational marijuana measures passed in California, Maine, Nevada and Massachusetts. Arizona was the only state to reject the initiative there. Across the board, marijuana industry leaders and legalization proponents are encouraged by the votes.
"From an industry standpoint, things went almost perfect," said Dan Humiston, president of the International Cannabis Association.
The initiatives' passage could help the $7 billion legal marijuana market to more than quadruple in coming years. California is the major prize -- by some estimates, it could be a $10 billion annual market.
"Legalization in California and Massachusetts is hugely important based on the size of the markets compared to the states where cannabis is currently legal. Obviously, California is one of the largest economies in the world and should have a cannabis market beyond anything we have seen yet," said Michael Weiner, partner at law firm Dorsey & Whitney in Denver.
States will now get to work devising a regulatory framework for businesses to set up and commence activity. The process will take months, if not years. Colorado took 14 months from the legalization vote to the start of sales, and in Alaska, where an initiative passed in 2014, a program still hasn't been implemented.
California Governor Jerry Brown signed the Medical Marijuana Regulation and Safety Act Governor Jerry Brown in October 2015 to create an agency to oversee medial dispensaries, cultivators and producers starting in January 2018. Observers believe folding in recreational use will extend the process into 2019.
Leslie Bocskor, president and managing member at Electrum Partners, a cannabis advisory firm, said lawmakers will have reason to act with expediency. In Nevada, for example, marijuana possession will become legal on January 1, 2017, even though the Taxation Department has until 2018 to craft regulations and licensing for sales.
"What I think [lawmakers] are going to do is to create a fast track for medical to offer limited amounts to recreational to make sure they don't create a more robust black market until regulations take effect," he said.
With Tuesday's results, more than half of U.S. states have now legalized marijuana in some form. However, it remains illegal federally and is classified as a Schedule 1 drug, the same as heroin and LSD. Proponents hope these latest votes, especially California, will help tip the scales and are optimistic about the incoming Trump administration.
"I'm actually encouraged that we can get some stuff done on the federal level," said Robert Capecchi, director of federal policies at the Marijuana Policy Project, a Washington, D.C.-based organization dedicated to marijuana policy reform. "I don't think that a Trump administration necessarily closes any doors."